# Usage: curl -sSL https://seed.show/accounting.us.gaap | bash -s <install-path>
# <install-path> is the directory where the file should land.

set -euo pipefail
[ -z "${1:-}" ] && {
  echo "install requires a path: curl -sSL https://seed.show/accounting.us.gaap | bash -s <install-path>" >&2
  exit 1
}
TARGET="$1"
mkdir -p "$TARGET"
DEST="$TARGET/seed-fold.ygtLN7.folded.md"

cat > "$DEST" <<'PORTDOWN_9DF636F0'
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file. The markers below are load-bearing; don't edit them directly.

To unpack (requires bash — if you have no shell, tell the user):
  1. curl -sSLf https://fold.dom.vin/skill | bash -s <INSTALL_DIR>
  2. <INSTALL_DIR>/fold/scripts/unfold <this-file>
     (or: unfold <this-file>  if fold/scripts is on your PATH)
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---
fold: true
marker: 3a2b53
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# US GAAP Accounting Context

## Mental model: the ASC is the authority

US GAAP is organized in the **FASB Accounting Standards Codification (ASC)** — a single, hierarchical, authoritative source that superseded all prior US GAAP standards (SFAS, APB Opinions, EITF abstracts, etc.) in 2009. Do not cite legacy SFAS numbers. The correct citation format is:

```
ASC [Topic]-[Subtopic]-[Section]-[Paragraph]
```

The hierarchy:
- **Topic** (three digits, e.g., 606) — the broad subject area
- **Subtopic** (two digits after the hyphen, e.g., 606-10) — a more specific scope within the topic
- **Section** (two digits, e.g., 606-10-25) — recognition (25), measurement (30), disclosure (50), etc.
- **Paragraph** (further digits, e.g., 606-10-25-1) — the specific requirement

When advising on any GAAP question, cite the ASC reference. "Per ASC 842-20-25-1..." not "per SFAS 13..." or "under the old lease standard."

ASU updates amend the ASC regularly. Before advising on any topic that may have been recently updated (segment reporting, crypto assets, income tax disclosures, software costs), check **https://www.fasb.org/standards** for ASUs issued after 2023 and verify the effective dates. The ASC text at asc.fasb.org reflects amendments as they are incorporated.

---

## Five-step revenue recognition model (ASC 606)

ASC 606 (*Revenue from Contracts with Customers*) has been effective for public companies since 2018 and private companies since 2019. It applies to nearly all revenue except insurance, leases, financial instruments, and a few other scoped-out areas.

The five-step model:
1. **Identify the contract** with a customer — must have commercial substance, approved by both parties, rights to goods/services identified, payment terms established, and collection probable (ASC 606-10-25-1)
2. **Identify the performance obligations** — distinct goods or services (ASC 606-10-25-14): distinct if the customer can benefit from it on its own AND it is separately identifiable from other promises in the contract
3. **Determine the transaction price** — includes variable consideration (constrained by the probability of significant reversal, ASC 606-10-32-11), significant financing components, noncash consideration, and consideration payable to the customer
4. **Allocate the transaction price** to each performance obligation based on relative standalone selling prices (SSPs) — observable SSP preferred; estimate using adjusted market assessment, expected cost plus margin, or residual approaches
5. **Recognize revenue** when (or as) each performance obligation is satisfied

Revenue is recognized **over time** when one of three criteria is met (ASC 606-10-25-27): customer simultaneously receives and consumes benefits; entity's performance creates or enhances an asset the customer controls; entity's performance does not create an asset with alternative use AND entity has an enforceable right to payment for performance to date.

Otherwise, revenue is recognized **at a point in time** — typically when control transfers, assessed using indicators at ASC 606-10-25-30 (right to payment, legal title, physical possession, risks/rewards, customer acceptance).

---

## Lease accounting (ASC 842)

ASC 842 (*Leases*) has been effective for public companies since 2019 and private companies since 2022. The key change: **operating leases that were previously off balance sheet are now on balance sheet** as right-of-use (ROU) assets and corresponding lease liabilities.

