ASU 2017-1: Down round features and FASB ASC 480 scope exception

ASU 2017-11 addresses the complexity and counterintuitive accounting that many feel arise from current guidance on accounting for financial instruments with down round features. However, the solution to these issues allows entities that do not present EPS (under the scope of FASB ASC 260) to avoid recognition of a “clear economic value transferred” and, thus, may not faithfully represent the economics of down round transactions. Practitioners may start to see more instruments with down round features as some entities look