Need to know: FASB requires supplier finance program disclosures


The Financial Accounting Standards Board (FASB) added new disclosure requirements for buyers of goods and services intended to increase transparency about how they use supplier finance programs.

FASB’s latest accounting standards update—ASU 2022-04, Liabilities-Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations—was issued Sept. 29.

“This standard is all about disclosure and does not provide new guidance on recognition and measurement,” said Mahesh Narayanasami, KPMG partner in the department of professional practice. “Although these programs have existed for a long time, FASB is addressing stakeholder feedback about the lack of transparency in buyers’ financial statements about these programs.”

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