Classification determines income statement treatment:
- **Finance lease**: front-loaded expense pattern — interest expense on the liability (effective interest method) plus amortization of the ROU asset (straight-line over shorter of lease term or useful life)
- **Operating lease**: straight-line total lease cost — single lease cost recognized ratably, but the liability is reduced using effective interest and the ROU asset is the plug

Classification criteria (ASC 842-10-25-2): transfer of ownership, purchase option reasonably certain, lease term is major part of economic life (bright-line no longer in GAAP but 75% is still used as a common threshold), present value is substantially all of fair value (90% threshold still common), specialized nature with no alternative use to lessor.

What agents still get wrong:
- **"Operating leases are off balance sheet"** — they are not, under ASC 842. Both finance and operating leases produce ROU assets and lease liabilities on Day 1
- **Low-value asset exemption** — this does not exist in ASC 842; it is an IFRS 16 concept. The only practical expedient that avoids balance sheet recognition is the **short-term lease exemption** (lease term ≤ 12 months, no purchase option reasonably certain — ASC 842-20-25-2)
- **Discount rate**: lessees use the rate implicit in the lease if readily determinable; otherwise the **incremental borrowing rate (IBR)**. Private companies may elect to use the risk-free rate as a practical expedient (ASC 842-20-30-3)
- **Lease term**: must include optional renewal periods when the lessee is **reasonably certain** to exercise — a higher bar than "likely." Economic incentives, leasehold improvements, and location significance all bear on this
- **Variable lease payments**: those that depend on an index or rate are included in the initial lease liability measurement using the rate at commencement; others (usage-based, performance contingent) are excluded from the liability and expensed as incurred

---

## Key financial statement linkages

The three statements are not independent:

**Income statement → Balance sheet**: Net income flows to retained earnings (equity). Revenues and gains increase equity; expenses and losses decrease it.

**Balance sheet → Cash flow statement**: Changes in working capital accounts (AR, AP, inventory, deferred revenue, accrued liabilities) appear as operating cash flow adjustments under the indirect method.

**Non-cash items**: Depreciation, amortization, stock-based compensation, and impairment charges reduce income but do not use cash — they are added back in the operating section of the cash flow statement.

**The balance sheet equation**: Assets = Liabilities + Stockholders' Equity. This must hold at every point in time. A journal entry that debits an asset and credits revenue increases both sides (asset up, equity up via retained earnings). Every transaction preserves the equation.

---

## What agents get wrong

### GAAP vs. IFRS — these are not interchangeable

Publicly traded US companies (SEC registrants) use **US GAAP**. Most of the rest of the world uses **IFRS** (issued by the IASB). Agents frequently blend the two, which produces wrong answers.

Key differences that matter in practice:

| Area | US GAAP | IFRS |
|---|---|---|
| Inventory write-downs | Permanent — cannot be reversed once written down (ASC 330) | Reversible if NRV recovers (IAS 2) |
| Development costs | Expensed as incurred (ASC 730) | Capitalized when feasibility criteria met (IAS 38) |
| Investment property | Generally no fair value model | Fair value model permitted (IAS 40) |
| LIFO inventory | Permitted | Prohibited |
| Revaluation of PP&E | Not permitted | Permitted (IAS 16) |
| Low-value lease exemption | Does not exist | Exists (IFRS 16) |

If a user is asking about a US public company or filing with the SEC, the answer is GAAP. Do not apply IFRS intuitions.

### Fair value hierarchy (ASC 820)

ASC 820 defines fair value as the **exit price** — the price received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This is not historical cost, not intrinsic value, not book value.

The three-level hierarchy ranks the quality of inputs:
- **Level 1**: Quoted prices in active markets for identical assets or liabilities — most reliable, no adjustment
- **Level 2**: Observable inputs other than Level 1 prices — quoted prices for similar assets, interest rates, yield curves, credit spreads, implied volatilities from observable market data
- **Level 3**: Unobservable inputs — entity's own assumptions about what market participants would use, supported by the best information available. Most judgment-intensive; requires the most disclosure

Agents get this wrong by:
- Conflating Level 2 and Level 3 (the distinction is whether inputs are observable in the market, not whether a model is used — models can use observable inputs and still be Level 2)
- Treating fair value as synonymous with market price (market price is Level 1; fair value is broader)
- Forgetting that the unit of account matters (a block discount for a controlling interest can be appropriate in some measurements but not others)

### Related-party disclosures (ASC 850)

ASC 850 requires disclosure of **material related-party transactions** — their nature, amounts, and any amounts due to/from related parties. Related parties include: affiliates, equity method investees, principal owners, management, immediate family of principal owners and management, and entities controlled by or under common control with the entity.

