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Bridging the GAAP: July 2026

Centri’s Bridging the GAAP newsletter highlights this month’s news, developments and emerging issues in the accounting and financial reporting world. 

Standard Setter Updates

Financial Accounting Standards Board (FASB)

June 24, 2026 Meeting

The Board discussed the characteristics of a potential new hedge accounting model and the staff’s outreach plan. The Board provided suggestions on and observations about the focus and prioritization for continued research efforts. The Board made no decisions.

The Board added a project to its technical agenda to amend the Codification to remove or replace references to the London Interbank Offered Rate (LIBOR).

The Board made the following decisions:

1. Remove the LIBOR swap rate from the list of benchmark interest rates and the Master Glossary.
2. Replace LIBOR references with Secured Overnight Financing Rate (SOFR)-based rates.
3. Make technical corrections to Example 9 beginning in paragraph 815-30-55-52.

For more information, see the FASB’s Tentative Board Decisions.

FASB Proposes Amendments to Investment Company Fair Value Reporting

On July 1, the FASB issued a proposed ASU specific to investment companies that report under ASC 946 by amending how such entities measure the fair value of equity securities that are subject to contractual sale restrictions. The proposal would require an investment company to consider a contractual sale restriction when measuring the fair value of an equity security and disclose the amount of the discount attributable to contractual sale restrictions. Under the proposed ASU, an investment company would apply the proposed guidance prospectively to existing investments in equity securities subject to contractual sale restrictions with any adoption-date adjustment recognized immediately in earnings. 

Comments are due by July 17.

July 8, 2026 Meeting

The Board discussed feedback received in response to the 2025 Invitation to Comment, Agenda Consultation (2025 ITC). The Board provided suggestions on and observations about the focus and prioritization for continued research efforts.

The FASB chair announced that the research project on Current Trends and Emerging Issues will explore semi-annual reporting. This research project monitors current trends and emerging issues and solicits stakeholder feedback to evaluate the continuing relevance of our standards and identify potential improvements. The research related to semi-annual reporting will explore whether targeted improvements to FASB standards are necessary related to current interim accounting and disclosure requirements, specifically where the guidance references a quarterly frequency. The information the staff gathers will be presented to the Board to determine whether to add items to the technical agenda.

For more information, see the FASB’s Tentative Board Decisions.

Emerging Issues Task Force (EITF)

June 23, 2026 Meeting

The EITF discussed the following topics:

1. Application of the Topic 815 Normal Purchases and Normal Sales Scope Exception to Electricity Contracts
2. Consideration Payable to Customer

The EITF recommended that the Board add a project to its technical agenda to make refinements to the NPNS scope exception to accommodate retail power purchase arrangements. Specifically, the EITF recommended that the Board consider two potential alternatives for how buyers should evaluate physical settlement when applying the NPNS scope exception to in-scope arrangements. If an entity satisfies the specified threshold, and if all other NPNS criteria are met, the physical settlement criterion would be considered to be met and the arrangement would be eligible to qualify for the NPNS scope exception.

The EITF also recommended that the Board add a project to its technical agenda on consideration payable to a customer. Specifically, the EITF recommended that payments made on behalf of a customer, or to a customer of an entity’s customer, should be evaluated as consideration payable to a customer when there is either (1) an explicit or implicit promise to the customer that such payments would be made or (2) the payment represents an in-substance price concession to the customer that has a reasonable expectation that the payment will be made to the customer’s customer.

For more information, see the FASB’s website. The next EITF meeting is scheduled for September 22, 2026.

International Accounting Standards Board (IASB)

SEC Regulatory Updates

2026 SEC Regulatory Agenda Released

On July 7, the Office of Information and Regulatory Affairs released the 2026 Regulatory Agenda. The agenda includes a list of potential rulemaking initiatives and the status of priority rulemaking activities for government agencies, including the SEC. The agenda includes several projects that are already the subject of recent SEC rulemaking proposals, including semiannual reporting, simplification of filer status, and registered offering reform. It also identifies additional potential areas of rulemaking, including reforms to executive compensation and shareholder proposal requirements, updates to the foreign private issuer framework, and crypto asset regulation.

SEC Proposes New Framework for Electronic Delivery

On July 16, the SEC proposed “Regulation E-Delivery” that would establish a modernized framework for the electronic delivery of information required under the federal securities laws. The proposal would allow issuers and market participants (including registered investment companies, broker-dealers, and investment advisers) to provide many required disclosures electronically by default, rather than first obtaining investors’ affirmative consent. Investors would retain the right to opt out of electronic delivery and request paper copies free of charge.

The proposal would also rescind Rule 30e-3, which provides an alternative method for delivering shareholder reports for registered investment companies, and make conforming amendments to other SEC rules to establish a more consistent electronic delivery framework.

Comments on the proposal are due 60 days following publication in the Federal Register.

Other Regulatory Updates

California Air Resources Board (CARB)

On June 24, the CARB announced its planned proposal to defer the reporting deadline for entities to report Scope 1 and Scope 2 greenhouse gas (GHG) emissions from August 10, 2026, to November 10, 2026. This three-month deferral will give reporting entities additional time following the formal adoption of Proposed California Corporate Greenhouse Gas Reporting and Climate-Related Financial Risk Disclosure Initial Regulation, if approved.

In addition, CARB will be proposing limited changes to the regulation to clarify certain requirements and will make these available for comment as part of a forthcoming 15-day public comment period.