The guidance in ASC 340-10 is limited to a discussion of the nature of prepaid expenses and guidance for preproduction costs related to long-term supply arrangements. Evaluate both (1) “general” Topic 845 scope guidance, and (2) subsection scope guidance. These transactions are most commonly associated with exchanges of fixed assets, but can also involve other items, such as inventory, liabilities, and ownership interests. In-depth accounting guidance for topics of significant interest. Please check your email for instructions on resetting your password. Scope and Scope Exceptions. FASB Accounting Standards Codification Manual, SEC Rules & Regulations (Title 17 — Commodity and Securities Exchanges), Trust Services Principles, Criteria, and Illustrations, Principles and Criteria for XBRL-Formatted Information, Audit and Accounting Guides & Audit Risk Alerts, Other Publications, Press Releases, and Reports, Dbriefs Financial Reporting Presentations, Business Combinations — SEC Reporting Considerations, Consolidation — Identifying a Controlling Financial Interest, Contingencies, Loss Recoveries, and Guarantees, Environmental Obligations and Asset Retirement Obligations, Equity Method Investments and Joint Ventures, Equity Method Investees — SEC Reporting Considerations, Foreign Currency Transactions and Translations, Guarantees and Collateralizations — SEC Reporting Considerations, Impairments and Disposals of Long-Lived Assets and Discontinued Operations, Multiple-Element Arrangements — A Roadmap to Applying the Revenue Recognition Guidance in ASU 2009-13, Qualitative Goodwill Impairment Assessment — A Roadmap to Applying the Guidance in ASU 2011-08, SEC Comment Letter Considerations, Including Industry Insights, Software Revenue Recognition — A Roadmap to Applying ASC 985-605, Transfers and Servicing of Financial Assets, Roadmaps Currently Available Only as a PDF. Loans and investments. The specific guidance for many other deferred costs is included in various other areas of the Codification. Contracts that are within the scope of ASC 610-20 are outside the scope of ASC 845. (1) Evaluate the list of scope exclusions and (2) perform a detailed scope test. Leases. ASC 820 provides the guidance for fair value and provides that when one of the parties to a nonmonetary transaction could have elected to receive cash in lieu of the nonmonetary asset, the amount of cash that would have been received may be the best evidence of the fair value of the nonmonetary assets exchanged. Customers, will supersede ASC 360-20 for all real estate sales to customers, except those involving a sale and leaseback of real estate. The Transfers and servicing guide addresses the principal guidance on transactions contained in ASC 860, Transfers and Servicing.The guide covers the process of determining whether transfers of financial assets are a sale or a secured borrowing. This chapter sets forth the basic structure and concepts of nonmonetary transactions, including the concept of commercial substance, rules regarding similar and dissimilar exchanges, involuntary conversions, and how to handle exchanges that include a certain amount of monetary consideration. Those transactions will now be accounted for under ASC 610-20. The amount of monetary assets or liabilities exchanged generally provides an objective basis for measuring the cost of nonmonetary assets or services received by an entity as well as for measuring gain or loss on nonmonetary assets transferred from an entity. A transfer of nonmonetary assets for which no assets are received or relinquished in exchange (nonreciprocal transfer). Previous. Updating ASC 845, Nonmonetary Transactions, to exclude exchanges of a nonfinancial asset for a noncontrolling ownership interest. We also have updated this edition to provide further enhancements to our interpretive guidance and to highlight recent standard-setting activity. Subscribe to PwC's accounting weekly news APB Opinion … Entities account for partial sales before adoption of the new revenue standard principally under the transaction-specific guidance in ASC 360-20 on real estate sales and partly under ASC 845-10-30. 845-10-05-7 The guidance in the General Subsections often discusses nonmonetary transactions that are required to be measured at fair value. Nonmonetary Transactions. Under ASC 845-10-30-10 Nonmonetary Transactions, Overall, Initial Measurement, Nonreciprocal Transfers with Owners and ASC 505-60, a pro-rata spinoff of a consolidated subsidiary or equity method investee that meets the definition of a business under ASC 805 is recognized at carrying amount (after ASC Codification Topic 835: Interest : ASC Codification Topic 840: Leases: ASC Codification Topic 845: Nonmonetary Transactions : ASC Codification Topic 850: Related Party Disclosures: ASC Codification Topic 852: Reorganizations: ASC Codification Topic 855: Subsequent Events : ASC Codification Topic 860: Transfers and Servicing This Topic notes that the “amount of monetary assets or liabilities exchanged generally provides an objective basis for measuring the cost of nonmonetary assets or services received by an entity as well as for measuring gain or loss on nonmonetary assets transferred from an entity.”. All rights reserved. Nonmonetary Transactions, ASC 845. accta February 10, 2018 U.S. GAAP by Topic. Partially updated in September 2020. 11. For guidance on the recognition of subsequent events in reissued financial statements, see paragraph 855-10-25-4. Per ASC 340-20-15-4: Download Citation | ASC 845: Nonmonetary transactions | This chapter focuses on the role of nonmonetary transactions. ASC 360-20 as well as the initial-measurement guidance on nonmonetary transactions in ASC 845-10-30 to simplify the accounting treatment for partial sales (i.e., entities would use the same guidance to account for similar transactions) and to remove inconsistencies between Codified definition of an “in substance nonfinancial asset” will improve consistency in applying the appropriate guidance. Post navigation. Partially updated in August 2020. There are three types of nonmonetary transactions identified in Accounting Standards Codification (ASC) 845: nonreciprocal transfers with owners, nonreciprocal transfers with nonowners, nonmonetary exchanges. Previous. We provide detailed Q&As, examples and observations, as well as comparisons to legacy US GAAP, updated for continuing developments in practice. Cite your sources for 2010-09, Subsequent Events (Topic 855): Amendments to Certain Recognition and Disclosure Requirements, are effective Consideration of ASC 845-10-15-4b . Nonmonetary Transactions addresses those transactions in which no money changes hands. Learn about our remote access options. Most business transactions involve exchanges of cash or other monetary assets or liabilities for goods or services. FASB Accounting Standards Codification (ASC) Topic 360, “Property, Plant, and Equipment,” provides guidance for the impairment of long-lived assets that are classified as held and used. With the new lease standard scheduled to go into effect for public entities by the end of 2018, organizations must start planning now to implement new—or change existing—business processes and internal controls to comply with the new guidance. The full text of this article hosted at iucr.org is unavailable due to technical difficulties. Covering all codifications by the Financial Accounting Standards Board (FASB) - including the latest updates - this book provides clear explanations and practical examples for real-world application of these dynamic guidelines. View CHAPTER 7 from ASC 845 at University of California, Riverside. See Topic 820 for guidance on fair value measurement. The most comprehensive guide to FASB Codifications, updated with the latest pronouncements Wiley GAAP 2020 is the essential resource for US GAAP implementation. statements. 845-10-05-7A Subtopic 505-60 provides guidance on the distribution of Learn more. 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