ASU 2019-06 — Intangibles—Goodwill and Other (Topic 350), Business Combinations (Topic 805), and Not-for-Profit Entities (Topic 958): Extending the Private Company Accounting Alternatives on Goodwill and Certain Identifiable Intangible Assets to Not-for-Profit Entities

The objective of the amendments in this Update is to address the concerns of not-for-profit stakeholders that the benefits of the current accounting for goodwill and certain identifiable intangible assets acquired in a business combination do not justify the related costs. Therefore, the amendments in this Update permit a not-for-profit entity to elect the private company alternatives. Under Topic 350, instead of testing goodwill for impairment annually at the reporting unit level, a not-for-profit entity can elect to amortize goodwill on a straight-line basis, test for impairment upon a triggering event, and have the option to elect to test for impairment at the entity level. Under the Topic 805, a not-for-profit entity can elect to recognize fewer items as separate intangible assets in an acquisition. The amendments in this Update are effective immediately.

This Accounting Standards Update is the final version of Proposed Accounting Standards Update 2018-320—Intangibles—Goodwill and Other (Topic 350), Business Combinations (Topic 805), and Not-for-Profit Entities (Topic 958): Extending the Private Company Accounting Alternatives on Goodwill and Certain Identifiable Intangible Assets to Not-for-Profit Entities, which has been deleted.

Issued: May 30, 2019