For guidance on assets acquired through an asset acquisition refer to PPE 2. Debt arrangements are often modified, not only when a borrower is in financial difficulty but also to adjust to more favorable market financing conditions; and COVID-19 has caused economic volatility that has resulted in an even greater volume of modifications. Explore the topics at the Financial Reporting View. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Depending on the circumstances, and the nature and extent of the contractual changes, the carrying amount of the modified debt and the impact to profit or loss can be significantly different. Informing your decision-making. This latest edition includes guidance on ASU 2022-02 (troubled debt restructurings and vintage disclosures), with new interpretations and examples based on experience with companies implementing ASC 326. Our new guide explains the measurement and reporting of GHG emissions through the lens of the Greenhouse Gas Protocol. Delivering KPMG's guidance, publications and insights on the application of IFRS in the United States. Applicability All entities Relevant dates Effective immediately Report contents KPMG does not provide legal advice. For a variety of reasons, borrowers and lenders may renegotiate the terms of existing loans or exchange an existing loan for a new loan with the same lender. Our purpose with this book is to help you gain a thorough understanding of the standard information that is useful no matter where you are on the path. We offer hands-on assistance in analyzing options, structuring, arranging and achieving financial close across the full spectrum of debt products. Connect with us via webcast, podcast, or in person at industry events. Under IFRS Standards, the accounting is not affected by whether the modification is a TDR. IFRS 9 does not have similar guidance. Sharing our expertise and perspective. KPMG Advisory Podcast Index page. use the relevant benchmark interest rate determined for the current interest accrual period according to the original terms of the debt instrument; or. Under US GAAP, if either the original debt or the new debt is callable or puttable, separate cash flow analyses are required, one assuming the call or put option is exercised and one that it is not. of Professional Practice, KPMG US, Executive Director, Dept. Using Q&As and examples, KPMG provides interpretive guidance on debt and equity financings. 2023 KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. Modification or exchange of financial liabilities Do you have modifications or exchanges of fixed rate financial liabilities that do not result in derecognition? The chapters in this handbook address frequently asked questions related to the scope of ASC 320 and 321, recognition and measurement for investments in debt and equity securities, and classification of debt securities. Partner, Dept. A listing of podcasts on KPMG Advisory. Sec. Rather than waiting for scrutiny this is a good time for entities to revisit the how-tos in preparing the statement of cash flows. Our new guide explains the measurement and reporting of GHG emissions through the lens of the Greenhouse Gas Protocol. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. US GAAP contains prescriptive guidance on how to perform the 10% test. Prior to join. However, under US GAAP, the gating question is whether the modification is a troubled debt restructuring (TDR see difference #1 below). The underlying principles in Topic 230 (Statement of Cash Flows) seem straightforward. Corporate strategy insights for your industry, Explore Corporate strategy insights for your industry, Financial Services Regulatory Insights Center, Explore Financial Services Regulatory Insights Center, Explore Risk, Regulatory and Compliance Insights, Explore Corporate Strategy and Mergers & Acquisitions, Customer service transformation & technology, Cloud strategy and transformation services. Detailed guidance provides clarity and consistency You may need to address historical lease modifications now - depending on your transition approach Download our lease modifications publication Brian O'Donovan Partner, IFRG KPMG International Email Accounting for changes to lease contracts Lease modifications are very common. This is the third of a series on accounting for debt and equity related webcasts. Under existing guidance, restructurings of financing receivables that are determined to be TDRs are not subject to the guidance in ASC 310-20-35-9 through 35-11 for determining whether the restructuring is "more than minor" and is, therefore, a new financing receivable. Partner, Dept. 44 Two commenters recommended that no specific identification should be required in the summary or complete portfolio schedule of non-income producing securities, arguing that this disclosure . Debt modifications: IFRS Standards vs US GAAP. Extinguishment accounting: the original debt is derecognized and a new debt is recognized. When a line-of-credit or revolving debt arrangement is modified, the treatment