# ASC 310-20-40: Receivables — Nonrefundable Fees and Other Costs — 40 Derecognition Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/310/20/#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): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:efd5110e844754f68a8c4374b1077db8d41fcbf36e6dff96c41632eeccfa099f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 310-20-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/310/20/#40-derecognition) SEC content: no #### Commitment Fees ##### [310-20-40-1](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:70e77048b5bd1e5a431c5a126ec9546f92ce4a8fd96f676078b0599d5db6ac88 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Except as set forth in paragraph [310-20-35-3(a) through (b)](https://asc.understandingaccounting.org/asc/310/20/#310-20-35-3), fees received for a commitment to originate or purchase 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. This definition encompasses loans accounted for as debt securities.") or group of loans shall be, if the commitment expires unexercised, recognized in income upon expiration of the commitment. #### Receipt of Assets in Full Satisfaction of a Receivable ##### [310-20-40-2](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:51c991165b97e568569c4dddeb87564c2e0665f7af9f05a9c4ed3303cb29a399 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A creditor that receives from a debtor in full satisfaction of a receivable either or both of the following shall account for those assets (including an equity interest) at their fair value at the [time of the restructuring](https://asc.understandingaccounting.org/glossary/t/#time-of-restructuring "Troubled debt restructurings may occur before, at, or after the stated maturity of debt, and time may elapse between the agreement, court order, and so forth, and the transfer of assets or equity interest, the effective date of new terms, or the occurrence of another event that constitutes consummation of the restructuring. The date of consummation is the time of the restructuring."): 1. a Receivables from third parties, real estate, or other assets 2. b Shares of stock or other evidence of an equity interest in the debtor. ##### [310-20-40-3](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:8f54e9cc03a4c36c36f160ebd2d704dcd04b860788b5ad342d097dca4eea7d10 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A creditor that receives long-lived assets that will be sold from a debtor in full satisfaction of a receivable shall account for those assets at their fair value less cost to sell, as that term is used in paragraph [360-10-35-43](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-43). The excess of the [amortized cost basis](https://asc.understandingaccounting.org/glossary/a/#amortized-cost-basis "The amortized cost basis is the amount at which a financing receivable or investment is originated or acquired, adjusted for applicable accrued interest, accretion, or amortization of premium, discount, and net deferred fees or costs, collection of cash, writeoffs, foreign exchange, and fair value hedge accounting adjustments.") satisfied over the fair value of assets received (less cost to sell, if required above) is a loss that shall be recognized. For purposes of this paragraph, losses, to the extent they are not offset against allowances for uncollectible amounts or other valuation accounts, shall be included in measuring net income for the period. The amortized cost basis is used in paragraphs [310-40-25-1 through 25-2](https://asc.understandingaccounting.org/asc/310/40/#310-40-25-1) ; [310-40-35-7](https://asc.understandingaccounting.org/asc/310/40/#310-40-35-7); [310-40-40-2 through 40-8](https://asc.understandingaccounting.org/asc/310/40/#310-40-40-2) ; and [310-40-50-1](https://asc.understandingaccounting.org/asc/310/40/#310-40-50-1) instead of [carrying amount](https://asc.understandingaccounting.org/glossary/c/#carrying-amount "For a receivable, the face amount increased or decreased by applicable accrued interest and applicable unamortized premium, discount, finance charges, or issue costs and also an allowance for uncollectible amounts and other valuation accounts.For a payable, the face amount increased or decreased by applicable accrued interest and applicable unamortized premium, discount, finance charges, or issue costs") of the receivable because the latter is net of an allowance for estimated uncollectible amounts or other valuation account, if any, while the former is not. ##### [310-20-40-4](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:64d9501b996c588c2bf5c6f9f4eebe252570bc713109bd311ba9c1b3272444e8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. That guidance is not intended to preclude using the fair value of the receivable satisfied if more clearly evident than the fair value of the assets received in full satisfaction of a receivable. ##### [310-20-40-5](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:3b8b07b3cc215c94e8cfb3a763322216b1e6fd13a1826b425a54bbb9dc00851d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A creditor shall account for assets received in satisfaction of a receivable the same as if the assets had been acquired for cash. #### Foreclosure ##### [310-20-40-6](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:adf6c1da9a8491db15eba9522d5fa372391ddd64375521e837395af55e57137d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A restructuring that is in substance a repossession or foreclosure by the creditor, that is, the creditor receives physical possession of the debtor's assets regardless of whether