SEC Staff Accounting Bulletin No. 103: Update of Codification of Staff Accounting Bulletins

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SECURITIES AND EXCHANGE COMMISSION 17 CFR Part 211 [Release No. SAB 103] Staff Accounting Bulletin No. 103, "Update of Codification of Staff Accounting Bulletins"

Agency : Securities and Exchange Commission. Action : Publication of staff accounting bulletin. Summary : This staff accounting bulletin revises or rescinds portions of the interpretive guidance included in the codification of staff accounting bulletins in order to make this interpretive guidance consistent with current authoritative accounting and auditing guidance and SEC rules and regulations. The principal revisions relate to the rescission of material no longer necessary because of private sector developments in U.S. generally accepted accounting principles, as well as Commission rulemaking. Dates : May 9, 2003. For Further Information Contact : Paul Munter or Jack Albert, Office of the Chief Accountant (202-942-4400), or Craig Olinger, Division of Corporation Finance (202-942-2960), Securities and Exhange Commission, 450 Fifth Street, N.W., Washington, DC 20549. Supplementary Information

Background

The last comprehensive review of the staff accounting bulletins was completed by the staff in 1981, which culminated in issuance of Staff Accounting Bulletin No. 40. At that time, the staff completed a comprehensive review of the material included in staff accounting bulletin numbers 1 through 38 to revise and update such materials, and to codify those staff accounting bulletins in order to make the interpretive guidance contained therein more useful to registrants, accountants and others (Staff Accounting Bulletin No. 39 was separately considered by the staff). Since that time, the staff has issued 62 additional staff accounting bulletins (through number 102) and occasional amendments ( e.g ., SAB No. 71A), and has, on a sporadic basis, revised or rescinded the guidance in individual staff accounting bulletins based on subsequent Commission rulemaking activities or developments by private sector accounting and auditing standards-setters. However, a comprehensive review of the guidance contained in the staff accounting bulletin codification has not been undertaken since 1981. Recent guidance issued by the Financial Accounting Standards Board (FASB), specifically Statements of Financial Accounting Standards (Statements) 141, Business Combinations , 142, Goodwill and Other Intangible Assets , 143, Accounting for Asset Retirement Obligations , 144, Accounting for the Impairment or Disposal of Long-Lived Assets , 146, Accounting for Costs Associated with Exit or Disposal Activities , 147 Acquisitions of Certain Financial Institutions - an Amendment of FASB Statements No. 72 and 144 and FASB Interpretation No. 9 , and Interpretations 45, Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others - an Interpretation of FASB Statements No. 5, 57, and 107 and Rescission of FASB Interpretation No. 34 and 46, Consolidation of Variable Interest Entities , revise or supersede certain guidance contained in Accounting Principles Board (APB) Opinions 16, Business Combinations , 17, Intangible Assets , and 30, Reporting the Results of Operations - Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions , Statements 5, Accounting for Contingencies , and 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of , as well as several issues addressed by the FASB's Emerging Issues Task Force (EITF) and other authoritative guidance. Provisions of the accounting standards identified above that have been revised or superseded were the subject of several staff interpretations included in the staff accounting bulletins. Furthermore, certain guidance contained in many of the staff accounting bulletins either is no longer useful or relevant due to the passage of time, or has been made obsolete by subsequent Commission rulemaking activities. Therefore, the purpose of this staff accounting
bulletin is to comprehensively update the existing codification to enhance the integrity and usefulness of this guidance. The statements in staff accounting bulletins are not rules or interpretations of the Commission, nor are they published as bearing the Commission's official approval. They represent interpretations and practices followed by the Division of Corporation Finance and the Office of the Chief Accountant in administering the disclosure requirements of the Federal securities laws. Margaret H. McFarland Deputy Secretary Date: May 9, 2003.