Agents miss:
- The disclosure requirement is independent of whether the transaction is at arm's length — related-party transactions must be disclosed even if priced fairly
- Zero-dollar transactions (loans at below-market rates, shared services, guarantees) still require disclosure if they would have material effects if priced at market
- Management representation letters in audits must affirmatively address related-party completeness — this is a high-risk audit area

### Matching principle vs. cash accounting

GAAP requires **accrual accounting** for all public companies and most private companies. Revenue is recognized when earned (performance obligation satisfied); expenses are recognized when incurred (matched to the related revenue or period).

Cash changing hands is not the recognition event:
- A customer paying in advance → liability (deferred revenue, ASC 606), not revenue
- Paying a two-year insurance premium upfront → prepaid asset, expensed ratably
- Receiving goods but not yet paying → accounts payable and expense recognized on receipt
- Selling goods on credit → revenue on sale, accounts receivable; cash collection later

The matching principle (expenses in the same period as the revenue they help generate) is distinct from period costs (SG&A, R&D, interest — expensed as incurred regardless of revenue).

### Materiality is a judgment, not a bright line

Materiality is defined in ASC 105-10-05-6 (referencing the Supreme Court's TSC Industries standard): information is material if there is a substantial likelihood that a reasonable investor would consider it important in making an investment decision.

SEC Staff Accounting Bulletin No. 99 (SAB 99) explicitly rejects quantitative-only assessments. A $500 item can be material if it crosses a covenant threshold, affects a trend, masks a management failure, or is intentionally designed to obscure. An agent that says "under $5,000 you don't need to worry about it" is giving wrong advice.

Qualitative materiality factors: items that affect debt covenants, change a trend, affect segment reporting, involve management compensation, or involve illegal acts.

---

## Key ASC topic map — most common areas

| Topic | Number | What it covers |
|---|---|---|
| Revenue | **ASC 606** | Revenue from contracts with customers (all industries except scoped-out) |
| Leases | **ASC 842** | Lessee and lessor accounting for leases |
| Business combinations | **ASC 805** | Acquisition method, goodwill recognition, purchase price allocation |
| Intangibles and goodwill | **ASC 350** | Goodwill impairment testing (annual + triggering events), indefinite-lived intangibles |
| Stock compensation | **ASC 718** | Share-based payment awards (options, RSUs, PSUs) — measurement, recognition, classification |
| Income taxes | **ASC 740** | Current and deferred taxes, uncertain tax positions |
| Fair value measurement | **ASC 820** | Definition of fair value, the three-level hierarchy (Level 1/2/3 inputs) |
| Financial instruments | **ASC 815** | Derivatives and hedging |
| Consolidation | **ASC 810** | Variable interest entities (VIEs), voting interest model |
| Inventory | **ASC 330** | Cost flow assumptions (FIFO, LIFO, weighted average), lower of cost or NRV |
| PP&E | **ASC 360** | Depreciation, impairment, disposal |
| Contingencies | **ASC 450** | Loss contingencies — probable and estimable threshold for accrual |
| Related parties | **ASC 850** | Disclosure requirements for related-party transactions |
| Segment reporting | **ASC 280** | Operating segment identification, aggregation criteria, required disclosures |
| EPS | **ASC 260** | Basic and diluted EPS, treatment of options/warrants/convertibles |

---

## What AI is changing

**What is automating:**

- **Journal entry drafting**: LLMs and RPA tools generate routine recurring entries (depreciation runs, prepaid amortization, accrual reversals) from templates. The risk is entries without adequate backup — an AI-drafted JE is not self-authorizing.
- **Reconciliation matching**: High-volume, rule-based matching (bank reconciliation, intercompany elimination) was the first wave of automation. ML models now handle mismatched data patterns that pure rules miss.
- **Flux and variance commentary**: Auto-generated period-over-period commentary is common in FP&A tools (Workiva, Planful, Mosaic). Quality is improving but still requires a human reviewer who understands the business drivers.
- **Close process orchestration**: Workflow tools (BlackLine, FloQast) now use AI to sequence close tasks, flag anomalies in reconciliations, and predict close completion dates.
- **Document extraction**: AI extracts lease terms, contract variable consideration components, and related-party indicators from PDFs and contracts — feeding into ASC 842, 606, and 850 analyses.

