83 FR 1295 - Staff Accounting Bulletin No. 117

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 8 (January 11, 2018)

This staff accounting bulletin modifies portions of the interpretive guidance included in the Staff Accounting Bulletin Series in order to make the relevant interpretive guidance consistent with authoritative accounting guidance and Securities and Exchange Commission rules and regulations. Specifically, the staff is updating the Series in order to bring existing guidance into conformity with the Financial Accounting Standards Board Accounting Standards Codification Topic 321, Investments--Equity Securities.

[Federal Register Volume 83, Number 8 (Thursday, January 11, 2018)]
[Rules and Regulations]
[Pages 1295-1296]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-00352]


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SECURITIES AND EXCHANGE COMMISSION

17 CFR Part 211

[Release No. SAB 117]


Staff Accounting Bulletin No. 117

AGENCY: Securities and Exchange Commission.

ACTION: Publication of Staff Accounting Bulletin.

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SUMMARY: This staff accounting bulletin modifies portions of the 
interpretive guidance included in the Staff Accounting Bulletin Series 
in order to make the relevant interpretive guidance consistent with 
authoritative accounting guidance and Securities and Exchange 
Commission rules and regulations. Specifically, the staff is updating 
the Series in order to bring existing guidance into conformity with the 
Financial Accounting Standards Board Accounting Standards Codification 
Topic 321, Investments--Equity Securities.

DATES: Effective: January 11, 2018.

FOR FURTHER INFORMATION CONTACT: Brian Staniszewski, Professional 
Accounting Fellow, Office of the Chief Accountant at (202) 551-5300 or 
Lindsay McCord, Associate Chief Accountant, Division of Corporation 
Finance at (202) 551-3400, Securities and Exchange Commission, 100 F 
Street NE, Washington, DC 20549.

SUPPLEMENTARY INFORMATION: The statements in staff accounting bulletins 
are not rules or interpretations of the Commission, nor are they 
published as bearing the Commission's official approval. They represent 
interpretations and practices followed by the Division of Corporation 
Finance and the Office of the Chief Accountant in administering the 
disclosure requirements of the federal securities laws.

List of Subjects in 17 CFR Part 211

    Accounting, Reporting and recordkeeping requirements, Securities.

    Dated: November 29, 2017.
Brent J. Fields,
Secretary.
    Accordingly, part 211 of title 17 of the Code of Federal 
Regulations is amended as follows:

PART 211--INTERPRETATIONS RELATING TO FINANCIAL REPORTING MATTERS

0
1. Add an authority citation for part 211 to read as follows:

    Authority: 15 U.S.C. 77g, 15 U.S.C. 77s(a), 15 U.S.C. 77aa(25) 
and (26), 15 U.S.C. 78c(b), 17 CFR 78l(b) and 13(b), 17 CFR 78m(b) 
and 15 U.S.C. 80a-8, 30(e) 15 U.S.C. 80a-29(e), 15 U.S.C. 80a-30, 
and 15 U.S.C. 80a-37(a).


0
2. Amend the table in subpart B by adding an entry for Staff Accounting 
Bulletin No. 117 at the end of the table to read as follows:

Subpart B--Staff Accounting Bulletins

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                  Subject                      Release No.        Date             Fed. Reg. Vol. and page
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                                                  * * * * * * *
Publication of Staff Accounting Bulletin            SAB-117       1/11/2018  [INSERT Federal Register CITATION].
 No. 117.
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    Note: The text of SAB 117 will not appear in the Code of Federal 
Regulations.

Staff Accounting Bulletin No. 117

    This staff accounting bulletin modifies portions of the 
interpretive guidance included in the Staff Accounting Bulletin Series 
in order to make the relevant interpretive guidance consistent with 
current authoritative accounting and auditing guidance and Securities 
and Exchange Commission (``Commission'') rules and regulations.

[[Page 1296]]

Specifically, the staff is updating the Series in order to bring 
existing guidance into conformity with the Financial Accounting 
Standards Board (``FASB'') Accounting Standards Codification (``ASC'') 
Topic 321, Investments--Equity Securities (``ASC Topic 321''). The FASB 
adopted ASC Topic 321 through its issuance of Accounting Standards 
Update No. 2016-01, Financial Instruments--Overall (Subtopic 825-10): 
Recognition and Measurement of Financial Assets and Financial 
Liabilities.
    The following describes the changes made to the Staff Accounting 
Bulletin Series that are presented at the end of this release:

1. Topic 5: Miscellaneous Accounting

    a. Topic 5.M in the Staff Accounting Bulletin Series entitled Other 
Than Temporary Impairment of Certain Investments in Equity Securities 
(``Topic 5.M'') is no longer applicable upon a registrant's adoption of 
ASC Topic 321. Topic 5.M provided the staff's views on evaluating 
whether an impairment loss should be recognized in net income for 
investments in equity securities that were measured at fair value with 
changes in fair value presented in other comprehensive income.\1\ ASC 
Topic 321 establishes new guidance that eliminates the ability to 
present changes in the fair value of investments in equity securities 
within other comprehensive income. After a registrant adopts ASC Topic 
321, investments in equity securities that previously qualified for 
presenting changes in fair value within other comprehensive income will 
be measured at fair value with changes in fair value presented 
immediately in net income. Therefore, ASC Topic 321 eliminates the need 
for Topic 5.M.
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    \1\ Prior to the adoption of ASC Topic 321, FASB ASC Topic 320, 
Investments--Debt and Equity Securities, permitted investments in 
equity securities with readily determinable fair values to be 
classified as (1) available-for-sale, with changes in fair value 
recognized in other comprehensive income, or as (2) trading 
securities, with changes in fair value recognized in net income.
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    Accordingly, the staff hereby amends the Staff Accounting Bulletin 
Series as follows:
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Topic 5: Miscellaneous Accounting

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M.1. Impact of a Registrant's Adoption of FASB ASC Topic 321, 
Investments--Equity Securities--Overall

    Topic 5.M is no longer applicable upon a registrant's adoption of 
ASC Topic 321. Topic 5.M provided the staff's views on evaluating 
whether an impairment loss should be recognized in net income for 
investments in equity securities that were measured at fair value with 
changes in fair value presented in other comprehensive income. ASC 
Topic 321 establishes new guidance that eliminates the ability to 
present changes in the fair value of investments in equity securities 
within other comprehensive income, which eliminates the need for Topic 
5.M. Registrants that have not yet adopted ASC Topic 321 should 
continue to refer to Topic 5.M.
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[FR Doc. 2018-00352 Filed 1-10-18; 8:45 am]
 BILLING CODE 8011-01-P