Understanding and Working with the

New FASB Codification

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 How the Codification is Structured

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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 How the Codification is Structured

I. Structure of the Codification

A. The codification uses a topical (menu) structure in which topics, subtopics,
and sections are numerically referenced. This effectively organizes the
content without regard to the original standard-setter or standard from
which the content was derived.
B. The codification excludes nonessential material such as redundant
summaries of existing standards, historical content, discussions of previous
practice, summaries of constituent feedback, and similar content.
C. The FASB excluded grandfathered material in the first release of the
codification; this material will be added in a special grandfathered section
under the relevant topics.
1. An example of grandfathered material includes pooling of interests in
a business combination described in paragraph B217 of FASB
Statement No. 141.
2. Other grandfathered items are identified in the notice to constituents.
D. The codification excludes certain content that is currently required, but will
be outdated or superseded by December 31, 2008, FASB’s target effective
date in authoring the codification.

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 How the Codification is Structured

II. Transition Guidance

A. The codification eliminates transition guidance for all guidance that
is fully effective as of December 31, 2008.
B. Transition guidance will be emphasized in the codification and
removed after the transition period lapses

KEY POINT
Entities that are applying GAAP for the first time may need to access the original standards
to determine relevant transition guidance.

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 How the Codification is Structured

III. Referencing the Codification

In April 2008, the FASB added a section to the Notice to Constituents
that addresses how they plan to reference the codification, by using
FASB ASC {Codification reference}, for example:

1. Topics – FASB ASC 310 (to access “Receivables” Topic)

2. Subtopics – FASB ASC 310-10 (to access “Overall Subtopic)

3. Sections – FASB ASC 310-10-15 (to access “Scope Section” )

4. Paragraph – FASB ASC 310-10-15-2 (to access “paragraph”)

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 How the Codification is Structured
IV. Terminology
A. To establish consistency, the codification uses the term “shall” throughout
the standards sections to refer to a requirement.
B. The codification eliminates the use of generic qualifying terms, such as:
1. Usually
2. Ordinarily
3. Generally
4. Similar terms
C. To provide consistency, the FASB adopted the term “entity” throughout the
codification, rather than using:
1. Company
2. Organization
3. Enterprise
4. Firm
5. Preparer
KEY POINT
Because FASB adopted the term entity for the codification, they adopted the term intra-entity
as the replacement for intercompany, and intend for the terms intra-entity and intercompany
to be interchangeable.
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How the Codification is Structured

V. How is it organized?
A. The codification is organized in a tiered/menu structure.
B. Information is organized into nine areas, ranging from industry
specific to general financial statement matters.
C. Within each area are topics, subtopics, sections, subsections and
paragraphs, where details of the technical content reside.
D. At the topic, subtopic and section levels, the codification material
correlates to IFRS.

KEY POINT
• The codification topical organization is expected to ease the convergence of
U.S. GAAP and IFRS standards.

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 How the Codification is Structured

VI. The codification uses a topical structure

A. Guidance is organized into areas, topics, subtopics, sections and subsections
as follows:

Areas (9 Categories)

Topics (XXX)

Subtopics (YY)

Sections (ZZ)

Subsections

Paragraphs (>>)

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 How the Codification is Structured

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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How the Codification is Structured

B. Each area represents a collection of related topics, designated

with 3-digit topic codes. The areas are:
1. General principles (100’s)
2. presentation; (200’s)
3. assets; (300’s)
4. liabilities; (400’s)
5. equity; (500’s)
6. revenue; (600’s)
7. expenses; (700’s)
8. broad transactions; (800’s)
9. industry.(900’s)

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How the Codification is Structured

1. “General Principles” area is for Generally Accepted Accounting Principles overview.

2. “Presentation” area relate only to general presentation matters and do not address
recognition, measurement, and de-recognition issues.
3. “Assets” – within the five financial statement account areas—various types of
financial statement accounts are treated as separate topics.
4. “Liabilities” – within the five financial statement account areas – various types of
financial statement accounts are treated as separate topics.
5. “Equity” – within the five financial statement account areas—various types of
financial statement accounts are treated as separate topics
6. “Revenue” – within the five financial statement account areas—various types of
financial statement accounts are treated as separate topics
7. “Expense” – within the five financial statement account areas—various types of
financial statement accounts are treated as separate topics
8. “Broad Transactions” area relate to multiple financial statement accounts and are
generally categorized by type of transaction.
9. “Industry” area deal with transactions that are unique to specific industries or types
of activities.

