Project Update

Conceptual Framework

Project Information Page

Last updated on July 3, 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 *)

The staff has prepared this summary of Board decisions for information purposes only. Those Board decisions are tentative and do not change current accounting. Official positions of the FASB are determined only after extensive due process and deliberations.

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

*OVERVIEW

This page contains information pertinent to the overall Conceptual Framework project. For specific details about each topic, please refer to the links below:

Active Topics
Measurement
Presentation
Disclosure

Inactive Topics
Elements and Recognition
Reporting Entity

*PROJECT OBJECTIVE

The objective of the conceptual framework project is to develop an improved conceptual framework that provides a sound foundation for developing future accounting standards. Such a framework is essential to fulfilling the Board’s goal of developing standards that are principles based, internally consistent, and that lead to financial reporting that provides the information capital providers need to make decisions in their capacity as capital providers. The new FASB framework will build on the existing framework.

*Decisions Reached at the Last Meeting (June 18, 2014)

The Board discussed whether and how to proceed with the conceptual framework project and decided to begin with presentation and measurement followed by the liability-equity distinction.

Presentation

The Board decided the following two presentation concepts should be further developed:

  1. Information should be grouped into reasonably homogeneous groups. Line items or subtotals that include items that have similar characteristics in more than one respect are likely to provide more information about prospects for future cash flows than if their characteristics are dissimilar.
  2. The association between changes in assets, liabilities, and equity instruments and the assets, liabilities, and equity instruments that changed should be made apparent in the financial statements (or in the financial statements and notes).

Measurement

The Board discussed how to proceed with developing concepts related to measurement, including:

  1. Agreeing on the meanings of key terms and what the objectives and qualitative characteristics imply for measurement
  2. Identifying appropriate types of measurements
  3. Determining which measurements to use in specific circumstances.

*Tentative Board Decisions Reached to Date (June 18, 2014)

See "Decisions Reached at the Last Meeting" above.

*Next Steps

The Board will discuss factors, or possible groupings, to consider when determining which line item(s) individual recognized items should be included within.

*Due Process Documents

Please refer to the measurement, presentation, disclosure, recognition and elements and reporting entity project pages for due process documents issued related to each of those topics.

*BOARD/OTHER PUBLIC MEETING Dates

The FASB meeting minutes are provided for the information and convenience of constituents who want to follow the Boards’ 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 Accounting Standards Update.

*June 18, 2014 Board Meeting—The Board discussed how to proceed with the conceptual framework project

Please refer to the measurement, presentation, and disclosure project pages for current Board meeting minutes related to each of those topics within the broader Conceptual Framework project.

*BACKGROUND INFORMATION

In October 2004, the FASB and the IASB added to their agendas a joint project to develop an improved, common conceptual framework that builds on their existing frameworks (that is, the IASB’s Framework for the Preparation and Presentation of Financial Statements and the FASB’s Statements of Financial Accounting Concepts).

In 2010, the FASB and the IASB issued two chapters of a revised conceptual framework as a part of Concepts Statement No. 8, Conceptual Framework for Financial Reporting. These chapters became effective as soon as they were published and now form part of the FASB’s existing Conceptual Framework.
  1. Chapter 1, The Objective of General Purpose Financial Reporting
  2. Chapter 3, Qualitative Characteristics for Useful Financial Information
In addition to finalizing these chapters, the FASB and IASB also did the following:
  1. Published Preliminary Views, Conceptual Framework for Financial Reporting: The Reporting Entity, and a proposed Concepts Statement, Conceptual Framework for Financial Reporting: The Reporting Entity
  2. Discussed the definition of the elements of financial statements
  3. Discussed and held public roundtable meetings about measurement concepts.
In 2010, the IASB and the FASB suspended work on the joint conceptual framework to concentrate on other projects on their agendas.

On January 29, 2014, the FASB Chairman, in consultation with the other Board members, decided that the FASB would perform research on the conceptual framework project. This project is no longer being conducted with the IASB.

CONTACT INFORMATION

Jill Switter
Project Manager
jmswitter@fasb.org

Jim Leisenring
Senior Advisor
jjleisenring@fasb.org

Ron Lott
Senior Technical Advisor
rwlott@fasb.org

Jaffer Alqamoussi
Postgraduate Technical Assistant
jealqamoussi@fasb.org