Accounting for Off-Balance Sheet Items Update

• Overview
• Agenda
• Faculty
• Credits

Benefits

For years, the Financial Accounting Standards Board, the SEC and others have wrestled with how companies should report their involvement with special-purpose vehicles and transactions with such entities in their financial statements. Frequently, these issues are mentioned in the context of structured finance or asset securitization or, more broadly, as off-balance sheet financing. The recent financial crisis elevated concerns about the adequacy of the accounting and reporting standards for these transactions and structures.

In June of 2009, the FASB issued two major standards, SFAS 166 and 167, in an attempt to address these concerns. SFAS 166 strengthens the sale accounting requirements for transactions involving transfers of financial assets, such as receivables and loans. SFAS 167 addresses perceived shortcomings and abuses relating to the consolidation rules for SPEs and similar structured entities. The new consolidation model focuses on identifying the party that exercises power over the SPE and places the onus of consolidation on it. Both standards require significantly more disclosures about such transactions and structured entities.

This teleconference will familiarize you with the key requirements of the new rules and provide you with a better understanding of their potential accounting and reporting implications. This teleconference will of be of interest to anyone who reads and works with financial statements, individuals who work with securitizations or in the financing business, and those who want to better understand the concepts and principles behind the new off-balance sheet model.