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85
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS KEYCORP AND SUBSIDIARIES
ACCOUNTING PRONOUNCEMENTS PENDING
ADOPTION AT DECEMBER 31, 2008
Business combinations. In December 2007, the FASB issued SFAS
No. 141(R), “Business Combinations.” The new pronouncement
requires the acquiring entity in a business combination to recognize only
the assets acquired and liabilities assumed in a transaction (e.g.,
acquisition costs must be expensed when incurred), establishes the
fair value at the date of acquisition as the initial measurement for all
assets acquired and liabilities assumed, and requires expanded
disclosures. SFAS No. 141(R) will be effective for fiscal years beginning
after December 15, 2008 (effective January 1, 2009, for Key). Early
adoption is prohibited.
Noncontrolling interests. In December 2007, the FASB issued SFAS No.
160, “Noncontrolling Interests in Consolidated Financial Statements,
an Amendment of ARB No. 51.” The new pronouncement requires all
entities to report noncontrolling (minority) interests in subsidiaries as
acomponent of shareholders’ equity. SFAS No. 160 will be effective for
fiscal years beginning after December 15, 2008 (effective January 1,
2009, for Key). Early adoption is prohibited. Adoption of this accounting
guidance is not expected to have a material effect on Key’s financial
condition or results of operations.
Accounting for transfers of financial assets and repurchase financing
transactions. In February 2008, the FASB issued Staff Position No. FAS
140-3, “Accounting for Transfers of Financial Assets and Repurchase
Financing Transactions.” This Staff Position provides guidance on
accounting for a transfer of a financial asset and a repurchase financing,
and presumes that an initial transfer of a financial asset and a repurchase
financing are considered part of the same arrangement (linked
transaction) under SFAS No. 140. However,if certain criteria are met,
the initial transfer and repurchase financing shall be evaluated separately.
Staff Position No. FAS 140-3 will be effective for fiscal years beginning
after November 15, 2008 (effective January 1, 2009, for Key). Early
adoption is prohibited. Adoption of this accounting guidance is not
expected to have a material effect on Key’s financial condition or
results of operations.
Disclosures about derivative instruments and hedging activities. In
March 2008, the FASB issued SFAS No. 161, “Disclosures about
Derivative Instruments and Hedging Activities,” which amends and
expands the disclosure requirements of SFAS No. 133, “Accounting for
Derivative Instruments and Hedging Activities.” This accounting
guidance requires qualitative disclosures about objectives and strategies
for using derivatives, quantitative disclosures about fair value amounts
and gains and losses on derivative instruments, and disclosures about
credit risk-related contingent features in derivative agreements. SFAS No.
161 will be effective for fiscal years beginning after November 15,
2008 (effective January 1, 2009, for Key).
Determination of the useful life of intangible assets. In April 2008, the
FASB issued Staff Position No. FAS 142-3, “Determination of the
Useful Life of Intangible Assets.” This accounting guidance amends the
factors that should be considered in developing renewal or extension
assumptions used to determine the useful life of a recognized intangible
asset under SFAS No. 142, “Goodwill and Other Intangible Assets.” This
Staff Position will be effective for fiscal years beginning after December
15, 2008 (effective January 1, 2009, for Key). Early adoption is
prohibited. Adoption of this accounting guidance is not expected to have
amaterial effect on Key’s financial condition or results of operations.
Hierarchy of generally accepted accounting principles. In May 2008,
the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles.” This guidance identifies the sources of accounting
principles and the framework for selecting the principles to be used in
the preparation of financial statements of nongovernmental entities
that are presented in conformity with GAAP. SFAS No. 162 will be
effective sixty days after the Securities and Exchange Commission
approves the Public Company Accounting Oversight Board amendments
to AU Section 411, “The Meaning of Present Fairly in Conformity
with Generally Accepted Accounting Principles.” Adoption of this
accounting guidance is not expected to have a material effect on Key’s
financial condition or results of operations.
Accounting for convertible debt instruments. In May 2008, the FASB
issued StaffPosition No. APB 14-1, “Accounting for Convertible Debt
Instruments That May Be Settled in Cash upon Conversion (Including
Partial Cash Settlement).” This guidance requires the issuer of certain
convertible debt instruments that may be settled in cash (or other assets)
on conversion to separately account for the liability (debt) and equity
(conversion option) components of the instrument in a manner that
reflects the issuer’snonconvertible debt borrowing rate. This Staff Position
will be effective for fiscal years beginning after December 15, 2008
(effective January 1, 2009, for Key). Early adoption is prohibited. Key has
not issued and does not have any convertible debt instruments outstanding
that aresubject to the accounting guidance in this StaffPosition. Therefore,
adoption of this accounting guidance is not expected to have a material
effect on Key’s financial condition or results of operations.
Employers’ disclosures about postretirement benefit plan assets. In
December 2008, the FASB issued Staff Position No. FAS 132(R)-1,
“Employers’ Disclosures about Postretirement Benefit Plan Assets,”
which amends SFAS No. 132 (revised 2003), “Employers’ Disclosures
about Pensions and Other Postretirement Benefits.” This new accounting
guidance will require additional disclosures about assets held in an
employer’s defined benefit pension or other postretirement plan including
fair values of each major asset category and level within the fair value
hierarchy as set forth in SFAS No. 157, “Fair Value Measurements.” This
Staff Position will be effective for fiscal years ending after December 15,
2009 (December 31, 2009, for Key).