In March 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2019-02, Entertainment—Films—Other Assets—Film Costs (Subtopic 926-20) and Entertainment—Broadcasters—Intangibles— Goodwill and Other (Subtopic 920-350): Improvements to Accounting for Costs of Films and License Agreements for Program Materials.
ASU 2019-02 helps organizations align their accounting for production costs for films and episodic content produced for television and streaming services.
The updated guidance aligns the capitalization for film and episodic television (TV) series production costs. In addition, the standard also addresses impairment, amortization and presentation/disclosure considerations for both traditional and non-traditional media entities.
The production and distribution of filmed content has significantly changed since relevant accounting standards were originally issued decades ago. The rise of digital streaming platforms, subscription-based services and other strategies to monetize filmed content has increased the complexity of accounting for the related costs.
