Project Update

Reporting Discontinued Operations

Last updated on April 11, 2014. Please refer to the Current Technical Plan for information about the expected release dates of exposure documents and final standards.

(Updated sections are indicated with an asterisk *)

This project update summarizes the project activities and decisions of the IASB and the FASB (Boards). It was prepared by the staff and is for the information and convenience of their constituents. All decisions of the Boards are tentative, may change at future Board meetings, and do not change current accounting and reporting requirements. Decisions of the Boards become final only after extensive due process.

Project Objective
Due Process Documents
Decisions Reached at the Last Meeting
Tentative Board Decisions Reached to Date
Next Steps
Board/Other Public Meeting Dates
Background Information
Contact Information

Project Objective

The primary objective of the project is to improve the definition and reporting of discontinued operations. Some stakeholders have said that too many disposals of assets qualify for discontinued operations presentation. This results in financial statements that are not decision useful for users and in higher costs for preparers. The project will also enhance convergence of the FASB’s and the IASB’s reporting requirements for discontinued operations.

Due Process Documents

On April 10, 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360).

Download the Accounting Standards Update No. 2014-08

The FASB issued an Exposure Draft, Presentation of Financial Statements (Topic 205): Reporting Discontinued Operations on April 2, 2013. The comment period ended on August 30, 2013.

Download the Exposure Draft

Read comment letters on the Exposure Draft

Read the comment letter summary on the Exposure Draft

Read the FASB In Focus issued on April 2, 2013

The FASB and IASB previously issued a joint Exposure Draft, FASB Staff Position FAS 144-d, Amending the Criteria for Reporting a Discontinued Operation, on September 25, 2008. The comment period was 120 days, and it ended on January 23, 2009.

Download the Exposure Draft 

Read the comment letters on the Exposure Draft

Read the comment letter summary on the Exposure Draft

Decisions Reached at the Last Meeting (January 15, 2014)

See minutes below.

Tentative Board Decisions Reached to Date (As of January 23, 2014)


See Update No. 2014-08.

Next Steps

None.

Board/Other Public Meeting Dates

The Board meeting minutes are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions become final only after a formal written ballot to issue a final standard.

January 15, 2014 FASB Board Meeting—The Board redeliberated the effective date for nonpublic entities and the disclosure requirements for reporting Discontinued Operations. The Board directed the staff to draft an Accounting Standards Update.
November 13, 2013 FASB Board Meeting—The Board completed redeliberations in the development of an Accounting Standards Update about reporting Discontinued Operations. The Board directed the staff to draft a final Accounting Standards Update.
March 13, 2013 FASB Board Meeting—The Board deliberated whether to retain the cash-generating unit concept in the proposed definition of discontinued operation or to replace the cash-generating unit concept with the current definition of component of an entity in U.S. GAAP.
December 12, 2012 FASB Board Meeting—The Board deliberated the proposed disclosure requirements for public and nonpublic entities, disposals of subsidiaries in which the parent entity retains a noncontrolling interest, and whether the FASB should reaffirm its prior decision to issue a proposed Update on reporting discontinued operations and, if so, the length and timing of the comment period.
February 3, 2010 FASB Board Meeting—Scope of proposed Accounting Standards Update on FASB Accounting Standards Codification™ Subtopic 205-20, Presentation of Financial Statements—Discontinued Operations
December 17, 2009 Joint FASB and IASB Board Meeting—Definition and Disclosures of a Discontinued Operation
October 26, 2009 Joint FASB and IASB Board Meeting—Alternatives for a definition of a discontinued operation
August 26, 2009 FASB Board Meeting—Discussion of the user feedback received
July 21, 2009 IASB Board Meeting—The way forward with the project
July 23, 2008 Board Meeting—Board directed the staff to proceed to a draft of a proposed FSP
May 14, 2008 Board Meeting—Decisions related to the definition of Discontinued Operations, required disclosures for all components of an entity that have been (or will be) disposed of, effective date and transition, and proposed FSP comment period
April 18, 2007 Board Meeting—Agenda Decision
January 24, 2007 Board Meeting—Financial Statement Presentation: Discontinued Operations

Background Information

At its January 24, 2007 meeting on the financial statement presentation project, the Board agreed to revise the definition of a discontinued operation in FASB Statement No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. It also decided to require an entity to provide additional disclosures when reporting the disposal (or future disposal) of a component of the entity. At the January 25, 2007 IASB Board meeting, the IASB agreed to converge with the FASB’s revised definition of a discontinued operation.

During the deliberations leading to the revised definition, the Board asked the staff to research the amount of the staff’s and the Board’s time necessary to create a separate project for this issue, effectively removing it from the scope of the financial statement presentation project. In February 2007, the staff received six letters from constituents, including NAREIT, in support of the revised definition and asked the IASB and the FASB to issue the revised guidance on an accelerated basis. In April 2007, the FASB and IASB Boards agreed to address the guidance for reporting discontinued operations and any related disclosure issues separately from the financial statement presentation project.

On September 25, 2008 the FASB and IASB Boards issued joint Exposure Drafts, FASB Staff Position FAS 144-d, Amending the Criteria for Reporting a Discontinued Operation which proposed amendments to FASB Statement No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets and the IASB’s Exposure Draft, Discontinued Operations. The comment period for those Exposure Drafts ended on January 23, 2009.

The Boards’ redeliberation of those exposure documents in 2009 and 2010 resulted in a nearly converged definition of a discontinued operation that would not be significantly different from the one included within IFRS. In April 2010, all five FASB Board members voted to issue a revised Exposure Draft due to the significant changes that were made during redeliberations. Subsequently, the Boards decided to focus their efforts on other convergence projects and the proposed revised Update was never issued. In November 2012, the Board decided to resume the work on the project, which led to the issuance of the proposed Accounting Standards Update, Presentation of Financial Statements (Topic 205): Reporting Discontinued Operations.

Contact Information

Phil Hood
Project Manager
prhood@fasb.org

Victoria McMillen
Postgraduate Technical Assistant
vmmcmillen@fasb.org