Extinguishment of Liabilities

Posted by BKHM CPAs on Wed, Jul 27, 2016 @ 01:05 PM

The FASB has recent issued Accounting Standards Update (ASU) No. 2016-04, Liabilities- Extinguishment of Liabilities (Subtopic 405-20) Recognition of Breakage for Certain Prepaid Store-Valued Products, which addresses liabilities related to prepaid store-value products (such as gift cards and traveler’s checks).  This new guidance coincides with the FASB’s overall revamping of revenue recognition standards to address current and future potential diversity in practice. 

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Topics: liabilities