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 How the Codification is Structured

VII. Areas → Topics

A. Nine areas (contain nearly 90 topics):
1. General Principles (Topic Code 105). There is only 1 topic in
General Principles.
2. Presentation (Topic Codes 205 – 299). These 15 Topics relate only
to presentation matters and do not address recognition,
measurement, and de-recognition matters. Topics include Income
Statement, Balance Sheet, Earnings per Share, etc.
3. Asset (Topics 305 – 399) There are 9 topics in Assets
4. Liabilities (Topics 405 – 499) There are 9 topics in Liabilities
5. Equity (Topics 505 – 599) There is only 1 topic in Equity
6. Revenue (Topics 605 – 699) There is only 1 topic in Revenue
7. Expenses (Topics 705 – 799) There are 8 topics in Expenses
8. Broad Transactions (Topic codes 805 – 899). These 14 Topics
relate to multiple financial statement accounts and are generally
transaction-oriented. Topics include Business Combinations,
Derivatives, Non-monetary Transactions, Leases, etc.
9. Industries (Topic codes 905 – 999). These 32 Topics relate to
accounting that is unique to an industry or type of activity.

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 How the Codification is Structured

VIII. Industry Area (and topics) General Principles

A. The Codification team applied the following Presentation

filtering approach for identifying the Assets

Liabilities
Codification Topics that should contain Equity
specific content: Revenue

1. The first filter related to industry content. If a Expenses

Broad Transactions
piece of content related solely to a single
Industry
industry, the Codification team authored the
content in that particular industry.

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 How the Codification is Structured

• Broad Transaction Area (& Topics) General Principles

The Codification team applied the following Presentation

filtering approach next: Assets

Liabilities
1) The second filter related to broad Equity
transactions. If a piece of content did Revenue
not relate to a single industry and it Expenses

related a broad transaction, the Broad Transactions

Industry
Codification team authored the content
in that broad transaction.

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 How the Codification is Structured

• Presentation and Financial Statement General Principles

Areas (& Topics) Presentation

The Codification team applied the following Assets

filtering approach next: Liabilities

Equity
 For all other content that did not meet the Revenue
industry or broad transaction filters, the Expenses

Codification team authored the content in Broad Transactions

Industry
either:
1) Financial statement account Topic
OR

1) Presentation Topic.

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 Working with the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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 Working with the Codification

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 Working with the Codification

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 Working with the Codification

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 Working with the Codification

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 Working with the Codification

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 Working with the Codification

I. The FASB Accounting Standards Codification™ Research System

features a notice to constituents which explains the scope,
structure, and usage of consistent terminology of the codification.
II. Constituents are encouraged to read this notice as it includes
content matters for which FASB is requesting constituent
feedback.

Following is a summary of several interesting points included in the notice to constituents.

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 Working with the Codification

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 Working with the Codification

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 Working with the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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 Working with the Codification
Topics

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 Working with the Codification
Topics

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 Working with the Codification
Topics

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 Working with the Codification
Topics

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 Working with the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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 Working with the Codification
III. Subtopics
A. Subtopics: represent subsets of a Topic and are generally
distinguished by type or by scope. In other cases, the Overall Subtopic
may not contain overall guidance, but instead may represent
miscellaneous content that does not fit into another Subtopic.
B. Overall XXX-10: Subtopic that generally represents the pervasive
guidance for the Topic.
C. Overall Subtopic: typically contains the pervasive scope for the
entire Topic, including the other Subtopics (in cases where a Topic
contains multiple Subtopics). The remaining Subtopics then refer to
the Overall Subtopic and address the specific exceptions from the
pervasive Overall Scope.

KEY POINT
Users must be aware that the Overall Subtopic is not a summary, but instead represents the
scope for the Overall Subtopic and the baseline for the other Subtopics, which may include
different scope inclusions or exclusions.

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 Working with the Codification

D. Additional Subtopic: XXX-YY represents incremental or unique

guidance not contained in the Overall Subtopic. In some cases, the
Overall Subtopic represents overall guidance. Subtopics unique to a
Topic use classification numbers between 00 and 99.

KEY POINT
• To provide consistency, the Codification segregates industry Topics into Subtopics that mirror
the general Topic structure. This provides multiple ways to access the content—by industry
Topic or by general Topic.

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 Working with the Codification

• One of the goals of the Codification was to eliminate redundant content.

• FASB concluded that industry Topics should contain only incremental industry-specific
guidance.
• The entities within the scope of the industry must follow the industry-specific guidance and
all other relevant guidance contained in other Topics that does not conflict with the industry
guidance.
• Industry Topics: may contain Subtopics that mirror the general Topics.

