Shutterfly 2015 Annual Report Download - page 70

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In August 2014, the FASB issued new guidance related to the disclosures around going concern. The new
standard provides guidance around management’s responsibility to evaluate whether there is substantial doubt
about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The new
standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15,
2016. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our
financial statements.
In April 2015, the FASB issued new guidance related to presentation of debt issue costs. The new standard
requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct
deduction from the carrying amount of that debt liability. The adoption of this guidance will be effective
beginning January 1, 2016, and is not expected to have a material impact on our financial statements.
In April 2015, the FASB issued new guidance related to accounting for fees paid in a cloud computing
arrangement. The new standard provides guidance to customers about whether a cloud computing arrangement
includes a software license. If a cloud computing arrangement includes a software license, then 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. We are evaluating the impact, if any, of adopting this new
accounting guidance on our financial statements.
In July 2015, the FASB issued ASU 2015-11, Inventory—Simplifying the Measurement of Inventory (Topic
330). ASU 2015-11 requires inventory to be subsequently measured using the lower of cost and net realizable
value, thereby eliminating the market value approach. Net realizable value is defined as the “estimated selling
prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and
transportation.” ASU 2015-11 is effective for reporting periods beginning after December 15, 2016 and is applied
prospectively. Early adoption is permitted. We are evaluating the impact, if any, of adopting this new accounting
guidance on its financial statements.
In September 2015, the FASB issued new guidance related to business combinations. The new guidance
requires that adjustments made to provisional amounts recognized in a business combination be recorded in the
period such adjustments are determined, rather than retrospectively adjusting previously reported amounts. The
new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after
December 15, 2015. Early adoption is permitted. We are evaluating the impact, if any, of adopting this new
accounting guidance on our consolidated financial statements.
In November 2015, the FASB issued new guidance related to balance sheet classification of deferred taxes.
The standard update requires that deferred tax liabilities and assets be classified as non-current in a classified
statement of financial position. The amendments in this update are effective for reporting periods beginning after
December 15, 2016. Early adoption is permitted. We early adopted ASU 2015-17 effective December 31, 2015
on a prospective basis. Adoption of this ASU resulted in a reclassification of our net current deferred tax asset to
the net non-current deferred liability in our consolidated balance sheet as of December 31, 2015. No prior periods
were retrospectively adjusted.
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