# ASC 808-10-15: Collaborative Arrangements — Overall — 15 Scope and Scope Exceptions Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/808/10/#15-scope-and-scope-exceptions) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:251cb91eda1b176c5d064653182079203e1a06f10900f775acd60e161d8fed74 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 808-10-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/808/10/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [808-10-15-1](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:878fca0841c4e9ae94ba7a5affa265b4353789d11be388c1f419bf22f73a4859 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Scope Section of the Overall Subtopic establishes the pervasive scope for the Collaborative Arrangements Topic. #### Transactions ##### [808-10-15-2](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-2) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:925867d775393f6fd8b2a67eb0d61abc3a9cf1b3e6b0fd83dae0c2ec2409d32b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in the Collaborative Arrangements Topic applies to [collaborative arrangements](https://asc.understandingaccounting.org/glossary/c/#collaborative-arrangement "A contractual arrangement that involves a joint operating activity (see paragraph 808-10-15-7). These arrangements involve two (or more) parties that meet both of the following requirements: They are active participants in the activity (see paragraphs 808-10-15-8808-10-15-9). They are exposed to significant risks and rewards dependent on the commercial success of the activity (see paragraphs 808-10-15-10808-10-15-11808-10-15-12808-10-15-13)."). ##### [808-10-15-3](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-3) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:a326c3e3811dcc19baa65a84aa69b04272fdacbcf4233a7883b33e6a9246c21e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Topic does not apply to arrangements for which the accounting is specifically addressed within the scope of other authoritative accounting literature. #### Other Considerations ##### [808-10-15-4](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-4) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:62b18325d28d1b8e1797ec6debb6eaa32eb5b3a33a3ea95abc83079f9bdfb579 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A collaborative arrangement within the scope of this Topic is not primarily conducted through a separate legal entity created for that activity. However, in some situations part of a collaborative arrangement may be conducted in a legal entity for specific activities or for a specific geographic location. The existence of a legal entity for part of an arrangement does not prevent an arrangement from being a collaborative arrangement. The part of the arrangement that is conducted in a separate legal entity shall be accounted for under the guidance in Topic 810, Consolidation, Subtopic 805-60, Business Combinations—Joint Venture Formations, Subtopic 323-10, Investments—Equity Method and Joint Ventures, or other related accounting literature. However, the disclosures required by paragraph [808-10-50-1](https://asc.understandingaccounting.org/asc/808/10/#808-10-50-1) apply to the entire collaborative arrangement, notwithstanding that a portion of the collaborative arrangement may be conducted in a legal entity. ##### [808-10-15-5](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-5) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:6ac741fbc90ba02b769daeee4409fa30bd2329a7c6cdbc27141bc9df2b38b0c1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Topic does not address all recognition or measurement matters related to collaborative arrangements, for example, determining the appropriate units of accounting, the appropriate recognition requirements for a given unit of account, or when the recognition criteria are met. ##### [808-10-15-5A](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-5A) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:7868fae44b451b608144d3538b7cde8c8f78418850f0e9c557b9464b587438de Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A collaborative arrangement within the scope of this Topic may be partially within the scope of other Topics, including, but not limited to, Topic 606 on revenue from contracts with customers. ##### [808-10-15-5B](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-5B) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:848b5555ff132e8ecd40aaad3c3fdfbcfd639b039cbfc3e72868087505264634 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A collaborative arrangement is partially within the scope of Topic 606 if a unit of account, identified as a promised good or service (or bundle of goods or services) that is distinct within the collaborative arrangement using the guidance in paragraphs [606-10-15-4](https://asc.understandingaccounting.org/asc/606/10/#606-10-15-4) and [606-10-25-19 through 25-22](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-19) , is with a [customer](https://asc.understandingaccounting.org/glossary/c/#customer "A party that has contracted with an entity to obtain goods or services that are an output of the entity's ordinary activities in exchange for consideration."). An entity shall apply the guidance in Topic 606 to a unit of account that is within the scope of that Topic, including the recognition, measurement, presentation, and disclosure requirements. If a portion of a distinct bundle of goods or services is not with a customer, the unit of account is not within the scope of Topic 606. ##### [808-10-15-5C](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-5C) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:12d1693d0f3ca11909d0e3fe51a9889d42334eaed037905b79a4647faeaa3100 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For a collaborative arrangement that is wholly or partially outside the scope of other Topics, including Topic 606, the unit of account, recognition, and measurement for the unit(s) of account outside the scope of other Topics, including Topic 606, shall be based on an analogy to authoritative accounting literature or, if there is no appropriate analogy, a reasonable, rational, and consistently applied accounting policy election. ##### [808-10-15-6](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-6) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:213171e007c8e3a58ada2da682983cf5fe34ce64222ae894cc74b1d415dceb2d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Participants