EXAMPLE
• The Subtopic classification number is the classification
number of the related Topic.
1. Agriculture—Receivables is 905-310.
2. Agriculture—Inventory is 905-330

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 Working with the Codification

Topics

Area

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Working with the Codification

Topics
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Working with the Codification

Subtopics

Area
Topics

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 Working with the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
XXX-9XX: Industry 45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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Working with the Codification

Area

Topics

Subtopics

Note cross-reference to “industry” area/topics

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 How the Codification is Structured

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
XXX-9XX: Industry 45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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 Working with the Codification

Area

Subtopics

Topics

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 Working with the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
XXX-9XX: Industry 45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions

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 Working with the Codification

IV. Sections
A. Sections represent the nature of the content in a Subtopic such as
Scope, Recognition, Measurement, Subsequent Measurement,
Derecognition, Disclosure, etc.
B. Every Subtopic uses the same Sections, unless there is no content
for a particular Section.

KEY POINT
• Similar to Topics, Sections correlate very closely with Sections of
individual International Accounting Standards.

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 Working with the Codification
C. The Sections of each Subtopic are as follows:
XXX-YY-ZZ where XXX = Topic, YY = Subtopic, ZZ = Section
XXX-YY-00 Status
XXX-YY-05 Overview and Background
XXX-YY-10 Objectives
XXX-YY-15 Scope and Scope Exceptions
XXX-YY-20 Topical Definitions—Glossary
XXX-YY-25 Recognition
XXX-YY-30 Initial Measurement
XXX-YY-35 Subsequent Measurement
XXX-YY-40 De-recognition
XXX-YY-45 Other Presentation Matters
XXX-YY-50 Disclosure
XXX-YY-55 Implementation Guidance and Illustrations
XXX-YY-60 Relationships
XXX-YY-65 Transition and Open Effective Date Information
XXX-YY-70 Links to Grandfathered Material
XXX-YY-75 XBRL Definitions

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Working with the Codification

KEY POINT
• “S” indicates that it is an SEC Rule.

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 Working with the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
XXX-9XX: Industry 45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions
SZZ: SEC SECTION

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Working with the Codification

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 Working with the Codification

00 Status D. The following is a description of the Sections:

05 Overview and Background

10 Objectives
1. XXX-YY-00 Status
15 Scope and Scope Exceptions This Section includes references to the post-
20 Topical Definitions—Glossary Codification standards that affect the Subtopic. It is
25 Recognition
comparable to the status section currently contained
30 Initial Measurement

35 Subsequent Measurement
in the FASB Statements (and other standards) in
40 De-recognition Original Pronouncements.
45 Other Presentation Matters

50 Disclosure

55 Implementation Guidance and EXAMPLE

Illustrations

60 Relationships • Section includes information similar to the following:

65 Transition and Open Effective a. Paragraph 25-6 added by Codification Update 10-03.
Date Information

70 Links to Grandfathered b. Paragraph 35-7 modified by Codification Update 09-02.

Material
c. Paragraph 50-3 superseded by Codification Update 09-
75 XBRL Definitions
23.

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 Working with the Codification

00 Status 2. XXX-YY-05 Overview and Background

05 Overview and Background

10 Objectives
• This Section provides a general overview and
15 Scope and Scope Exceptions background regarding the Subtopic.
20 Topical Definitions—Glossary
• It does not provide historical background of the
25 Recognition

30 Initial Measurement
standard setter, due process, or similar items.
35 Subsequent Measurement • It may contain certain material generally considered
40 De-recognition
useful to a user to understand the typical situations
45 Other Presentation Matters

50 Disclosure
required by the standard.
55 Implementation Guidance and
Illustrations
• This material comes primarily from the Introduction
60 Relationships section of the standard or, in some cases, the Basis
65 Transition and Open Effective
Date Information
for Conclusions.
70 Links to Grandfathered • This Section does not summarize the requirements of
Material

75 XBRL Definitions
the Subtopic.

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 Working with the Codification

00 Status 3. XXX-YY-10 Objectives

05 Overview and Background
When available, the Objectives Section states the
10 Objectives

15 Scope and Scope Exceptions

high-level objectives of the Subtopic, but does not
20 Topical Definitions—Glossary discuss the main principles of the Subtopic.
25 Recognition

30 Initial Measurement

35 Subsequent Measurement

40 De-recognition

45 Other Presentation Matters

50 Disclosure

55 Implementation Guidance and

Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material

75 XBRL Definitions

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 Working with the Codification

00 Status 4. XXX-YY-15 Scope and Scope Exceptions

05 Overview and Background

10 Objectives
a. This Section outlines the items (for example, the
15 Scope and Scope Exceptions entities, transactions, instruments, or events) to
20 Topical Definitions—Glossary which the guidance in the Subtopic does or does
25 Recognition
not apply. It does not contain actual accounting or
30 Initial Measurement

35 Subsequent Measurement
reporting guidance (for example, subsequent
40 De-recognition measurement).
45 Other Presentation Matters
b. The FASB concluded that unless otherwise
50 Disclosure