**What stays human:**

- **Materiality judgments**: Whether an error is material (quantitative + qualitative) requires understanding investor expectations, covenant thresholds, and management intent. ASC 250 error correction decisions are not automatable.
- **Going concern assessment**: ASC 205-40 requires management to evaluate whether conditions raise substantial doubt about the ability to continue as a going concern for twelve months after the financial statement issuance date. This is a judgment requiring knowledge of refinancing plans, asset sale timelines, and covenant waivers — not pattern matching.
- **Estimate development**: Goodwill impairment (ASC 350), credit loss allowance (ASC 326 CECL), warranty reserves, legal contingencies (ASC 450) — all require human judgment about future conditions. AI can build the model; a human must defend the inputs.
- **Uncertain tax positions**: ASC 740-10 (formerly FIN 48) requires a "more likely than not" threshold assessment for each tax position. The legal and regulatory judgment underlying this is not delegatable to an agent.
- **Audit opinions**: PCAOB and AICPA standards require an independent auditor to form and express opinions. AI supports the work; it does not sign the report.

**How agents should reference ASC:**

When advising on an accounting question, always: (1) identify the governing ASC topic, (2) cite the specific subtopic and section, (3) state whether the standard is stable or has had recent ASUs that could affect the answer, (4) note where judgment is required and what a reasonable range of treatments looks like. Do not state a single "correct" answer when the standard permits elections or when estimates are involved.

---

## Citations and authority

The ASC is the **single authoritative source** for US GAAP (for non-governmental entities). SEC guidance (SABs, FRRs) is authoritative for SEC registrants but cannot override FASB. PCAOB standards govern audits of public companies; AICPA standards govern audits of private companies.

Always cite: ASC [Topic]-[Subtopic]-[Section]-[Paragraph]. Fetch sources.md for current codification URLs before advising on any specific accounting treatment. Check FASB.org for ASUs issued after 2023 before advising on any area that may have been recently updated.
<!--fold:3a2b53@file path="glossary.md" mode="644"-->
# US GAAP Glossary

Key terms with precise definitions and ASC references. Use these when an accounting question turns on what a term actually means under GAAP.

---

## The balance sheet equation

**Assets = Liabilities + Stockholders' Equity**

This holds at every point in time. Every transaction preserves the equation: debits equal credits in every journal entry, and the resulting changes to asset, liability, and equity accounts always net to zero. A journal entry that records revenue (credit) and increases an asset (debit) increases both sides — assets up, equity up via retained earnings. The equation is not aspirational; it is an accounting identity.

---

## Accrued liabilities

Obligations for expenses incurred in the current period but not yet paid — wages earned by employees but not yet paid, utilities used but not yet billed, interest accumulated but not yet due. Recognized when the expense is incurred, not when cash is disbursed (ASC 420, and the general matching principle throughout ASC). Distinguished from accounts payable in that accrued liabilities typically lack an invoice; the amount is estimated. Must be probable and reasonably estimable to accrue a loss contingency (ASC 450-20-25-2); for ordinary operating accruals, the threshold is lower — the obligation is recognized when the service or goods are received.

## ASU (Accounting Standards Update)

The mechanism by which FASB amends the ASC. Each ASU has an effective date that differs between public and non-public entities, and may permit early adoption. The ASU text explains the amendment; the operative guidance is the amended ASC paragraph. When advising on any recently updated area, identify the relevant ASU, its effective date for the entity type in question, and whether early adoption has occurred.

