When the FASB issued its revenue standard (FASB Accounting Standards Update 2014-09) [developed jointly with the IASB (IASB, IFRS 15)] it also created ASC Subtopic 610-20 (FASB Accounting Standards Codification Subtopic 610-20). ASC Subtopic 610-20 generally required the application of the revenue model of ASC Topic 606 (FASB Accounting Standards Codification Topic 606) in accounting for the derecognition of nonfmancial assets and in-substance nonfmancial assets. However, in its original guidance, the FASB did not define in-substance nonfmancial assets nor did it specify how to determine when a group of assets should be treated as nonfmancial assets. Additionally, the original guidance was unclear about the interaction between the accounting for the derecognition of nonfmancial assets and the derecognition of a business. Finally, it was unclear how that guidance interacted with long-standing guidance on partial sales of real estate (FASB Accounting Standards Codification Sub-topic 970-323). Because ASC Subtopic 610-20 has the same effective date as ASC Topic 606 (periods beginning after December 15, 2017 for public business entities) (Holzmann and Munter, 2014; 2015), these questions began to take on an urgency as entities prepared for the adoption of ASC Topic 606 and Subtopic 610-20.
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