FASB issues proposals on consolidated collateralized financing entity

  • FASB (US Financial Accounting Standards Board) (lt blue) Image

22 Jul 2013

The FASB has issued a proposed Accounting Standards Update (ASU), which provides more specific guidelines for the accounting for the difference upon initial consolidation between the fair value of assets and liabilities of a collateralized financing entity.

The main provisions provided in this proposed ASU will “allow a reporting entity within the scope of this proposed Update to measure the financial liabilities of the collateralized financing entity on the basis of the fair value of the financial assets and the carrying value of any nonfinancial assets as described in the proposed amendments.”

Currently, IFRS does not contain any guidance on collateralized financing entities.

The proposed ASU has a comment deadline of 17 September 2013 (comment deadline has been extended to 17 October 2013).

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