Tax & AccountingMarch 27, 2023
FASB improves lease guidance for related party arrangements
The FASB issued Accounting Standards Update (ASU) No. 2023-01, Leases (Topic 842): Common Control Arrangements that is intended to improve the guidance for applying Topic 842 to arrangements between entities under common control.
During the FASB’s post-implementation review (PIR) of Topic 842, certain stakeholders expressed concerns with applying Topic 842 to related party arrangements between entities under common control.
The ASU provides private companies and not-for-profit organizations that are not conduit bond obligors with a practical expedient to use the written terms and conditions of a common control arrangement to determine whether a lease exists and, if so, the classification of and accounting for that lease.
In addition, the ASU requires all entities (that is, including public companies) to amortize leasehold improvements associated with common control leases over the useful life to the common control group.
This ASU is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been made available for issuance. If an entity adopts the amendments in an interim period, it must adopt them as of the beginning of the fiscal year that includes that interim period.
Keep Reading on CCH® Accounting Research Manager.
Not a subscriber? Sign up for a Free Trial
Research & Learning
CCH® Accounting Research Manager® delivers interpretive guidance and authoritative content needed to confidently make accounting, financial reporting and audit decisions.
More from CCH ARM
Related Insights
-
ArticleTax & AccountingApril 05, 2024eBook: How Tax and Accounting Firms Supercharge Efficiency With a Digital WorkflowOur ebook outlines three productivity challenges your firm can solve by automating data collection and input with CCH digital tax solutions.
-
ArticleComplianceTax & AccountingApril 05, 2024Tax relief for victims of Rhode Island severe storms and flooding: IRA and HSA deadlines postponedDue to destruction caused by severe storms that took place in parts of Rhode Island beginning December 17, 2023, the IRS has announced that affected taxpayers will receive tax relief. As a result, certain IRA and HSA deadlines are extended.
-
ArticleComplianceTax & AccountingApril 05, 2024Tax relief for victims of Rhode Island severe storms and flooding: IRA and HSA deadlines postponedDue to destruction caused by severe storms that took place in parts of Rhode Island beginning January 9, 2024, the IRS has announced that affected taxpayers will receive tax relief. As a result, certain IRA and HSA deadlines are extended.
-
ArticleComplianceTax & AccountingApril 05, 2024Tax relief for victims of Maine severe storms and flooding: IRA and HSA deadlines postponedDue to destruction caused by severe storms that took place in parts of Maine beginning January 9, 2024, the IRS has announced that affected taxpayers will receive tax relief. As a result, certain IRA and HSA deadlines are extended.
