Posted by & filed under Debt, Equity-Linked Transactions, Indexed to Own Stock.

With ASU No. 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity‚Äôs Own Equity (Subtopic 815-40), the FASB took the long-overdue step of simplifying its accounting models applicable to convertible instruments. Among the changes is the complete elimination of the beneficial conversion feature (BFC). The changes in 2020-06 can be applied as early as fiscal years beginning after December 15, 2020 (the early adoption date)…so as of January 1, 2021, for calendar year reporting entities. Do it!

Comments are closed.