Part 211 - (AMEND) Accordingly, Part 211 of Title 17 of the Code of Federal Regulations is amended by adding Staff Accounting Bulletin No. 103 to the table found in Subpart B. STAFF ACCOUNTING BULLETIN NO. 103

The staff hereby revises the Staff Accounting Bulletin Series as follows: 1. TOPIC 1: FINANCIAL STATEMENTS

Topic 1.A is modified to delete the reference to previously-deleted Rules 3-07 and 3-08 of Regulation S-X. Topic 1.B.1 is modified to reflect the provisions of FASB Statement 109, Accounting for Income Taxes . Topic 1.D.1 is modified to conform such guidance with the revised disclosure requirements for foreign private issuers required under Form 20-F as a result of the Commission's International Disclosure Standards rule (Exchange Act Release No. 34-41936) which became effective September 30, 2000. The modifications primarily relate to changes in the former reference in this guidance to Item 9 (Management's Discussion and Analysis) of Form 20-F to make the reference consistent with the new non-financial disclosure requirements of this Form. Topic 1.E.1 is deleted. A definition of the term "audit (or examination)," which was the subject of this interpretive guidance, is now provided in Rule 1-02 of Regulation S-X, thus making the guidance contained in this staff accounting bulletin unnecessary. Topic 1.F is modified to change the references in this guidance from Form S-14 to Form S-4, since Form S-4 subsequently replaced Form S-14. This topic is also modified to delete question 3 and the related interpretive response. The guidance contained in this interpretive response, related to the appropriate accounting treatment for costs incurred to register securities issued for the formation of one-bank holding companies, has been superseded by American Institute of Certified Public Accountants' (AICPA) Statement of Position (SOP) 98-5, Reporting on the Costs of Start-Up Activities . Topic 1.I is modified to update the former reference in this guidance to the American Institute of Certified Public Accountants' February 1986 Notice to Practitioners, ADC Arrangements . ADC Arrangements

was originally issued as a notice to practitioners, published in the April 1986 issue of The Journal of Accountancy . This notice was subsequently reprinted without modification as Exhibit I to the AICPA's Practice Bulletin 1 dated November 1987. Furthermore, question 8 of this topic is deleted because the guidance contained in this question and interpretive response, which related to transition to the guidance in Topic 1.I, is no longer relevant due to the passage of time. Furthermore, the reference in the interpretive response to question 1 to Rule 1-02(v) of Regulation S-X has been changed to Rule 1-02(w) of Regulation S-X, since this Rule was redesignated in Exchange Act Release No. 34-35094. Topic 1.J, the first paragraph of the interpretative response is modified to remove the reference to specific percentages and refer to the significance tests in Rule 3-05. Topic 1.L is deleted since it refers to the bankruptcy of a specific accounting firm (Laventhol & Horwath) which occurred in 1990. Topic 1.M is modified to update references to authoritative literature such as SAS 99, Consideration of Fraud in a Financial Statement Audit , which superseded SAS 82, Consideration of Fraud in a Financial Statement Audit .

2. TOPIC 2: BUSINESS COMBINATIONS-Note: In June 2001, the FASB issued Statement 141, which superseded APB Opinion 16, and Statement 142 which superseded APB Opinion 17. Paragraph 13 of Statement 141 requires all business combinations within the scope of that statement to be accounted for using the purchase method as described in that statement. The provisions of Statement 141 are applicable to all business combinations initiated after June 30, 2001. The pooling-of-interests method of accounting for business combinations, as provided for in APB Opinion 16, is no longer permitted for business combinations initiated after June 30, 2001. Several of the interpretive questions in this topic relate to the conditions that must be met in order for a business combination to be appropriately accounted for under the pooling-of-interests method. Accordingly, these interpretive questions are no longer needed.

