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DEFM14A
ASTERIAS BIOTHERAPEUTICS, INC. filed this Form DEFM14A on 02/04/2019
Entire Document
 

 

 

Asterias will continue to monitor additional modifications, clarifications or interpretations undertaken by the FASB that may impact its current conclusions and will expand its analysis to include any new revenue arrangements initiated before adoption. As Asterias completes its evaluation of the new standard, new information may arise that could change Asterias’s understanding of the impact to its financial statements.

 

In May 2017, the FASB issued ASU 2017-09, Compensation – Stock Compensation: Scope of Modification Accounting to clarify the scope of modification accounting for share-based compensation. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. The new guidance will reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as modifications. The new authoritative guidance will be effective for public business entities in fiscal years beginning after December 15, 2017. The authoritative guidance will be effective for Asterias beginning in fiscal year 2018. Asterias does not anticipate that adoption of this guidance will have a material impact on its financial statements.

 

In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220). The amendments ASU 2018-02 allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. Consequently, the amendments eliminate the stranded tax effects resulting from the Tax Cuts and Jobs Act and will improve the usefulness of information reported to financial statement users. The new authoritative guidance will be effective for all entities for fiscal years beginning after December 15, 2018. For public business entities, early adoption is permitted at any time, including interim periods, for reporting periods for which financial statement have not yet been issued. Asterias does not currently expect that the impact from the adoption of this guidance to have a material impact on its financial statements, as the adoption of ASU 2016-01 on January 1, 2018 will eliminate the current accumulated other comprehensive loss balance.

 

3. Balance Sheet Components

 

Property, plant and equipment, net

 

As of December 31, 2017 and 2016, property, plant and equipment, net were comprised of the following (in thousands):

 

   December 31, 
   2017   2016 
Computers, machinery and equipment  $2,112   $2,545 
Furniture, fixtures and leasehold improvements   5,275    5,421 
    7,387    7,966 
Less - accumulated depreciation and amortization   (2,844)   (2,491)
Property, plant and equipment, net  $4,543   $5,475 

 

Depreciation and amortization expense amounted to $1.1 million, $1.2 million, and $564,000 for the years ended December 31, 2017, 2016 and 2015, respectively.

 

Accrued expenses

 

As of December 31, 2017 and 2016, accrued expenses were comprised of the following (in thousands):

 

   December 31, 
   2017   2016 
Accrued compensation and benefits  $1,561   $1,770 
Other accrued expenses   996    725 
Accrued expenses  $2,557   $2,495 

 

On November 2, 2017, we began making adjustments to our operating expenses as appropriate by reducing staffing allocated to non-clinical activities as a part of a broader effort to more closely align operating expenses with Asterias’ primary goal of continuing to generate clinical data in our clinical stage programs which we believe are the activities that have the greatest potential to create value for shareholders over the next several years. The reduction in staffing affected approximately 25 employees and was completed in the fourth quarter of 2017. Asterias recognized approximately $0.5 million of pre-tax restructuring charges in the fourth quarter of 2017 in connection with the reduction in staffing, consisting of severance and other employee termination benefits, substantially all of which are expected to be settled in cash. As of December 31, 2017, $0.3 million in severance and other termination benefits are still due to employees and included in accrued compensation and benefits.

 

 F-15 

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