"The negative impact of the tax hikes on sentiment will weigh on the willingness of prospective buyers to acquire a residential unit, given that buying a house constitutes one of the most important investment decisions for the Lebanese, and the value of a house is usually the single most important nonfinancial asset
for Lebanese residents," he added.
Durbin continued with a discussion of a new term in GAAP, the "in-substance nonfinancial asset
." This is an asset in which substantially all the fair value is concentrated in nonfinancial assets
, and therefore, when sold, would be derecognized according to the guidance for nonfinancial assets
rather than financial assets.
In the future, a lease will be defined as: a contract that conveys the right to use a nonfinancial asset
(the underlying asset) for a period of time in an exchange or exchange-like transaction.
(B) Forward contracts, options, futures, options on futures, swaps, and similar contracts, whether traded on exchanges or not, based on any rate, price, financial asset (including gold, silver, platinum, palladium, copper, or any other metal approved by the Board), nonfinancial asset
, or group of assets, other than a bank-ineligible security, (1) if:
NOTE: This first step is not an accounting requirement for off-balance sheet treatment of a nonfinancial asset
, but it may be a rating agency or investor requirement.
"Buying a residential unit constitutes one of the most important investment decisions for the Lebanese, and the value of a house is usually the single most important nonfinancial asset
for resident Lebanese," Ghobril said.
The fair value of a nonfinancial asset
is determined based on the asset's highest and best use, which normally is presumed its current use.
Other new disclosment: ASU 2022-04 requires a reporting entity to include disclosures about when it uses a nonfinancial asset
in a way that differs from its highest and best use when the asset is measured, at fair value or when its fair value In disclosed.
Percent Type of nonfinancial asset
1989 1992 1995 1998 Vehicles 5.6 5.7 7.1 6.5 Primary residence 45.9 47.0 47.4 47.1 Other residential property 8.1 8.5 8.0 8.5 Equity in nonresidential property 11.0 10.9 7.9 7.7 Business equity 26.9 26.3 27.3 28.5 Other 2.5 1.6 2.3 1.7 Total 100 100 100 100 MEMO Nonfinancial assets
as a share of total assets 69.6 68.5 63.4 59.4
Where a nonfinancial asset
is not involved--for example public accountants provide all accounting services to NFP Organization Z at no charge--Z would debit the fair value of the services to an expense account and credit the same amount to revenue.(16) SFAS No.
Percent Nonfinancial asset
1989 1992 1995 Vehicles 5.4 5.5 6.9 Primary residence 44.1 45.7 45.9 Investment real estate 21.4 21.4 16.6 Business assets 27.0 25.7 29.0 Other nonfinancial assets
2.1 1.6 2.1 Total 100 100 100 Memo Nonfinancial assets
as a share of total assets 72.1 69.5 65.9
of asset, 1989 and 1992 Percent Nonfinancial asset
1989 1992 Primary residence 44.1 43.5 Investment real estate 21.3 22.0 Business assets 27.0 27.2 Vehicles 5.4 4.9 Other nonfinancial assets
2.1 2.4 Total 100 100 MEMO Nonfinancial assets
as a percentage of total assets 72.1 67.7