Defining Issues | October 2023
ASU 2023-06 updates US GAAP disclosures in response to the SEC’s disclosure update and simplification initiative.
The SEC’s August 2018 release, Disclosure Update and Simplification, referred certain of its disclosure requirements that overlap with US GAAP but provide incremental information to the FASB for potential incorporation into the FASB’s Accounting Standards Codification. Several of the FASB’s changes apply to private and not-for-profit entities in addition to public entities.
Effective date | Entities subject to the existing SEC disclosure requirements, including those preparing for sale or issuance of securities | All other entities |
---|---|---|
Each amendment will be effective | As of the effective date to remove the related disclosure from Reg S-X or S-K. | Two years later |
Early adoption allowed? | No | Yes |
ASU 2023-06 incorporates into the Codification several disclosures and presentation requirements currently residing in SEC Regulations S-X and S-K.
As a result, the ASU is not expected to significantly affect entities currently subject to these SEC requirements. However, certain disclosures currently presented outside the financial statements as a result of Regulation S-K may need to be relocated into the financial statements.
Conversely, the ASU adds requirements for private and not-for-profit entities, including new disclosures about:
Disclosure of the weighted-average interest rates on short-term borrowings and repurchase liabilities is required only for public business entities.
If by June 30, 2027, the SEC has not removed the existing disclosure requirement from Regulations S-X or S-K, the corresponding disclosure pending requirement will be removed from the Codification and will not become effective for any entities. The ASU is applied prospectively.
FASB proposes disclosure changes
KPMG reports on the proposed ASU to update disclosures in response to the SEC’s disclosure initiative.
SEC matters
Keeping you up to date about SEC staff positions on reporting matters and proposed rulemaking that will affect registrants
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