In its December 4 response letter, PwC supported the FASB's recent proposal to issue to a new Codification section: ASC 812, Consolidation. ASC 812 is not new guidance. It consist of the current consolidation guidance reorganized in a manner intended to facilitate a user's application of the consolidation rules. The proposal is not intended to change consolidation outcomes or how the guidance currently in ASC 810 has been historically applied.

As proposed, ASC 812 will consist of three subtopics, consisting of an overview, guidance applicable to variable interest entities, and guidance applicable to voting interest entities. The latter two subtopics are intended to be largely standalone; for example, if an entity is deemed to be a variable interest entity, all guidance relevant to it (primary beneficiary evaluation, measurement upon initial consolidation, etc.) will appear in the VIE Subtopic.

The proposal also contains clarifications to certain key consolidation terms.

December 4, 2017

Ms. Susan Cosper

Technical Director

Financial Accounting Standards Board

401 Merritt 7

P.O. Box 5116

Norwalk, CT 06856-5116

Dear Ms. Cosper:

PricewaterhouseCoopers LLP appreciates the opportunity to respond to the FASB’s Proposed Accounting Standards Update, Consolidation (Topic 812) – Reorganization (the “ED”).

We support the ED’s proposed reorganization of the consolidation guidance currently housed in Topic 810. We believe that preparers of financial statements and practitioners alike will find the reorganized Topic 812 easier to understand and apply. We endorse the proposed construct of the new Topic, consisting of a separate standalone Subtopic for each of the two consolidation models accompanied by an introductory Subtopic. Given the degree of commonality that the two consolidation models share, this standalone approach causes the two Subtopics to provide identical guidance in certain instances. Nonetheless, we believe this to be the most practicable (and user-friendly) path in the circumstances.

The appendix to this letter contains our response to each of the Questions for Respondents in the ED.

If you have any questions, please contact David Schmid at (973) 236-7247 or John Bishop at (973) 236-4420.

Sincerely,

PricewaterhouseCoopers LLP

Yes. We believe that preparers of financial statements and practitioners alike will find the reorganized Topic 812 easier to understand and apply.

Yes. In our experience, the subject guidance is applied chiefly by not-for-profit entities. Moving this material into Topic 958 is appropriate in the circumstances.

We concur with the proposed elimination of the subject guidance, the source of which was EITF Issue 99-16, Accounting for Transactions with Elements of Research and Development Arrangements. In our experience, the variable interest entity consolidation guidance currently codified in ASC 810-10 has rendered application of the provisions in Subtopic 810-30 moot.

Given the limited scope of this project, we believe that the Topic, as proposed to be reorganized and clarified, accomplishes its stated objectives. We observe, however, that the consolidation models under current GAAP are intrinsically complex and, particularly with respect to variable interest entities, frequently entail consideration of detailed prescriptive guidance that will continue to be challenging to apply in practice. The reorganized content does not address or mitigate these inherent complexities.

We agree with the proposed transition guidance. We do not believe that the reorganized content, and the modest clarifying-type edits proposed to be made to various terms and concepts currently in ASC 810, should result in changes in previous consolidation conclusions. However, in the unlikely event that the Update results in any such changes, we consider it prudent for the Update to provide for transition.

We concur with the proposed transition requirements.

We concur with the proposed transition requirements.

Yes. Since the Update is not intended to alter current consolidation standards, we believe its effective date should be the same for all entities.

Assuming that it is issued no later than the middle of 2018, we believe that the Update should be effective for all entities for fiscal years beginning after December 15, 2018, with earlier adoption permitted. Since Topic 812 will consist almost entirely of reorganized material, we believe that reporting entities will not require much time to understand and apply its content.