# ASC 470-60: Debt — Troubled Debt Restructurings by Debtors Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/470/60/) 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): 2026-09-10T00:33:11.172Z to 2026-09-10T00:33:34.628Z Record version: sha256:15f33b23a62ae3b5034e7ad43be4a39a14835a7021deb2529165de9f31cab0e4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60: Debt — Troubled Debt Restructurings by Debtors ### Machine-generated study aids ```json { "summary": "ASC 470-60 governs how a debtor accounts for a troubled debt restructuring (TDR) — a restructuring in which the creditor, for economic or legal reasons related to the debtor's financial difficulties, grants a concession it would not otherwise consider (470-60-15-5). Settlements by transfer of assets or grant of an equity interest are measured at fair value, with a gain on restructuring equal to the excess of the payable's carrying amount over that fair value (470-60-35-2, 35-4). Pure modifications of terms are accounted for prospectively with no change in carrying amount and a new effective interest rate, unless total future cash payments (including contingent amounts) are less than the carrying amount, in which case the debtor writes down the payable and recognizes a gain (470-60-35-5 through 35-7).", "key_points": [ "A restructuring is a TDR only if the creditor grants a concession for reasons related to the debtor's financial difficulties (470-60-15-5); a debtor able to borrow elsewhere at rates near nontroubled market rates generally is not in a TDR (470-60-15-8, 470-60-55-9), and a concession exists if the effective borrowing rate on the restructured debt is lower than on the old debt (470-60-55-10).", "Substance over form controls: modifications of timing, amounts designated as interest, or amounts designated as face amount are all treated alike, and each payable is accounted for individually even if negotiated jointly (470-60-10-1, 470-60-15-4).", "Full settlement by transferring assets produces a gain on restructuring equal to carrying amount of the payable less fair value of the assets, plus a separate gain or loss on transfer of assets equal to fair value less the assets' carrying amount (470-60-35-2 through 35-3); equity interests granted are recorded at fair value (470-60-35-4).", "In a modification-of-terms TDR, the debtor does not change the carrying amount and applies a new effective interest rate that equates the present value of future cash payments (excluding contingent amounts) to that carrying amount (470-60-35-5).", "If total future cash payments under the new terms are less than the carrying amount, the debtor reduces the payable to that total, recognizes a gain, and thereafter records all payments as reductions of carrying amount with no interest expense (470-60-35-6).", "Contingent payments are assumed payable and included in total future cash payments to the extent needed to prevent recognizing a gain that could be offset by future interest expense; they are later accrued under 450-20-25-2 (470-60-35-7, 35-10).", "The Subtopic does not apply where the debtor restates its liabilities generally in bankruptcy or a quasi-reorganization (470-60-15-10, 55-1) and excludes lease modifications and mere payment delays (470-60-15-11); disclosures include principal changes in terms, aggregate gain on restructuring, net gain or loss on asset transfers, and per-share gain (470-60-50-1)." ], "categories": [ "Debt and equity", "Subsequent measurement", "Derecognition", "Disclosure" ], "audience_level": "intermediate", "student_note": "Exam questions hinge on the counterintuitive modification rule: unless undiscounted total future cash payments (including contingent ones) fall below the carrying amount, the debtor recognizes no gain and simply re-solves for a lower effective interest rate — students wrongly assume any concession triggers immediate gain recognition. Also remember the two-part scope test: debtor financial difficulty plus a creditor concession (a decreased effective borrowing rate under 470-60-55-10); if either is absent, apply 470-50 instead.", "related_topics": [ "470-50", "470-10", "450-20", "835-30", "852", "310-40" ], "key_concepts": [ "troubled debt restructuring", "concession", "debtor financial difficulties", "gain on restructuring of payables", "modification of terms", "effective borrowing rate", "contingent future payments", "settlement by transfer of assets or equity interest" ] } ``` Source downloaded (UTC): 2026-09-10T00:33:11.172Z to 2026-09-10T00:33:11.172Z Record version: sha256:c2e0ae4fe44d86f87e4ca395b99ff44f5dac830a9d26ac7df5895b0f58398a77 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/470/60/#00-status) SEC content: no ##### [470-60-00-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-00-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:11.172Z to 2026-09-10T00:33:11.172Z Record version: sha256:c6221b63622f0bb85f1461d178b8fde18a8ec2678258eb5787fc96f368473ab8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Amortized Cost BasisAddedAccounting Standards Update No. 2016-1306/16/2016
ContractAddedAccounting Standards Update No. 2016-0202/25/2016
DebtSupersededAccounting Standards Update No. 2016-1912/14/2016
LeaseAddedAccounting Standards Update No. 2016-0202/25/2016
Lease ModificationAddedAccounting Standards Update No. 2016-0202/25/2016
Recorded Investment in the ReceivableSupersededAccounting Standards Update No. 2016-1306/16/2016
470-60-05-1AmendedAccounting Standards Update No. 2022-0203/31/2022
470-60-10-1AmendedAccounting Standards Update No. 2016-1912/14/2016
470-60-15-3SupersededAccounting Standards Update No. 2022-0203/31/2022
470-60-15-3AmendedAccounting Standards Update No. 2016-1306/16/2016
470-60-15-4AAddedAccounting Standards Update No. 2016-1912/14/2016
470-60-15-9AmendedAccounting Standards Update No. 2016-1912/14/2016
470-60-15-11AmendedAccounting Standards Update No. 2016-0202/25/2016
470-60-15-12AmendedAccounting Standards Update No. 2016-1306/16/2016
470-60-35-3AmendedMaintenance Update 2017-19 (PDF)11/15/2017
470-60-35-8AmendedAccounting Standards Update No. 2016-1912/14/2016
470-60-50-1AmendedAccounting Standards Update No. 2024-0311/04/2024
