FASB issues technical corrections

FASB issued numerous technical corrections and clarifications to GAAP in Accounting Standards Update No. 2016-19, Technical Corrections and Improvements. The amendments apply to all reporting organizations that are within the scope of the affected accounting guidance. All the amendments are now in effect.

Amendments affecting all organizations included:

• An amendment that promotes consistent use of the term “participating insurance” in FASB Accounting Standards Codification (ASC) Subtopics 715-30 and 715-60, as well as Topic 944, Financial Services—Insurance.
• An amendment to Topic 825, Financial Instruments, and Topic 944 promoting consistent use of the term “reinsurance recoverable.”
• An amendment removing the term “debt” from the Master Glossary.
• An amendment removing the phrase “that contain no purpose restrictions” from Topic 958, Not-for-Profit Entities.
• An amendment to Subtopic 350-40 that adds a reference to use when accounting for internal-use software licensed from third parties.
• An amendment to Subtopic 360-20 pertaining to loans issued under the Federal Housing Administration and the Veterans Administration.
• An amendment to Topic 820, Fair Value Measurement, that clarifies the difference between a “valuation approach” and a “valuation technique” when applying the guidance. The amendment also requires an organization to disclose when there has been a change in either a valuation approach, a valuation technique, or both.
• An amendment to Subtopic 405-40 pertaining to obligations under arrangements to be considered fixed at the reporting date.
• An amendment to Subtopic 860-20 aligning its implementation guidance to its corresponding guidance.
• An amendment to Subtopic 860-50 that adds guidance from an AICPA position statement on the accounting for the sale of servicing rights when the transferor retains loans. The AICPA guidance had been omitted from the ASC.