FASB to Issue an Accounting Standards Update on the Scope of Modification Accounting in Topic 718

The Financial Accounting Standards Board (FASB) on October 5, 2016 directed its staff to draft a proposed Accounting Standards Update (ASU) for vote by written ballot that would narrow the scope of modification accounting in FASB Accounting Standards Codification (ASC) Topic 718 (Topic 718). The proposed change would be beneficial for companies and compensation professionals because it would permit some changes to outstanding share-based payment awards to escape the complexities and potential incremental costs of accounting for modifications under Topic 718.