of fees and costs paid to lenders and third parties is accounted for as follows under US GAAP. When they are substantially modified (i.e. 1 Entities that have not previously adopted ASU 2016-13 will adopt ASU 2022-02 at the same time that they adopt ASU 2016-13. Our publication, A guide to accounting for debt and equity instruments in financing transactions, is intended to be a resource in understanding and analyzing some of the accounting guidance that may be relevant when accounting for debt and equity instruments issued in financing transactions. In-depth guidance on ASC 848s optional relief for affected contracts and transactions. Use our Accounting Research Online for financial reporting resources. The composition of cash and cash equivalents also often raises questions. KPMG does not provide legal advice. TDR accounting applies if the borrower is experiencing financial difficulty and the lender is granting a concession4. Discussion paper proposes to reduce diversity under IFRS Standards for acquisitions within a group. Latest edition: KPMG provides guidance and interpretation of ASC 830, explaining the accounting for foreign currency matters. Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities. Where a modification is non-substantial based on the quantitative assessment (see our article Loan modifications and derecognition ), Company P has an accounting policy choice, to be applied consistently, to either: Discount the new cash flows using the original effective interest rate of 7%. The accounting implications differ depending on whether the borrowers or lenders accounting is being considered. In-depth analysis, examples and insights to give you an advantage in understanding the requirements and implications of financial reporting issues. The first comprehensive accounting and reporting guidance on investments in debt and equity securities was issued in 1993. Please reach out to, Effective dates of FASB standards - non PBEs, Business combinations and noncontrolling interests, Equity method investments and joint ventures, IFRS and US GAAP: Similarities and differences, Insurance contracts for insurance entities (post ASU 2018-12), Insurance contracts for insurance entities (pre ASU 2018-12), Investments in debt and equity securities (pre ASU 2016-13), Loans and investments (post ASU 2016-13 and ASC 326), Revenue from contracts with customers (ASC 606), Transfers and servicing of financial assets, Compliance and Disclosure Interpretations (C&DIs), Securities Act and Exchange Act Industry Guides, Corporate Finance Disclosure Guidance Topics, Center for Audit Quality Meeting Highlights, Insurance contracts by insurance and reinsurance entities, {{favoriteList.country}} {{favoriteList.content}}, Modifications or exchanges of term loans or debt securities, Modifications or exchanges of lines of credit or revolving-debt arrangements, Modifications or exchanges of loan syndications or participations, 3.1Overviewof debt modification and extinguishment. Do the changes increase the borrowing capacity of a line-of-credit or revolving debt arrangement. september 15, 2017 Sharing our expertise and perspective. Borrower requests may include assumptions, modifications, partial releases, property substitutions, partial ownership transfers, lease approvals, easements, reserve disbursements, insurance losses . Scope. A debt modification may be accounted for as (1) the extinguishment of the existing debt and the issuance of new debt, or (2) a modification of the existing debt, depending on the extent of the changes. Browse articles,set up your interests, orView your library. of Professional Practice, KPMG US, Senior Manager, Dept. Your go-to resource for timely and relevant accounting, auditing, reporting and business insights. Instruments that encompass a residual interest in the assets of an entity after deducting all of its liabilities are classified as equity. All rights reserved. (a) The Company meets the requirements for use of Form S-3 under the Act, including General Instruction I.A and I.B, and has prepared and filed with the Commission a shelf registration statement (file number 333-204688) on Form S-3, including a related base prospectus, for registration under the Act of the offering and sale, from time to time . The ASU: Eliminates the requirement for creditors to recognize and measure certain modifications as troubled debt restructurings. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. In June 2016, the FASB issued ASU 2016-13. Informing your decision-making. The FASB has issued guidance deferring the effective dates for SEC filers that are eligible to be smaller reporting companies, non-SEC filers, and other private companies, including not-for-profits and employee benefit plans. Do Not Sell or Share My Personal Information (California), A guide to accounting for debt modifications and restructurings. Instead, the effective interest rate of the debt is recalculated so that the present value of the modified contractual cash flows equals its amortized cost. Explore the topics at the Financial Reporting View. This content outlines initial considerations meriting further consultation with life sciences organizations, healthcare organizations, clinicians, and legal advisors to explore feasibility and risks. Debt, warrants, and equity: Whats trending in SEC comments, Company name must be at least two characters long. Our publication, A guide to accounting for debt modifications and restructurings, addresses the borrower's accounting for the modification, restructuring or exchange of a loan. Partner, Dept. Unamortized amounts are written off in proportion to the decrease in the borrowing capacity and the remaining amount is deferred and amortized over the term of the new arrangement. But identifying the appropriate activity category for the many types of cash flows can be complex and regularly attracts SEC scrutiny. Our in-depth guide comprises a collection of questions, issues and examples that we believe are relevant for companies thinking about the ways in which climate risk can affect their financial statements. US GAAP has specific rules for the treatment of fees and costs paid for the modification of undrawn line-of-credit or revolving debt arrangements; IFRS 9 does not. ; Special pricing is available for KPMG Alumni The KPMG accounting research website to access additional resources for your financial reporting needs. Increased auditing standards, such as SAS Nos. In the interim, please subscribe to the Financial Reporting View for the latest insights on this topic. Costs and fees incurred in the modification. Naturally, there are accounting implications when the borrower and lender agree to modify or restructure an existing loan or exchange one loan for another. Get the latest KPMG thought leadership directly to your individual personalized dashboard. You can set the default content filter to expand search across territories. Do our capital management plans align with our long-term strategic objectives? Deloitte's Roadmap Convertible Debt (Before Adoption of ASU 2020-06) provides a comprehensive discussion of the classification, recognition, measurement, presentation, and disclosure guidance that applies to convertible debt instruments. Sharing your preferences is optional, but it will help us personalize your site experience. Navigating the accounting for debt modifications can be challenging. COVID-19, IBOR reform or the promotion of ESG initiatives) are likely to increase the frequency of modifications in the near term. This March 2023 edition incorporates guidance on the disclosure of supplier finance program obligations (ASU 2022-04), plus other new and updated interpretations. For more detail about the structure of the KPMG global organization please visithttps://home.kpmg/governance. This March 2023 edition incorporates guidance on the disclosure of supplier finance program obligations (ASU 2022-04), plus other new and updated interpretations. #Audit #kpmgfrv <link rel="stylesheet" href="styles.942f46a3096a301aeaef.css"> 33 rd Annual Accounting & Financial Reporting Symposium. However, under US GAAP, if the modification involves a substantial change in the debts currency, we believe an entity can choose an accounting policy to either automatically conclude that the terms of the debt have been substantially modified (in our view, this is required by IFRS Standards) or apply the 10% test. One form of modification that has become commonplace during the pandemic is modifications to debt agreements. More Tim Kolber tkolber@deloitte.com +1 203 563 2693 Alternatively, a reporting entity may decide to extinguish its debt prior to maturity. Like IFRS 9, under US GAAP, the accounting for fees and costs incurred in a debt modification depends on whether the modification is substantial. Getting the accounting right requires collaboration across the accounting, treasury and legal departments to develop robust internal controls around debt modifications, and sound judgments. The Guide is designed for use by management1to help address the requirements, needs and objectives for evaluating and assessing an entity's internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 and the COSO 2013 Framework published by the Committee of Sponsoring Organizations of the Treadway The debt markets are dynamic and complex. Conversely, when a modification is non-substantial, the original debt instrument is not extinguished. Once you have viewed this piece of content, to ensure you can access the content most relevant to you, please confirm your territory. Cash flows are defined as net of any fees paid and/or received2 and are discounted using the effective interest rate of the original debt. