Wiley GAAP 2015: Interpretation and Application of Generally Accepted Accounting Principles 2015

Chapter 8ASC 235 NOTES TO FINANCIAL STATEMENTS

PERSPECTIVE AND ISSUES

   Subtopic

   Technical Alert

DEFINITIONS OF TERMS

CONCEPTS, RULES, AND EXAMPLES

   Accounting Policies

   Disclosure Techniques

PERSPECTIVE AND ISSUES

Subtopic

ASC 235, Notes to Financial Statements, contains one Subtopic:

• ASC 235-10, Overall, which addresses “the content and usefulness of the accounting policies judged by management to be most appropriate to fairly present the entity's financial statement.”

The topic does not address specific disclosures. Those are addressed in the related topics. The topic does, however, list accounting policy disclosures commonly required:

• Basis of consolidation
• Depreciation methods
• Amortization of intangibles
• Inventory pricing
• Accounting for recognition of profit on long-term construction-type contracts

• Recognition of revenue from franchising and leasing operations.

  (ASC 235-10-50-4)

Technical Alert

Disclosures have drawn the attention of both the FASB and the SEC. As the disclosure requirements have accumulated over the years, there has been a growing concern about information overload and whether more is necessarily better.

The FASB has a project to develop a framework to increase the effectiveness of disclosures. The framework will address the process for establishing disclosure and for determining which disclosures to make. More information can be found on the FASB's website.

The SEC is reviewing specific sections of regulations S-K and S-X, with a goal ...