Wiley GAAP 2024

26ASC 405 LIABILITIES

• Perspective and Issues
  • Technical Alert
    • Guidance
    • Effective Date
    • Transition
  • Subtopics
  • Scope and Scope Exceptions
    • ASC 405-20
    • ASC 405-30
    • ASC 405-40
    • ASC 405-50
    • Example 1 – Disclosure of Key Terms of a Supplier-Finance Program
    • Example 2 – Disclosure in a Rollforward of Obligations
  • Overview
• Definitions of Terms
• Concepts, Rules, and Examples
  • ASC 405-10, Overall
  • ASC 405-20, Extinguishments of Liabilities
    • Example of Accounting for the Extinguishment of Debt
  • ASC 405-30, Insurance-Related Assessments
    • Probability of Assessment
  • ASC 405-40, Obligations Resulting from Joint and Several Liabilities
  • ASC 405-50, Supplier Finance Programs

PERSPECTIVE AND ISSUES

Technical Alert

In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Program (Subtopic 405-50). It issued the ASU in response to financial statement user requests for additional information about buyers’ use of supplier finance programs. This additional data would help financial statement investors and other users to understand the effect of those programs on working capital, liquidity, and cash flows.

Guidance The objective of the disclosures required by the ASU is to disclose information to enable users to understand:

• The nature,
• Activity during the period,
• Changes from period to period, and
• The potential magnitude of the entity’s program.

  (ASC 405-50-50-1)

See Appendix B for a list of the required disclosures. Because of the current effective date described below, ...