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Guidance effective for calendar year-end nonpublic companies
Publication date: 01 Mar 2021
us FASB standards effective dates
The FASB’s recently released standards are grouped below by effective date — those that are effective now and those that are effective in subsequent fiscal years -- for calendar year-end nonpublic companies (that is, companies that are neither public, nor meet the definition of a public business entity). Since the issuance of ASU 2013-12, Definition of a Public Business Entity—An Addition to the Master Glossary, the term public business entity (PBE) has been used to establish effective dates and to scale disclosure requirements for new ASUs. Therefore, all companies need to consider whether or not they meet the definition of a PBE when adopting new standards. While the guidance generally refers to PBEs, and sometimes the effective date for PBEs excludes smaller reporting companies (as defined by the SEC), we have used the “short hand” of “public” and “nonpublic” to refer to the earlier and later effective date buckets.
Guidance effective in 2020 for calendar year-end nonpublic companies
Guidance effective after 2020 for calendar year-end nonpublic companies
a) Effective in 2020 for nonpublic entities that have not yet issued financial statements or made financial statements available for issuance reflecting the adoption of ASC 606.
b) Effective in 2022 for nonpublic entities that have not yet issued financial statements or made financial statements available for issuance reflecting the adoption of ASC 842.
Guidance effective in 2020 for calendar year-end nonpublic companies
ASU No. | Standard name | Effective date | Early adoptable | PwC resources |
Leases (Topic 842): Codification Improvements | Issue 1 and Issue 2: Fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020 | Not applicable | ||
Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities | Fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020 | Yes | ||
Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features, II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. | Part 1: Fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020 Part 2: No transition guidance required | Yes | ||
Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting | Fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020 | Yes after adoption of ASU 2014-09 | ||
Compensation—Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Codification Improvements—Share-Based Consideration Payable to a Customer | For entities that have adopted ASU 2018-07, fiscal years beginning after December 15, 2019, and interim periods within those fiscal years For entities that have not yet adopted ASU 2018-07, fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020 | Yes, but only after adoption of ASU 2018-07 | ||
Fair Value Measurement (Topic 820) Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement | Fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 | Yes | ||
Not-for-Profit Entities (Topic 958): Updating the Definition of Collections | Fiscal years beginning after December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020 | Yes | ||
Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments | Topics 1, 2 and 5 (Amendments to Topic 326):
Topic 3 (Amendments to Topic 815):
Topic 4 (Amendments to Topic 825):
| Topics 1, 2 and 5: Yes if ASU 2016-13 has been adopted Topic 3: Yes if ASU 2017-12 has been adopted Topic 4: Yes if ASU 2016-01 has been adopted | ||
Codification Improvements to Financial Instruments | Issues 1,2,4 and 5: Fiscal years beginning after December 15, 2019, and interim periods within those fiscal years beginning after December 15, 2020 Issue 3: Fiscal years beginning after December 15, 2019, including interim periods within those fiscal years Issues 6 and 7 For entities that have not yet adopted the amendments related to ASU 2016-13, the same as ASU 2016-13 For entities that have adopted the guidance in ASU 2016-13, fiscal years beginning after December 15, 2019, including interim periods within those fiscal years | Issues 1, 2, 4, and 5: Yes | ||
Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting | Upon issuance (March 12, 2020) through December 31, 2022 | Not applicable | ||
Revenue from Contracts with Customers (Topic 606) and Leases (Topic 842): Effective Dates for Certain Entities | Upon issuance (June 3, 2020). Defers the effective date of Topic 606 to fiscal years beginning after December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020 for all entities that have not yet issued financial statements (or made available for issuance) as of June 3, 2020 | Not applicable | ||
Reference Rate Reform (Topic 848): Scope | Upon issuance (January 7, 2021) through December 31, 2022 | Not applicable |
Guidance effective after 2020 for calendar year-end nonpublic companies
ASU No. | Standard name | Effective date | Early adoptable | PwC resources |
Leases (Topic 842) | As amended by ASU 2020-05, fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022 | Yes | ||
Leases (Topic 842): Land Easement Practical Expedient for Transition to Topic 842 | Upon issuance for entities that early adopted Topic 842 For entities that have not adopted Topic 842, the same as the effective date in Topic 842 | Not applicable | ||
Codification Improvements to Topic 842, Leases | Upon issuance for entities that early adopted Topic 842. For entities that have not adopted Topic 842, the same as the effective date in Topic 842 | Not applicable | ||
Leases (Topic 842): Targeted Improvements | For entities that have not adopted Topic 842, the effective date for the new lessor practical expedient is the same as the effective date for Topic 842 Entities that have already adopted Topic 842 may apply the new lessor practical expedient (1) to the first reporting period following the issuance of the practical expedient or (2) at the original effective date of Topic 842 | Not applicable | ||
