New Standard Clarifying Investment Company Status and Accounting
- The ASU changes the definition of when an entity qualifies to be an investment company, clarifies the characteristics of an investment company and provides comprehensive guidance for assessing whether the entity is an investment company.
- Under the ASU, an investment company also will be required to measure non-controlling ownership interests in other investment companies at fair value rather than using the equity method of accounting.
- There are additional disclosure requirements as a result of the ASU that should be incorporated into your year end financial statements.
The amendments in the ASU are effective for an entity’s interim and annual reporting periods in fiscal years that begin after December 15, 2013. Earlier application is prohibited.
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