Wells Fargo 2014 Annual Report Download - page 114

Current Accounting Developments
The following table provides accounting pronouncements
applicable to us that have been issued by the FASB but are not
yet effective.
Effective date and financial
Standard Description statement impact
Accounting Standards Update (ASU or
Update) 2015-02 - Consolidation (Topic
810): Amendments to the Consolidation
Analysis
The Update primarily amends the criteria
companies use to evaluate whether they
should consolidate certain variable
interest entities that have fee
arrangements and the criteria used to
determine whether partnerships and
similar entities are variable interest
entities . The Update also excludes
registered 2a-7 money market funds
(including unregistered funds that
operate in a similar manner) from the
consolidation guidance.
The changes are effective for us in first
quarter 2016 with early adoption
permitted. We are evaluating the impact
the Update will have on our consolidated
financial statements.
ASU 2015-01 - Income Statement -
Extraordinary and Unusual Items
(Subtopic 225-20): Simplifying Income
Statement Presentation by Eliminating
the Concept of Extraordinary Items
The Update removes the concept of
extraordinary items from GAAP and
eliminates the requirement for
extraordinary items to be separately
presented in the statement of income.
The Update is effective for us in first
quarter 2016 with prospective or
retrospective application. Early adoption
is permitted. The Update will not have a
material impact on our consolidated
financial statements.
ASU 2014-16 - Derivatives and Hedging
(Topic 815): Determining Whether the
Host Contract in a Hybrid Financial
Instrument Issued in the Form of a Share
is More Akin to Debt or Equity
The Update clarifies that the nature of
host contracts in hybrid financial
instruments that are issued in share form
should be determined based on the entire
instrument, including the embedded
derivative.
The Update is effective for us in first
quarter 2016 with retrospective
application. The Update will not have a
material impact on our consolidated
financial statements.
ASU 2014-13 - Consolidation (Topic 810):
Measuring the Financial Assets and the
Financial Liabilities of a Consolidated
Collateralized Financing Entity
The Update provides a measurement
alternative to companies that consolidate
collateralized financing entities (CFEs),
such as collateralized debt obligation and
collateralized loan obligation structures.
Under the new guidance, companies can
measure both the financial assets and
financial liabilities of a CFE using the
more observable fair value of the financial
assets or of the financial liabilities.
These changes are effective for us in first
quarter 2016 with early adoption
permitted at the beginning of an annual
period. The guidance can be applied
either retrospectively or by a modified
retrospective approach. The Update will
not have a material impact on our
consolidated financial statements.
ASU 2014-12 - Compensation - Stock
Compensation (Topic 718): Accounting
for Share-Based Payments When the
Terms of an Award Provide That a
Performance Target Could Be Achieved
After the Requisite Service Period
The Update provides accounting guidance
for employee share-based payment
awards with specific performance targets.
The Update clarifies that performance
targets should be treated as performance
conditions if the targets affect vesting and
could be achieved after the requisite
service period.
The Update is effective for us in first
quarter 2016 with early adoption
permitted and can be applied
prospectively or retrospectively. This
Update will not have a material impact on
our consolidated financial statements.
ASU 2014-11 - Transfers and Servicing
(Topic 860): Repurchase-to-Maturity
Transactions, Repurchase Financings,
and Disclosures
The Update requires repurchase-to-
maturity transactions to be accounted for
as secured borrowings versus sales. The
guidance also requires separate
accounting for transfers of financial assets
that are executed contemporaneously
with repurchase agreements. The Update
also includes new disclosures for transfers
accounted for as sales and for repurchase
agreements and similar arrangements,
such as classes of collateral pledged for
gross obligations and the remaining
contractual maturity of repurchase
agreements.
The accounting changes are effective for
us in first quarter 2015 with early
adoption prohibited. The disclosures are
required in first quarter 2015 for transfers
accounted for as sales with the remaining
disclosures required in second quarter
2015. This Update will not have a material
impact on our consolidated financial
statements.
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