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

Chapter 19ASC 320 INVESTMENTS—DEBT AND EQUITY SECURITIES

PERSPECTIVE AND ISSUES

   Subtopics

   Scope and Scope Exceptions

   Overview

   Practice Alert

DEFINITIONS OF TERMS

CONCEPTS, RULES, AND EXAMPLES

   Debt Securities and Equity Securities with Readily Determinable Fair Values

   Held-to-Maturity Debt Securities

   Trading Securities

   Available-for-Sale Securities

   Deferred Income Tax Effects

   Transfers Between Categories

   Other-than-Temporary Impairment (OTTI)

   Cost-Method Investments

   Option Contracts

   Change in Fair Value Measurements After Year-end, Disclosures, and Elections

PERSPECTIVE AND ISSUES

Subtopics

The Codification contains several Topics dealing with investments, including:

• ASC 320, Investments—Debt and Equity Securities
• ASC 323, Investments—Equity Method and Joint Ventures
• ASC 325, Investments—Other

ASC 320, Investments–Debt and Equity Securities contains one subtopic:

• ASC 320-10, Overall, that contains guidance for
  • Passive investments in all debt securities and
  • Those equity securities that have a readily determinable fair value.

Scope and Scope Exceptions

ASC 320 applies to all entities that do not belong to specialized industries for purposes of ASC 320. The entities to which it applies include

• Cooperatives,
• Mutual entities and
• Trusts that do not report substantially all their securities at fair value.

ASC 320 does not apply to “entities whose specialized accounting practices include accounting for substantially all investments ...