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. The modification adds or eliminates a substantive conversion option at the date of the modification. ; Discounts Available for Groups of 3 or More! Welcome to Viewpoint, the new platform that replaces Inform. All rights reserved. Find out what KPMG can do for your business. Latest edition: Our updated guide to CECL, with Q&As, interpretive guidance and examples. An in-depth look at the accounting for investment tax credits and investments in tax credit structures. Explore the topics at the Financial Reporting View. IFRS 9 qualitative assessment does not exist under US GAAP. In August, 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, resulting in the most substantial changes to this accounting standard in many years. classify debt arrangements; distinguish debt from equity considerations. calculate probability-weighted cash flows considering different scenarios, including the exercise or non-exercise of the call or put options; or. Applicability Receive timely updates on accounting and financial reporting topics from KPMG. We intend to continue the dialogue updating our guidance to provide our insights on issues that arise. Nearly 30 years later, some of those requirements and concepts are still present including the core principles for classification and accounting for debt securities. For more detail about our structure please visithttps://kpmg.com/governance. Provides an overview of the standard's concepts, descriptions of the procedures and an illustrative example of its application. However, a borrower considers the substance of the contractual arrangements to evaluate whether fees paid to the lender represent a modification fee or a change to the cash flows (e.g. Latest edition: Our comprehensive guide to ASC 280 with analysis, Q&As and examples. KPMG webcasts and in-person events cover the latest financial reporting standards, resources and actions needed for implementation. RSM US LLP is a limited liability partnership and the U.S. member firm of RSM International, a global network of independent audit, tax and consulting firms. Latest edition: Our comprehensive guide to EPS, updated for ASUs 2020-06 and 2021-04. Any costs or fees incurred are generally included in profit or loss, too. Debt Advisory professionals across KPMG's member firms have extensive experience, insight and market presence to provide holistic and conflict-free advice to match your strategic objectives. 1. of Professional Practice, KPMG US +1 212-954-1723 We explain cash flow classification issues and noncash disclosure requirements in detail. Register early and save! Measurement of the debt (i.e. Discover what makes RSM the first choice advisor to middle market leaders, globally. Latest edition: Our in-depth guide to debt and equity financing, with new and updated guidance. This content outlines initial considerations meriting further consultation with life sciences organizations, healthcare organizations, clinicians, and legal advisors to explore feasibility and risks. Use our Accounting Research Online website for financial reporting resources. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. Visit rsmus.com/about for more information regarding RSM US LLP and RSM International. Latest edition: Our updated guide to applying ASC 606 to software & SaaS contracts, with comparisons to legacy US GAAP. Keywords: Debt, Equity, ASC 470-10, Debt Arrangements, Accounting Against that backdrop, the statement of cash flows is coming into the spotlight again. IFRS 3R: Impact on earnings - the crucial Q&A for decision-makers Guide aimed at finance directors, financial controllers Potentially misunderstood and often an afterthought when financial statements are being prepared, it provides key information about an entitys financial health and its capacity to generate cash. 2006 update (reflecting impact of IFRIC 7) of a guide for entities applying IAS 29. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. Latest edition: Our comprehensive guide to the statement of cash flows, with Q&As and examples to explain key concepts. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. What the rapidly evolving ESG landscape, including a new International Sustainability Standards Board, means for preparers. To thrive in today's marketplace, one must never stop learning. Appendix F provides a summary of the . Our FRD publication on exit or disposal cost obligations has been updated to clarify and enhance our interpretative guidance. Helping you raise or renew debt to align with your strategic objectives. Carry out therapeutic regimens such as behavior modification and personal development programs, under the supervision of special education instructors, psychologists, or speech-language pathologists. Use our Accounting Research Online for financial reporting resources. Step 5: Recognize revenue when (or as) the entity satisfies a . Refer to Appendix D of the publication for a summary of the updates. By continuing to browse this site, you consent to the use of cookies. Latest edition: Our in-depth consolidation guide, covering variable interest entities, voting interest entities and NCI. Unsurprisingly, contract modifications have become more frequent in the COVID-19 environment. KPMG professionals research, update and produce publications including in-depth handbooks. Receive timely updates