470-60-55-4AmendedAccounting Standards Update No. 2016-1912/14/2016
470-60-55-8AmendedAccounting Standards Update No. 2016-1912/14/2016
470-60-55-15SupersededAccounting Standards Update No. 2022-0203/31/2022
Source downloaded (UTC): 2026-09-10T00:33:13.451Z to 2026-09-10T00:33:13.451Z Record version: sha256:9c783385f45d1854acb73e25e9849ae7bce1ebae382cbf86fc8c001dd5f857e0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/470/60/#05-overview-and-background) SEC content: no ##### [470-60-05-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:13.451Z to 2026-09-10T00:33:13.451Z Record version: sha256:4924efcfbb8d23dd3be7f57ce767e8481fddc2c0012fc57cf123df00a48fc561 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic addresses measurement, derecognition, disclosure, and implementation guidance issues concerning [troubled debt restructurings](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") focused on the debtor's records. Source downloaded (UTC): 2026-09-10T00:33:17.391Z to 2026-09-10T00:33:17.391Z Record version: sha256:4559be879a2e102cc502c00c5150547c425e0a0bc88f6bc73b653b6446db8880 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-10: 10 Objectives [Read section](https://asc.understandingaccounting.org/asc/470/60/#10-objectives) SEC content: no ##### [470-60-10-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-10-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:17.391Z to 2026-09-10T00:33:17.391Z Record version: sha256:60f9297431d3b9194937ff7aaa5f87dd4641b413ca87dbfcaea1a22321167046 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The accounting for restructured debt is based on the substance of the modifications—the effect on cash flows—not on the labels chosen to describe those cash flows. The substance of all modifications of a debt in a [troubled debt restructuring](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") is essentially the same whether they involve modifications of any of the following: 1. a Timing 2. b Amounts designated as interest 3. c Amounts designated as face amounts. ##### [470-60-10-2](https://asc.understandingaccounting.org/asc/470/60/#470-60-10-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:17.391Z to 2026-09-10T00:33:17.391Z Record version: sha256:faf8626e0aaf09562a72e2aadbf7c270e1dbc384d991015184c36baf97dd4521 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. All of those kinds of modifications affect future cash receipts or payments and therefore affect both of the following: 1. a The creditor's total return on the receivable, its effective interest rate, or both 2. b The debtor's total cost on the payable, its effective interest rate, or both. Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:220d1b6ba310cc6ba714505f595c9d21b489b370ac42dc59d1fc4f86c8215ccb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/470/60/#15-scope-and-scope-exceptions) SEC content: no #### Entities ##### [470-60-15-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:3e73c164461b1515d6fa7187ba00a5daa0dc88a8d4517a41ebd0723fe4bc241f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic applies to all debtors. #### Transactions ##### [470-60-15-2](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:4e1ee403836440309d1453a960274cf3cd9c7e5e0539e2473c451fde4d1ef810 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic applies to all [troubled debt restructurings](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") by debtors. ##### [470-60-15-3](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-3) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:f54c8d32ae5a1e46d13d262fbd1811a4f08f32d6ac08941b8cc259bb81d83a2a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2022-02](https://asc.understandingaccounting.org/updates/asu-2022-02/). ##### [470-60-15-4](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-4) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:fac34ba45f1dce346c2d48a1a8d5ba8e5a7983322c8c06eb5a54a225dbb1d588 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The substance rather than the form of the payable shall govern. Payables that may be involved in troubled debt restructurings commonly result from borrowing of cash, or purchasing goods or services on credit. Examples are accounts payable, notes, debentures and bonds (whether those payables are secured or unsecured and whether they are convertible or nonconvertible), and related accrued interest, if any. Typically, each payable is negotiated separately, but sometimes two or more payables are negotiated together. For example, a debtor may negotiate with a group of creditors but sign separate debt instruments with each creditor. For purposes of this Subtopic, restructuring of each payable, including those negotiated and restructured jointly, shall be accounted for individually. ##### [470-60-15-4A](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-4A) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:646ce8cc5d5606824bce1ea72c97166fb04004c7f454585778167ad8181ad009 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In this Subtopic, a receivable or a payable (collectively referred to as debt) represents a contractual right to receive money or a contractual obligation to pay money on demand or on fixed or determinable dates that is already included as an asset or a liability in the creditor's or debtor's balance sheet at the time of the restructuring. ##### [470-60-15-5](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-5) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:54c5055fa53b9c201b9fc87f7e8d64a8413284f48aad0f48c93b46a23a2ab386 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A restructuring of a debt constitutes a troubled debt restructuring for purposes of this Subtopic if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider. ##### [470-60-15-6](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-6) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:3b395a3a815388d17d99da1dbd9be4c87abd8ddee08d3d3356f100c9af8825f1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. That concession is granted by the creditor in an attempt to protect as much of its investment as possible. That concession either stems from an agreement between the creditor and the debtor or is imposed by law or a court; for example, either of the following circumstances might occur: 1. a A creditor may restructure the terms of a debt to alleviate the burden of the debtor's near-term cash requirements, and many troubled debt restructurings involve modifying terms to reduce or defer cash payments required of the debtor in the near future to help the debtor attempt to improve its financial condition and eventually be able to pay the creditor. 