Guide to Accounting for Financing Transactions: What You Need to Know about Debt, Equity, and the Instruments in Between - 2013 edition

  • Print-friendly version
Accounting guides 08/08/2013 by Assurance services
Guide to Accounting for Financing Transactions: What You Need to Know about Debt, Equity, and the Instruments in Between - 2013 edition

At a glance

The accounting guidance for the issuance, modification, conversion and repurchase of debt and equity securities has developed over many years into a complex set of rules. Although the guidance is now codified within the FASB’s Accounting Standards Codification, the analysis continues to involve detailed and sequential consideration of the relevant provisions of the guidance. Our Guide provides a roadmap to the applicable accounting literature to help you determine which steps are necessary for a particular transaction.

The accounting guidance for the issuance, modification, conversion and repurchase of debt and equity securities has developed over many years into a complex set of rules. Before the FASB codified accounting standards, the accounting guidance applicable to a single transaction was contained in a number of separate FASB Standards, EITF Issues, interpretations, and speeches. Although the guidance is now codified within the FASB’s Accounting Standards Codification, the analysis continues to involve detailed and sequential consideration of the relevant provisions of the guidance. Our Guide provides a roadmap to the applicable accounting literature to help you determine which steps are necessary for a particular transaction.

We have organized the Guide to first discuss the accounting literature and analyses applicable to many financing transactions and then discuss the application of this guidance to specific financing transactions.

This Guide compiles the accounting guidance an issuer should consider when:

  • Issuing debt, equity and hybrid securities (including determining whether the security should be classified as debt or equity for accounting purposes),
  • Creating a noncontrolling interest,
  • Modifying debt or equity securities,
  • Inducing an investor to convert, and
  • Buying back debt or equity securities.