Topic 2.A.1 is deleted. This topic addresses the impact of cash contingencies on classifying a combination as a pooling-of-interests. Since business combinations cannot be accounted for using the pooling-of-interests method, the guidance is no longer relevant. Topic 2.A.2 is deleted. This topic contained two interpretive questions regarding how the acquiring corporation should be determined in a purchase business combination, following the guidance in APB Opinion 16. These interpretations were premised on the language contained in paragraph 70 of APB Opinion 16, which indicated that "...presumptive evidence of the acquiring corporation in combinations effected by an exchange of stock is obtained by identifying the former common stockholder interests of a combining company which either retain or receive the larger portion of the voting rights in the combined corporation. That corporation should be treated as the acquirer unless other evidence clearly indicates that another corporation is the acquirer." Guidance on identifying the acquiring entity is now provided in paragraphs 15 through 19 of Statement 141. This guidance provides several factors to be considered in determining the acquiring entity, one of which is the relative voting rights in the combined entity after the combination. The presumptive language contained in APB Opinion 16 was not retained in Statement 141. Therefore, the guidance in Topic 2.A.2 is no longer relevant. Topic 2.A.3 is deleted. This topic provided interpretive guidance regarding the application of the purchase method of accounting for business combinations to acquisitions of financial institutions during a period of unusual economic conditions (i.e., a period of abnormally high interest rates). This guidance focused on: 1) unique considerations in the allocation of purchase price to acquired tangible and intangible assets in financial institution acquisitions (such as the determination of the fair values of assets acquired, and the identification and valuation of identifiable intangible assets), 2) the appropriate measure of the fair value of deposit liabilities assumed in acquisitions of financial institutions, and 3) the appropriate amortization periods and methods for intangible assets acquired and goodwill arising from financial institution acquisitions. Statements 141 and 147 provide new guidance as to the criteria for recognizing an intangible asset apart from goodwill in a purchase business combination. Statement 142 provides new guidance on the initial recognition and measurement of intangible assets, and the determination of the useful lives and amortization methods for intangible assets subject to amortization. Statement 142 also provides new guidance on accounting for goodwill. Consequently, the guidance contained in this topic is no longer relevant. Topic 2.A.4 is deleted. This topic provided guidance on the determination of the appropriate amortization period for goodwill arising from financial institution
acquisitions which occurred after December 23, 1981 at the time an entity participating in such an acquisition became an SEC registrant. Under the provisions of Statement 142, goodwill is not amortized, but instead must be tested for impairment at least annually following the methodology provided in that statement. Therefore, the guidance in this topic is no longer relevant. Topic 2.A.5 is modified to update the former references to APB Opinion 16 contained therein to the relevant portions of Statement 141, and to otherwise make the language in this guidance consistent with the provisions of Statement 141. Topic 2.A.6 is modified to update the former references to APB Opinion 16 contained therein to the relevant portions of Statement 141, and to otherwise make the language in this guidance consistent with the provisions of Statement 141. Topic 2.A.7 is modified to update the former references to APB Opinion 16 contained therein to the relevant portions of Statement 141, and to otherwise make the language in this guidance consistent with the provisions of Statement 141. Topic 2.A.8 is modified to update the former references to APB Opinion 16 contained therein to the relevant portions of Statement 141, and to otherwise make the language in this guidance consistent with the provisions of Statement 141. Furthermore, footnote 2 is deleted, since this footnote provided transition guidance which is no longer necessary due to the passage of time. Topic 2.A.9 is modified to update the former references to APB Opinion 16 contained therein to the relevant portions of Statement 141, and to otherwise make the language in this guidance consistent with the provisions of Statement 141. Topic 2.B is deleted. It addressed the treatment of merger expenses in a pooling-of-interests combination. Since, under Statement 141, all combinations are treated as purchases, this guidance is no longer necessary. Topic 2.C is deleted. It addressed certain pro forma disclosures required for a pooling-of-interests combination. Since, under Statement 141, all combinations are treated as purchases, this guidance is no longer necessary. Topic 2.D is modified to update the former references to APB Opinion 16 contained therein to the relevant portions of Statement 141, and to otherwise make the language in this guidance consistent with the provisions of Statement 141 and to delete portions of the guidance related to pooling-of-interests accounting. Topic 2.E is deleted. The topic addressed the implications of risk sharing provisions on the classification of a combination as a pooling-of-interests. Since, under Statement 141, all combinations are treated as purchases, this guidance is no longer necessary. Topic 2.F is deleted. This topic addressed the implications of treasury stock transactions following the consummation of a business combination on the classification of a combination as a pooling-of-interest. Since, under Statement 141, all combinations are treated as purchases, this
guidance is no longer necessary.