2. b The creditor may accept cash, other assets, or an equity interest in the debtor in satisfaction of the debt though the value received is less than the amount of the debt because the creditor concludes that step will maximize recovery of its investment. Although troubled debt that is fully satisfied by foreclosure, repossession, or other transfer of assets or by grant of equity securities by the debtor is, in a technical sense, not restructured, that kind of event is included in the term _troubled debt restructuring_ in this Subtopic. ##### [470-60-15-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-7) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:bbe5449cbb0a9a4abd3c494bbac6547fc9d6064a89f053f54496775a660bf556 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Whatever the form of concession granted by the creditor to the debtor in a troubled debt restructuring, the creditor's objective is to make the best of a difficult situation. That is, the creditor expects to obtain more cash or other value from the debtor, or to increase the probability of receipt, by granting the concession than by not granting it. ##### [470-60-15-8](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-8) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:9f0258dae3215ce3c77ac78c0d9ff6a815db2f774c3d1a30b478ca423bdc4cf1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In general, a debtor that can obtain funds from sources other than the existing creditor at market interest rates at or near those for nontroubled debt is not involved in a troubled debt restructuring. A debtor in a troubled debt restructuring can obtain funds from sources other than the existing creditor in the troubled debt restructuring, if at all, only at effective interest rates (based on market prices) so high that it cannot afford to pay them. ##### [470-60-15-9](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-9) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:760b0844a362ca3c9be51b945083411dedb18d2fd4835a2a19622ee234b496d8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A troubled debt restructuring may include, but is not necessarily limited to, one or a combination of the following: 1. a Transfer from the debtor to the creditor of receivables from third parties, real estate, or other assets to satisfy fully or partially a debt (including a transfer resulting from foreclosure or repossession) 2. b Issuance or other granting of an equity interest to the creditor by the debtor to satisfy fully or partially a debt unless the equity interest is granted pursuant to existing terms for converting the debt into an equity interest 3. c Modification of terms of a debt, such as one or a combination of any of the following: 1. 1 Reduction (absolute or contingent) of the stated interest rate for the remaining original life of the debt 2. 2 Extension of the maturity date or dates at a stated interest rate lower than the current market rate for new debt with similar risk 3. 3 Reduction (absolute or contingent) of the face amount or maturity amount of the debt as stated in the instrument or other agreement 4. 4 Reduction (absolute or contingent) of accrued interest. ##### [470-60-15-10](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-10) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:353358fbe0217d093da121f49cb655d1af7c082c55c3ebfad2bd162e2137fab4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic shall be applied to all troubled debt restructurings including those consummated under reorganization, arrangement, or other provisions of the Federal Bankruptcy Act or other federal statutes related thereto. This Subtopic does not apply, however, if under provisions of those federal statutes or in a quasi-reorganization or corporate readjustment (see Topic 852) with which a troubled debt restructuring coincides, the debtor restates its liabilities generally, that is, if such restructurings or modifications accomplished under purview of the bankruptcy court encompass most of the amount of the debtor's liabilities. ##### [470-60-15-11](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-11) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:e93eaaf98053eca70f9c83871cc470f1694d674b093bb5095c5b3bd75533bbc6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For purposes of this Subtopic, none of the following are considered troubled debt restructurings: 1. a [Lease modifications](https://asc.understandingaccounting.org/glossary/l/#lease-modification "A change to the terms and conditions of a contract that results in a change in the scope of or the consideration for a lease (for example, a change to the terms and conditions of the contract that adds or terminates the right to use one or more underlying assets or extends or shortens the contractual lease term).") (for guidance, see Topic 842) 2. b Changes in employment-related agreements, for example, pension plans and deferred compensation contracts 3. c Unless they involve an agreement between debtor and creditor to restructure, neither of the following: 1. 1 Debtors' failures to pay trade accounts according to their terms 2. 2 Creditors' delays in taking legal action to collect overdue amounts of interest and principal. ##### [470-60-15-12](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-12) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:25dfe58694759df6b0e1c0007d9f4ee5b7f48f3feb86fef05a3775b55a1e4ef5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debt restructuring is not necessarily a troubled debt restructuring for purposes of this Subtopic even if the debtor is experiencing some financial difficulties. For example, a troubled debt restructuring is not involved if any of the following circumstances exist: 1. a The [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") of cash, other assets, or an equity interest accepted by a creditor from a debtor in full satisfaction of its receivable at least equals the creditor's [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.") in the receivable. 