Using an illustrative example that compares ASU 2020-06 to current GAAP, KPMG discusses certain effects arising from the adoption of the ASU; as well as considerations around contractually modifying an Instrument X to an Instrument C and other transition guidance.
Entities that issue convertible instruments or contracts in an entity's own equity.
Effective date | Public entities | All other entities |
---|---|---|
Annual periods – Fiscal years beginning after |
December 15, 2021 |
December 15, 2023 |
Interim periods – In fiscal years beginning after |
December 15, 2021 |
December 15, 2023 |
Early adoption allowed? |
Yes, no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years1. |
|
1 An entity that has not yet adopted the amendments related to certain instruments with down-round features in ASU 2017-11 may adopt the recognition and measurement amendments in ASU 2020-06 for any convertible security that includes a down-round feature (see Defining Issues) in financial statements that have not yet been issued or made available for issuance for fiscal years (or interim periods) beginning after December 15, 2019. |
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