To simplify the accounting for business combinations, the Financial Accounting Standards Board is proposing a change to the rules around how to adjust provisional amounts recorded at the time of a transaction.

Current business combination rules say if companies don’t have all the information they need to fully account for a transaction in the period it occurs, they can record provisional amounts where necessary and adjust them later after more information is obtained. The adjustments, however, must be retrospective, so companies must go back and adjust historical information, including goodwill. “The acquirer also must revise comparative information for prior periods presented in financial statements as needed, including making changes to depreciation, amortization, or other income effects as a result of changes made to provisional amounts,” FASB says in its proposal.

FASB says stakeholders have told the board the current rules around retrospective adjustments of provisional amounts are costly and complicated to apply. To boot, they don’t significantly improve the information that’s available to investors or other users of financial statements.

That makes the rule a candidate for simplification under FASB’s simplification initiative, where the board is looking for ways to make accounting easier without compromising the quality of information. FASB’s proposal says companies can recognize adjustments in the period they are identified without retrospective restatement. The company would record in that same period the effect on earnings of the changes in depreciation, amortization, or other income effects, calculated as if the accounting had been completed at the acquisition date.

FASB adopted the current rules around business combinations in 2007 under the historical Financial Accounting Standard 141(R), which is highly consistent with requirements for companies that report under International Financial Reporting Standards.

A post-implementation review completed in 2013 suggested preparers could benefit from some simplifications around the definition of a business, accounting for purchased loans, and separately reporting some intangibles and goodwill. FASB said then it would consider the review findings in light of its standard-setting agenda at that time to determine whether to pursue further changes to the standard.

With its current proposal, FASB is asking for feedback through July 6. The board is interested in views on whether the simplification is appropriate, and how much time companies would require to adjust to the new method. FASB did not set an intended effective date, but will do so later after reviewing feedback.