2. b The fair value of cash, other assets, or an equity interest transferred by a debtor to a creditor in full settlement of its payable at least equals the debtor's carrying amount of the payable. 3. c The creditor reduces the effective interest rate on the debt primarily to reflect a decrease in market interest rates in general or a decrease in the risk so as to maintain a relationship with a debtor that can readily obtain funds from other sources at the current market interest rate. 4. d The debtor issues in exchange for its debt new marketable debt having an effective interest rate based on its market price that is at or near the current market interest rates of debt with similar maturity dates and stated interest rates issued by nontroubled debtors. ##### [470-60-15-13](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-13) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:19.847Z to 2026-09-10T00:33:19.847Z Record version: sha256:abb3f92e520c16f0e02d0b595f9ae1abd2b8dc8caa50f438407df0864019b0af Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For further guidance on determining whether a modification or exchange is a troubled debt restructuring, see paragraphs [470-60-55-4 through 55-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-4) . If a debtor concludes that the modification or exchange is not within the scope of this Subtopic, the debtor would apply the provisions of Subtopic 470-50. Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:5b2a709815d2d45430b3dc2b8cfdbd6194e8ff90277e56b60bc53423d40a309e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/470/60/#35-subsequent-measurement) SEC content: no ##### [470-60-35-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:1c552c082afdd9980f378f3030e89ff67fbddac5792b7cb2225addddaed4571a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debtor shall account for a [troubled debt restructuring](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") according to the type of the restructuring as prescribed in this Section. ##### [470-60-35-2](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:9c1322c6a508f955617d761d554482a153dfa6ac65503e85d40c356a393b3db2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debtor that transfers its receivables from third parties, real estate, or other assets to a creditor to settle fully a payable shall recognize a gain on restructuring of payables. The gain shall be measured by the excess of the [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 payable over the [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") of the assets transferred to the creditor. However, while the guidance in this Subtopic indicates that the fair value of assets transferred or the fair value of an equity interest granted shall be used in accounting for a settlement of a payable in a troubled debt restructuring, that guidance is not intended to preclude using the fair value of the payable settled if more clearly evident than the fair value of the assets transferred or of the equity interest granted in a full settlement of a payable. However, in a partial settlement of a payable, the fair value of the assets transferred or of the equity interest granted shall be used in all cases to avoid the need to allocate the fair value of the payable between the part settled and the part still outstanding. ##### [470-60-35-3](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-3) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:e71707fec49fb4f5c5bebee4f39067edaf0c2a88625fe2ba80d06a17188c96a5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A difference between the fair value and the carrying amount of assets transferred to a creditor to settle a payable is a gain or loss on transfer of assets. The carrying amount of a receivable encompasses not only unamortized premium, discount, acquisition costs, and the like but also an allowance for uncollectible amounts and other valuation accounts, if any. The debtor shall include that gain or loss in measuring net income for the period of transfer, reported as provided in Topic 220. A loss on transferring receivables to creditors may therefore have been wholly or partially recognized in measuring net income before the transfer and be wholly or partly a reduction of a valuation account rather than a gain or loss in measuring net income for the period of the transfer. ##### [470-60-35-4](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-4) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:5aff3f0f085dbbfd03012232fd7041b763343b81d44395cbe9d1bd5ff802d6a5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debtor that issues or otherwise grants an equity interest to a creditor to settle fully a payable shall account for the equity interest at its fair value. The difference between the fair value of the equity interest granted and the carrying amount of the payable settled shall be recognized as a gain on restructuring of payables. ##### [470-60-35-5](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-5) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:78f5bd9c3b2c001b61cb9434158877d22fc0a86e2842f732fa596d6a082189db Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debtor in a troubled debt restructuring involving only modification of terms of a payable—that is, not involving a transfer of assets or grant of an equity interest— shall account for the effects of the restructuring prospectively from the [time of 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."), and shall not change the carrying amount of the payable at the time of the restructuring unless the carrying amount exceeds the total future cash payments specified by the new terms. Total future cash payments includes related accrued interest, if any, at the time of the restructuring that continues