3. TOPIC 3: SENIOR SECURITIES

Topic 3.C is modified to include a reference to EIT Topic D-98 in the interpretive response to Question 1.

4. TOPIC 4: EQUITY ACCOUNTS

Topic 4.B is retitled. It previously referred to Subchapter S Corporations. Such entities are now referred to as S Corporations. Topic 4.E is modified to revise the interpretive response to be consistent with revisions subsequently made in Rule 5-02.30 of Regulation S-X.

5. TOPIC 5: MISCELLANEOUS ACCOUNTING

Topics 5.C.1 and 5.C.2 are deleted. These topics provided interpretive guidance related to the current recognition of tax loss carryforwards under APB Opinion 11, Accounting for Income Taxes . APB Opinion 11 has since been superseded by Statement 109 and the guidance contained in these topics is no longer relevant. Topic 5.E, question 1 is modified to add an appropriate reference to FASB Interpretation 46. Topic 5.E, question 2 is modified to remove, in the interpretive response, the reference to APB Opinion 30, since the relevant authoritative guidance that this response was referring to (accounting for the disposal of a segment of a business) has been superseded by Statement 144. Additionally, that interpretive response is modified to remove the reference to ASR 95, Accounting for Real Estate Transactions Where Circumstances Indicate that Profits Were Not Earned at the Time the Transactions Were Recorded , which previously was rescinded. Topic 5.F is modified to delete the reference in the interpretive response to Statement 8, Accounting for the Translation of Foreign Currency Transactions and Foreign Currency Financial Statements , which has since been superseded. Topic 5.J, footnote 1 has been modified to reflect the fact that the FASB has not determined when or whether it will address push down accounting. Additionally, the interpretive response to question 3 has been modified to include reference to the guidance provided in Interpretation 45. Topic 5.M is modified in order to conform this guidance with the provisions of Statement 115, Accounting for Certain Investments in Debt and Equity Securities , which superseded Statement 12, Accounting for Certain Marketable Securities . The guidance contained in question 1 of this interpretation continues to be relevant, because Statement 115, like Statement 12, requires a determination of whether a decline in the fair value of debt or equity securities is other than temporary. References to the applicable authoritative literature in the interpretive response to this question are changed, and the language in the interpretive response to question 1 is modified, to be consistent with the new authoritative guidance. Question 2 and the related interpretive response are deleted since Statement 115, paragraph 16 now provides relevant guidance on determining the amount of the write down when a decline in fair value is judged to be other than temporary. Topics 5.P.1 and 5.P.2 are deleted. These topics provided interpretive guidance related to APB Opinion 30 and EITF Issues 94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (Including Certain Costs Incurred in a Restructuring) , and 95-3, Recognition of Liabilities in Connection with a Purchase Business Combination , as they applied to restructuring provisions. Statement 146 establishes standards for accruing liabilities related to exiting activities and requires that the liability be recorded when it has
been incurred and that it be recorded at its fair value. Accordingly, the previous guidance provided in these topics is no longer needed. Topic 5.P.3 is modified to delete the language that referred to the requirements of APB Opinion 30 regarding the reporting of discontinued operations, which has since been superseded by Statement 144. Footnote 13 of this guidance also has been modified and renumbered to make reference to Statement 131, Disclosures about Segments of an Enterprise and Related Information , which superseded Statement 14, Financial Reporting for Segments of a Business Enterprise . The guidance in this footnote continues to be relevant, considering the revisions hereby made, under Statement 131. Topic 5.P.4 is modified to change the reference in former footnote 16 from Statement 38, Accounting for Preacquisition Contingencies of Purchased Enterprises , to Statement 141. Statement 141 superseded Statement 38, although the guidance in Statement 38 was carried forward into the new standard without reconsideration. Therefore, the guidance in this footnote remains relevant. Additionally, the topic is modified to reflect the disclosure requirements of Statement 146. Topic 5.R is deleted. With the issuance of Statement 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities , and Interpretation 39, Offsetting of Amounts Related to Certain Contracts , this guidance is no longer needed. Topic 5.S, question 4 is modified to change the references in the interpretive response from Statement 96, Accounting for Income Taxes , to the relevant provisions in Statement 109. Although Statement 109 superseded Statement 96, the guidance in this interpretive response remains relevant, considering the revisions hereby made, because Statement 109 carried forward the same guidance contained in Statement 96 with respect to quasi-reorganizations. Topic 5.T, footnote 2 is modified to remove reference to APB Opinion 16, which was superseded, and Topic 2.B, which is being deleted. Topic 5.U is modified to add new footnotes 4 and 5 to clarify the guidance applicable to gain deferral situations. Topic 5.V is modified to note that the interpretive guidance therein does not apply to sales of the residual equity in an entity holding nonperforming loans to an unrelated party. Instead, the provisions of Statement 140 apply to such transactions. Also, it is modified to add an appropriate reference to FASB Interpretation 46 and to delete the reference to EITF Topic D-14, Transactions involving Special-Purpose Entities . In addition, footnote 5 has been modified to note that EITF Issue 87-17, Spinoffs or Other Distributions of Loans Receivable to Shareholders , was subsequently codified as issue 11 of EITF Issue 01-02, Interpretations of APB Opinion No. 29 . Topic 5.W is modified to incorporate the guidance of SOP 94-6, Disclosure of Certain Significant Risks and Uncertainties . Topic 5.X is deleted. This interpretive guidance
expressed the staff's views regarding the accounting for income tax benefits of thrift bad-debt losses. This guidance was intended to serve as interim guidance until a new standard on accounting for income taxes was adopted. The FASB subsequently issued Statement 109 which provides guidance on this issue. Topic 5.Y is modified as follows:

