We discuss the accounting for preferred stock, including determining whether it is debt or equity and other key judgments in accounting.
We continue our miniseries on accounting for financing transactions with a focus on preferred shares. In this episode we provide an overview and walk through the key judgments in accounting for different types of preferred stock.
In this episode, we discuss:
  • 2:01 – An overview of preferred stock, common features, and reasons companies may issue it over other forms of financing
  • 9:40 – The accounting model for preferred stock
  • 14:30 – Classification, recognition, and measurement of preferred stock
  • 30:55 – Dividends
  • 33:34 – Extinguishment or modification accounting

For more information on these topics, read chapter 7 of our Financing transactions guide. Also, for more on the EPS implications of preferred stock, listen to our podcast, Presenting earnings per share (EPS). Additionally, follow this podcast on your favorite podcast app for more episodes.
About our guests
Bret Dooley is a Deputy Chief Accountant in PwC’s National Office who leads teams focused on the financial services sectors and accounting for financial instruments. He has over 25 years of experience in the financial services, banking, and capital markets industries. Bret focuses on emerging financial reporting issues related to financial instruments, developing interpretive guidance, and assisting clients in resolving complex accounting matters.
Christopher Gerdau is a partner in PwC’s National Office specializing in accounting for financial instruments and banking-related topics. Chris also conducts technical reviews of SEC filings and provides technical support to PwC’s practice offices. Chris’s client service expertise includes the banking, capital markets, and insurance industries.
About our host
Heather Horn is the PwC National Office Sustainability & Thought Leader, responsible for developing our communications strategy and conveying firm positions on accounting, financial reporting, and sustainability matters. In addition, she is part of PwC’s global sustainability leadership team, developing interpretive guidance and consulting with companies as they transition from voluntary to mandatory sustainability reporting. She is also the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series.
Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to us_podcast@pwc.com.
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