to be payable under the new terms. That is, the effects of changes in the amounts or timing (or both) of future cash payments designated as either interest or face amount shall be reflected in future periods. Interest expense shall be computed in a way such that a constant effective interest rate is applied to the carrying amount of the payable at the beginning of each period between restructuring and maturity (in substance the interest method prescribed by paragraphs [835-30-35-2](https://asc.understandingaccounting.org/asc/835/30/#835-30-35-2) and [835-30-35-4 through 35-5](https://asc.understandingaccounting.org/asc/835/30/#835-30-35-4) ). The new effective interest rate shall be the discount rate that equates the present value of the future cash payments specified by the new terms (excluding amounts contingently payable) with the carrying amount of the payable. ##### [470-60-35-6](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-6) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:866647473de3ab84bb60f99b085bf5b47851140db3837fec3247046881bcdd4a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If, however, the total future cash payments specified by the new terms of a payable, including both payments designated as interest and those designated as face amount, are less than the carrying amount of the payable, the debtor shall reduce the carrying amount to an amount equal to the total future cash payments specified by the new terms and shall recognize a gain on restructuring of payables equal to the amount of the reduction. If the carrying amount of the payable comprises several accounts (for example, face amount, accrued interest, and unamortized premium, discount, finance charges, and issue costs) that are to be continued after the restructuring, some possibly being combined, the reduction in carrying amount may need to be allocated among the remaining accounts in proportion to the previous balances. Thereafter, all cash payments under the terms of the payable shall be accounted for as reductions of the carrying amount of the payable, and no interest expense shall be recognized on the payable for any period between the restructuring and maturity of the payable. The only exception is to recognize interest expense according to paragraph [470-60-35-10](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-10). However, the debtor may choose to carry the amount designated as face amount by the new terms in a separate account and adjust another account accordingly. ##### [470-60-35-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-7) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:25b89a7d6a3ca4d9fa71cedb2015b22787fe5a5397929d7b0335c96361ccf322 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debtor shall not recognize a gain on a restructured payable involving indeterminate future cash payments as long as the maximum total future cash payments may exceed the carrying amount of the payable. Amounts designated either as interest or as face amount by the new terms may be payable contingent on a specified event or circumstance (for example, the debtor may be required to pay specified amounts if its financial condition improves to a specified degree within a specified period). To determine whether the debtor shall recognize a gain according to the provisions of the preceding two paragraphs, those contingent amounts shall be included in the total future cash payments specified by the new terms to the extent necessary to prevent recognizing a gain at the time of restructuring that may be offset by future interest expense. Thus, the debtor shall apply paragraphs [450-30-25-1](https://asc.understandingaccounting.org/asc/450/30/#450-30-25-1) and [450-30-50-1](https://asc.understandingaccounting.org/asc/450/30/#450-30-50-1) in which probability of occurrence of a gain contingency is not a factor, and shall assume that contingent future payments will have to be paid. The same principle applies to amounts of future cash payments that must sometimes be estimated to apply the provisions of the preceding two paragraphs. For example, if the number of future interest payments is flexible because the face amount and accrued interest is payable on demand or becomes payable on demand, estimates of total future cash payments shall be based on the maximum number of periods possible under the restructured terms. ##### [470-60-35-8](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-8) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:14c9dcdf4546c892bb1b867c7548d378e2fa699358ec95d27dff0672431b767a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A troubled debt restructuring may involve partial settlement of a payable by the debtor's transferring assets or granting an equity interest (or both) to the creditor and modification of terms of the remaining payable. Even if the stated terms of the remaining payable, for example, the stated interest rate and the maturity date or dates, are not changed in connection with the transfer of assets or grant of an equity interest, the restructuring shall be accounted for as prescribed by this guidance. A debtor shall account for a troubled debt restructuring involving a partial settlement and a modification of terms as prescribed in paragraphs [470-60-35-5 through 35-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-5) except that, first, assets transferred or an equity interest granted in that partial settlement shall be measured as prescribed in paragraphs [470-60-35-2](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-2) and [470-60-35-4](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-4), respectively, and the carrying amount of the payable shall be reduced by the total fair value of those assets or equity interest. If cash is paid in a partial settlement of a payable in a troubled debt restructuring, the carrying amount of the payable shall be reduced by the amount of cash paid. A difference between the fair value and the carrying amount of assets transferred to the creditor shall be recognized as a gain or loss on transfer of assets. No gain on restructuring of payables shall be recognized unless the remaining