Wiley GAAP: Financial Statement Disclosure Manual

61ASC 853 SERVICE CONCESSION ARRANGEMENTS

1. Authoritative Literature
   1. Subtopic
   2. Scope
   3. Scope Exception
   4. Accounting for Service Concession Arrangements
      1. Service Concession Arrangements
      2. Economic Substance
2. Presentation and Disclosure Requirements
3. Presentation and Disclosure Examples
   1. Example 61.1: Contracts Considered Service Concession Arrangements—Accounting Policy
   2. Example 61.2: Contracts Considered Service Arrangements—Accounting Before and After Adoption of ASC 606

AUTHORITATIVE LITERATURE

ASC 853 addresses a narrow issue and limits the scope of the guidance to arrangements in which the grantor is a public‐sector entity.

Subtopic

ASC 853, Service Concession Arrangements, contains one Subtopic:

• ASC 853‐10, Overall, which addresses the accounting for service concession arrangements between a public sector entity grantor and an operating entity where the operating entity operates the grantor's infrastructure

Scope

ASC 853 applies to the accounting:

• By operating entities
  • Of a service concession arrangement
  • Under which a public‐sector entity grantor enters into a contract with an operating entity
  • To operate the grantor's infrastructure

The operating entity also may provide the construction, upgrading, or maintenance services of the grantor's infrastructure. (ASC 853‐10‐15‐2)

It is important to note that a service concession arrangement within the scope of ASC 853 must meet both of the following conditions:

1. The grantor controls or has the ability to modify or approve ...