Alert: FASB Accounting Standards Update No. 2017-09 – Compensation: Stock Compensation

Category: US GAAP

Alert: FASB Accounting Standards Update No. 2017-09 – Compensation: Stock Compensation

On May 10, 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2017-09 Compensation – Stock Compensation (Topic 718). The ASU seeks to clarify which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting under Topic 718. The ASU requires that such changes be accounted for as a modification unless the modified award’s fair value (or calculated/intrinsic value), vesting conditions and classification as an equity or liability instrument are the same as those for the original award immediately prior to the modification.

The current disclosure requirements in Topic 718 remain unchanged and apply regardless of whether modification accounting is applied.

The amendments are effective for all entities for annual periods beginning after December 15, 2017, including interim periods therein, and should be applied prospectively to an award modified on or after the adoption date.

Early adoption, including in any interim period, is permitted as follows:

  • Public business entities – for reporting periods for which financial statements have not yet been issued.
  • All other entities –for reporting periods for which financial statements have not yet been made available for issuance.

To access the full script of ASU No. 2017-09, click here.

This communication contains a general overview of the topic and is current as of May 10, 2017. The application of the principles addressed will depend upon the particular facts and circumstances of each individual case. Accordingly, this publication is not a substitute for professional advice and we recommend that any decisions you take about the application or not of any of the information presented be made in consultation with a qualified professional, who can address any variance that may be required to reflect your circumstances. Please contact your local MNP representative for customized assistance with the application of this material. MNP LLP accepts no responsibility or liability for any loss related to any person's use of or reliance upon this material. © MNP LLP 2017. All rights reserved.

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Michelle Balmer

Michelle Balmer CPA, CA

Vice President, Assurance

Michelle Balmer, CPA, CA, is a Senior Assurance Services Partner with MNP. With 14 years of experience in public practice, Michelle helps a broad range of public and privately held companies in a variety of industries. She also works on special projects, including costing studies, benchmarking and best-practice studies, operational analyses, litigation support and due diligence.

As a key member of MNP's Assurance team, Michelle has played an instrumental role in assurance policy development, implementing accounting and assurance standards firm-wide and educating assurance practitioners regarding methodologies and new pronouncements. She also provides technical advice and consultation on accounting and assurance issues, as well as on rules of professional conduct issues, to all MNP practitioners.

Michelle was certified a Chartered Accountant (CA) after obtaining a Bachelor of Commerce degree from the University of Alberta. She has been actively involved with the Institute of Chartered Accountants of Alberta, including the Chartered Accountants School of Business, in an instructional and marketing capacity. An avid volunteer, she has assisted numerous groups such as the Easter Seals of Alberta, Paralympic Sports Association and Junior Achievement of Northern Alberta.