FASB FSP to Amend Disclosure Requirements of Statement 140 and Interpretation 46(R)

FASB: FSP to Amend Disclosure Requirements of Statement 140 and Interpretation 46(R)

Project Update

FSP to Amend Disclosure Requirements of Statement 140 and Interpretation 46(R)

Last Updated: September 24, 2008 (Updated sections are indicated with an asterisk *)

The staff has prepared this summary of Board decisions for information purposes only. Those Board decisions are tentative and do not change current accounting. Official positions of the FASB are determined only after extensive due process and deliberations.

*Project Objective
*Due Process Documents
*Decisions Reached at the Last Meeting
*Summary of Decisions Reached to Date
*Next Steps
Board/Other Public Meeting Dates
Background Information
Contact Information

*Project Objective

The objective of this project is to amend FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, to require public entities to provide additional disclosures about transfers of financial assets and to amend FASB Interpretation No. 46 (revised December 2003), Consolidation of Variable Interest Entities, to require public enterprises to provide additional disclosures about their involvement with variable interest entities. Additionally, this proposed FSP requires certain disclosures to be provided by a public enterprise that is (a) a sponsor that has a variable interest in a variable interest entity (irrespective of the significance of the variable interest) and (b) an enterprise that holds a significant variable interest in a qualifying special-purpose entity (SPE) but was not the transferor (nontransferor enterprise) of financial assets to the qualifying SPE. The disclosures required by this proposed FSP are intended to provide greater transparency to financial statement users about a transferor’s continuing involvement with transferred financial assets and an enterprise’s involvement with variable interest entities.

This project is being considered by the Board contemporaneously with the proposed amendments to Statement 140 and the proposed amendments to Interpretation 46(R).

*Due Process Documents

On September 15, 2008, the Board issued a Proposed FSP FAS 140-e and FIN 46(R)-e, Disclosures about Transfers of Financial Assets and Interests in Variable Interest Entities, for a 30-day comment period. The comment period ends on October 15, 2008.

Exposure Draft

*Decisions Reached at the Last Meeting

See minutes below.

*Summary of Decisions Reached to Date

See Exposure Draft.

*Next Steps

The Board issued an Exposure Draft on September 15, 2008 with a 30-day comment period. Following the completion of the comment period, the Board will begin redeliberations on the proposed amendments.

*Board/Other Public Meeting Dates

The Board meeting minutes are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions become final only after a formal written ballot to issue a final Statement, Interpretation, FSP, or Statement 133 Implementation Issue.

July 30, 2008 Board Meeting—Effective Date and Transition Including Disclosures
June 4, 2008 Board Meeting—Enhanced disclosures in Statement 140 and Interpretation 46(R)

*Background Information

At its July 30, 2008 meeting, the Board agreed to require enhanced disclosures as part of its projects to amend Statement 140 and Interpretation 46(R). The Board decided this because financial statement users indicated that greater transparency is needed to understand the extent of continuing involvement a transferor has with transferred financial assets and the involvement an enterprise has with a variable interest entity.

As a result of its decisions related to the effective date for its projects to amend Statement 140 and Interpretation 46(R), the Board decided to issue an FSP that would require disclosures in the interim to expeditiously meet financial statement users’ needs for more transparent information. The disclosures in this FSP are similar to those in the pending Exposure Drafts to amend Statement 140 and Interpretation 46(R), but would be effective sooner.

Contact Information

Jamie Mayer
Practice Fellow
jamayer@fasb.org

Patricia Donoghue
Project Manager
padonoghue@fasb.org

Christopher Roberge
Project Manager
ceroberg@fasb.org

Philip Hood
Assistant Project Manager
prhood@fasb.org