carrying amount of the payable exceeds the total future cash payments (including amounts contingently payable) specified by the terms of the debt remaining unsettled after the restructuring. Future interest expense, if any, shall be determined according to the provisions of paragraphs [470-60-35-5 through 35-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-5) . ##### [470-60-35-9](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-9) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:2bfd9420580ac3b43e2ba5e3bb0731d5fb87beaa8ceddec9415869a316fd4760 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A troubled debt restructuring that is in substance a repossession or foreclosure by the creditor or other transfer of assets to the creditor shall be accounted for according to the provisions of the preceding paragraph and paragraphs [470-60-35-2 through 35-3](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-2) . ##### [470-60-35-10](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-10) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:09f5203d60951902f93e0ea6bf0db751ce42b1d7f815ce9a3b912a09c4aded3b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a troubled debt restructuring involves amounts contingently payable, those contingent amounts shall be recognized as a payable and as interest expense in future periods in accordance with paragraph [450-20-25-2](https://asc.understandingaccounting.org/asc/450/20/#450-20-25-2). Thus, in general, interest expense for contingent payments shall be recognized in each period in which both of the following conditions exist: 1. a It is probable that a liability has been incurred. 2. b The amount of that liability can be reasonably estimated. Before recognizing a payable and interest expense for amounts contingently payable, however, accrual or payment of those amounts shall be deducted from the carrying amount of the restructured payable to the extent that contingent payments included in total future cash payments specified by the new terms prevented recognition of a gain at the time of restructuring (see paragraph [470-60-35-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-7)). ##### [470-60-35-11](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-11) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:68d22ffe6e67b22ac47ffee31466d0e852dd7f1f5930f04bf158a0aaf44d40fd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If amounts of future cash payments must be estimated to apply the provisions of paragraphs [470-60-35-5 through 35-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-5) because future interest payments are expected to fluctuate—for example, the restructured terms may specify the stated interest rate to be the prime interest rate increased by a specified amount or proportion—estimates of maximum total future payments shall be based on the interest rate in effect at the time of the restructuring. Fluctuations in the effective interest rate after the restructuring from changes in the prime rate or other causes shall be accounted for as changes in estimates in the periods in which the changes occur. However, the accounting for those fluctuations shall not result in recognizing a gain on restructuring that may be offset by future cash payments (see the preceding paragraph and paragraph [470-60-35-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-7)). Rather, the carrying amount of the restructured payable shall remain unchanged, and future cash payments shall reduce the carrying amount until the time that any gain recognized cannot be offset by future cash payments. ##### [470-60-35-12](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-12) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:23.646Z to 2026-09-10T00:33:23.646Z Record version: sha256:764e6a62463e25914b74099ccb9c844a14bbcaac0f0a82af222129bb5d99d423 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Legal fees and other direct costs that a debtor incurs in granting an equity interest to a creditor in a troubled debt restructuring shall reduce the amount otherwise recorded for that equity interest according to paragraphs [470-60-35-4](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-4) and [470-60-35-8](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-8). All other direct costs that a debtor incurs to effect a troubled debt restructuring shall be deducted in measuring gain on restructuring of payables or shall be included in expense for the period if no gain on restructuring is recognized. Source downloaded (UTC): 2026-09-10T00:33:26.123Z to 2026-09-10T00:33:26.123Z Record version: sha256:0f1c6343c7fbcee3fc42ecfb35158dabc5d9d20f89ca78169be4727ba971701c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/470/60/#45-other-presentation-matters) SEC content: no ##### [470-60-45-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-45-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:26.123Z to 2026-09-10T00:33:26.123Z Record version: sha256:3eb7434f761fd7457866446a0c7efe8dfd31d5d2582a577ed25888bcfb66fd25 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. All or a portion of the [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 payable 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.") may need to be reclassified in the balance sheet because of changes in the terms, for example, a change in the amount of the payable due within one year after the date of the debtor's balance sheet. ##### [470-60-45-2](https://asc.understandingaccounting.org/asc/470/60/#470-60-45-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:26.123Z to 2026-09-10T00:33:26.123Z Record version: sha256:241bc8ec3cf9d5d47813a8500f73a8dd66d5c2305818c71785fa5f860d6eba4e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A [troubled debt restructuring](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") of a short-term obligation after the date of a debtor's balance sheet but before that balance sheet is issued or is available to be issued (as discussed in Section 855-10-25) may affect the classification of that obligation in accordance with Subtopic 470-10. Source downloaded (UTC): 2026-09-10T00:33:28.511Z to 2026-09-10T00:33:28.511Z