ASU 2014-17: Pushdown Accounting

Can acquirees in business combinations adopt the same new basis of accounting the acquirer uses? The Financial Accounting Standards Board recently published a consensus position from the Emerging Issues Task Force (EITF), ASU 2014-17, Business Combinations (Topic 805): Pushdown Accounting, to answer this question. The standard establishes new and common guidance on applying pushdown accounting for public and nonpublic acquirees. The Securities and Exchange Commission (SEC) simultaneously released Staff Accounting Bulletin 115 to rescind the existing guidance for public acquirees. This blog entry summarizes the main features of the new standard.