The Facts section, questions 1, 2, and 3 are deleted. The remaining questions are renumbered. This information is no longer needed because the issues are addressed in SOP 96-1, Environmental Remediation Liabilities . Previously-numbered question 4 is modified to replace the reference to EITF Issue No. 93-5, Accounting For Environmental Liabilities , with SOP 96-1 (SOP 96-1 carried forward the guidance previously contained in EITF Issue 93-5). In addition, previously-numbered footnote 3, included in the interpretive response to question 4, is modified to provide the relevant language from Concepts Statement 7, Using Cash Flow Information and Present Value in Accounting Measurements . Previously-numbered question 5 is modified to incorporate guidance from and reference to SOP 96-1. The interpretive response to previously-numbered question 7 is modified to refer registrants to the disclosure requirements of Statement 143 for legal obligations associated with the retirement of tangible long-lived assets within the scope of that statement and to Interpretation 45 for guarantees. Previously-numbered question 8 and the related interpretive response are deleted. This guidance, related to the appropriate accounting for site restoration costs, post-closure and monitoring costs, or other environmental costs incurred at the end of the useful life of an asset, is no longer relevant due to the issuance of Statement 143, which establishes accounting standards for recognition and measurement of liabilities for asset retirement obligations and associated asset retirement costs.

Topic 5.Z.1 is deleted. The guidance in this interpretive response provided the staff's views as to whether the criteria under APB Opinion 30 for presentation as discontinued operations had been met under certain facts and circumstances. Statement 144 provides new guidance on reporting discontinued operations that supersedes the portions of APB Opinion 30 that addressed this issue. Therefore, this interpretative guidance is no longer relevant. Topic 5.Z.2 is deleted. The guidance in these interpretive responses provided the staff's views as to whether the criteria under APB Opinion 30 for presentation as discontinued operations had been met under certain facts and circumstances. Statement 144 provides new guidance on reporting discontinued operations that supersedes the portions of APB Opinion 30 that addressed this issue. Therefore, this interpretative guidance is no longer relevant. Topic 5.Z.3 is deleted. The guidance in these interpretive responses provided the staff's views as to whether the criteria under APB Opinion 30 for presentation as discontinued operations had been met under certain facts and circumstances. Statement 144 provides new guidance on reporting discontinued operations that supersedes the portions of APB Opinion 30 that addressed this issue. Therefore, this interpretative guidance is no longer relevant. Topic 5.Z.4 is modified to be consistent with the guidance of Statement 144, which superseded the previous guidance of APB Opinion 30. Topic 5.Z.5 is modified to reflect the appropriate terminology from Statement 144 (separate component) rather than that previously provided by APB Opinion 30 (segment of a business), to make other changes related to the accounting provisions of Statement 144, and to remind registrants of the disclosure requirements of Interpretation 45. Topic 5.Z.6 is deleted. This topic provided the staff's views as to whether subsidiaries that a company intends to sell, which cannot be reported as discontinued operations under APB Opinion 30, must