formal foreclosure proceedings take place, or in which the creditor otherwise obtains one or more of the debtor's assets in place of all or part of the receivable, shall be accounted for according to the provisions of paragraphs [310-20-35-12C](https://asc.understandingaccounting.org/asc/310/20/#310-20-35-12C), [310-20-40-2 through 40-4](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-2) , and, if appropriate, [310-20-40-9](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-9). See paragraphs [310-20-40-7 through 40-8](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-7) for the classification and measurement of certain government-guaranteed mortgage loans. For guidance on when a creditor shall be considered to have received physical possession (resulting from an in substance repossession or foreclosure) of residential real estate property collateralizing a consumer mortgage loan, see paragraph [310-20-55-18F](https://asc.understandingaccounting.org/asc/310/20/#310-20-55-18F). #### Classification and Measurement of Certain Government-Guaranteed Mortgage Loans upon Foreclosure ##### [310-20-40-7](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:7a6e785b401e8411e5266e7e46f817316c6601c260843d5e6d8787f4ee3254b1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A guaranteed mortgage loan receivable shall be derecognized and a separate other receivable shall be recognized upon foreclosure (that is, when a creditor receives physical possession of real estate property collateralizing a mortgage loan in accordance with the guidance in paragraph [310-20-40-6](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-6)) if the following conditions are met: 1. a The loan has a government guarantee that is not separable from the loan before foreclosure. 2. b At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim. A creditor would be considered to have the ability to recover under the guarantee at the time of foreclosure if the creditor determines that it has maintained compliance with the conditions and procedures required by the guarantee program. 3. c At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. ##### [310-20-40-8](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:36acc163c2a7609e987b12db76677b37de3a71d634f113df3e0df9a293bb4b1f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Upon foreclosure, the separate other receivable shall be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. #### Sale of Assets from a Loan Refinancing or Restructuring ##### [310-20-40-9](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-9) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:ed44aca4648692d7d20f54aac3c7e25680223721a8bdbd533cccc3c8c5b3d3df Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In the case of a loan refinancing or restructuring deemed to be a new loan in accordance with paragraphs [310-20-35-9 through 35-11](https://asc.understandingaccounting.org/asc/310/20/#310-20-35-9) , a receivable from the sale of assets previously obtained in a loan refinancing or restructuring shall be accounted for according to Subtopic 835-30 regardless of whether the assets were obtained in satisfaction (full or partial) of a receivable to which that Topic was not intended to apply. A difference, if any, between the amount of the new receivable and the carrying amount of the assets sold is a gain or loss on sale of assets. #### Cost Basis of Debt Security Received in a Restructuring ##### [310-20-40-10](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-10) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:7ff8a36b4a5859876c053bf55f9e6ecc9bd5791f550ea617bdbd15d51d3aad0f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The initial cost basis of a debt security of the original debtor received as part of a debt restructuring shall be the security's fair value at the date of the restructuring. Any excess of the fair value of the security received over the net carrying amount of the loan shall be recorded as a recovery on the loan. Any excess of the net carrying amount of the loan over the fair value of the security received shall be recorded as a charge-off to the allowance for credit losses. Subsequent to the restructuring, the security received shall be accounted for according to the provisions of Topic 320. ##### [310-20-40-11](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-11) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:208b40e0d211acb61187a2989789a1a201e871043e58e8dd9e18c601e7e63e6b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A security received in a restructuring in settlement of a claim for only the past-due interest on a loan shall be measured at the security's fair value at the date of the restructuring and accounted for in a manner consistent with the entity's policy for recognizing cash received for past-due interest. Subsequent to the restructuring, the security received shall be accounted for according to the provisions of Topic 320. #### Cost Basis of a Long-Lived Asset Received in Full Satisfaction of a Receivable ##### [310-20-40-12](https://asc.understandingaccounting.org/asc/310/20/#310-20-40-12) Pending content: no Source downloaded (UTC): 2026-09-09T23:26:02.921Z to 2026-09-09T23:26:02.921Z Record version: sha256:7d880bc0769a6c6d497a511ddd4ac831c3d83a0199db3f7b6f9dd6219a31c339 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A valuation allowance for a loan collateralized by a long-lived asset shall not be carried over as a separate element of the cost basis for purposes of accounting for the long-lived asset under Topic 360 after foreclosure.