Record version: sha256:478a1260c295d925c73b6e9f149c2e533b3c33a68fb8121b4913ab1a31c9b6f2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/470/60/#50-disclosure) SEC content: no ##### [470-60-50-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-50-1) Pending content: yes Source downloaded (UTC): 2026-09-10T00:33:28.511Z to 2026-09-10T00:33:28.511Z Record version: sha256:aa5c9b2344da9d4abdf43d31082d8f754d9a22a10d41b8e228f2552fc75ff4c8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debtor shall disclose, either in the body of the financial statements or in the accompanying notes, all of the following information about [troubled debt restructurings](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") that have occurred during a period for which financial statements are presented: 1. a For each restructuring, a description of the principal changes in terms, the major features of settlement, or both; separate restructurings within a fiscal period for the same category of payables (for example, accounts payable or subordinated debentures) may be grouped for disclosure purposes 2. b Aggregate gain on restructuring of payables 3. c Aggregate net gain or loss on transfers of assets recognized during the period (see paragraphs [470-60-35-3](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-3) and [470-60-35-8](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-8)) 4. d Per-share amount of the aggregate gain on restructuring of payables. Transition date:(P) December 16, 2026; (N) December 16, 2026Transition guidance: [220-40-65-1](https://asc.understandingaccounting.org/asc/220/40/#220-40-65-1)A debtor shall disclose, either in the body of the financial statements or in the accompanying notes, all of the following information about [troubled debt restructurings](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") that have occurred during a period for which financial statements are presented: 1. a For each restructuring, a description of the principal changes in terms, the major features of settlement, or both; separate restructurings within a fiscal period for the same category of payables (for example, accounts payable or subordinated debentures) may be grouped for disclosure purposes 2. b Aggregate gain on restructuring of payables 3. c Aggregate net gain or loss on transfers of assets recognized during the period (see paragraphs [470-60-35-3](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-3) and [470-60-35-8](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-8)) 4. d Per-share amount of the aggregate gain on restructuring of payables. See paragraphs [220-40-50-21 through 50-25](https://asc.understandingaccounting.org/asc/220/40/#220-40-50-21) for additional disclosure requirements. ##### [470-60-50-2](https://asc.understandingaccounting.org/asc/470/60/#470-60-50-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:28.511Z to 2026-09-10T00:33:28.511Z Record version: sha256:24144eb5b94c74dbb93778bae91f3cd0dbe914da0365beb8b687e8a3067dea83 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A debtor shall disclose in financial statements for periods after a troubled debt restructuring the extent to which amounts contingently payable are included in the [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 restructured payables pursuant to the provisions of paragraph [470-60-35-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-35-7). If required by paragraphs [450-20-50-1 through 50-6](https://asc.understandingaccounting.org/asc/450/20/#450-20-50-1) and [450-20-50-9 through 50-10](https://asc.understandingaccounting.org/asc/450/20/#450-20-50-9) , a debtor shall also disclose in those financial statements total amounts that are contingently payable on restructured payables and the conditions under which those amounts would become payable or would be forgiven. Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:75604a787542be6bd77c68526bd923f44624b5a2fc7804cb40736e15eb23c95a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 470-60-55: 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/470/60/#55-implementation-guidance-and-illustrations) SEC content: no #### Implementation Guidance ##### [470-60-55-1](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:c6251f4b0f9ed127c56d1599e5235ad54aa0a8c538038bab178ef9145117b099 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Entities involved with Chapter 11 bankruptcy proceedings frequently reduce all or most of their indebtedness with the approval of their creditors and the court in order to provide an opportunity for the entity to have a fresh start. Such reductions are usually by a stated percentage so that, for example, the debtor owes only 60 cents on the dollar. Because the debtor would be restating its liabilities generally, this Subtopic would not apply to the debtor's accounting for such reduction of liabilities. ##### [470-60-55-2](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:894152a3e14452b12d13d50948885dc90a82132bae19ffb4bc4b0c2ad90b6f9e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. On the other hand, this Subtopic would apply to an isolated [troubled debt restructuring](https://asc.understandingaccounting.org/glossary/t/#troubled-debt-restructuring "A restructuring of a debt constitutes a troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.") by a debtor involved in bankruptcy proceedings if such restructuring did not result in a general restatement of the debtor's liabilities. ##### [470-60-55-3](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-3) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:854a88ee017c0204eedae17b205b9d20c58a1ecd66096a0c99b97e853a78e447 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. To a debtor, a bond constitutes one payable even though there are many bondholders. ##### [470-60-55-4](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-4) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:6c49571ee2e5998f262aa22bd123813b0aad6a60850e943d95cf14cbcc6b8085 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. No single characteristic or factor, taken alone, is determinative of whether a modification or exchange is a