be consolidated in the company's financial statements. This interpretive question arose as a result of the "temporary control" exception to consolidation in ARB 51, Consolidated Financial Statements , as amended by Statement 94, Consolidation of all Majority-Owned Subsidiaries . Statement 144 provides guidance which supersedes the guidance in APB Opinion 30 related to the reporting of discontinued operations. Statement 144 also amended ARB 51 to eliminate the exception to consolidation for a subsidiary for which control is likely to be temporary. Therefore, the interpretive guidance in this topic is no longer relevant. Topic 5.Z.7 is modified to change the reference therein from APB Opinion 30 to Statement 144. Furthermore, the interpretive response is also amended to add language clarifying the staff's interpretation of the term "dissimilar" based on long-standing staff practice. Topic 5.AA is deleted. Statement 140 superseded the previous guidance on
extinguishments of debt. Accordingly, the guidance is no longer needed. Topic 5.CC is modified. Topic 5.CC provides interpretive guidance on certain questions related to the recognition and measurement of impairment of the carrying amount of long-lived assets, certain identifiable intangible assets, and goodwill pursuant to the provisions of Statement 121 and APB Opinion 17. A portion of this guidance has since been superseded by Statements 142 and 144 and is now deleted. The remaining relevant guidance is rewritten so that it is consistent with the requirements of Statements 142 and 144.

6. TOPIC 6: INTERPRETATIONS OF ACCOUNTING SERIES RELEASES

Topic 6.A.1 is deleted. ASR 166, Disclosure of Unusual Risks and Uncertainties in Financial Reporting , has been rescinded. Therefore, the guidance contained in this topic is no longer relevant. Topic 6.F.1 is deleted. This interpretation provided interpretive guidance on the requirements of Rule 12-03 of Regulation S-X. The schedule previously required under Rule 12-03 was eliminated by Exchange Act Release No. 34-35094. Therefore, the guidance contained in this topic is no longer necessary. Topic 6.G.1 is modified as follows:

The interpretive response to Question 5 is modified to incorporate the terminology used in Statement 144. Question 7 and the related interpretive response under sub-section a. to this topic are modified to remove the reference to Form 8, which was rescinded by Exchange Act Release No. 34-31905. Sub-section c. and the related questions and interpretive responses thereunder are deleted. Item 302(a)(5) of Regulation S-K was amended by Exchange Act Release No. 34-42266 which made the requirements of Item 302(a) of Regulation S-K applicable to any registrant, except a foreign private issuer, that has securities registered pursuant to sections 12(b) or 12(g) of the Exchange Act. Therefore, the guidance contained in these questions and interpretive responses, which related to the former requirements of Item 302(a) of Regulation S-K, no longer applies.

Topic 6.G.2.a is modified as follows:

Question 4 is modified to refer to cash and cash equivalents rather than to funds. APB Opinion 19, Reporting Changes in Financial Position , referred to flow of funds. Statement 95, Statement of Cash Flows , superseded APB Opinion 19 and refers to flow of cash and cash equivalents. Question 5 is deleted. Question 5 refers to an analysis of changes in each element of working capital, which is consistent with a "funds" model. However, with the provisions of Statement 95, which uses "cash and cash equivalents," this guidance is no longer relevant.

