Proposed Accounting Standards Update · 2019
Proposed ASU 2019-300 — Business Combinations (Topic 805)—Revenue from Contracts with Customers—Recognizing an Assumed Liability
Affects805 Business Combinations
The amendments in this proposed Update would provide specific guidance for a business combination on how to apply the recognition principle in Topic 805 to revenue contracts with customers after the acquirer has adopted Topic 606, Revenue from Contracts with Customers. The proposed amendments would require that an acquirer recognize a liability assumed in a business combination from a contract with a customer if that liability represents an unsatisfied performance obligation under Topic 606 for which the acquiree has received consideration (or the amount is due) from the customer.
The proposed Update was issued concurrently with the FASB Invitation to Comment, Measurement and Other Considerations Related to Revenue Contracts with Customers under Topic 805, which addresses the measurement of contract liabilities from revenue contracts with customers acquired in a business combination and other topics related to the accounting for revenue contracts acquired in a business combination.
For more information, see the following:
Issued: February 14, 2019
Comments Due: April 30, 2019
The Exposure Draft identifies the Codification Sections that may be changed upon issuance of this guidance.
Text as published in the FASB Accounting Standards Codification, Basic View.