FASB Approves Finalization of LIBOR Transition Guidance
As you know, the LIBOR transition topic is evolving on an almost daily basis.
Earlier this week, the FASB approved the finalization of guidance to assist entities with the transition away from LIBOR. The new Accounting Standards Update (ASU), which is expected to be issued in early 2020, will include optional expedients and exceptions to accounting guidance. This will ease the transition and allow contracts meeting certain criteria to change the reference rate away from LIBOR (or one of the other IBORS impacted) to a new reference rate without creating a new contract for accounting purposes. In addition, the new guidance will include provisions to ensure that, under the right circumstances, hedge accounting will continue uninterrupted during the transition.