FASB Issues Staff Q&A on Accounting for The Effects of The Tax Cuts and Jobs Act

The Financial Accounting Standards Board (FASB) staff has issued a Staff Q&A document on whether private companies and not-for-profit organizations can apply U.S. Securities and Exchange Commission (SEC) Staff Accounting Bulletin (SAB) No. 118 (Topic 5.EE, Income Tax Accounting Implications of the Tax Cuts and Jobs Act). In the Q&A, the FASB staff indicates that they would not object to private companies and not-for-profit organizations applying SAB 118.

SAB 118 provides that in certain circumstances an entity may include in its financial statements, as a provisional amount, a reasonable estimate of the accounting effects and implications of the Tax Cuts and Jobs Act.

In addition, and the Staff Q&A provides that if a private company or not-for-profit organization applies SAB 118, they would be in compliance with GAAP. The FASB staff consulted with stakeholders and members of the Private Company Council in forming the view contained in the Staff Q&A.

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CCH ARM Editorial

CCH ARM Editorial

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