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Because the guidance in ASC 410-30 addresses (albeit not exclusively) the application of federal and state environmental laws and regulations in the United States, this Roadmap provides an overview of some of those laws and regulations and describes the application of ASC 410-30 within the relevant legal framework. �7�/��0��$y?��n��c�*��T��"��H��V��Ӊ.�Z=��I�$� h�{�uq�[��jz^��2��q��t��E��?��FIS�h�\��d��n�b4��qq�W(C3]|�'uԁ��ijG��>6 �,��i@ Vs}7�^�%Ϫ��y��Xl\R��~Rq}��$�AǤ�F�3��`��E��Y�.��2�4��eR��F��4͋�Ժ��l�f� �`h�l��.� Y�"��Ro�0 �Z|dZ^h�E\y4��n�hr-��, L��Lt^��tx�\�bݬ�ـ�k�� H�d�z��=�W��"��o~�{��8�kf��L�_n%��A��$~��DGdz�;Hu� :\o��q��!#��G�>=*Ԧ��޽��h�Z��W;��\��ֹW�m.�=*2��x�h��f9 \E��F��G��o��i�� These liabilities may no longer be necessary or estimates of the amount and timing of future cash flows may need to change if the related asset has been damaged or destroyed. Alex Debbink. This course also addresses key controls, policies, and metrics. Entities at the same time must recognize an offsetting asset retirement cost by increasing the carrying amount of the related long-lived asset. Taking action against systemic bias, racism, and unequal treatment, Key opportunities, trends, and challenges, Go straight to smart with daily updates on your mobile device, See what's happening this week and the impact on your business. We are pleased to present the 2020 edition of A Roadmap to Accounting for Environmental Obligations and Asset Retirement Obligations. An asset retirement obligation (ARO) is a liability associated with the eventual retirement of a fixed asset. The liability is commonly a legal requirement to return a site to its previous condition. 143, Accounting for Asset Retirement Obligations, to Legislative Requirements on Property Owners to Remove and Dispose of Asbestos-Containing Materials We appreciate the opportunity to comment on the above-referenced proposed FASB Staff Position (FSP). Asset retirement obligation/decommissioning cost broadly refers to the amount that a company expects to incur in disposing of the asset and reversing modifications made to the installation site. Steven M. Bragg, CPA, is a full-time book and course author who has written more than 70 business books. Because the accounting for environmental obligations and AROs will vary depending on the laws and regulations governing such obligations, this publication provides an overview of some of the applicable federal and state environmental laws and regulations in the United States and describes the application of the accounting guidance within the relevant legal framework. We have updated our Financial reporting developments publication on asset retirement obligations to further clarify and enhance our interpretative guidance. %PDF-1.4 %�� The Complete Guide to Fixed Asset Accounting addresses all aspects of fixed asset accounting, including the most complex topics: asset impairments, asset retirement obligations, and asset revaluations. costs of an asset. www.ey.com Proposed FASB Staff Position-Applicability of FASB Statement No. ASC 410 comprises three Subtopics (Overall, Asset Retirement Obligations, and Environmental Obligations). H�tWKsܸ��W��Y%��LNZg׵9m��i�DB#�r��ȫ��Ό\�Ҁx4�nt��͇��Ji��|�3��iR��(��R��}�:O��x��v�&U��~��? zPPE acquired in a swap is measured at fair value unless it lacks commercial substance ASC 410-10 simply provides information about the differences between the other two Subtopics on asset retirement obligations and environmental obligations. Asset Retirement and Environmental Obligations — Asset Retirement Obligations. Asset retirement obligations Other financial liabilities Equity shall be presented in accordance with the requirements of Section 3251, Equity. DTTL (also referred to as "Deloitte Global") does not provide services to clients. View the active version (subscription required; updated as warranted). Telecommunications, Media & Entertainment, Stay current: Audit & Assurance subscriptions, Financial Statement & Internal Control Audit. He provides Western CPE with self-study courses in the areas of accounting and finance, with an emphasis on the practical application of … zThe costs of dismantlement, removal or restoration should be included in the cost of property, plant and equipment. This Roadmap is intended to help entities address the impact of certain environmental and asset retirement laws and regulations on accounting for environmental obligations and AROs. 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