{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/310/948/#30-initial-measurement","source":"FASB Accounting Standards Codification, Basic View","usage":"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.","topic":"310","topic_title":"Receivables","subtopic":"310-948","subtopic_title":"Financial Services—Mortgage Banking","section":{"number":"30","label":"30 Initial Measurement","anchor":"30-initial-measurement","is_sec":false,"groups":[{"block":null,"heading":"Affiliated Transactions","paragraphs":[{"citation":"310-948-30-1","para":"30-1","html":"The carrying amount of mortgage loans to be sold to an affiliated entity shall be adjusted to the lower of amortized cost basis or fair value of the loans as of the date management decides that a sale to an affiliated entity will occur. The date shall be determined based on, at a minimum, formal approval by an authorized representative of the purchaser, issuance of a commitment to purchase the loans, and acceptance of the commitment by the selling entity. The amount of any adjustment shall be charged to income. If a particular class of mortgage loans or all loans are originated exclusively for an affiliated entity, the originator is acting as an agent of the affiliated entity, and the loan transfers shall be accounted for at the originator's acquisition cost. Such an agency relationship, however, would not exist in the case of right of first refusal contracts or similar types of agreements or commitments if the originator retains all the risks associated with ownership of the loans. The originator's acquisition cost must conform to the provisions set forth in Topic 310. A mortgage loan classified as held-for-long-term-investment shall be measured at amortized cost basis. See Subtopic 326-20 for guidance on the measurement of credit losses for financial assets measured at amortized cost basis.