PwC commented on the FASB’s proposal to amend the guidance for the classification of debt. The proposed changes are intended to simplify how companies classify debt as current or noncurrent in the balance sheet.
The proposed changes will eliminate complexity in the current model by creating a principles-based model. We believe this model will simplify and improve financial reporting. However, we believe the Board should clarify how variable rate demand obligations and share settled debt should be classified under the proposed model.