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Some FASB standards require entities that issue securities that trade in public markets to provide more extensive disclosures, or to adopt new standards sooner than other entities. While SEC registrants are the most common example, such requirements sometimes apply to NFPs that issue bonds that are bought and sold in the public over-the-counter bond market (see NP 11 for a description of these debt obligations). Sometimes, NFPs issue bonds directly to investors and those bonds may trade in the over-the-counter market. More commonly, NFPs issue bonds via a municipal authority (e.g., a state financing authority or county development agency). Informally, NFPs that issue these securities are sometimes referred to as “public” NFPs or “not-for-profit conduit bond obligors.”
The FASB codification uses various terms to describe the classes of entities to which these different requirements apply, discussed in NP 1.3.1 and NP 1.3.2.

1.3.1 Public business entity

The term public business entity, which is widely used throughout the FASB’s accounting standards codification, categorically excludes NFPs. For certain standards, the FASB requires “public” NFPs (i.e., those NFPs that have issued, or are a conduit bond obligor for, securities that are traded, listed, or quoted in an exchange or over-the-counter market) to adopt the standard at the same time and/or provide the same disclosures as public business entities. For example, the effective date provisions of ASU 2014-09, Revenue from Contracts with Customers, included a specific reference to NFP conduit bond obligors, making it clear these entities were subject to the same requirements as public business entities. Alternatively, ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, established different effective date requirements for public business entities, but did not specify different requirements for NFP conduit bond obligors. In that standard, all NFPs (including NFP conduit bond obligors) apply the effective date requirements for nonpublic entities, as can be seen in Figure NP 1-2.
Figure NP 1-2
Comparison of effective date provisions for NFP conduit bond obligors (emphasis added)

1.3.2 Public entity, publicly-traded entity, publicly-traded company

The FASB’s codification uses terms such as public entity, publicly-traded entity, publicly-traded company, or nonpublic entity to denote the scope of different guidance. The ASC Master Glossary contains definitions of these terms (sometimes more than one), which can include or exclude NFP conduit bond obligors depending on the specific subtopic in which the term is used. If a term that applies to conduit bond obligors is included in a subtopic that includes NFPs within its scope, an NFP conduit bond obligor must apply it. For example, as used in ASC 740, Income taxes, the definition of public entity includes conduit bond obligors. Because ASC 740 is applicable to NFPs, NFP conduit bond obligors must apply the public entity disclosures for income taxes. As used in ASC 470-20, Debt with conversion and other options, however, the definition of public entity excludes entities that do not issue equity securities and thus disclosures required for public entities do not apply to NFP conduit bond obligors.
Similarly, the term “nonpublic entity” has multiple definitions within the ASC Master Glossary and might include or exclude NFP conduit bond obligors depending on the specific codification section in which the term is used.
Figure NP 1-3 illustrates how codification subtopics that are applicable to NFPs use these terms and whether they include or exclude NFP conduit bond obligors.
Figure NP 1-3
Applicability of “public” terminology to NFP conduit bond obligors
Master Glossary term
Includes NFP conduit bond obligors
Excludes NFP conduit bond obligors
Public entity
ASC 740, Income taxes
ASC 805, Business combinations
ASC 954-805, Health Care Entities – Business combinations
ASC 958-805, NFPs – Business combinations
ASC 470-20, Debt with conversion and other options
Publicly-traded company
ASC 220, Comprehensive income
ASC 270, Interim reporting
ASC 325, Other investments
ASC 825, Fair value option
ASC 932, Extractive entities oil and gas
Publicly-traded entity
ASC 715, Compensation – retirement benefits
Nonpublic entity
ASC 480, Distinguishing liabilities from equity
Numerous instances (e.g., ASC 740, Income taxes; ASC 825, Fair value option)

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