55 Implementation Guidance and

indicated, the content applies to all entities.
Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material

75 XBRL Definitions

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 Working with the Codification

00 Status 5. XXX-YY-20 Glossary

05 Overview and Background

10 Objectives
a. This Section contains all the glossary terms used
15 Scope and Scope Exceptions in the Subtopic.
20 Topical Definitions—Glossary
b. In some cases, the terms originated from the
25 Recognition

30 Initial Measurement
Glossary of the original standard.
35 Subsequent Measurement c. In other cases, the term was embedded in the
40 De-recognition
text of the original standard.
45 Other Presentation Matters

50 Disclosure

55 Implementation Guidance and

Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material

75 XBRL Definitions

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 Working with the Codification

00 Status 6. XXX-YY-25 Recognition

05 Overview and Background
This Section addresses the criteria, timing, and
10 Objectives

15 Scope and Scope Exceptions

location (within the financial statements) for
20 Topical Definitions—Glossary recognizing a particular item.
25 Recognition

30 Initial Measurement

35 Subsequent Measurement

40 De-recognition

45 Other Presentation Matters

50 Disclosure

55 Implementation Guidance and

Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material

75 XBRL Definitions

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 Working with the Codification

00 Status 7. XXX-YY-30 Initial Measurement

05 Overview and Background

10 Objectives
a. This Section addresses the criteria and amounts
15 Scope and Scope Exceptions used to measure a particular item at date of
20 Topical Definitions—Glossary recognition.
25 Recognition

30 Initial Measurement
b. In many cases, this Section may be empty
35 Subsequent Measurement because the initial standards did not include
40 De-recognition initial measurement.
45 Other Presentation Matters

50 Disclosure

55 Implementation Guidance and

Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material

75 XBRL Definitions

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 Working with the Codification

00 Status 8. XXX-YY-35 Subsequent Measurement

05 Overview and Background

10 Objectives
a. This Section relates almost exclusively to assets,
15 Scope and Scope Exceptions liabilities, and equity.
20 Topical Definitions—Glossary
b. It addresses the criteria and amounts used to
25 Recognition

30 Initial Measurement
measure a particular asset, liability, or equity item
35 Subsequent Measurement subsequent to the date of recognition (for
40 De-recognition example, impairment, fair value changes,
45 Other Presentation Matters
depreciation, amortization, and similar items).
50 Disclosure

55 Implementation Guidance and

Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material KEY POINT
75 XBRL Definitions
Income statement accounts do not generally have this section.

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 Working with the Codification

00 Status 9. XXX-YY-40 Derecognition

05 Overview and Background

10 Objectives
a. This Section relates almost exclusively to assets,
15 Scope and Scope Exceptions liabilities, and equity.
20 Topical Definitions—Glossary
b. It addresses the criteria, the basis to be relieved
25 Recognition

30 Initial Measurement
(for example, the method to determine the
35 Subsequent Measurement amount), and the timing to be used when
40 De-recognition derecognizing a particular asset, liability, or equity
45 Other Presentation Matters
item for purposes of determining gain or loss, if
50 Disclosure

55 Implementation Guidance and

any.
Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material KEY POINT
75 XBRL Definitions
Income statement accounts do not generally have this section.

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 Working with the Codification

00 Status 10. XXX-YY-45 Other Presentation Matters

05 Overview and Background
This Section includes other presentation matters
10 Objectives

15 Scope and Scope Exceptions

related to the Subtopic. Some examples include:
20 Topical Definitions—Glossary a. Specific balance sheet classification
25 Recognition

30 Initial Measurement
b. Specific cash flow requirements
35 Subsequent Measurement c. Specific effect on earnings per share.
40 De-recognition

45 Other Presentation Matters

50 Disclosure

55 Implementation Guidance and

Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material

75 XBRL Definitions

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 Working with the Codification

00 Status 11. XXX-YY-50 Disclosure

05 Overview and Background

10 Objectives a. This Section contains specific disclosure

15 Scope and Scope Exceptions requirements for a Subtopic.
20 Topical Definitions—Glossary

25 Recognition
b. It does not include general disclosure
30 Initial Measurement requirements that may reside in the Notes to
35 Subsequent Measurement
Financial Statement Topic and other general
40 De-recognition

45 Other Presentation Matters

presentation Topics.
50 Disclosure
c. This Section may include references to general
55 Implementation Guidance and
Illustrations disclosure requirements that encompass the
60 Relationships
items addressed by the Subtopic.
65 Transition and Open Effective
Date Information

70 Links to Grandfathered
Material EXAMPLE
75 XBRL Definitions The Receivables Subtopic contains a link to the general financial instrument
disclosure requirements that relate to receivables.

