FASB issues guidance related to profits interest awards

On March 21, the FASB issued an ASU that adds an illustrative example to help entities determine whether profits interest and similar awards are in the scope of ASC 718, Stock Compensation. The ASU is effective for calendar year-end public entities in 2025 and all other calendar year-end entities in 2026. It can be applied either retrospectively or prospectively. Early adoption is permitted.

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