If debt issuance costs are presented as a prepaid asset on the balance sheet — that is, the costs do not affect the total amount of debt shown — the entity’s debt in any year would run up against the ...

A debt issue is a financial obligation that allows the issuer to raise funds by promising to repay the lender at a certain point in the future.

“Additionally, the requirement to recognize debt issuance costs as deferred charges conflicts with the guidance in FASB Concepts Statement No. 6, Elements of Financial Statements, which states that ...