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Deloitte comments on FASB's proposed ASU related to consolidation guidance for not-for-profit entities

Published on: Sep 30, 2016

Deloitte & Touche LLP comments on the FASB's proposed ASU, "Clarifying When a Not-for-Profit Entity That Is a General Partner Should Consolidate a For-Profit Limited Partnership or Similar Entity," which was issued in August 2016.

An excerpt from the comment letter is shown below:

We support the FASB’s proposal to amend the consolidation guidance in ASC 958-810 to specify when a not-for-profit entity (NFP) that is a general or a limited partner should consolidate a for-profit limited partnership or similar legal entity. 

We agree that incorporating the guidance that is currently in ASC 810-20, which will be superseded when ASU 2015-02 is adopted, into ASC 958-810 is the most cost-effective solution until the Board completes its project on reorganizing and clarifying the consolidation guidance in ASC 810-10. Although we support the proposed ASU, we believe that the best long-term solution is to provide a single consolidation model that can be applied to all entities (variable interest entities, voting interest entities, and NFPs). A single consolidation model would reduce complexity by eliminating inconsistences in the assessment of “control,” thus resulting in consistent consolidation conclusions.

Full text of the comment letter is available below.


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