The Accounting Standards Codification is meant to be comprehensive in its coverage of accounting standards. The ASC is broken down into nine topics, which are further divided into subsections. The nine overarching topics are as follows.
Businesses operating in the U.S. should follow the guidelines established in the ASC to ensure their financial reporting is reliable. More importantly, compliance with ASC is mandatory for many entities, particularly those that are publicly traded or regulated by government agencies. Compliance with these accounting standards can reduce the risk of penalties, legal issues, and reputational damage.
Is your business compliant with the ASC? Schedule a demo of our lease accounting software and to learn more about how Accruent can help. Contact us today!
- 100 – General Principles: This section pertains to General Principles and Master Glossary. It provides an overview of the structure and organization of the ASC, as well as defines key terms and concepts used throughout the codification.
- 200 – Presentation: This section sets out the general principles and requirements for the presentation of financial information to ensure transparency and comparability.
- 300 – Assets: This section covers detailed guidance on receivables and various investments, including debt securities, equity securities, and equity method and joint ventures. It also covers credit losses, inventory, deferred costs, intangibles, and property and equipment.
- 400 – Liabilities: This section provides guidance on the recognition, measurement, presentation, and disclosure of various types of liabilities in financial statements.
- 500 – Equity: This section covers the recognition, measurement, presentation, and disclosure of equity-related items in financial statements. It addresses various aspects of equity, including capital stock, retained earnings, other comprehensive income, and equity transactions.
- 600 – Revenue: This topic is related to transaction-specific revenue recognition, revenue related to the transfer of promised goods or services to customers, and other income from the derecogntion of nonfinancial assets, and gains and losses related to involuntary conversions.
- 700 – Expenses: This section provides guidance on the measurement and disclosure of fair value for financial and non-financial assets and liabilities.
- 800 – Broad Transactions: This topic covers broad transactions, including business combinations, collaborative arrangements, consolidation, derivatives and hedging, fair value measurement, financial instruments, foreign currency matters, government assistance, interest, accounting for leases, nonmonetary transactions, reference rate reform, related party disclosures, reorganizations, service concession arrangements, subsequent events, and transfers and servicing. This section also includes the ASC 842 lease accounting standards.
- 900 – Industry: This topic covers standards related to specific industries, including agriculture, airlines, contractors, development stage entities, entertainment, extractive activities, financial services, franchisors, health care entities, not-for-profit entities, plan accounting, real estate, regulated operations, software, U.S. steamship entities.
Businesses operating in the U.S. should follow the guidelines established in the ASC to ensure their financial reporting is reliable. More importantly, compliance with ASC is mandatory for many entities, particularly those that are publicly traded or regulated by government agencies. Compliance with these accounting standards can reduce the risk of penalties, legal issues, and reputational damage.
Is your business compliant with the ASC? Schedule a demo of our lease accounting software and to learn more about how Accruent can help. Contact us today!