Variable Interest Entity Analysis
August 16, 2010 NDS 2010-19
New Developments Summary
Variable interest entity analysis
ASC 810, Consolidation, as amended by ASU 2009-17
Introduction
A reporting entity must assess whether its involvement with another legal entity requires the reporting entity to consolidate that legal entity and / or provide disclosures in accordance with guidance for variable interest entities.
This bulletin outlines a reporting entity’s step-by-step approach to the assessment of its involvement with
TM
a legal entity under the guidance in FASB Accounting Standards Codification (ASC) 810-10,
Consolidation, “Variable Interest Entities” subsections (formerly FASB Interpretation 46 (revised
December 2003), Consolidation of Variable Interest Entities), as amended by
•
ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest
Entities (formerly FASB Statement 167, Amendments to FASB Interpretation No. 46(R))
•
ASU 2010-10, Amendments for Certain Investment Funds
The guidance in both ASU 2009-17 and ASU 2010-10 is identified in the Codification, as of August 12,
2010, as pending content linked to transition guidance in ASC 810-10-65-2. The amended variable interest entity guidance is effective for fiscal years beginning after November 15, 2009 and for interim periods within those years. Early application is not permitted.
Contents
A. Background and overview ...................................................................................................................... 3
Overview of VIE guidance, as amended by ASU 2009-17 and ASU 2010-10 ....................................... 4
Purpose of this bulletin ........................................................................................................................... 5
B. General considerations ........................................................................................................................... 6
Consider only substantive
New Developments Summary
Variable interest entity analysis
ASC 810, Consolidation, as amended by ASU 2009-17
Introduction
A reporting entity must assess whether its involvement with another legal entity requires the reporting entity to consolidate that legal entity and / or provide disclosures in accordance with guidance for variable interest entities.
This bulletin outlines a reporting entity’s step-by-step approach to the assessment of its involvement with
TM
a legal entity under the guidance in FASB Accounting Standards Codification (ASC) 810-10,
Consolidation, “Variable Interest Entities” subsections (formerly FASB Interpretation 46 (revised
December 2003), Consolidation of Variable Interest Entities), as amended by
•
ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest
Entities (formerly FASB Statement 167, Amendments to FASB Interpretation No. 46(R))
•
ASU 2010-10, Amendments for Certain Investment Funds
The guidance in both ASU 2009-17 and ASU 2010-10 is identified in the Codification, as of August 12,
2010, as pending content linked to transition guidance in ASC 810-10-65-2. The amended variable interest entity guidance is effective for fiscal years beginning after November 15, 2009 and for interim periods within those years. Early application is not permitted.
Contents
A. Background and overview ...................................................................................................................... 3
Overview of VIE guidance, as amended by ASU 2009-17 and ASU 2010-10 ....................................... 4
Purpose of this bulletin ........................................................................................................................... 5
B. General considerations ........................................................................................................................... 6
Consider only substantive