This section provides authoritative literature that is relevant to financial reporting including Financial Accounting Standards Board (FASB) pronouncements and others.  All of the FASB pronouncements can be found at www.fasb.org/st.  NOTE: Please ensure that you refer to the FASB copyright notice when utilizing pronouncements found on the FASB website.  For all other pronouncements, use the link accompanying its respective summary.  They are grouped as follows: 

Purchase Price Allocations:

SFAS No. 141 - Business Combinations: In June 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 141, Business Combinations (FAS141), which is effective for all business combinations initiated after June 30, 2001. This Statement also applies to all business combinations accounted for using the purchase method for which the date of acquisition is July 1, 2001, or later. All business combinations in the scope of this Statement are to be accounted for using one method, the purchase method.

SFAS No. 141R - Business Combinations: In December 2007 the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 141R, Business Combinations (FAS141R), which is effective for fiscal years beginning on or after December 15, 2008.  FAS141R replaces FAS141 Business Combinations which was originally issued in June 2001.  Under FAS141R, all business combinations are to be accounted for using the acquisition method of accounting (which FAS141 called the purchase method).  Among other things, this statement establishes principles and requirements regarding accounting for asset acquisitions, including recognizing (1) the assets acquired,(2) the liabilities assumed and (3) any non-controlling interest all measured at fair value with limited exceptions.

SFAS No. 157 - Fair Value Measurements: In September 2006 the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements (FAS157), which is effective for fiscal years beginning after November 15, 2007. This Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.      SFAS No. 142 - Acquisitions of Assets (paragraph 9): In June 2001 the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets (FAS142), which addressed financial accounting for acquired goodwill and other intangible assets. The Statement explained how intangible assets should be accounted for upon their acquisition. It then addressed how goodwill and other intangible assets should be accounted for after they have been initially recognized in the financial statements.   FIN No. 35 - An interpretation of APB No. 18: Acquisitions of less than 50% interests: In May 1981, the Financial Accounting Standards Board (FASB) issued FASB Interpretation Number 35, Criteria for Applying the Equity Method of Accounting for Investments in Common Stock—an interpretation of APB Opinion No. 18.  This interpretation clarifies the criteria for applying the equity method of accounting for investments of 50 percent or less of the voting stock of an investee enterprise (other than a corporate joint venture).   EITF 01-3 - Deferred revenue: Emerging Issues Task Force (EITF) Abstract 01-3, Accounting in a Business Combination for Deferred Revenue of an Acquiree, was last discussed in March 2002.    EITF 02-17 - Customer relationships: Emerging Issues Task Force (EITF) Abstract 02-17, Recognition of Customer Relationship Intangible Assets Acquired in a Business Combination, was last discussed in October 2002.    EITF 03-9 - Useful lives: Emerging Issues Task Force (EITF) Abstract 03-9, Determination of the Useful Life of Renewable Intangible Assets under FASB Statement No. 142, was last discussed in September 2004.    EITF 04-1 - Pre-existing relationships: Emerging Issues Task Force (EITF) Abstract 03-9, Determination of the Useful Life of Renewable Intangible Assets under FASB Statement No. 142, was last discussed in September 2004.    IFRS No. 3 – International - Business Combinations: The International Accounting Standards Board (IASB) issued International Financial Reporting Standard (IFRS) No. 3 with the objective to enhance the relevance, reliability and comparability of the information that an entity provides in its financial statements about a business combination and its effects.  Learn More>>

IAS No. 38 - International – Intangible Assets: The International Accounting Standards Board (IASB) issued International Accounting Standard No. 38 with the objective to prescribe the accounting treatment for intangible assets that are not dealt with specifically in another Standard. Learn More>>   Back to top

Impairment Testing:

SFAS No. 142 - Goodwill and Intangibles:  In June 2001 the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets (FAS142), which addressed financial accounting for acquired goodwill and other intangible assets. The Statement explained how intangible assets should be accounted for upon their acquisition. It then addressed how goodwill and other intangible assets should be accounted for after they have been initially recognized in the financial statements.   SFAS No. 144 - Long-lived Assets:  In August 2001 the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, which addressed financial accounting and reporting for the impairment or disposal of long-lived assets.   SFAS No. 141 - Business Combinations (Step 2 tests): In June 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 141, Business Combinations (FAS141), which is effective for all business combinations initiated after June 30, 2001. This Statement also applies to all business combinations accounted for using the purchase method for which the date of acquisition is July 1, 2001, or later. All business combinations in the scope of this Statement are to be accounted for using one method, the purchase method.   SFAS No. 157 - Fair Value Measurements:  In September 2006 the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements (FAS157), which is effective for fiscal years beginning after November 15, 2007. This Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.   EITF 02-7 - Unit of Account: Emerging Issues Task Force (EITF) Abstract 02-7, Unit of Accounting for Testing Impairment of Indefinite-Lived Intangible Assets, was last discussed in March 2002.    EITF 02-13 - Deferred taxes: Emerging Issues Task Force (EITF) Abstract 02-13, Deferred Income Tax Considerations in Applying the Goodwill Impairment Test in FASB Statement No. 142 was last discussed in September 2002.

IAS No. 36 - International – Impairment:  The International Accounting Standards Board (IASB) issued International Accounting Standard No. 36 with the objective to prescribe the procedures that an entity applies to ensure that its assets are carried at no more than their recoverable amount. Learn More>>   Back to top

Share-based Compensation

SFAS No. 123R - Share-based Payment: In December of 2004 by the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 123R, Share-Based Payment (FAS123R).  In summary, SFAS 123R addresses the accounting for transactions in which an entity exchanges its equity instruments for goods or services. The Statement eliminates the ability to account for share-based compensation transactions under the intrinsic-value method utilizing APB Opinion No. 25, Accounting for Stock Issued to Employees, and generally requires that such transactions are accounted for using the fair-value method.    SEC SAB No. 107: Securities and Exchange Commission (SEC) Staff Accounting Bulletin (SAB) No. 107 was issued in March 2005 express views of the staff regarding the interaction between Statement of Financial Accounting Standards Statement No. 123 (revised 2004), Share-Based Payment (“Statement 123R” or the “Statement”) and certain Securities and Exchange Commission (“SEC”) rules and regulations and provide the staff’s views regarding the valuation of share-based payment arrangements for public companies.  Learn More>>   EITF 96-18 Options to non-employees: Emerging Issues Task Force (EITF) Abstract 96-18, Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services, was last discussed in July 2001.

IFRS No. 2 - International – Share-based compensation:  The International Accounting Standards Board (IASB) issued International Financial Reporting Standard (IFRS) No. 2 with the objective to specify the financial reporting by an entity when it undertakes a share-based payment transaction.  Learn More>>

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