Wiley GAAP 2015: Interpretation and Application of Generally Accepted Accounting Principles 2015

Chapter 59ASC 860 TRANSFERS AND SERVICING

PERSPECTIVE AND ISSUES

   Subtopics

   Scope and Scope Exceptions

   Overview

DEFINITIONS OF TERMS

CONCEPTS, RULES, AND EXAMPLES

   Transfers of Financial Assets under ASC 860—Introduction

PERSPECTIVE AND ISSUES

Subtopics

ASC 860 contains five Subtopics:

• ASC 860-10, Overall
• ASC 860-20, Sales of Financial Assets
• ASC 860-30, Secured Borrowings and Collateral
• ASC 860-50, Servicing Assets and Liabilities.

Scope and Scope Exceptions

ASC 860 applies to transfers and servicing of noncash financial assets. A transfer includes

• Selling a receivable,
• Transferring a receivable to a trust, or
• Using a receivable as security for a loan.

A transfer does not include

• The origination of a receivable,
• The settlement of a receivable, or
• The restructuring of a receivable in a troubled debt restructuring.

Those transactions are transfers involving the issuer of the receivable.

Among the types of transfers of financial assets for which ASC 860 establishes standards are:

• Financial instruments
• Financial assets
• Collateral
• Transfers of receivables with recourse (factoring with recourse)
• Transfers of undivided partial interests in receivables (retained interests)
• Transfers of receivables with servicing retained
• Transfers of minimum lease payments under sales-type and direct financing leases and any related guaranteed residual
• Putting a receivable into a securitization trust
• Repurchase agreements
• Dollar rolls
• Securities lending transactions
• Posting a receivable ...