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Perspectives

A roadmap to consolidations — identifying a controlling financial interest (2017)

The 2017 edition of this Roadmap reflects changes in the consolidation landscape introduced by the issuance of FASB Accounting Standards Update No. 2015-02, Amendments to the Consolidation Analysis, in February 2015.

This publication reflects changes in the consolidation landscape introduced by the FASB’s issuance of ASU 2015-02 in February 2015. The 2017 edition contains new interpretations and guidance as a result of FASB and SEC activity as well as developments in practice since publication of the 2016 edition of this Roadmap. A summary of the changes made to this Roadmap since the 2016 edition is available in Appendix H.

While the changes to the consolidation guidance were not unexpected, there have been numerous twists in their development. After working together on a joint project to establish a single consolidation model, the FASB and IASB ultimately decided not to converge their guidance and instead followed their own paths. The IASB amended its consolidation model in May 2011 with the issuance of IFRS 10, and after deciding not to rewrite its consolidation guidance, the FASB issued ASU 2015-02 in February 2015 to make targeted amendments to its consolidation model. Although the ASU’s amendments were intended to address concerns that primarily apply to the investment management sector, the ASU could have a significant effect on the consolidation conclusions for entities in all industries.

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The Roadmap Series contains periodic collections of our accounting guidance on selected topics of broad interest to the financial reporting community.

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