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2017

FASB Proposes Targeted Amendments to the Related-Party Guidance for Variable Interest Entities (July 14, 2017)

Heads Up | Volume 24, Issue 19
July 14, 2017
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FASB Proposes Targeted Amendments to the Related-Party Guidance for Variable Interest Entities

On June 22, 2017, the FASB issued for public comment a proposed ASU1 that would amend certain aspects of the related-party guidance in ASC 810.2 The proposed ASU’s three main objectives are (1) to add an elective private-company scope exception to the variable interest entity (VIE) guidance for entities under common control, (2) to remove a sentence in ASC 810-10-55-37D regarding the evaluation of fees paid to decision makers to conform with the amendments in ASU 2016-173 (issued in October 2016), and (3) to make additional changes to the related-party guidance in the VIE primary-beneficiary assessment, including amending the guidance in ASC 810-10-25-44 (frequently referred to as the related-party tiebreaker test).

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