---

## COGS vs. period costs

**Cost of goods sold (COGS)** (ASC 330, ASC 606): The direct costs of producing the goods sold or services delivered in the period. Inventoried first (capitalized on the balance sheet), then expensed when the related revenue is recognized. Includes direct materials, direct labor, and manufacturing overhead for product companies. For service companies, includes the cost of delivering the service (direct labor, allocated overhead directly attributable to service delivery).

**Period costs**: Costs expensed as incurred regardless of whether related revenue is recognized in the same period. Examples: SG&A (selling, general, and administrative), R&D (expensed as incurred under ASC 730 — no capitalization of research costs, and development costs are capitalized only when software meets internal-use criteria under ASC 350-40), and interest expense. Period costs do not sit on the balance sheet; they flow directly to the income statement.

The distinction matters for gross margin: only COGS flows above the gross profit line. Misclassifying a period cost as COGS understates gross margin; misclassifying a product cost as a period cost overstates it.

---

## Consolidation

**ASC 810** governs when one entity must consolidate another into its financial statements. Two models:

**Voting interest model**: An entity with a majority voting interest (>50%) generally consolidates. Standard model for straightforward parent-subsidiary relationships.

**Variable interest entity (VIE) model**: When an entity lacks sufficient equity at risk, or equity holders lack decision-making rights or the obligation to absorb losses / right to receive returns, it may be a VIE. The **primary beneficiary** — the entity that (1) has the power to direct the activities that most significantly affect the VIE's economic performance AND (2) has the obligation to absorb losses or right to receive benefits that could be significant — must consolidate the VIE regardless of ownership percentage (ASC 810-10-25-38A). VIE analysis is required before voting interest analysis when VIE indicators are present.

Consolidation eliminates intercompany transactions, balances, and unrealized profits. The resulting financial statements present the group as a single economic entity.

---

## Deferred revenue

A liability representing cash received (or invoiced) for goods or services not yet delivered. Recognized as revenue only when the performance obligation is satisfied (ASC 606-10-45-2). Common in subscription businesses (monthly fee paid upfront), software licenses, gift cards, and long-term contracts with upfront payments.

Deferred revenue is not a bad debt reserve — it is the entity's obligation to deliver future goods or services. If the entity cannot perform, it must refund the customer. For this reason, large deferred revenue balances on the balance sheet represent real economic obligations, not just accounting entries.

**Contract liability** is the ASC 606 term; "deferred revenue" is the common legacy label. Both describe the same thing. Many entities still use "deferred revenue" in their financial statements under the permitted label.

---

## Depreciation methods

The systematic allocation of a tangible long-lived asset's cost over its useful life (ASC 360-10-35). The method must be rational and systematic and applied consistently.

**Straight-line**: (Cost − Salvage value) ÷ Useful life. Equal charge each period. Most common for financial reporting.

**Declining balance** (including double-declining balance): (Book value × Rate), where rate is a multiple of the straight-line rate. Front-loads depreciation. Switches to straight-line when straight-line produces a higher charge.

**Units of production**: (Cost − Salvage value) ÷ Estimated total production × Actual production. Depreciation tracks actual usage — appropriate for machinery whose wear is driven by output, not time.

**Sum-of-the-years'-digits**: An accelerated method. Depreciation for year n = (Remaining life ÷ Sum of years' digits) × Depreciable base.

The choice of method is an accounting policy election and must be disclosed. Changing methods requires justification that the new method is preferable and is accounted for as a change in accounting principle (ASC 250-10-45). Tax depreciation (MACRS) often differs from book depreciation — the difference creates deferred tax assets or liabilities (ASC 740).

---

## EPS (Earnings Per Share)

**ASC 260** governs EPS disclosure for public companies. Two measures required:

**Basic EPS**: Net income attributable to common shareholders ÷ Weighted average common shares outstanding. Shares weighted by the fraction of the period they were outstanding.

**Diluted EPS**: Adjusts for the effect of all dilutive potential common shares — stock options (using the treasury stock method), RSUs, convertible debt/preferred stock (if-converted method), and warrants. Antidilutive securities (those that would increase EPS) are excluded. The denominator includes dilutive shares; the numerator is adjusted for after-tax interest on convertible debt or preferred dividends avoided upon conversion.

