a) ASC 830-230-55-1:
55-1: The accounting standards provide guidance to a manufacturing entity which has its operations in foreign countries over the presentation of cash flow statement under the direct method. The objective of such guidance over reconciliation of net income to net cash provided by operating activities is to provide detailed information in excess of that required for a meaningful presentation. The standard discusses the reference in relation to the local currency and how it should be shown with the parent company. However, the standard permits other formats only under certain prescribed circumstances.
b) ASC 926-330-35-1:
926 Entertainments—Films330 Inventory35 Subsequent Measurement
35-1: The standard relates to measurement of inventory as video cassettes, digital video discs, which are primarily held for sale at each balance sheet. Providing a brief guidance over inventory valuation, the inventory can be valued at the net realizable value less any kind of obsolescence exposure.
c) ASC 954-440-25-2:
954 Health Care Entities440 Commitments25 Recognition
25-2: The standard is the extension to the paragraph 954-440-35-1 , which requires that the continuing care community is required to record a liability if the advance fee received and periodic fees charged by it are not sufficient enough to meet the cost of providing future services and other facilities. However, such liability shall be recorded on actuarial assumptions and is equal to the amount that is expected to be incurred to provide services and the use of facilities to individuals over their remaining lives under continuing care contracts. Thus, the community care facilities are required to calculate their annual service fee and the service costs and to check if any liability should be recorded in the financial statements.
d) ASC 505-20-50-1:
505 Equity20 Stock Dividends and Stock Splits50 Disclosure
50-1: The standard is related to identification of situation where a stock dividend is a form of stock split in substance. The standard declares that the entity shall make the best possible effort to avoid the use of word ‘dividend’ whenever it engages into stock splits in its corporate notices and announcements. However, at times, when because of legal requirements the entity is not able to avoid the word dividend, in such case, the transaction can be described as ‘A stock split effected in the form of a dividend.’
e) ASC 710-10-05-6:
710 Compensation—General10 Overall05 Overview and Background
05-6: This standard is related to deferred compensation agreement and provides guidance over them, primarily on deferred compensation agreements that are employment contracts and are not in substance a pension or other postretirement benefit plan. The extensive guidance over this standard is related to benefits agreements as laid in the paragraph 71-10-15-3, which are as follows:
- a. Any arrangement that is in substance a pension or other postretirement benefit plan, regardless of its form or the means or timing of its funding
- b. Written plans and unwritten plans whose existence is discernible either from a practice of paying pension or other postretirement benefits or from oral representations made to current or former employees
- c. Deferred compensation contracts with individual employees if those contracts, taken together, are equivalent to a plan that provides pension or other postretirement benefits
- d. Health and other welfare benefits expected to be provided to employees deemed to be on a disability retirement.