shall evaluate whether an arrangement is a collaborative arrangement at its inception based on the facts and circumstances specific to the arrangement. However, a collaborative arrangement can begin at any point in the life cycle of an [endeavor](https://asc.understandingaccounting.org/glossary/e/#endeavor "The activity that participants in a collaborative arrangement collaborate on. For example, in a biotechnology or pharmaceutical environment the endeavor may be the development and commercialization of a drug candidate. In the entertainment industry, it may be production and distribution of a motion picture."). Participants shall reevaluate whether an arrangement continues to be a collaborative arrangement whenever there is a change in either the roles of the participants in the arrangement or the participants' exposure to significant risks and rewards dependent on the ultimate commercial success of the endeavor. For example, the exercise of an option could change a participant's role in the arrangement or its exposure to risks and rewards. ##### [808-10-15-7](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-7) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:7e207d0898ef524a1b52357f3e03ba508a2c408e404d3d40ce93235e1a5c3b92 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The joint operating activities of a collaborative arrangement might involve joint development and commercialization of intellectual property, a drug candidate, software, computer hardware, or a motion picture. For example, a joint operating activity involving a drug candidate may include research and development, marketing (including promotional activities and physician detailing), general and administrative activities, manufacturing, and distribution. However, there may also be collaborative arrangements that do not relate to intellectual property. For example, the activities of a collaborative arrangement may involve joint operation of a facility, such as a hospital. A collaborative arrangement may provide that one participant has sole or primary responsibility for certain activities or that two or more participants have shared responsibility for certain activities. For example, the arrangement may provide for one participant to have primary responsibility for research and development and another participant to have primary responsibility for commercialization of the final product or service. ##### [808-10-15-8](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-8) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:9f29fa3b90aaef41edc2540817770a20db2af2ca7d36f218353e5fb8328ea1be Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Whether the parties in a collaborative arrangement are active participants will depend on the facts and circumstances specific to the arrangement. Examples of situations that may evidence active participation of the parties in a collaborative arrangement include, but are not limited to, the following: 1. a Directing and carrying out the activities of the joint operating activity 2. b Participating on a steering committee or other oversight or governance mechanism 3. c Holding a contractual or other legal right to the underlying intellectual property. ##### [808-10-15-9](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-9) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:1b26009265a70d9831172e3f919f211aba08a49791cdb02827b82b59b6d8ee03 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An entity that solely provides financial resources to an endeavor is generally not an active participant in a collaborative arrangement within the scope of this Topic. ##### [808-10-15-10](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-10) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:d1a8daa0862feb20540fddcd0a0df7549261f348490ec2a017224d08a60074bb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Whether the participants in a collaborative arrangement are exposed to significant risks and rewards dependent on the commercial success of the joint operating activity depends on the facts and circumstances specific to the arrangement, including, but not limited to, the terms and conditions of the arrangement. ##### [808-10-15-11](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-11) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:7f974fc0bc9e19fbecb111cfba3d422680e3b0042c9f44bcc816b1a5e929635b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The terms and conditions of the arrangement might indicate that participants are not exposed to significant risks and rewards if, for example: 1. a Services are performed in exchange for fees paid at market rates. 2. b A participant is able to exit the arrangement without cause and recover all (or a significant portion) of its cumulative economic participation to date. 3. c Initial profits are allocated to only one participant. 4. d There is a limit on the reward that accrues to a participant. ##### [808-10-15-12](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-12) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:8cdb166d6a7022967a2be301133a8acbfae431d971373661e7089065d8d7134b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Other factors that shall be considered in evaluating risks and rewards include: 1. a The stage of the endeavor's life cycle 2. b The expected duration or extent of the participants' financial participation in the arrangement in relation to the endeavor's total expected life or total expected value. ##### [808-10-15-13](https://asc.understandingaccounting.org/asc/808/10/#808-10-15-13) Pending content: no Source downloaded (UTC): 2026-09-10T01:28:24.211Z to 2026-09-10T01:28:24.211Z Record version: sha256:4a9bdb7f5cd42263b880f9c95e24dd52f5e35c94fd9bcff9308210367cc2e009 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Many collaborative arrangements involve licenses of intellectual property, and the participants may exchange consideration related to the license at the inception of the arrangement. Such an exchange does not necessarily indicate that the participants are not exposed to significant risks and rewards dependent on the ultimate commercial success of the endeavor. An entity shall use judgment in determining whether its participation in an arrangement subjects it to significant risks and rewards.