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 Working with the Codification

00 Status 12. XXX-YY-55 Implementation Guidance and

05 Overview and Background
Illustrations
10 Objectives

15 Scope and Scope Exceptions a. This Section contains implementation guidance and
20 Topical Definitions—Glossary illustrations, which are an integral part of the standards.
25 Recognition The Codification separates implementation guidance
30 Initial Measurement
and illustrations from the main body of the standards,
35 Subsequent Measurement

40 De-recognition
but provides references and links in both directions.
45 Other Presentation Matters b. This Section provides guidance relating to the standards
50 Disclosure
in simplified and generalized situations. Applying the
55 Implementation Guidance and
Illustrations standards to actual situations requires judgment and the
60 Relationships implementation guidance and illustrations are intended
65 Transition and Open Effective
Date Information
to aid in making those judgments.
70 Links to Grandfathered
Material KEY POINT
75 XBRL Definitions
• The implementation guidance and illustrations assume that all items addressed are
material to the entity.
• Because the implementation guidance and illustrations cannot address all possible
variations, users must consider carefully the facts and circumstances in actual situations
when applying the provisions of the Subtopic
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 Working with the Codification

00 Status 13. XXX-YY-60 Relationships

05 Overview and Background

10 Objectives
a. This Section includes references to other Subtopics
15 Scope and Scope Exceptions that may contain guidance related to the Subtopic.
20 Topical Definitions—Glossary The references point to content in another Topic that
25 Recognition is either the object of the other Topic or in which the
30 Initial Measurement
material otherwise relates to the particular Topic.
35 Subsequent Measurement

40 De-recognition EXAMPLE
45 Other Presentation Matters

50 Disclosure
The Income Taxes Topic may have discussions of LIFO reserves as the object of an
55 Implementation Guidance and
illustration or example. In this case, the Relationships Section of the Inventory Topic
Illustrations would refer to the LIFO material in the relevant Income Taxes Subtopic
60 Relationships

65 Transition and Open Effective b. The relationships provide simple references to the
Date Information

70 Links to Grandfathered
relevant content, but do not include a complete
Material description of the relationship. In addition, the
75 XBRL Definitions
Section does not contain requirements.
KEY POINT
While the goal is to include as many relevant relationships as possible, users should not
assume that the lists are exhaustive.
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 Working with the Codification

00 Status 14. XXX-YY-65 Transition and Open Effective Date Information

05 Overview and Background a. This Section contains references to paragraphs within the
10 Objectives Subtopic that have open transition guidance.
15 Scope and Scope Exceptions
b. The transition guidance will appear in an emphasized
20 Topical Definitions—Glossary
manner in the text of the standards Sections. After the
25 Recognition
transition period lapses, the Codification Research System
30 Initial Measurement
will remove the outdated guidance and the emphasis on
35 Subsequent Measurement
the new content.
40 De-recognition

45 Other Presentation Matters

50 Disclosure KEY POINTS

55 Implementation Guidance and • The Codification was written with an assumed effective date of December
Illustrations

60 Relationships
31, 2008.
65 Transition and Open Effective • As a result, transition and open effective date guidance for dates prior to
Date Information
December 31, 2008 is not in the Codification (despite the fact that the
70 Links to Grandfathered
Material effective date may not have occurred yet) because of its imminent removal
75 XBRL Definitions
as authoritative content.
• As such, there is no transition or effective date information in the
Codification for such guidance.
• Users can search the original standards.
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 Working with the Codification

00 Status 15. XXX-YY-70 Links to Grandfathered Material

05 Overview and Background

10 Objectives
a. This Section contains descriptions, references,
15 Scope and Scope Exceptions and transition periods for post-December 31, 2008,
20 Topical Definitions—Glossary grandfathered standards.
25 Recognition

30 Initial Measurement
b. For all pre-December 31, 2008, grandfathered
35 Subsequent Measurement literature, we will include a notice indicating that
40 De-recognition the Codification represents standards as of
45 Other Presentation Matters
December 31, 2008, and there is no transition or
50 Disclosure

55 Implementation Guidance and

effective date guidance in the Codification for older
Illustrations
standards.
60 Relationships

65 Transition and Open Effective

Date Information
KEY POINTS
70 Links to Grandfathered
Material • Users must access the original standards for the guidance for pre-
75 XBRL Definitions December 31, 2008 grandfathered literature.

