The FASB issued ASU 2025-07 to address two separate issues:
- How to apply derivative accounting to contracts with an underlying based on the operations or activities of just one of the parties to the contract; and
- How to reduce the diversity in practice that currently exists when accounting for share-based noncash consideration from a customer for the transfer of goods or services.
Snapshot 2025-12 (PDF - 408KB), “Derivatives scope refinements,” summarizes the amendments that exclude from the scope of ASC 815 non-exchange-traded contracts with underlyings based on operations or activities specific to one of the parties to the contract (the “operations or activities scope exception”).
Snapshot 2025-13 (PDF - 384 KB), “FASB clarifies share-based noncash consideration in revenue contracts,” discusses the amendments clarifying that share-based noncash consideration is subject to the guidance in ASC 606 until the entity’s right to receive or retain the share-based noncash consideration becomes “unconditional” under ASC 606; at that point, the share-based noncash consideration is subject to guidance on financial instruments, such as ASC 815 or ASC 321.
The publications draw directly on citations from the FASB’s guidance and feature insights from Grant Thornton specialists along with illustrative examples.
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