A little-noticed accounting change is coming down the pike that will have a major impact on business. According to the New York Times, this one has corporate executives up in arms — and scrambling to comply.
1. What is the title of the new FASB rule?
2. Which equity investments are affected?
3. How could the new standard curtail investments by large companies in smaller companies?
4. What are the significant accounting changes proposed?
5. Discuss whether you believe this standard will improve or impede transparency.
Cohan, W. (2017) A Little-Known Accounting Change Could Have a Big Impact. The New York Times, May 12 (Retrievable online at https://www.nytimes.com/2017/05/12/business/dealbook/a-little-known-accounting-change-could-have-a-big-impact.html?ref=dealbook)