Big Four-Led Convertible Debt Accounting Plan Eyed for Year-End

US accounting standard-setters plan to propose clarifications to complex convertible debt accounting rules after all four Big Four accounting firms said they had persistent questions.

The Financial Accounting Standards Board expects to release its proposal for public comment in late December. The board agreed Wednesday to clear up how to account for convertible debt instruments that allow the issuer to settle them wholly or partly in cash. The proposal would offer guidance on whether a settlement that differs from a contract’s original terms should be accounted for as an “induced conversion,” meaning it included sweeteners not part of the original ...