Leases (Topic 842): Narrow-Scope Improvements for Lessors | For entities that have not adopted Topic 842, the effective date is the same as the effective date for Topic 842 Entities that have already adopted Topic 842 may apply the amendments (1) at the original effective date of Topic 842 for the entity, (2) in the first reporting period ending after the issuance of this Update or (3) in the first reporting period beginning after the issuance of this Update | Not applicable | ||
Leases (Topic 842): Codification Improvements | Issue 3: The effective date is the same as the effective date in ASU 2016-02 | Not applicable | ||
Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments | As amended by ASU 2019-10, fiscal years beginning after December 15, 2022, including interim periods within those fiscal years | Yes | ||
Codification Improvements to Topic 326, Financial Instruments—Credit Losses | The effective date is the same as the effective date in ASU 2016-13 | Not applicable | ||
Financial Instruments—Credit Losses (Topic 326) Targeted Transition Relief | For entities that have not yet adopted ASU 2016-13, the same as ASU 2016-13 For entities that have adopted ASU 2016-13, for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years | Early adoption is permitted if ASU 2016-13 has already been adopted | ||
Codification Improvements to Topic 326, Financial Instruments—Credit Losses | For entities that have not yet adopted ASU 2016-13, the same as ASU 2016-13 For entities that have adopted ASU 2016-13, fiscal years beginning after December 15, 2019, including interim periods within those fiscal years | Early adoption is permitted if ASU 2016-13 has already been adopted | ||
Intangibles—Goodwill and Other (Topic 350) | As amended by ASU 2019-10, annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2022 | Yes, for any goodwill impairment tests performed after January 1, 2017 | ||
Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities | As amended by ASU 2019-10, fiscal years beginning after December 15, 2020, and interim periods beginning after December 15, 2021 | Yes | ||
Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes | For entities that have not already adopted ASU 2017-12, concurrent with ASU 2017-12 For entities that already have adopted ASU 2017-12, fiscal years beginning after December 15, 2019, and interim periods within those fiscal years | Yes for entities that have already adopted ASU 2017-12 | ||
Financial Services—Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts | As amended by ASU 2020-11, fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025 | Yes | ||
Financial Services—Insurance (Topic 944): Effective Date | As amended by ASU 2020-11, effective for fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025 | Not applicable | ||
Financial Services—Insurance (Topic 944): Effective Date and Early Application | Effective for fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025 | Yes - early transition relief available | ||
Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20) Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans | Fiscal years ending after December 15, 2021 | Yes | ||
Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract | Fiscal years beginning after December 15, 2020, and all interim periods beginning after December 15, 2021 | Yes | ||
Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities | Fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021 | Yes | ||
Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 | Fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021 | Yes, but no earlier than the adoption date of Topic 606 | ||
Entertainment—Films—Other Assets—Film Costs (Subtopic 926-20) and Entertainment—Broadcasters—Intangibles—Goodwill and Other (Subtopic 920-350) | Fiscal years beginning after December 15, 2020, and interim periods within those fiscal years | Yes | ||
Financial Instruments—Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates | Credit losses & goodwill impairment: Fiscal years beginning after December 15, 2022, including interim periods within those fiscal years Hedging & leases: Fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021 | Not applicable | ||
Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes | Fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022 | Yes | ||
Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) | Fiscal years beginning after December 15, 2021, and interim periods within those fiscal years | Yes | ||
Revenue from Contracts with Customers (Topic 606) and Leases (Topic 842): Effective Dates for Certain Entities | Upon issuance (June 3, 2020). Defers the effective date of Topic 842 to fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022 for all entities that have not yet issued financial statements (or made available for issuance) as of June 3, 2020 | Not applicable | ||
Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging —Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity | Fiscal years beginning after December 15, 2023, and interim periods within those fiscal years | Yes, but only as of the beginning of a fiscal year beginning after December 15, 2020. | ||
Not-for-Profit Entities (Topic 958): Presentation and Disclosures by Not-for-Profit Entities for Contributed Nonfinancial Assets | Fiscal years beginning after June 15, 2021, and interim periods within annual periods beginning after June 15, 2022 | Yes | ||
Codification Improvements to Subtopic 310-20, Receivables—Nonrefundable Fees and Other Costs | Fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022 | Yes, but only for fiscal years beginning after December 15, 2020 | ||
Codification Improvements | Fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022 | Yes | ||
Franchisors—Revenue from Contracts with Customers (Subtopic 952-606): Practical Expedient | For entities that have not already adopted ASC 952-606, concurrent with ASC 952-606. For entities that already have adopted ASC 952-606, fiscal years beginning after December 15, 2020, and interim periods within those fiscal years | Yes |
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