Download Recent Accounting Pronouncements — Not Yet Adopted

2 Summary of Significant Accounting Policies
Recent Accounting Pronouncements —
Not Yet Adopted
In January 2016, the Financial Accounting Standards Board
(“FASB”) issued amended guidance on the measurement
and classification of financial instruments. This amended
guidance requires that all equity investments be measured
at fair value with changes in fair value recognized through
net income (other than those accounted for under equity
method of accounting or those that result in consolidation
of the investee). The amendments also require an entity
to present separately in other comprehensive income the
portion of the total change in the fair value of a liability
resulting from a change in the instrument-specific credit risk
when the fair value option has been elected for financial
liabilities. The amendments eliminate the requirement to
disclose the methods and significant assumptions used to
estimate the fair value for financial instruments measured
at amortized cost, however public business entities will be
required to use the exit price when measuring the fair value
of financial instruments measured at amortized cost for
disclosure purposes. In addition, the new guidance requires
financial assets and financial liabilities to be presented
separately in the notes to the financial statements, grouped
by measurement category and form of financial asset. The
amended guidance is effective in fiscal years beginning after
December 15, 2017, including interim periods within those
fiscal years. Therefore, the Company is required to adopt
the guidance on January 1, 2018. For the provision related to
presentation of financial liabilities, early adoption is permitted
for financial statements that have not been previously issued.
The Company is evaluating the requirements of this amended
measurement and classification of financial instruments
guidance and the potential impact on the Company’s financial
position and results of operations.
In April 2015, the FASB issued amended guidance on
presentation of debt issuance costs. This amended guidance
requires that debt issuance costs be presented in the balance
sheet as a direct deduction from the carrying amount of the
debt liability, consistent with debt discounts or premiums.
The recognition and measurement guidance for debt issuance
costs is not affected by the amendments. The amended
guidance is effective for interim and annual periods beginning
after December 15, 2015. Therefore, the Company is required
to adopt the guidance on January 1, 2016. Early adoption of
the amended guidance is permitted for financial statements
that have not been previously issued. An entity should apply
the amended guidance on a retrospective basis, wherein the
balance sheet of each individual period presented should be
adjusted to reflect the period-specific effects of applying the
new guidance. The Company does not expect the adoption of
this presentation guidance to impact the Company’s financial
position or results of operations.
In February 2015, the FASB issued new consolidation guidance
that affects reporting entities that are required to evaluate
whether they should consolidate certain legal entities. All
legal entities are subject to reevaluation under the revised
consolidation model. The new guidance eliminates specialized
guidance for limited partnerships and similar legal entities,
and removes the indefinite deferral for certain investment
funds. The new guidance is effective for interim and annual
periods beginning after December 15, 2015. Therefore, the
Company is required to adopt the guidance on January 1,
2016. Early adoption is permitted, including adoption
in an interim period. The new guidance may be applied
retrospectively or through a cumulative effect adjustment
to retained earnings as of the beginning of the year of
adoption. The Company does not expect the adoption of
this new consolidation guidance to have an impact on it’s
financial position or results of operations.
In May 2014, the FASB issued amended guidance on revenue
recognition. The amended guidance affects any entity that
either enters into contracts with customers to transfer
goods or services or enters into contracts for the transfer
of nonfinancial assets unless those contracts are within the
scope of other standards. Insurance contracts are within
the scope of other standards and therefore are specifically
excluded from the scope of the amended revenue recognition
guidance. The core principle of the amended guidance is
that an entity recognizes revenue to depict the transfer of
promised goods or services to customers in an amount that
reflects the consideration to which the entity expects to be
entitled in exchange for those goods or services. To achieve
the core principle, the entity applies a five step process
outlined in the amended guidance. The amended guidance also
includes a cohesive set of disclosure requirements. In August
2015, the FASB issued guidance to defer the effective date
of the revenue recognition guidance. The amended guidance
is effective for interim and annual periods beginning after
December 15, 2017 and earlier application is permitted only
as of annual reporting periods beginning after December 15,
2016, including interim reporting periods within that reporting
period. Therefore, the Company is required to adopt the
guidance on January 1, 2018. An entity can choose to apply
the amended guidance using either the full retrospective
approach or a modified retrospective approach. The Company
is evaluating the requirements of the revenue recognition
guidance as it relates to its non-insurance contract revenue
and the potential impact on the Company’s financial position
and results of operations.
ASSURANT, INC. – 2015 Form 10-K
F-17