FASB Debt — Modifications and Extinguishments of Liabilities
TXCPA’s Professional Standards Committee submitted a comment letter to FASB supporting proposed updates on debt modifications, noting the changes would simplify accounting, improve consistency, and provide more useful investor information
The TXCPA Professional Standards Committee (PSC) submitted a comment letter to the Financial Accounting Standards Board (FASB) in response to the proposed Accounting Standards Update (ASU) on Debt-Modifications and Extinguishments and Liabilities–Extinguishments of Liabilities (File Ref. No. 2025-ED200).
The PSC commended FASB’s efforts to simplify accounting for debt exchanges involving multiple creditors, supporting the proposal to treat such exchanges as extinguishments of old debt and issuances of new debt. The committee believes the amendments will improve consistency, align better with economic substance, reduce costs, and provide investors with more decision-useful information. The committee also supported prospective application and early adoption without requiring retrospective adjustments or extensive transition disclosures.
Read the full comment letter here. View TXCPA PSC comment letter here.
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