FASB Suspends Push to Simplify Equity Method of Accounting

The Financial Accounting Standards Board (FASB) voted on May 11 to terminate its efforts to simplify the equity method of accounting.

In June 2015, the board issued a proposal intended to simplify the equity method of accounting. It included a provision that would have eliminated the requirement for an equity method investor to account for the basis difference, which is the difference between the cost of an investment and the investor’s proportionate share of the net assets of the investee.

NAREIT was critical of the proposed treatment.

(Contact: Chris Drula at cdrula@nareit.com)

 

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