**Two-class method**: Required when the entity has participating securities (securities that contractually share in undistributed earnings). Common in companies with preferred stock that participates in dividends. Allocates earnings between common and participating classes before computing EPS for each.

---

## Goodwill impairment

**ASC 350-20**: Goodwill arising from a business combination (ASC 805) is not amortized for public companies (private companies may elect to amortize over 10 years under the PCC alternative). Instead, it is tested for impairment at least annually and whenever a triggering event occurs.

**Impairment test**: A reporting unit's fair value is compared to its carrying amount (including goodwill). If carrying amount exceeds fair value, goodwill is impaired by the difference, limited to the carrying amount of goodwill (ASC 350-20-35-2). The impairment loss reduces goodwill on the balance sheet and is recognized in the income statement; it cannot be reversed.

**Qualitative assessment (Step 0)**: An entity may first assess qualitative factors to determine whether it is more likely than not that the reporting unit's fair value is less than its carrying amount. If the answer is no, no quantitative test is required.

**Triggering events**: A significant adverse change in the business climate, loss of a key customer, a decline in stock price below book value, or a change in management's plans that would significantly reduce the fair value of a reporting unit all require interim impairment testing.

Goodwill is not deductible for tax purposes in most business combinations structured as stock purchases — creating a permanent book-tax difference.

---

## Segment reporting

**ASC 280**: Public companies must disclose information about operating segments, defined by the **management approach** — the segments are the components that the chief operating decision maker (CODM) uses to allocate resources and assess performance.

Aggregation of segments is permitted when they have similar economic characteristics and meet five qualitative criteria (nature of products/services, production processes, customers, distribution methods, regulatory environment) (ASC 280-10-50-11).

Required disclosures include: segment revenues, segment profit or loss (as measured by the CODM), segment assets (if regularly provided to the CODM), and reconciliations to consolidated totals. ASU 2023-07 (effective for fiscal years beginning after December 15, 2023 for public companies) significantly expanded CODM disclosure requirements and requires disclosure of significant segment expenses.

---

## VIE (Variable Interest Entity)

An entity that has one or more of the following (ASC 810-10-15-14): insufficient equity investment at risk to permit it to finance its activities without additional subordinated financial support; equity investors that lack decision-making rights; equity investors that do not absorb expected losses or receive expected residual returns in proportion to their voting interests.

VIE analysis precedes the voting interest model. If an entity is determined to be a VIE, the primary beneficiary must consolidate it. If no primary beneficiary exists (e.g., shared power), no consolidation occurs under either model but disclosures are still required.

Common VIE structures: special purpose entities used in securitizations, real estate joint ventures where the developer has an option but limited equity, and operating entities with complex governance structures.

---

## Deferred tax asset / liability

**ASC 740**: Income taxes create timing differences between when an item is recognized for financial reporting and when it is recognized for tax purposes. These give rise to deferred tax assets (DTAs) and deferred tax liabilities (DTLs).

**DTA**: Future deductible amounts — the entity will pay less tax in a future period because it has already recognized expense for financial reporting. Examples: warranty reserves accrued for financial reporting but deductible when paid; net operating loss carryforwards.

**DTL**: Future taxable amounts — the entity will pay more tax in a future period. Examples: accelerated tax depreciation (MACRS) vs. straight-line book depreciation; installment sale gains deferred for tax but recognized in full for financial reporting.

**Valuation allowance**: A DTA is reduced by a valuation allowance if it is more likely than not that some or all of the DTA will not be realized (ASC 740-10-30-5). The valuation allowance determination requires evaluating all available positive and negative evidence, weighted by reliability.

**Uncertain tax positions**: A tax benefit is recognized only if it is more likely than not that the tax position will be sustained upon examination (ASC 740-10-25-6). The recognized amount is the largest amount more likely than not of being realized. Interest and penalties are recognized as a component of income tax expense or as SG&A — an accounting policy election disclosed consistently.
<!--fold:3a2b53@file path="sources.md" mode="644"-->
# US GAAP Accounting Sources

## Primary authority

**FASB Accounting Standards Codification (ASC)**
- Free read-only access: https://asc.fasb.org
- The single authoritative source for US GAAP (non-governmental entities). Browse by Topic number or use the search. As of 2009, all prior GAAP (SFAS, APB Opinions, EITF abstracts) was codified here. The codified text reflects all amendments from subsequently issued ASUs.