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 Working with the Codification

00 Status 16. XXX-YY-75 XBRL Definitions

05 Overview and Background
This Section is expected to contain the related XBRL
10 Objectives

15 Scope and Scope Exceptions

definitions for the Subtopic or relevant links to the
20 Topical Definitions—Glossary definitions.
25 Recognition

30 Initial Measurement

35 Subsequent Measurement

40 De-recognition

45 Other Presentation Matters

50 Disclosure

55 Implementation Guidance and

Illustrations

60 Relationships

65 Transition and Open Effective

Date Information

70 Links to Grandfathered
Material

75 XBRL Definitions

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 Working with the Codification
E. Securities and Exchange Commission (SEC) Sections
00 Status 1. Standards issued by the SEC is included for reference to improve the usefulness of the
Codification for public companies.
05 Overview and Background
2. The system attempts to embed relevant SEC content for reference in the same Topics and
10 Objectives
Subtopics as all other content.
15 Scope and Scope Exceptions 3. An "S" precedes the SEC Section codes.
20 Topical Definitions—Glossary a. All original SEC content remains essentially intact in the S99-SEC Materials Sections,
25 Recognition except that SEC observer comments made at EITF meetings are no longer shown with
30 Initial Measurement
the related material from EITF issues, some comments have been edited for
appropriate context. The other SEC Sections contain links to the relevant content
35 Subsequent Measurement
within the S99-SEC Materials Sections.
40 De-recognition b. The SEC Sections do not contain the entire population of SEC rules, regulations,
45 Other Presentation Matters interpretive releases and staff guidance.
50 Disclosure

55 Implementation Guidance and

EXAMPLE
Illustrations
The Codification does not include all content related to matters outside of the basic financial
60 Relationships
statements, such as Management's Discussion and Analysis (MD&A), or to auditing or
65 Transition and Open Effective
Date Information
independence matters.
70 Links to Grandfathered
Material c. There may be delays between SEC and staff changes and updates to the Codification.
75 XBRL Definitions d. The Codification does not replace or affect guidance issued by the SEC or its staff for
public companies in their filings with the SEC. Further, SEC staff guidance does not
constitute rules or interpretations of the SEC nor does such guidance bear official SEC
approval.

SEC
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 Working with the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
XXX-9XX: Industry 45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions
SZZ: SEC SECTION

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Working with the Codification

KEY POINT
• “S” indicates that it is an SEC Rule.

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Working with the Codification

F. Subsections
Subsections are a further segregation of a Section and, except for the
General Section, occur in a limited number of cases.
1. Each Section has at least one General Subsection.
2. A Section may contain additional Subsections as a means of
filtering content related to multiple Sections of the same Subtopic.
3. Unlike a Section, a Subsection is not numbered. A Subsection
differs from a paragraph heading because the Codification
research system provides a feature to combine all Subsection
content for a Topic.

KEY POINT
• This allows a user to combine all content related to acquisition, development, and
construction arrangements.

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Working with the Codification

G. Paragraph groups
Paragraph groups represent a series of related paragraphs under
the same paragraph heading.
1. The Topic structure allows paragraph groups to be
subordinated to other paragraph groups because of
dependencies.
2. Paragraph groups are presented in a hierarchy.
3. Within the Codification, one or more ">" symbols precede each
paragraph group heading. The number of ">" symbols
identifies the hierarchy among paragraph groups. For example,
the following illustrates the hierarchy of the paragraph group
headings:
a. > Statement of Financial Position Classification of Income
Tax Accounts
b. > > Deferred Tax Accounts
c. > > > Deferred Tax Accounts Related to an Asset or
Liability.

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Working with the Codification

H. Paragraphs
Paragraphs contain multipart numbers. The first part represents the
Section and the second part represents the sequential paragraph
number. Paragraph numbers restart at the beginning of each
Section.
1. To ensure accurate links, paragraph numbers will not change
over time. The content of a paragraph may be amended, but
the paragraph number will remain constant.
2. New paragraphs will be added using a letter extension.

EXAMPLE
A new paragraph inserted between paragraphs 50-5 and 50-6 would be 50-5A.

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Working with the Codification

I. Classification codes
The FASB developed a hybrid classification system specifically for
the Codification.
• The following is the structure of the classification system:
XXX-YY-ZZ-PP where:
1. XXX = Topic
2. YY = Subtopic
3. ZZ = Section
4. PP = Paragraph
In the case of SEC content, an "S" precedes the Section number.
XXX-YY-SZZ-PP where:
1. XXX = Topic
2. YY = Subtopic
3. SZZ = SEC Section
4. PP = Paragraph

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Working with the Codification

EXAMPLE
The classification codes for Leases are as follows:
•840 = Leases (Topic)
• 840-10 = Overall (Subtopic)
• 840-10-15 = Scope (Section)
• 840-10-50 = Disclosure (Section)
• 840-20 = Operating Leases (Subtopic)
• 840-20-15 = Scope (Section)
• 840-20-50 = Disclosure (Section)
• 840-30 = Capital Leases (Subtopic)
• 840-30-15 = Scope (Section)
• 840-30-50 = Disclosure (Section)

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Working with the Codification