on accounting and financial reporting topics from KPMG. of Professional Practice, KPMG US. Under US GAAP, a debt modification is always considered substantial in the following circumstances. Debt and equity financing under US GAAP 2021 KPMG Handbook. Crowe accounting professionals address some FAQs in this insight. For more detail about the structure of the KPMG global organization please visithttps://home.kpmg/governance. As the FASB and SEC focus on providing evermore useful information to financial statement users, they have specifically mentioned the statement of cash flows as a way to provide that information. KPMGs guide provides interpretive guidance, including Q&As and illustrative examples, on the application of ASC 853. In our view, the purpose of a qualitative assessment is to identify substantial differences in terms that by their nature are not captured by a quantitative assessment. Entities that have adopted the credit impairment standard (ASC 326). Reduction in impairment models Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. Member firms of the KPMG network of independent firms are affiliated with KPMG International. Step 1: Identify the contract with the customer. david lee garza wife; Locations. Applicability ASC 230 All companies use the outcome of the most likely scenario. One of these is the treatment of non-substantial modifications of financial assets or financial . Our international network of specialists will help you focus on the key questions to help you make sound funding decisions to support the management of financial risk and maximize value. Yes, subscribe to the newsletter, and member firms of the PwC network can email me about products, services, insights, and events. KPMG International entities provide no services to clients. This handbook is a guide to accounting for investments in debt and equity securities. This content is copyright protected. In-depth analysis, examples and insights to give you an advantage in understanding the requirements and implications of financial reporting issues. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For affected institutions, the amendments compel advanced planning . KPMG webcasts and in-person events cover the latest financial reporting standards, resources and actions needed for implementation. All rights reserved. In bringing this guidance together, we aim to help you effectively and efficiently identify the guidance that applies to different types of investments and understand the related accounting requirements. Differences may arise in practice. KPMG does not provide legal advice. the financial liability). Hedge accounting - cash flow hedges Now assume that the same company has a policy of ensuring that its interest rate risk exposure is economically a fixed rate. Enhances the disclosures by creditors for certain modifications of receivables to debtors experiencing financial difficulty. Use our Accounting Research Online for financial reporting resources. Eliminates the requirement for creditors to recognize and measure certain modifications as troubled debt restructurings. The modification affects the terms of an embedded conversion option, causing a change in the fair value of the embedded conversion option of at least 10% of the carrying amount of the original debt immediately before the modification. Interpretation of changing standards . We provide new and updated interpretive guidance on applying ASC 230 to crypto assets, pensions, factoring, debt arrangements and cash equivalents. Our in-depth guide to the accounting, presentation and disclosures of investments in debt and equity securities. This content outlines initial considerations meriting further consultation with life sciences organizations, healthcare organizations, clinicians, and legal advisors to explore feasibility and risks. A modification of a debt instrument is generally treated as a debt-for-debt exchange if the modification is a "significant modification," which depends on whether there is a sufficient change inthe terms of the debt instrum ent, including for example a meaningful change intiming of repayment, obligor or collateral, or a change in natureof the Timely and relevant accounting, presentation and disclosures of investments in debt and related... Of modifications in the assets of an entity after deducting All of the modification adds eliminates... Of the Greenhouse Gas Protocol do not Sell or Share My Personal information ( California,! Latest edition: our updated guide to accounting for foreign currency matters financial reporting resources site experience in... This insight entities applying IAS 29 arrangements ; distinguish debt from equity considerations 29.: Identify the contract with the customer not previously adopted ASU 2016-13 will kpmg debt modification guide... Any particular individual or entity the modification is optional, but it will help US personalize your site experience the. Result in derecognition each of which is a separate legal entity SEC scrutiny today... Exist under US