**FASB Standards and Updates**
- Accounting Standards Updates (ASUs): https://www.fasb.org/standards
- ASUs amend the ASC. They are numbered by year and sequence (e.g., ASU 2016-02 introduced ASC 842). The ASU itself explains what changed; the amended ASC text is the operative standard.
- **Check here for recent amendments** before advising on: segment reporting (ASU 2023-07), income tax disclosures (ASU 2023-09), software costs (ASU 2023-10 / ASC 350-40), crypto assets (ASU 2023-08 / ASC 350-60), disaggregation of income statement expenses (ASU 2024-03). Effective dates vary by entity type (public vs. private) and fiscal year.
- FASB implementation guides and staff Q&As: https://www.fasb.org/resources

**FASB Conceptual Framework**
- Statements of Financial Accounting Concepts (CON): https://www.fasb.org/conceptual-framework
- Not authoritative GAAP, but foundational for understanding the principles behind the ASC (definitions of assets/liabilities/revenue/expense, qualitative characteristics of useful financial information). Useful when the ASC does not address a specific transaction and analogical reasoning is needed.

## SEC guidance (authoritative for SEC registrants)

**Staff Accounting Bulletins (SABs)**
- https://www.sec.gov/divisions/corpfin/acctinterpretations.htm
- SAB 99: Materiality — qualitative factors; rejects bright-line thresholds
- SAB 101/104: Revenue recognition — superseded by ASC 606 for most purposes, but the SAB 104 framework for software and multi-element arrangements surfaces in practice for pre-606 analogies
- SAB 118: Tax reform transition — Tax Cuts and Jobs Act measurement period guidance
- SAB 121: Crypto asset safeguarding obligations — requires entities that safeguard crypto assets for others to record a liability and corresponding asset (controversial; subject to ongoing SEC guidance updates)

**Financial Reporting Releases (FRRs) and Regulation S-X**
- https://www.sec.gov/divisions/corpfin/ecfrlinks.htm
- SEC rules on form and content of financial statements. Regulation S-X Article 4 governs the form and content of financial statements; Article 11 governs pro forma financial information.

**SEC EDGAR — company filings**
- https://www.sec.gov/cgi-bin/browse-edgar
- 10-K and 10-Q filings show how registrants apply GAAP in practice; the critical accounting policies and estimates section is particularly useful for judgment-intensive areas (goodwill impairment, lease term, revenue recognition assumptions, CECL allowance methodology).

**SEC Comment Letters**
- https://efts.sec.gov/LATEST/search-index?q=%22comment+letter%22&dateRange=custom
- The SEC staff's comments to registrants on accounting and disclosure questions reveal where the staff pushes back on GAAP applications. Useful for understanding how accounting treatments are viewed in practice.

## AICPA (authoritative for private company audits and attestation)

**AICPA Audit and Accounting Guides**
- https://www.aicpa-cima.com/resources/landing/audit-and-accounting-guide
- Industry-specific application guidance: revenue recognition by industry, not-for-profit, employee benefit plans, construction contractors, investment companies. These guides often have worked examples that the ASC itself does not.

**AICPA Technical Questions and Answers (TQAs)**
- https://www.aicpa-cima.com/resources/article/technical-questions-and-answers
- Interpretive guidance on specific accounting questions; not authoritative GAAP but useful for practical application.

**Private Company Council (PCC) Alternatives**
- https://fasb.org/pcc
- The PCC issues accounting alternatives for private companies that simplify certain GAAP requirements (e.g., goodwill amortization under ASC 350-20, simplified hedge accounting under ASC 815, lease discount rate practical expedient under ASC 842). These alternatives require an accounting policy election and disclosure.

## PCAOB (public company audit standards)

**PCAOB Standards and Rules**
- https://pcaobus.org/Standards
- Auditing standards (AS), staff guidance, and inspection reports. AS 2201 governs the integrated audit of internal controls over financial reporting (ICFR). AS 2410 covers related parties. AS 2805 covers management representations. Relevant when the question involves audit scope, internal controls, or auditor independence.

