Fair Value Measurement

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Fair Value Measurement Topic
The source of the Fair Value Measurement Topic is primarily FASB Statement No. 157, Fair
Value Measurements.
Statement 157 included amendments to various FASB-issued guidance. However, the
amendments only covered certain FASB-issued guidance. Amendments were not included for
EITF Abstracts, FASB Questions and Answers, and AICPA literature. Therefore, fair value
guidance from those sources of literature may not properly reflect the effect of Statement 157. As
of July 1, 2009, the FASB has a project in process to identify all such literature. When the FASB
completes that project, it will update the Codification to reflect any necessary amendments.
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Codification Research System
Joining and combining content
The Leases Topic figure provides a visual illustration of two features available to subscribers of
the Codification Research System—Join Sections and Combine Subsections.
Topic
Subtopics
Sections
Subsections
Leases
Scope Disclosure Scope Disclosure Scope Disclosure
Capital
Leases
Operating
Overall Leases
Lessees
Lessors
Lessees
Lessors
Lessees
Lessors
Lessees
Lessors
Lessees
Lessors
Lessees
Lessors
Note: This is for illustration purposes only and does not include all Topics, Subtopics, Sections and Subsections.
By using consistent Sections, subscribers can access functions within the Codification Research
System to combine similar types of content. For example, in the Codification Research System,
subscribers can combine all Disclosure Sections for a Topic without the need to access each
individual Subtopic. In fact, the functionality of the system enables subscribers to produce a
comprehensive listing of all authoritative US GAAP disclosures by Topic.
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Join
Sections:
Leases /
Disclosure
Disclosure
Lessees
Lessors
Disclosure
Lessees
Lessors
Disclosure
Lessees
Lessors
Overall Operating Leases Capital Leases
Combine
Subsections:
Lessees Lessees Lessees Lessees Lessees Lessees Lessees
Overall Operating Leases Capital Leases
Scope Disclosure Scope Disclosure Scope Disclosure
Note: The above are for illustration purposes only and do not include all Sections and Subsections.
In a similar fashion, as indicated in the discussion under the heading titled Subsections, the
system allows subscribers to combine Subsections. Unlike the Join Section feature, the Combine
Subsection feature combines the Subsections on the basis of the Subsection title.
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General Codification matters
Materiality
Over the years, various standards have included language stating that a standard is applicable if
an item is material. Retaining such individual materiality references in the Codification could
lead users to believe that materiality applies to one set of standards, but not another. To provide
greater consistency, the Codification excludes individual materiality references. Instead, the
Codification solely provides the standards of accounting and reporting. See Codification Topic
105 for a discussion of materiality.
Use of standards by analogy
In many cases, entities apply accounting literature by analogy. Some previous standards (for
example, EITF Abstracts) stated: “Do not use by analogy.” In those cases, the language was
carried over to the Codification to inform users.
Laws, rules, and regulations
Some codified non-SEC standards make reference to laws, rules, regulations (Acts), and other
standards issued by entities other than the FASB. In cases where such content was included in
the Codification, users must be aware that the FASB did not evaluate whether such regulations,
laws, or similar items are still current. In many cases, the team inserted text similar to the
following paragraph:
Any references to various laws, rules, or regulations established by others shall not be
considered definitive interpretations of such laws, rules, and regulations for any purpose.
Laws, rules, and regulations may change over time and the standard FASB process will
not update the Codification for such changes. Therefore, users must evaluate the current
laws, rules, or regulations to ensure that the prescribed accounting continues to correlate
with the laws, rules and regulations.
In cases where the above text was not included, users must be aware that the FASB does not take
responsibility for the current state of such items.
If you find any discrepancies between the content in the Codification and current laws, rules, and
regulations, the FASB asks that you use the content feedback feature of the Codification
Research System to submit your comments.
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Ongoing standard-setting process
Effective date and superseded standards
With the issuance of FASB Statement No. 168, The FASB Accounting Standards CodificationTM
and the Hierarchy of Generally Accepted Accounting Principles, the FASB approved the
Codification as the single source of authoritative US GAAP for interim and annual periods
ending after September 15, 2009. The Codification supersedes all existing non-SEC standards.
The Codification Research System will include the superseded standards for archive purposes.
Ongoing standard-setting process
The results of the ongoing standard-setting activity will be an Accounting Standards Update
composed of the background and basis for conclusions together with an appendix of Accounting
Standards Update Instructions. The title of the combined set will be Accounting Standards
Update YYYY-XX, where YYYY is the year issued and XX is the sequential number for each
Accounting Standards Update with that year. For example, the combined numbers would be
2009-01, 2009-02, and so forth. All authoritative US GAAP issued by the FASB will be issued
in this format, regardless of the form in which such guidance may have been issued previously
(for example, EITF Abstracts, FASB Staff Positions, FASB Statements, FASB Interpretations,
and so forth). Accounting Standards Updates also will be issued for amendments to the SEC
content in the Codification.
The FASB will organize the contents of Accounting Standards Updates using the same Section
headings as those used in the Codification. The contents of the Accounting Standards Update
Instructions will include marked changes. However, the Codification itself will not display
marked changes in the body of the Codification, other than in an archived version of the
Accounting Standards Update Instructions.
The FASB does not consider new Accounting Standards Updates as authoritative in their own
right. Instead, the new Accounting Standards Updates serve only to provide background
information about the issue, update the Codification, and provide the basis for conclusions on
changes in the Codification. An Accounting Standards Update is a transient document to initiate
the Board”s process of creating Accounting Standards Update Instructions. The Accounting
Standards Update Instructions will be the source used to update the Codification and the
instructions will be available on the website. As the FASB and SEC amend existing Codification
paragraphs, both the current paragraph and the updated paragraph will reside in the Codification
until such time that the new guidance is completely effective for all entities. During that period,
the Codification Research System will emphasize the newly amended paragraph as Pending Text
and will provide a link to the related transition guidance. When the newly amended paragraph is
fully effective, the outdated guidance will be removed from the paragraph and the amended
paragraph will remain.
Before approval of the Codification, the FASB amended pre-Codification standards. The FASB
will not amend Accounting Standards Updates. It will only amend the Codification.
When the ongoing standard-setting process is fully operational, the Codification Research
System will be updated concurrent with the release of a new Accounting Standards Update.
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