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Big Four Firms Ask for Clarity on Convertible Debt Accounting

Nov. 25, 2022, 9:02 PM

The four largest audit firms issued a rare joint request for US accounting rulemakers to clear up a narrow part of accounting guidance for certain types of convertible debt instruments.

The firms—KPMG LLP, Deloitte & Touche LLP, Ernst & Young LLP, and PricewaterhouseCoopers LLP—called on the Financial Accounting Standards Board to weigh in on questions about convertible debt instruments that allow the issuer to settle them partly or wholly in cash.

Questions have always existed about this tricky area of accounting, the firms said, but more bubbled to the surface after FASB in 2020 eliminated special accounting for instruments with ...