Consolidation, Variable Interest Entities, ASC 810

Variable Interest Entities (VIE)

SFAS 167 amended FIN 46(R) in June 2009
FIN 46(R) revised FIN 46 in December 2003
FIN 46 was issued in January 2003 as an interpretation of ARB 51
SFAS 167, June 2009
“Amendments to FASB Interpretation No. 46(R)”

FASB Interpretation 46(R), Revised in December 2003
“Consolidation of Variable Interest Entities – an interpretation of ARB No. 51”

Amendments to FIN 46(R) by SFAS 167 in June 2009

1. Determination of VIE
After SFAS 167
–> FIN46R-5b(1) was amended with new guidance
–> Whether an entity is a VIE may change after SFAS 167

2. Reconsideration of VIE
–> FIN46R-7e was added as an event for reconsideration of VIE

3. Determination of Primary Beneficiary
–> Quantitative approach was deleted
–> “majority” guidance was deleted by amending FIN46R-14

4. Reconsideration of Primary Beneficiary
–> After SFAS 167, reassessment is done on an ongoing basis
–> FIN46R-15, that listed the events triggering reconsideration, was deleted

5. Troubled debt restructuring
–> Before SFAS 167, troubled debt restructuring was not an event
that triggers the reconsideration of VIE or Primary Beneficiary
–> Such exceptions were deleted by amendments to FIN46R-7 and FIN46R-15

6. Additional disclosures
–> Paragraphs 22A – 22E and 23A were added for additional disclosures