Leases
Topic 840

Operating Capital
Overall Leases Leases
Subtopics 840:10
840:20 840:30

Scope Disclosure Scope Disclosure Scope Disclosure

Sections 840:10:15 840:10:50 840:20:15 840:20:50 840:30:15 840:30:50

Lessees Lessees Lessees Lessees Lessees Lessees

Subsections
Lessors Lessors Lessors Lessors Lessors Lessors

Note: This is for illustration only and does not include all Topics, Subtopics, Sections and Subsections

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 Working with/Using the Codification

As we look at the actual website, a few points to keep in mind:

• While conducting their surveys, the Codification project team found
that over 90% of the respondents expected that the content would
be accessible electronically.
• They also expressed strong interest in being able to navigate the
data a number of ways:
1. Browse by topic/menu
2. Key word
3. Codification site
4. GAAP standard

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 Working with/Using the Codification
Let’s go to the Codification home page: http://asc.fasb.org/home

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 Working with/Using the Codification

VII. After we log-in, we’ll be back to the homepage. Look at Browse/Menu

the homepage—along the left side of the homepage are Key word
the list of Areas (with Topics).
Codification
 If you are interested in the Revenue topic, you can click on
Revenue area and go straight to that topic. GAAP standard

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 Working with/Using the Codification

Area Topic

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 Working with/Using the Codification

Subtopic

Area Topic

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 Working with/Using the Codification

AREAS TOPICS SUBTOPICS SECTIONS

XXX XXX-YY XXX-YY-ZZ

100’s: General Principles XXX-10: Overall XXX-YY- 00:Status
05: Overview & Background
200’s: Presentation 10: Objectives
15: Scope & Scope Exceptions
300’s: Assets 20: Topical Definitions – Glossary
25: Recognition
400’s: Liabilities
90 30: Initial Measurement
35: Subsequent Measurement
500’s: Equity 40: De-recognition
XXX-9XX: Industry 45: Other Presentation Matters
600’s: Revenue 50: Disclosures
55: Implementation Guidance…
700’s: Expenses 60: Relationships
800’s: Broad Transactions 65: Transition & Open Effect…
70: Links to Grandfathered…
900’s: Industry 75: XBRL Definitions
SZZ: SEC SECTION

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 Working with/Using the Codification

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 Working with/Using the Codification

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 Working with/Using the Codification

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

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 Working with/Using the Codification

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 Working with/Using the Codification
This is the resulting report after selecting “Printer-Friendly with sources”

KEY POINT
Your result will not look like this if you
use the browser’s print function.

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 Working with/Using the Codification
Browse/Menu
VIII. Another way to find information on the CRS:
Use the Search feature located at the top right side of the homepage. Key word
• Let’s type “Multiple element arrangements” into the Search box. Codification

GAAP standard

Multiple element arrangements

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 Working with/Using the Codification
The subsequent screen indicates that there are 27 results for MEAs.

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 Working with/Using the Codification

• On the bottom right, we see the screen breaks down the results By Area. To the
right of each area, we see a number in parentheses. This indicates the number times
the result “Multiple element arrangement” comes up for each area.

Let’s check the

box for Revenue
and click “go”.

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 Working with/Using the Codification

• This brings us 11 results representing the MEA guidance regarding revenue

recognition that is contained within the Codification.

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 Working with/Using the Codification
Browse/Menu
IX. Cross-Reference Report
Key word

The codification includes a cross-reference report that Codification

allows users to identify where current standards reside GAAP standard

in the codification, or the source material that populates
a specific location.

However, certain standards that served to amend other literature may

no longer appear in the codification by the standard number. For
example:
A. FASB Statement No. 151, Inventory Costs, was an amendment of ARB No. 43,
chapter 4.
B. In the cross-reference report, users will no longer see FASB Statement No.
151; rather the amended material is reflected in ARB No. 43.
KEY POINT
Users should be aware of this when reviewing the codification, as some standards may appear to be
"missing," but are in fact incorporated into the standard(s) that they revised or updated.

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 Working with/Using the Codification
Browse/Menu
• Now let’s run a Cross Reference Report.
Look at the Accounting Standards Codification’s (ASC’s) top menu bar Key word
and select the “Cross Reference” tab.
Codification

GAAP standard

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 Working with/Using the Codification
• We know the Codification reference to the appropriate guidance, now let’s go back Browse/Menu
to the Standards (pre ASC)
• Type in the following under “By Codification”: Topic 605, Subtopic 25, Section 25 Key word
• Then select “Generate Report”
Codification

GAAP standard

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 Working with/Using the Codification

• The resulting report provides the sources “By Standard”, showing that the
Codification has brought forward the guidance contained in EITF 00-21.

