Recent Accounting Pronouncements

12 Months Ended

Dec. 28, 2019

Recent Accounting Pronouncements

(15) Recent Accounting Pronouncements

Adoption of New Accounting Standards

In February 2016, the FASB issued Accounting Standards Update 2016-02 – Leases (“ASU 2016-02”), amended by ASU 2018-11, Leases (Topic 842): Targeted Improvements. ASU 2016-02 requires a company to recognize a right-of-use asset and lease liability for the obligation to make lease payments measured as the present value of the lease payments for all leases with terms greater than twelve months. The ASU requires adoption using a modified retrospective transition approach with either (1) periods prior to the adoption date being recast or (2) a cumulative-effect adjustment recognized to the opening balance of retained earnings on the adoption date with prior periods not recast. The Company adopted this standard on December 30, 2018 using the cumulative-effect adjustment approach. No cumulative-effect adjustment was recognized as the amount was not material. The Company had $2,745,000 in right-of-use assets and corresponding lease obligations as of December 28, 2019. See Note 9 for corresponding disclosures required under Topic 842.

Accounting Standards Issued But Not Yet Adopted

In June 2016, the FASB issued Accounting Standards Update 2016-13– Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires measurement and recognition of expected versus incurred credit losses for financial assets held. ASU 2016-13 is effective for annual periods beginning after December 15, 2019, and interim periods therein. ASU 2016-13 is not expected to have a material impact on the Company’s financial statements.