Note 3 - New Accounting Pronouncements
|3 Months Ended|
Jan. 31, 2020
|Notes to Financial Statements|
|New Accounting Pronouncements and Changes in Accounting Principles [Text Block]||
3.New Accounting Pronouncements
We have opted to take advantage of the extended transition period available to emerging growth companies pursuant to the Jumpstart Our Business Startups Act of
2012(the “JOBS Act”) for new accounting standards.
Newly adopted accounting pronouncements
January 2017,the FASB issued ASU
Business Combinations (ASC(“ASU
805): Clarifying the Definition of a Business
01”), which provides guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. ASU
01requires entities to use a screen test to determine when an integrated set of assets and activities is
nota business or if the integrated set of assets and activities needs to be further evaluated against the framework. The new standard will be applied prospectively to any transactions occurring within the period of adoption and is effective for entities other than public business entities for fiscal years beginning after
December 15, 2018,and interim periods within fiscal years beginning after
December 15, 2019.The Company adopted this ASU in the
2020.As there have been
nonew business combinations, this ASU has
nothad an effect on the Company’s consolidated financial statements. The Company will continue to evaluate this ASU as new business combinations occur.
August 2016,the FASB issued ASU
Statement of Cash Flows (Topic: Classification of Certain Cash Receipts and Cash Payments (“ASU
15”) related to how certain cash receipts and payments are presented and classified in the statement of cash flows. These cash flow issues include debt prepayment or extinguishment costs, settlement of
zero-coupon debt, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, distributions received from equity method investees, beneficial interests in securitization transactions, and separately identifiable cash flows. ASU
15is effective for emerging growth companies in annual reporting periods beginning after
December 15, 2018,and interim reporting periods within annual reporting periods beginning after
December 15, 2019.The Company has elected to early adopt this ASU in the
2020.The Company adopted this standard retrospectively, and the adoption did
nothave a material impact on the consolidated financial statements.
Recently issued accounting pronouncements
May 2014,the FASB issued ASU
Revenue from Contracts with Customers (ASC(“ASU
09”), which is a comprehensive new revenue recognition model.
09and the related clarifying ASUs, a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services. ASU
09is effective for emerging growth companies in annual reporting periods beginning after
December 15, 2018and interim reporting periods within annual reporting periods beginning after
December 15, 2019and is to be adopted using either a full retrospective or modified retrospective transition method. The Company expects to adopt the guidance under the modified retrospective approach during the
fourthquarter of the fiscal year ending
October 31, 2020.The Company is currently evaluating the impact of the pending adoption of the new standard on the consolidated financial statements.
February 2016,the FASB issued ASU
02”), which is codified in ASC
842”) and supersedes current lease guidance in ASC
842requires a lessee to recognize a right-of-use asset and a corresponding lease liability for substantially all leases. The lease liability will be equal to the present value of the remaining lease payments while the right-of-use asset will be similarly calculated and then adjusted for initial direct costs. In addition, ASC
842expands the disclosure requirements to increase the transparency and comparability of the amount, timing and uncertainty of cash flows arising from leases. In
July 2018,the FASB issued ASU
Targeted Improvements, which allows entities to initially apply the new leases standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption.
The new standard is effective for emerging growth companies for fiscal years beginning after
December 15, 2020,and interim periods within fiscal years beginning after
December 15, 2021.The Company plans to adopt the new standard effective for the year ending
October 31, 2022.The Company is currently evaluating the impact of the pending adoption of the new standard on the consolidated financial statements.
June 2016,the FASB issued ASU
Financial Instruments—Credit Losses (Topic, This ASU, along with subsequently issued related ASUs, requires financial assets (or groups of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected, among other provisions. This ASU is effective for emerging growth companies with annual and interim periods beginning after
December 15, 2022,with early adoption permitted. The Company plans to adopt the new standard effective for the year ending
October 31, 2023.The amendments of this ASU should be applied on a modified retrospective basis to all periods presented. The Company is currently evaluating the effects adoption of this guidance will have on the consolidated financial statements.
The entire disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef