The Financial Accounting Standards Board has issued three exposure drafts of proposed financial standards and amendments relating to accounting for transfers of financial assets.

One of the additions aims to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about transfers of financial assets, including through securitization transactions. These include the effects of such transfers of financial assets on its financial position, financial performance, and cash flows, and a transferor's continuing involvement in the transferred financial assets.

Another exposure draft provides guidance on determining whether an enterprise must consolidate a special-purpose entity, including those previously considered qualifying SPEs. The QSPEs are controversial off-balance-sheet assets that many banks and financial institutions have used to bundle complex financial instruments, such as securitized mortgages, and FASB said they are no longer relevant for accounting purposes.

The FASB Staff Position amends Statement 140 to require public entities to provide additional disclosures about transfers of financial assets and also amends Interpretation 46(R) to require public enterprises to provide additional disclosures about their involvement with variable interest entities. The purpose of the FASB Staff Position is to promptly improve disclosures by public entities and enterprises until the pending amendments to Statement 140 and Interpretation 46(R) are effective.

FASB is seeking comments on the proposed standards. For more information, visit

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