# ASC 310-10-40: Receivables — Overall — 40 Derecognition Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/310/10/#40-derecognition) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-09T23:25:03.641Z to 2026-09-09T23:25:03.641Z Record version: sha256:679d219cb9356ce08a395b2d49fba3738ee89a3798c294df9ba1225241a84fd9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 310-10-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/310/10/#40-derecognition) SEC content: no #### Transfers of Receivables ##### [310-10-40-1](https://asc.understandingaccounting.org/asc/310/10/#310-10-40-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:25:03.641Z to 2026-09-09T23:25:03.641Z Record version: sha256:28ab60322e07e1f0f6e2ae204bf1da053ed013199d6bb6c705575f228edd12a0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Topic 860 for guidance on a transferor's accounting for transfers of receivables. Subtopic 860-10 establishes criteria that are required to be satisfied for derecognition of a transferred asset. Subtopic 860-20 provides guidance for accounting for transfers of assets, including accounting for transfers of receivables in securitization transactions, transfers of receivables with [recourse](https://asc.understandingaccounting.org/glossary/r/#recourse "The right of a transferee of receivables to receive payment from the transferor of those receivables for any of the following: Failure of debtors to pay when due The effects of prepayments Adjustments resulting from defects in the eligibility of the transferred receivables."), and factoring arrangements. #### Classification and Measurement of Certain Government-Guaranteed Mortgage Loans upon Foreclosure ##### [310-10-40-1A](https://asc.understandingaccounting.org/asc/310/10/#310-10-40-1A) Pending content: no Source downloaded (UTC): 2026-09-09T23:25:03.641Z to 2026-09-09T23:25:03.641Z Record version: sha256:62d796dadf50de3b26bf8ecf3c187bd2fee56c26e267a7d2339713250fb8945c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For guidance on the classification and measurement of certain government-guaranteed mortgage loans upon foreclosure by a creditor, see paragraphs [310-20-40-7 through 40-8](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-7) . ### Acquisition, Development, and Construction Arrangements ##### [310-10-40-2](https://asc.understandingaccounting.org/asc/310/10/#310-10-40-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:25:03.641Z to 2026-09-09T23:25:03.641Z Record version: sha256:d55387f3dde2612f1bb07e5411eb894c89b9838f00291742520169374c4cf764 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subsection provides derecognition guidance related to the sale of a lender's interest in [expected residual profit](https://asc.understandingaccounting.org/glossary/e/#expected-residual-profit "The amount of profit, whether called interest or another name, such as equity kicker, above a reasonable amount of interest and fees expected to be earned by a lender."). ##### [310-10-40-3](https://asc.understandingaccounting.org/asc/310/10/#310-10-40-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:25:03.641Z to 2026-09-09T23:25:03.641Z Record version: sha256:493b75eb67f0db21d2dae8af057d8d7748d3dac34ea21721addd99084d0448da Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The lender's share of the expected residual profit in a project may be sold to the borrower or a third party for cash or other consideration. If the expected residual profit in an acquisition, development, and construction arrangement accounted for as a [loan](https://asc.understandingaccounting.org/glossary/l/#loan "A contractual right to receive money on demand or on fixed or determinable dates that is recognized as an asset in the creditor's statement of financial position. Examples include but are not limited to accounts receivable (with terms exceeding one year) and notes receivable.") is sold, the proceeds from the sale shall be recognized prospectively as additional interest over the remaining term of the loan. The expected residual profit is considered additional compensation to the lender, and the sale results in a quantification of the profit. ##### [310-10-40-4](https://asc.understandingaccounting.org/asc/310/10/#310-10-40-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:25:03.641Z to 2026-09-09T23:25:03.641Z Record version: sha256:6fed196e75e3ffdc1168e96ea04195a30fece2ac11020cc98d7c65bded29053f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an acquisition, development, and construction arrangement is accounted for as an investment in real estate or joint venture and the expected residual profit is sold, the entity shall apply the guidance in Topic 860 on transfers and servicing. ##### [310-10-40-5](https://asc.understandingaccounting.org/asc/310/10/#310-10-40-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:25:03.641Z to 2026-09-09T23:25:03.641Z Record version: sha256:65e5da3f8a930bcfb90fbdacea4f845a6df151167ef96b220a0afd32a5f3c239 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a financial institution was the seller of the property at the initiation of the project, the entity shall apply the guidance in paragraphs [360-10-40-3A through 40-3B](https://asc.understandingaccounting.org/asc/360/10/#360-10-40-3A) . However, if the sale is part of a sale and leaseback transaction, gain recognition, if any, should be determined by reference to Subtopic 842-40.