Comment: Share-based consideration paid to customers

In our response to the FASB’s proposed clarifications to share-based consideration payable to customers, we believe the proposed amendments will reduce the existing diversity in practice in accounting for a grantor’s share-based payment award paid to a customer that contains vesting targets based on the customer’s purchases of the grantor’s goods or services. We commend the Board for addressing stakeholders’ concerns in this area and believe the proposal will provide a practical and operational path forward.

Because we believe that customer purchases constitute a performance condition as opposed to a service condition, we therefore agree with the proposal to incorporate performance targets based on customer purchases into the Master Glossary under the term “performance condition” for share-based consideration payable to a customer.

Download our letter to read our comments in full.