Expand
Resize
Add to favorites
A reporting entity emerging from bankruptcy must record the effects of its reorganization plan. In most cases, the reporting entity will also qualify for fresh-start reporting whereby balance sheet items are adjusted to fair values to denote a "fresh-start" upon emergence from bankruptcy. If the criteria to apply fresh-start reporting are met, the reporting entity should apply fresh-start reporting once the Court has confirmed the reporting entity's reorganization plan and it has emerged from Chapter 11. This chapter outlines the criteria and application of fresh-start reporting, as well as guidance for a reporting entity that does not qualify for fresh-start reporting. Throughout the chapter, references are made to the "predecessor" and "successor" company when applying fresh-start reporting. As discussed in BLG 4.4, the separate references are the result of the predecessor company exiting the bankruptcy process and becoming the successor company as a result of applying fresh-start reporting. This successor company is considered to be a "new" reporting entity, separate from the predecessor for accounting and financial reporting purposes. In essence, as a result of its emergence from bankruptcy and the adoption of fresh-start reporting, the reporting entity has a new beginning, which should be reflected in its financial statements.
Expand

Welcome to Viewpoint, the new platform that replaces Inform. Once you have viewed this piece of content, to ensure you can access the content most relevant to you, please confirm your territory.

Your session has expired

Please use the button below to sign in again.
If this problem persists please contact support.

signin option menu option suggested option contentmouse option displaycontent option contentpage option relatedlink option prevandafter option trending option searchicon option search option feedback option end slide