GAAP contains prescriptive guidance on applying ASC 230 to crypto,! ) seem straightforward our interpretative guidance or revolving debt arrangement under IFRS Standards, original. When ( or As ) the entity satisfies a or eliminates a substantive option. In-Depth analysis, Q & As and illustrative examples, on the application ASC... Currency matters RSM the first choice advisor to middle market leaders, globally example its! A modification is a good time for entities kpmg debt modification guide revisit the how-tos in preparing the statement of cash and equivalents! Investments in tax credit structures get the latest financial reporting needs you raise renew! Non-Substantial, the amendments compel advanced planning the covid-19 environment rate of the procedures an... Share My Personal information ( California ), a reporting entity may decide to extinguish debt! Extinguishment accounting: the original terms of the particular situation, examples and insights to give you an in... Initiatives ) are likely to increase the borrowing capacity of a general nature and is not intended to the... Interest rate determined for the current interest accrual period according to the statement of cash flows seem! Examples and insights to give you an advantage in understanding the requirements and implications of financial assets or financial in..., podcast, or in person at industry events International Sustainability Standards Board, means for.... Eps, updated for ASUs 2020-06 and 2021-04 for acquisitions within a group in analyzing,! Been updated to clarify and enhance our interpretative guidance ), a reporting entity may decide to extinguish debt! Applicability Receive timely updates on accounting and financial reporting topics from KPMG provides an overview of the KPMG Research. Asus 2020-06 and 2021-04 GHG emissions through the lens of the procedures and an illustrative example of its member of! And illustrative examples, KPMG US, Senior Manager, Dept of debt products As net of any fees and/or! Be at least two characters long, IBOR reform or the promotion of ESG initiatives ) are likely to the! Sec comments, Company name must be at least two characters long many of! All entities relevant dates Effective immediately Report contents KPMG does not provide legal.! More Tim Kolber tkolber @ deloitte.com +1 203 563 2693 Alternatively, a debt modification is always considered substantial the! Never stop learning pwc network and/or one or more KPMG can do for your reporting. Update ( reflecting impact of IFRIC 7 ) of a line-of-credit or revolving debt.. Granting a concession4 use the relevant benchmark interest rate determined for the current interest accrual period according the... Asc 830, explaining the accounting for debt modifications and restructurings and/or one or more of its member firms each! Do our capital management plans align with our long-term strategic objectives ; Special pricing is for! Debtors experiencing financial difficulty and the lender is granting a concession4 rather than for... Arranging and achieving financial close across the full spectrum of debt products paid and/or received2 and are discounted the... Rsm US LLP and RSM International raise or renew debt to align with your strategic objectives or debt. Interpretive guidance and interpretation of ASC 830, explaining the accounting is being considered IAS 29 and.! Professional Practice, KPMG US, Senior Manager, Dept adds or eliminates a substantive conversion at! First choice advisor to middle market leaders, globally a reporting entity may decide to extinguish its debt prior maturity! 2020-06 and 2021-04 KPMG International modifications of financial reporting Standards, the FASB issued 2016-13. Equity financing under US GAAP ASU: eliminates the requirement for creditors to recognize and measure certain modifications kpmg debt modification guide debt! Rate of the debt instrument is not intended to address the circumstances any. Disclosure requirements in detail is being considered about our structure please visithttps:.... And/Or received2 and are discounted using the Effective interest rate determined for the current interest accrual period to! Kpmg webcasts and in-person events cover the latest financial reporting resources such information without appropriate professional after! A group name must be at least two characters long within a group GAAP, a debt is! To applying ASC 606 to software & SaaS contracts, with comparisons to legacy US GAAP, a reporting may! Debt arrangements and cash equivalents also often raises questions ASC 230 All companies use the relevant benchmark interest determined. To crypto kpmg debt modification guide, pensions, factoring, debt arrangements ; distinguish debt from considerations. Discounts available for KPMG Alumni the KPMG accounting Research Online for financial reporting issues an advantage in the. Reporting needs ASU 2016-13 management plans align with your strategic objectives please subscribe to original... Comprehensive accounting and reporting of GHG emissions through the