Topic 6.G.2.b.1 is modified to add a footnote reference to APB Opinion 20, Accounting Changes , which requires disclosure of the nature and justification of a change in accounting principle. Topic 6.H is modified as follows:

The Facts

section is modified to delete item (3), since the related supplemental schedule that this item was referring to (Rule 12-10 of Regulation S-X) was eliminated by Exchange Act Release No. 34-35094. Topic 6.H.1.b is modified to refer to Rule 17a-5 as currently numbered. Topic 6.H.2.a is modified to remove the reference to ASR 172, Notice of Rescission of Guidelines Set Forth in Accounting Series Release No. 148 Pertaining to Classification of Short-Term Obligations Expected to be Refinanced . Topic 6.H.4.c and the related question and interpretive response thereunder are deleted. The schedule formerly required pursuant to Rule 12-10 of Regulation S-X was eliminated by Exchange Act Release No. 34-35094. Therefore, this guidance, which related to the disclosures previously required under Rule 12-10, is no longer relevant.

Topic 6.I.3 is modified to refer to discontinued operations rather than discontinuance or disposals of business segments so that it is consistent with Statement 144. Topic 6.I.7 is modified to refer to Rule 4-08(h) rather than Rule 4-08(g) to reflect current numbering. Topic 6.K.1 is deleted. This topic provided interpretive guidance related to the early adoption of ASR 302, Separate Financial Statements Required by Regulation S-X . This guidance is no longer necessary due to the passage of time. Topic 6.4.b is modified to refer to Rule 1-02(w). The rules for determining significant subsidiaries were previously renumbered and moved to subsection (w).

7. TOPIC 7: REAL ESTATE COMPANIES

Topic 7.A is deleted. This topic provided guidance on the presentation of funds data in quarterly reports on Form 10-Q for real estate companies. This guidance is no longer relevant due to the issuance Statement 95. Topic 7.B is deleted. This topic provided guidance on the appropriate format for the statement of changes in financial position for registrants engaged in retail land development and sale activities. This guidance is no longer relevant due to the issuance of Statement 95.

8. TOPIC 8: RETAIL COMPANIES

The Facts to Topic 8.A are rewritten to make them more generically applicable to retail companies.

9. TOPIC 9: FINANCE COMPANIES

Topic 9.A is deleted. This topic provided interpretive guidance on the appropriate accounting for nonrefundable "points" charged by finance companies at the time a loan transaction is closed. Related guidance is now provided in Statement 91, Accounting for Nonrefundable Fees and Costs Associated with Originating or Acquiring Loans and Initial Direct Costs of Leases , making the continued need for the guidance in this topic unnecessary.

10. TOPIC 10: UTILITY COMPANIES

In the interpretive response to Topic 10.A, reference to Rule 4-08(j) is deleted since that rule no longer exists. Topic 10.B is deleted. This topic provided interpretive guidance on disclosures that should be made concerning the estimated future costs of storing spent nuclear fuel and decommissioning nuclear generating plants. Statement 143 establishes accounting standards for recognition and measurement of a liability for an asset retirement obligation and the associated asset retirement cost, including required disclosures. Therefore, the guidance in this topic is no longer relevant. Topic 10.C is modified to add a footnote reminding registrants to consider the guidance provided in Interpretation 46. In the interpretive response to Topic 10.D, the second, third and fourth sentences of the final paragraph are deleted. These sentences referred to ASR 122, Coverage of Fixed Charges , which has been rescinded. Additionally, a footnote is added to remind registrants of the need to consider the guidance provided in Interpretations 45 and 46 and Statement 133, Accounting for Derivative Instruments and Hedging Activities and related literature. Topic 10.E, question 2 and related interpretive response dealing with transition to the requirements of Statement 90, Regulated Enterprises - Accounting for Abandonments and Disallowances of Plant Costs

is deleted as no longer necessary due to the passage of time. Topic 10.F is modified to incorporate a footnote to the interpretive response to relate the response to the requirements of SOP 96-1.

