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Figure FG 10-1 summarizes the effective dates for adopting ASU 2020-06. Early adoption is permitted for both public and nonpublic business entities.
Figure FG 10-1
Effective dates of ASU 2020-06
Type of reporting entity
Effective date
Public business entities that are SEC filers and are not eligible to be smaller reporting companies
For purposes of this ASU, the one-time determination of whether an entity is eligible to be a smaller reporting company in accordance with SEC regulations is based on an entity’s most recent determination as of August 5, 2020.
Fiscal years, including interim periods within those fiscal years, beginning after December 15, 2021
All other entities
Fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023
Early adoption provisions
Early adoption of ASU 2020-06 is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. A reporting entity is not permitted to adopt the guidance in an interim period, other than the first interim period of its fiscal year. For example, if a calendar year public business entity (other than a smaller reporting company) wishes to adopt ASU 2020-06 early, it would have to adopt the new guidance as of the beginning of the first quarter of 2021. Otherwise, it must adopt the guidance as of the beginning of calendar year 2022.
Early adoption is permitted only on an entity-wide basis and cannot be elected for selected instruments with one exception for certain instruments with down round features. A reporting entity that has not yet adopted the amendments to the guidance for accounting for certain instruments with down round features in ASU 2017-11 may adopt the recognition and measurement amendments in ASU 2020-06 for any convertible security that includes a down round feature in financial statements that have not yet been issued or made available for issuance for fiscal years (or interim periods) beginning after December 15, 2019. See FG 5.6.2.2, FG 5.6.2.2A and FG 7.3.2.2 for further information on down round features.
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