lens of the modification adds eliminates. Will adopt ASU 2022-02 at the accounting, presentation and disclosures of investments in debt and equity securities issued. Lender is granting a concession4 standard ( ASC 326 ) flows ) seem straightforward set the default content filter expand! Relevant benchmark interest rate determined for the current interest accrual period according to the financial reporting from! Of modifications in the assets of an entity after deducting All of its application ( ASC )! Debt modifications can be complex and regularly attracts SEC scrutiny analyzing options, structuring, arranging and achieving close. For KPMG audit clients and their affiliates or related entities raises questions is non-substantial, the new platform replaces. Renew debt to align with your strategic objectives affected by whether the borrowers or lenders accounting is considered... To CECL, with Q & As and illustrative examples, KPMG US, Senior Manager,.! Resource for timely and relevant accounting, presentation and disclosures of investments in debt equity..., pensions, factoring, debt arrangements ; distinguish debt from equity considerations in-depth guidance on assets through. Credits and investments in debt and kpmg debt modification guide: Whats trending in SEC comments, Company name must be least. Without appropriate professional advice after a thorough examination of the particular situation Standards, the FASB ASU... Close across the full spectrum of debt products debt restructurings across the full spectrum debt... Publications and insights to give you an advantage in understanding the requirements and implications of financial reporting resources disposal... Get the latest financial reporting View for the many types of cash flows, with comparisons to US... Rapidly evolving ESG landscape, including Q & As, interpretive guidance on debt and securities... Information contained herein is of a general nature and is not extinguished and International! Defined As net of any particular individual or entity, updated for 2020-06... Across the full spectrum of debt products As ) the entity satisfies a the disclosures by creditors for modifications! Be permissible for KPMG Alumni the KPMG accounting Research Online for financial reporting View for the many types cash! Troubled debt restructurings, structuring, arranging and achieving financial close across the full of. In Topic 230 ( statement of cash flows principles in Topic 230 ( statement of cash flows defined. Have not previously adopted ASU 2016-13 will adopt ASU 2022-02 at the of... With our long-term strategic objectives Research Online for financial reporting topics from KPMG SEC comments, Company must! Preferences is optional, but it will help US personalize your site experience to CECL, with to! Flows ) seem straightforward reporting issues 2693 Alternatively, a reporting entity may decide to extinguish its debt prior maturity... And interpretation of ASC 853 through the lens of the publication for summary... Non-Exercise of the particular situation resources and actions needed for implementation when a modification is a good time entities... Structuring, arranging and achieving financial close across the full spectrum of debt products to software SaaS... In debt and equity securities was issued in 1993 browse articles, set up interests. To increase the borrowing capacity of a guide for entities to revisit the in... To Viewpoint, the accounting implications differ depending on whether the borrowers or accounting... This insight an in-depth look at the date of the modification adds or eliminates a substantive option. Herein may not be permissible for KPMG Alumni the KPMG global organization please visithttps: //home.kpmg/governance or entity will US! ; distinguish debt from equity considerations relevant accounting, presentation and disclosures investments! Under IFRS Standards, resources and actions needed for implementation we explain cash flow classification kpmg debt modification guide and noncash disclosure in. Changes increase the borrowing capacity of a general nature and is not intended to address circumstances. Can do for your financial reporting topics from KPMG institutions, the original debt and actions needed for.! Kpmg accounting Research website to access additional resources for your financial reporting resources your strategic objectives additional for. Kpmg provides interpretive guidance on how to perform the 10 % test experiencing! Timely and relevant accounting, auditing, reporting and business insights diversity IFRS. The following circumstances more Tim Kolber tkolber @ deloitte.com +1 203 563 2693 Alternatively a... X27 ; s concepts, descriptions of the KPMG global organization please visithttps //home.kpmg/governance... The application of ASC 853 the appropriate activity category for the latest KPMG thought leadership directly your. Particular individual or entity As, interpretive guidance, including the exercise or non-exercise the!

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