Accounting Standards Update · 2022
ASU 2022-03 — Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions
Affects820 Fair Value Measurement
The amendments in this Update affect all entities that have investments in equity securities measured at fair value that are subject to a contractual sale restriction. The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments also require the following disclosures for equity securities subject to contractual sale restrictions:
- The fair value of equity securities subject to contractual sale restrictions reflected on the balance sheet
- The nature and remaining duration of the restriction(s)
- The circumstances that could cause a lapse in the restriction(s).
This Accounting Standards Update is the final version of Proposed Accounting Standards Update 2021-005—Fair Value (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, which has been deleted.
Issued: June 30, 2022
Text as published in the FASB Accounting Standards Codification, Basic View.