{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/325/40/#15-scope-and-scope-exceptions","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":"325","topic_title":"Investments—Other","subtopic":"325-40","subtopic_title":"Beneficial Interests in Securitized Financial Assets","section":{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Entities","paragraphs":[{"citation":"325-40-15-1","para":"15-1","html":"
The guidance in this Subtopic applies to all entities.
","snippet":"The guidance in this Subtopic applies to all entities.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f6d6545d5f2508f25518500713e8901d558e640a6b592767e439de5c00d214b2","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:efc40fec1839026edbca13eee48a2f201137c038e3fbdfe4964d56fa67399685","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"block":null,"heading":"Instruments","paragraphs":[{"citation":"325-40-15-2","para":"15-2","html":"
The guidance in this Subtopic applies to a transferor's interests in securitization transactions that are accounted for as sales under Topic 860 and purchased beneficial interests in securitized financial assets.
","snippet":"The guidance in this Subtopic applies to a transferor's interests in securitization transactions that are accounted for as sales under Topic 860 and purchased beneficial interests in securitized financial assets.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cb4a98600e989d05c8942e8ccb051c43896ae33c640bf368860f3412e2e48890","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"citation":"325-40-15-3","para":"15-3","html":"
The guidance in this Subtopic applies to beneficial interests that have all of the following characteristics:
  1. a
    Are either debt securities under Subtopic 320-10 or required to be accounted for like debt securities under that Subtopic pursuant to paragraph 860-20-35-2.
  2. b
    Involve securitized financial assets that have contractual cash flows (for example, loans, receivables, debt securities, and guaranteed lease residuals, among other items). Thus, the guidance in this Subtopic does not apply to securitized financial assets that do not involve contractual cash flows (for example, common stock equity securities, among other items). See paragraph 320-10-35-38 for guidance on beneficial interests involving securitized financial assets that do not involve contractual cash flows.
  3. c
    Do not result in consolidation of the entity issuing the beneficial interest by the holder of the beneficial interests.
  4. d
    Subparagraph superseded by Accounting Standards Update No. 2016-13.
  5. e
    Are not beneficial interests in securitized financial assets that have both of the following characteristics:
    1. 1
      Are of high credit quality (for example, guaranteed by the U.S. government, its agencies, or other creditworthy guarantors, and loans or securities sufficiently collateralized to ensure that the possibility of credit loss is remote)
    2. 2
      Cannot contractually be prepaid or otherwise settled in such a way that the holder would not recover substantially all of its recorded investment.
","snippet":"The guidance in this Subtopic applies to beneficial interests that have all of the following characteristics:\n(a) Are either debt securities under Subtopic 320-10 or required to be accounted for like debt securities unde…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8d33a9eb5fcaaa0b0759ac0e49d6116b87b40ac072b7d2be60dc88e2f11857c5","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"citation":"325-40-15-4","para":"15-4","html":"
For guidance on recognition of interest income on beneficial interests that have both of the characteristics described in (e) in the preceding paragraph, see Subtopic 320-10. For guidance on determining the allowance for credit losses on beneficial interests that have both of the characteristics described in (e) in the preceding paragraph (other than trading debt securities), see Topic 326 on measurement of credit losses.
","snippet":"For guidance on recognition of interest income on beneficial interests that have both of the characteristics described in (e) in the preceding paragraph, see Subtopic 320-10. For guidance on determining the allowance for…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0eb515d51923fa4b814011aea67575382f51f33187991af5718589177bd61f07","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"citation":"325-40-15-5","para":"15-5","html":"
A beneficial interest in securitized financial assets that is in equity form may meet the definition of a debt security. For example, some beneficial interests issued in the form of equity represent solely a right to receive a stream of future cash flows to be collected under preset terms and conditions (that is, a creditor relationship), while others, according to the terms of the special-purpose entity, must be redeemed by the issuing entity or must be redeemable at the option of the investor. Consequently, those beneficial interests would be within the scope of both this Subtopic and Topic 320 because they are required to be accounted for as debt securities under that Topic.
","snippet":"A beneficial interest in securitized financial assets that is in equity form may meet the definition of a debt security. For example, some beneficial interests issued in the form of equity represent solely a right to rec…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2370e314d24aef6a4211b1781e3047a2166694e7747ae17ba9a6e15ffa28d989","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"citation":"325-40-15-6","para":"15-6","html":"
Beneficial interests issued in the form of equity that do not meet the criteria in the preceding paragraph shall be accounted for under the applicable provisions of Subtopic 323-10, the applicable consolidation guidance (see, for example, Subtopic 810-10), or Subtopic 321-10.
","snippet":"Beneficial interests issued in the form of equity that do not meet the criteria in the preceding paragraph shall be accounted for under the applicable provisions of Subtopic 323-10, the applicable consolidation guidance …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:65a1df9542d62fb129b413f9c67f3fb27bba83d2e954a0d3a7a02d0b1437aa43","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"citation":"325-40-15-7","para":"15-7","html":"
For income recognition purposes, beneficial interests classified as trading are included in the scope of this Subtopic because it is practice for certain industries (such as banks and investment companies) to report interest income as a separate item in their income statements, even though the investments are accounted for at fair value.
","snippet":"For income recognition purposes, beneficial interests classified as trading are included in the scope of this Subtopic because it is practice for certain industries (such as banks and investment companies) to report inte…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b6e5702a2a2996ba8e9631615385573d998a6f7fc217cd1afdb3c6507fb2f00f","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"citation":"325-40-15-8","para":"15-8","html":"
Included in the scope of this Subtopic are the host contract portion of a hybrid beneficial interest that requires separate accounting for an embedded derivative under paragraphs 815-15-25-1;
815-15-25-11 through 25-14
; and
815-15-25-26 through 25-29
when the host contract otherwise meets the scope of this Subtopic. The issue of when and how a hybrid contract is to be separated into its component parts is an implementation issue of Topic 815 and, therefore, not within the scope of this Subtopic.
","snippet":"Included in the scope of this Subtopic are the host contract portion of a hybrid beneficial interest that requires separate accounting for an embedded derivative under paragraphs 815-15-25-1; 815-15-25-11 through 25-14; …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7ef1a6d0605754ab910ded2c6b1befd25a3b2132a3e14802182167cabebdec25","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},{"citation":"325-40-15-9","para":"15-9","html":"
The guidance in this Subtopic does not apply to hybrid beneficial interests measured at fair value pursuant to paragraphs
815-15-25-4 through 25-6
for which the transferor does not report interest income as a separate item in its income statements.
","snippet":"The guidance in this Subtopic does not apply to hybrid beneficial interests measured at fair value pursuant to paragraphs 815-15-25-4 through 25-6 for which the transferor does not report interest income as a separate it…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:633c6c362bb02f84ce0778bcb62c24f925b268f1b7ab65b8f252c5e9f67bc051","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5b923f1b4de88bb116432f6e85109209bb247178bcd2ebe39f4eaf5366d063f2","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e47dd3909fbc701038203d69548c11a4abfa68209bbe26dfa54e073956c208f5","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e47dd3909fbc701038203d69548c11a4abfa68209bbe26dfa54e073956c208f5","downloaded_from":"2026-09-09T23:44:33.248Z","last_downloaded_at":"2026-09-09T23:44:33.248Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147481541","source_sha256":"1320329c6bc6e425d0190bec3996b54caba249b369030c4eb136cccdd8a65221"}}