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Early adoption is permitted in any interim period before the mandatory effective date. If adopted in an interim period, the new guidance needs to be reflected as of the beginning of the reporting entity’s fiscal year.

12.4.1 SEC filings

Although a calendar year-end public reporting entity adopting the new guidance in an interim period of 2018 will reflect the change as of January 1, 2018, the Form 10-Qs for any quarters of 2018 already issued will not need to be amended. Instead, the reporting entity will revise the comparative information and disclosures for 2018 in the Form 10-Qs for the corresponding quarters of 2019 to reflect the adopted standard. Reporting entities also need to consider if there were any significant changes in internal controls over financial reporting in the period of adoption that may need to be disclosed in Item 4 of the interim period Form 10-Q.
In the 2018 Form 10-K, the reporting entity should revise the disclosure of quarterly financial data. The selected financial data table in the Form 10-K is not impacted because the prior year amounts are not affected by the adoption of the new guidance. If a new registration statement were filed prior to the issuance of the 2018 Form 10-K, the reporting entity would need to consider including revised quarterly financial data for the prior quarters of 2018 in the registration statement.
Reporting entities also need to consider if there were any significant changes in internal controls over financial reporting in the period of adoption that may need to be disclosed in Item 9A of the Form 10-K.
Figure DH 12-4 illustrates how a calendar year-end public reporting entity that adopts the new guidance in the second quarter of 2018 on April 1, 2018 would consider hedges in effect for different periods.
Figure DH 12-4
Application of the transition guidance upon early adoption in an interim period (April 1, 2018)
Term of hedging relationship
Apply new recognition and measurement guidance to hedging relationship?
Would this hedge impact the cumulative effect adjustment?
Apply new presentation guidance in 2018?
11/1/17 – 3/30/18
No - the hedging relationship expired before the adoption date
No - while the hedging relationship existed at the initial application date, it expired before the adoption date
No - the hedging relationship expired before the adoption date
1/2/18 – 3/30/18
No - the hedging relationship expired before the adoption date
No - the hedge was designated after the initial application date and expired before the adoption date
No - the hedging relationship expired before the adoption date
11/1/17 – 10/1/18
Yes - the hedging relationship existed at the adoption date
Yes - the hedging relationship existed at the initial application date and the adoption date
Yes - the hedging relationship existed at the adoption date
1/2/18 – 10/1/18
Yes - the hedging relationship existed at the adoption date
No - while the hedging relationship existed at the adoption date, it was designated after the initial application date *
Yes - the hedging relationship existed at the adoption date
* Because the recognition and measurement provisions of the new guidance must be applied, but the impact is not included in the cumulative effect, the impact will be reflected in the year-to-date results.
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