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 Working with/Using the Codification
• ASC functionality also enables us to move from the standards to the codification. Browse/Menu
• Click the down arrow under standard type; A series of acronyms appears. Key word
• If we need clarification of what each acronym is, we can click on the following hot
link: Codification

GAAP standard

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 Working with/Using the Codification

By clicking on the hot link, you will see definitions of each of the standard types:

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 Working with/Using the Codification

Once we select EITF, a drop down box appears listing all the EITF’s in numeric sequence.
We can now select EITF 00-21.

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 Working with/Using the Codification
We know that EITF 00-21 provided guidance on
revenue recognition for MEAs.

Now we want to find out where all the guidance has

been incorporated into the standards.

Is there any guidance that isn’t under Topic 605,

Subtopic 25, Section 25?

The resulting report is several pages in length, this is

just the first page.

The report indicates that all of EITF 00-21 has been

incorporated into Topic 605

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 Working with/Using the Codification

X. Joining and combining content

By using consistent Sections, users can access functions within the Codification
Research System to combine similar types of content.

EXAMPLE
In the online Codification Research System, users can combine all Disclosure
Sections for a Topic without the need to access each individual Subtopic.

a. The functionality of the system enables users to produce a

comprehensive listing of all authoritative GAAP disclosures sorted by
Topic.
b. As familiarity with the Codification Research System advances, it is
expected that users will increasingly employ the Section organization
to streamline research efforts.
c. Subsections, the system allows users to combine subsections.

KEY POINT
Unlike the Join Section feature, the Combine Subsection feature combines the Subsections
based on the Subsection title.

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Working with/Using the Codification
The Leases Topic figure provides a visual illustration of two features of the online
Codification Research System—Join Sections and Combine Subsections.

Leases
Topic 840

Operating Capital
Overall Leases Leases
Subtopics 840:10
840:20 840:30

Scope Disclosure Scope Disclosure Scope Disclosure

Sections 840:10:15 840:10:50 840:20:15 840:20:50 840:30:15 840:30:50

Lessees Lessees Lessees Lessees Lessees Lessees

Subsections
Lessors Lessors Lessors Lessors Lessors Lessors

Note: This is for illustration only and does not include all Topics, Subtopics, Sections and Subsections

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Working with/Using the Codification

840:10:50 840:20:50 840:30:50

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 Working with/Using the Codification
• Now let’s explore the functionality of the menu item “Join Sections”.
The Join Sections function allows you to select Codification content that spans
multiple Topics and Subtopics.

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KEY POINT
• You must select a Topic AND a Section.
• No subtopic is selected
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 Working with/Using the Codification

The Topic drop down menu provides a choice of all the ASC Topic areas:

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 Working with/Using the Codification
Once the Topic is selected, the Section drop down box will provide only those sections that exist for the
selected topic.

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 Working with/Using the Codification

Once the Topic and Section are selected, click on the “Get Sections” button to generate a report
containing results for your search.

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 Working with/Using the Codification

The search for Topic 605,

Section 25 yielded these
results.
Checking boxes along the left
side of the window will enable
you to generate a custom
report containing only the
guidance you select.

After you’ve checked the

boxes, click on the “Join
Sections” button.

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 Working with/Using the Codification

This report has extracted the

guidance at 605-10-25 along
with 605-25-25.
Revenue Recognition with
multiple element
arrangements.

Moving the mouse over the

button labeled “Page
Functions” provides options
on how to print the report.

Selecting “Printer –Friendly

with sources, a sample of the
resulting report is on the next
page.

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 Working with/Using the Codification

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 What’s New

XI. What’s New

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 What’s New

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 Glossary

XII. Glossary

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 Glossary

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 Glossary

Portions of FASB Accounting Standards CodificationTM, copyright © by Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, are reproduced by permission.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 Working with/Using the Codification

Bottom Line:

• The FASB Accounting Standards Codification (ASC) site appears to be:

A. cleanly laid out
B. relatively intuitive to learn
C. fairly easy to use.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.

 What’s next?

I. Project Updates

FASB Accounting Standards Codification™

Last Updated: June 4, 2009

A. The Financial Accounting Standards Board (FASB) officially
completed the verification phase of the FASB Accounting Standards
Codification™ (Codification) in January 2009.
B. In June 2009, the FASB approved the Codification to be the single
official source of authoritative, nongovernmental U.S. generally
accepted accounting principles.
C. The codification is “live” July 1, 2009 and is effective for interim and
annual periods ending on or after September 15, 2009.
D. To improve usability, the Codification continue to include
authoritative content issued by the SEC, as well as selected SEC staff
interpretations.
E. Now, with the exception of any SEC or grandfathered guidance, all
other accounting literature not included in the Codification is deemed
non-authoritative.

© 2009 DeVry/Becker Educational Development Corp. Unauthorized reproduction is prohibited.