November 19, 2009
EITF Reaches Consensus to Account for Elective Stock/Cash Dividends as a Stock IssuanceOn November 19, 2009, the Financial Accounting Standards Board's (FASB) Emerging Issues Task Force (ETIF) reached a consensus that the stock portion of elective stock/cash dividends would be accounted for as a stock issuance. This
accounting treatment would include the stock portion of the dividend arrangement prospectively in reported per share amounts. The stock portion would be considered contingently issuable shares until paid under the current earnings per
share guidance. The EITF also concluded that companies would report the stock portion of these elective dividends as a liability on the balance sheet when there is an obligation to pay shareholders in stock. The EITF will provide further
guidance for the accounting and reporting of these liabilities at a later time. If the EITF's consensus is ratified by the FASB, it would be effective for interim and annual periods ending on or after December 15, 2009.
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Contact
For further information, please contact
Sally Glenn at sglenn@nareit.com or
George Yungmann at gyungmann@nareit.com.
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