Defining Issues | October 2021
The ASU provides a share-based payment practical expedient for equity-classified awards.
Applicability
- Nonpublic entities that provide share-based payment awards to employees and nonemployees
Relevant dates
- October 25, 2021 – FASB issued final ASU
| Effective dates | Private companies |
|---|---|
Annual periods – Fiscal years beginning after |
Dec. 15, 2021 |
Interim periods – In fiscal years beginning after |
Dec. 15, 2022 |
Early application allowed? |
Yes, for interim or annual financial statements that have not been issued (or made available for issuance) |
Key impacts
- The FASB has provided a practical expedient that allows a private company to determine, for equity-classified share-based payment awards, the share price for restricted stock awards and the current price input for option-based awards, using a ‘reasonable application of a reasonable valuation method’.
- The practical expedient does not change the measurement objective of ASC 718.
Report contents
- Applicability
- Fast facts, impacts, actions
- Background
- Share price practical expedient for equity-classified awards
- Effective dates and transition
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