Wiley GAAP 2018, 16th Edition

55ASC 825 Financial Instruments

1. Perspective and Issues
   1. Subtopics
   2. Scope and Scope Exceptions
      1. ASC 825-10
      2. ASC 825-20
   3. Overview
2. Definitions of Terms
3. Concepts, Rules, and Examples
   1. ASC 825-10, Overall
      1. Fair value option—flexibility of application
      2. Timing of the election
   2. Financial Statement Presentation and Disclosure
4. ASC 825-20

Perspective and Issues

Subtopics

ASC 825, Financial Instruments, contains two subtopics:

• ASC 825-10, Overall, which has two subsections:
  • General, which provides guidance on the fair value option and some disclosures about financial instruments
  • Fair Value Option, which provides guidance on the circumstances under which entities may choose the fair value option and the related presentation and disclosure requirements

    (ASC 825-10-05-2)

• ASC 825-20, Registration Payment Arrangements, which provides guidance on financial instruments subject to registration payment arrangements.

Scope and Scope Exceptions

ASC 825-10

The following items are eligible for the fair value option (also see the chapter on ASC 820—the summary table in the section entitled “The Mixed Attribute Model”):

1. All recognized financial assets and financial liabilities except for those listed in ASC 825-10-15-5 below:
2. Firm commitments that would otherwise not be recognized at inception and that involve only financial instruments. An example is a forward purchase contract for a loan that is not readily convertible to cash. The commitment involves only financial instruments (the loan and cash) ...