## Big 4 accounting policy resources

These are not authoritative but provide detailed worked examples, election matrices, and GAAP vs. IFRS comparison tables. Useful for quick orientation before tracing to the ASC.

- Deloitte Roadmap Series: https://dart.deloitte.com/USDART/
- PwC Viewpoint: https://viewpoint.pwc.com/
- EY AccountingLink: https://www.ey.com/en_us/assurance/accountinglink
- KPMG Handbook: https://frv.kpmg.us/reference-library.html

## How to use these sources

1. Start at **asc.fasb.org** — search the topic number or keyword. The codification text is the operative answer.
2. Check **fasb.org/standards** for ASUs with effective dates after the question's context — a standard's answer may differ for public vs. private companies and for fiscal years ending before vs. after an effective date.
3. For SEC registrants, cross-check **SABs** and **Regulation S-X** for SEC-specific overlay.
4. For industry-specific questions, check **AICPA guides** for worked examples.
5. For private companies, check **PCC alternatives** — some simplifications require an affirmative election; others are automatic.
6. Big 4 handbooks are useful for quick orientation and comparison tables but always trace back to the ASC for the authoritative text.
<!--fold:3a2b53@end-->
PORTDOWN_9DF636F0

# ── post ──
MARKER=$(awk '/^---$/ { f++; if (f==2) exit; next } f==1 && /^marker:[[:space:]]/ { sub(/^marker:[[:space:]]+/, ""); print; exit }' "$DEST")
[ -z "$MARKER" ] && { echo "seed: archive has no marker — corrupt" >&2; exit 1; }
awk -v m="$MARKER" -v outdir="$TARGET" '
  BEGIN {
    # Match <!--fold:<m>@file path="X"--> with an optional mode attr after
    # the path (fold emits  mode="644"  on executables).
    file_re = "^<!--fold:" m "@file path=\"([^\"]+)\"( mode=\"[0-9]+\")?-->$"
    end_re  = "^<!--fold:" m "@end-->$"
  }
  $0 ~ end_re { if (current) close(current); exit }
  $0 ~ file_re {
    if (current) close(current)
    line = $0
    sub(/^<!--fold:[^@]+@file path="/, "", line); sub(/".*$/, "", line)
    current = outdir "/" line
    dir = current; sub(/\/[^\/]*$/, "", dir)
    if (dir != current) system("mkdir -p \"" dir "\"")
    printf "" > current
    next
  }
  current { print >> current }
' "$DEST"
SEED_EXTRACTED=$(find "$TARGET" -type f -not -path "$DEST" 2>/dev/null | wc -l)
if [ "$SEED_EXTRACTED" = "0" ]; then
  echo "seed: archive contained no files — refusing to delete the source" >&2
  echo "  archive preserved at: $DEST" >&2
  exit 1
fi
rm -f "$DEST"

echo "" >&2
echo "✓ seed unpacked → $TARGET ($SEED_EXTRACTED files)" >&2
find "$TARGET" -type f | sort | while IFS= read -r _sf; do
  echo "  ${_sf#${TARGET}/}" >&2
done
echo "" >&2
if [ -f "$TARGET/SKILL.md" ]; then
  echo "This seed contains a skill (SKILL.md). Install it in your agent's skills directory." >&2
  echo "" >&2
fi
echo "Install the seed skill if not already installed:" >&2
echo "  https://seed.show/skill" >&2
echo "" >&2
echo "Publisher prompt:" >&2
sed 's/^/  /' >&2 <<'__SEED_PROMPT_END_AC1F2B__'
You have US GAAP context across three files. Start with README.md: ASC hierarchy, five-step revenue model, lease accounting, fair value levels, related-party rules, and what AI is changing. Then sources.md for current FASB/SEC/PCAOB URLs — check FASB for recent ASUs before advising on any area updated after 2023. Then glossary.md for precise term definitions with ASC citations. Cite ASC topic-subtopic-section-paragraph throughout. Never cite legacy SFAS numbers. Ask what accounting question to work through.
__SEED_PROMPT_END_AC1F2B__
exit 0