11. TOPIC 11: MISCELLANEOUS DISCLOSURE

Topic 11.D is deleted. This topic provided interpretive guidance on the offsetting of related assets and liabilities. This guidance is no longer necessary due to the issuance of Interpretation 39. Question 1 of Topic 11.H.2 is deleted with Questions 2 and 3 being renumbered as Questions 1 and 2. Question 1 and the Interpretive Response are no longer needed in light of the provisions of Statements 15 and 114. Topic 11.J is deleted. This topic provided interpretive guidance on reporting information related to financial guarantees. This guidance is no longer necessary due to the issuance of Interpretation 45. Topic 11.K, footnote one is modified to remove reference to activities of the FASB's financial instruments project which subsequently have been completed. Topic 11.N, footnote 2 is modified to remove reference to Statement 72, Accounting for Certain Acquisitions of Banking or Thrift Institutions (an Amendment of APB Opinion No. 17, an Interpretation of APB Opinions 16 and 17, and an Amendment of FASB Interpretation No. 9) . With the issuance of Statement 147, the provisions of Statement 72 are no longer relevant to the accounting for such transactions.

12. TOPIC 12: OIL AND GAS PRODUCING ACTIVITIES

Topic 12.A.1 is revised to delete, in the interpretive response to question 3, the reference to Item 2(b)(3) of Regulation S-K, which has been redesignated within Industry Guide 2. Topic 12.A.2 is revised to update the references to the required disclosures of the standardized measure of discounted future net cash flows to the provisions of Statement 69, Disclosures about Oil and Gas Producing Activities . Consistent with this change, reference to "standardized measure of discounted future net cash flows" is substituted for "estimated future net revenues" and "year end prices" substituted for "current prices" for consistency with the terminology used in Statement 69. Furthermore, questions 4-11, and the related interpretive responses to those questions which deal with the reporting implications of the Windfall Profits Tax and the 1985 natural gas price decontrol and disclosure of reserve information are deleted as no longer being relevant. Topic 12 A.3.a is deleted. The required disclosures of the standardized measure of discounted future net cash flows is provided by Statement 69 and the guidance is no longer necessary. Topic 12.A.3.c is revised to update the references to the required disclosures of the standardized measure of discounted future net cash flows to the provisions of Statement 69. Topic 12.A.3.d is revised to update the references to the required disclosures of the standardized measure of discounted future net cash flows to the provisions of Statement 69. Topic 12.A.4, regarding filings by Canadian registrants, is deleted as no longer being relevant. Topic 12.B regarding supplemental disclosures on the basis of reserve recognition accounting is deleted as no longer being relevant. Topic 12.C.2 is revised to update the references currently included in Regulation S-X. Topic 12.D.1 is revised to update the references currently included in Regulation S-X. Topic 12.D.2 is revised to update the references to the required disclosures of the standardized measure of discounted future net cash flows to the provisions of Statement 69. Topic 12.D.3.a is revised to update the references currently included in Regulation S-X. Topic 12.D.3.b is redesignated as Topic 12.D.3.c and revised to provide updated guidance consistent with Statement 133. Topic 12.D.3.b is rewritten to reflect the changes in the computation as a result of changes in the authoritative literature related to derivatives accounted for in accordance with Statement 133. Topic 12.F is revised to substitute the reference to Rule 4-10(c)(3)(iii) of Regulation S-X for outdated Rule 4-10(i)(3)(iii) of Regulation S-X. Topic 12.G is revised to update the references to the required disclosures of the standardized measure of discounted future net cash flows to the provisions of Statement 69 and to substitute the reference to Rule 4-10(c)(4) of Regulation S-X for Rule 4-10(k)(4) of Regulation S-X.

13. TOPIC 13: REVENUE RECOGNITION

Topic 13.A.3, the following changes are made:

The interpretive response to question 3 is modified to incorporate the guidance on separate elements of an arrangement from EITF Issue 00-21. Additionally, footnote 24 is modified to remove the reference to Statement 53, Financial Reporting by Producers and Distributors of Motion Picture Films , which has been superseded and to add a reference to SOP 00-2, Accounting by Producers or Distributors of Films . The interpretive response to question 7 is modified to refer to Statement 140 which replaced Statement 125, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities .

Topic 13.B, footnote 6 is modified to refer to SAS 99 which superseded SAS 82.

Codification of Staff Accounting Bulletins

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Modified: 01/23/2004