FASB Clarifies Conditional Asset Retirement Obligation
April 21, 2005
The Financial Accounting Standards Board published Interpretation No. 47, “Accounting for Conditional Asset Retirement Obligations,” on March 31. The interpretation clarifies the term conditional asset obligation used in FASB Statement No. 143, “Accounting for Asset Retirement Obligations.” According to the interpretation, a conditional asset retirement obligation refers to a legal obligation to perform the asset retirement activity.
In general, FASB believes that when an obligation meets the definition of a liability, it should be recognized. The Board believes that questions about uncertainty in the timing and method of payment are measurement issues that usually can be addressed by using a fair value measure. The interpretation represents a relatively recent change in thought from FASB’s earlier statements—most notably FASB Statement No. 5, "Accounting for Contingencies," which required an entity to consider uncertainty in its determination of whether to recognize a liability.
The interpretation is effective no later than the end of fiscal years ending after December 15, 2005 (December 31, 2005, for calendar-year organizations).
For information, please contact Sue Menditto.
- NACUBO and FASB Discuss Grant Revenue Recognition
- ED Proposes Auditing Safeguards Rule Compliance
- NACUBO and ACE to Negotiate Rates for Use of Music on Campus
- WEBCAST: NACUBO Live! 2017 Higher Education Accounting Forum
May 7-9, 2017
- WEBCAST: Update to Strategic Financial Analysis in Higher Education, 7th Edition: Corrections and Clarifications
Thursday, May 25, 2017 1:00PM ET
- WEBCAST: Results of the 2016 NACUBO Tuition Discounting Study
Wednesday, May 31, 2017 1:00 PM ET
- ON-DEMAND: How to Budget for Technology That Aligns with Institutional Goals
- ON-DEMAND: What’s Happening in Student Financial Services?
- ON-DEMAND: Legislative Lunchcast: A 30-Minute Washington Update from NACUBO