AIG 2015 Annual Report Download - page 240

ITEM 8 / NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

240
The standard is effective for interim and annual reporting periods beginning after December 15, 2015. Early adoption is
permitted. The standard may be applied prospectively to all awards granted or modified after the effective date or
retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period
presented in the financial statements and to all new or modified awards thereafter. We plan to adopt the standard on its
required effective date of January 1, 2016 and do not expect the adoption of the standard to have a material effect on our
consolidated financial condition, results of operations and cash flows.
Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity
In August 2014, the FASB issued an accounting standard that allows a reporting entity to measure the financial assets and
financial liabilities of a qualifying consolidated collateralized financing entity using the fair value of either its financial assets or
financial liabilities, whichever is more observable.
The standard is effective for interim and annual reporting periods beginning after December 15, 2015. Early adoption is
permitted. The standard may be applied retrospectively or through a cumulative effect adjustment to retained earnings at the
date of adoption. We plan to adopt the standard on its required effective date of January 1, 2016 and do not expect the
adoption of the standard to have a material effect on our consolidated financial condition, results of operations and cash flows.
Consolidation: Amendments to the Consolidation Analysis
In February 2015, the FASB issued an accounting standard that affects reporting entities that are required to evaluate whether
they should consolidate certain legal entities. Specifically, the amendments modify the evaluation of whether limited
partnerships and similar legal entities are variable interest entities (VIEs) or voting interest entities; eliminate the presumption
that a general partner should consolidate a limited partnership; affect the consolidation analysis of reporting entities that are
involved with VIEs, particularly those that have fee arrangements and related party relationships; and provide a scope
exception from consolidation guidance for reporting entities with interests in legal entities that are required to comply with or
operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for
registered money market funds.
The standard is effective for interim and annual reporting periods beginning after December 15, 2015. Early adoption is
permitted, including adoption in an interim period. The standard may be applied retrospectively or through a cumulative effect
adjustment to retained earnings as of the beginning of the year of adoption. We plan to adopt the standard on its required
effective date of January 1, 2016 and do not expect the adoption of the standard to have a material effect on our consolidated
financial condition, results of operations and cash flows.
Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement
In April 2015, the FASB issued an accounting standard that provides guidance to customers about whether a cloud computing
arrangement includes a software license. If a cloud computing arrangement includes a software license the customer should
account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a
cloud computing arrangement does not include a software license, the customer should account for the arrangement as a
service contract. The guidance does not change generally accepted accounting principles applicable to a customer's
accounting for service contracts. Consequently, all software licenses will be accounted for consistent with other licenses of
intangible assets.
The standard is effective for interim and annual periods beginning after December 15, 2015. Early adoption is permitted. The
standard may be adopted prospectively to all arrangements entered into or materially modified after the effective date or
retrospectively. We plan to adopt the standard on its required effective date of January 1, 2016 and do not expect the adoption
of the standard to have a material effect on our consolidated financial condition, results of operations or cash flows.