Accounting rule makers have decided to put some elbow grease into better distinguishing liabilities from equity in financial statements with the goal of making the guidance less complex and easier to understand.

The Financial Accounting Standards Board added a project to its technical agenda after considering the feedback to its 2016 request for public comment on what accounting issues deserve the board’s priority attention. FASB says its liabilities and equities project will focus on convertible debt, disclosures, and earnings per share, plus indexation and settlement within the context of the derivative scope exception.

In addition, the FASB added a new project on a component of financial performance reporting focusing on separating performance reporting by function and nature. FASB also plans to take up a narrow standard-setting effort on segment reporting, which will seek to improve aggregation criteria and segment disclosures.

While taking up some new initiatives, the board also made some determinations of where it will not devote any further resources, removing four specific projects from its research agenda. Those include interest rate risk disclosures for financial instruments, and pensions and other postretirement employee benefits.

Mothballed projects also include some early exploration into whether and how to require companies to account for organically developed intangible assets, which currently appear nowhere in financial statements. Finally, FASB jettisoned work on a narrow aspect of segment disclosures for not-for-profit entities.

In a separate measure, FASB has issued a proposed accounting standards update to reorganize the consolidation guidance contained in ASC Topic 810 to make it easier to navigate, and therefore easier to understand. That should help facilitate the analysis companies must complete to determine when they need to add separate legal entities to their balance sheet based on their interests in such entities.

The proposal creates a new topic in the codification specifically for consolidations, and it organizes the guidance under separate subtopics for variable interest entities and voting interest entities. Guidance on entities controlled by contract would be moved to a different topical area because it is relevant only to not-for-profit entities.

The proposal also contains some language clarifications, which FASB stresses are not meant to change the analyses companies conduct, nor the outcomes they currently reach following current guidance. FASB says the edits and reorganization “should make navigating and understanding consolidation guidance easier without affecting how consolidation analyses are currently performed.”