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To the Point - FASB issues initial measurement guidance for paid-in-kind dividends on equity-classified preferred stock


Overview

Our publication summarizes the FASB’s final guidance requiring entities to initially measure paid-in-kind (PIK) dividends on equity-classified preferred stock using the PIK dividend rate stated in the preferred stock agreement. The guidance is effective for fiscal years beginning after 15 December 2026, including interim reporting periods within those fiscal years. Early adoption is permitted.

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