Handbook | October 2019

Equity method of accounting

KPMG explains the equity method of accounting, ASC 323, in detail. We provide guidance and interpretations, including Q&As and examples. 


ASC Topic 323

  • All companies with equity method investments

Relevant dates

  • Effective immediately

Key impacts

This October 2019 edition incorporates:

  • New interpretive guidance on tax credit structures
  • Expanded guidance on transitioning from the equity method to consolidation when the investee is not a business
  • Revised guidance on the forthcoming ASU on income tax simplification
  • Additional guidance on, and illustration of, the recently proposed ASU on the interaction of Topic 323 (equity method) with Topic 321 (equity securities). 

Report contents

  • Scope
  • Initial recognition and measurement
  • Recognizing investee activity
  • Recognizing investor-level adjustments
  • Changes in ownership and degree of influence
  • Presentation and disclosure     

Spotlight on contributors

Angie Storm

Angie Storm

Partner, Dept. of Professional Practice, KPMG US

Brent Hansen

Brent Hansen

Partner, Audit, KPMG US

Shoshana Feldman

Shoshana Feldman

Director, Dept. of Professional Practice, KPMG US

Brian Stewart

Brian Stewart

Senior Manager, Dept. of Professional Practice, KPMG US



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