Defining Issues  | March 2019

FASB proposals on share-based consideration payable to a customer

The FASB’s proposed ASU clarifies how an entity would measure and classify share-based payments to a customer after adopting ASU 2018-07. The proposed ASU would require the application of ASC 718 to measure and classify share-based payments to a customer.


Proposed ASU

  • Company in the scope of ASC 606 that issues share-based payments to customers.

Relevant dates

  • March 4, 2019 – FASB issued proposed ASU
  • April 18, 2019 – Comments due

Key impacts

  • A company would measure the grant-date fair value of a share-based payment to a customer on the grant date, which is when the company and the customer reach a mutual understanding of the key terms and conditions of the award
  • A company would classify the award on the balance sheet based on the provisions of ASC 718
  • A company that previously analogized to the noncash consideration guidance in ASC 606 would be required to retrospectively adopt this guidance




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