troubled debt restructuring under this Subtopic. That is, the fact that a single characteristic is present in a transaction (such as that described in paragraph [470-60-15-9(c)(3)](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-9) or [470-60-15-12(d)](https://asc.understandingaccounting.org/asc/470/60/#470-60-15-12)) should not be considered sufficient to overcome the preponderance of contrary evidence. Determining whether a transaction is within the scope of this Subtopic requires the exercise of judgment. The guidance that follows is not limited to marketable debt instruments. ##### [470-60-55-5](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-5) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:74f9f9e6c7a7622ec27e0d7ea24f8b98074200c1204a1dfaca09d6679c6554be Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following model should be applied by a debtor when determining whether a modification or an exchange of debt instruments is within the scope of this Subtopic. - ![](https://asc.understandingaccounting.org/asc-img/GUID-04BDABDF-BBFD-4577-B6ED-02D88AFF7044-low.gif) ##### [470-60-55-6](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-6) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:ea2fc659ab76b64dcf1991f0ccf17e7ca0761d7e06260de289768d1fa28d99a3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following factors have no relevance in the determination of whether a modification or an exchange is within the scope of this Subtopic: 1. a The amount invested in the old debt by the current creditors 2. b The [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") of the old debt immediately before the modification or exchange compared to the fair value of the new debt at issuance 3. c Transactions among debt holders. In addition, the length of time the current creditors have held the investment in the old debt is not relevant in the determination of whether a modification or exchange is within the scope of this Subtopic unless all the current creditors recently acquired the debt from the previous debt holders to effect what is in substance a planned refinancing. ##### [470-60-55-7](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-7) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:c185e184b03c176c9c65c838871831ca9bf1e0b3013551af9189110a8e8045b3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the debtor's creditworthiness (for example, based on its credit rating or equivalent, the effects of the original collateral or credit enhancements in the debt, or its sector risk) has deteriorated since the debt was originally issued, the debtor should evaluate whether it is experiencing financial difficulties. Changes in an investment-grade credit rating are not considered a deterioration in the debtor's creditworthiness for purposes of this guidance. Conversely, a decline in credit rating from investment grade to noninvestment grade is considered a deterioration in the debtor's creditworthiness for purposes of this guidance. ##### [470-60-55-8](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-8) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:8ac9f9948522ede2873cd4505c7282ce5f82b75b7cfa7da9819fe75c763bf685 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. All of the following factors are indicators that the debtor is experiencing financial difficulties: 1. a The debtor is currently in default on any of its debt. 2. b The debtor has declared or is in the process of declaring bankruptcy. 3. c There is significant doubt as to whether the debtor will continue to be a going concern. 4. d Currently, the debtor has securities that have been delisted, are in the process of being delisted, or are under threat of being delisted from an exchange. 5. e Based on estimates and projections that only encompass the current business capabilities, the debtor forecasts that its entity-specific cash flows will be insufficient to service the debt (both interest and principal) in accordance with the contractual terms of the existing agreement through maturity. 6. f Absent the current modification, the debtor cannot obtain funds from sources other than the existing creditors at an effective interest rate equal to the current market interest rate for similar debt for a nontroubled debtor. ##### [470-60-55-9](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-9) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:e053653323091b37c916f9e9b64ad535f3aa8c3e44e418fe772b360d31ddb046 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Notwithstanding the above, the following factors, if both are present, provide determinative evidence that the debtor is not experiencing financial difficulties, and, thus, the modification or exchange is not within the scope of this Subtopic (the presence of either factor individually would be an indicator, but not determinative, that the debtor is not experiencing financial difficulty): 1. a The debtor is currently servicing the old debt and can obtain funds to repay the old prepayable debt from sources other than the existing creditors (without regard to the current modification) at an effective interest rate equal to the current market interest rate for a nontroubled debtor. 2. b The creditors agree to restructure the old debt solely to reflect a decrease in current market interest rates for the debtor or positive changes in the creditworthiness of the debtor since the debt was originally issued. ##### [470-60-55-10](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-10) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:d30b30bb46d30bf6ffcc75ab90e0ec08c8720fa2ecd0cf0f248c2bc5e67158a1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A creditor is deemed to have granted a concession if the debtor's effective borrowing rate on the restructured debt is less than the effective borrowing rate of the old debt immediately before the restructuring. The effective borrowing rate of the restructured debt (after giving effect to all the terms of the restructured debt including any new or revised options or warrants, any new or revised guarantees or letters of credit, and so forth) should be calculated by projecting all the cash flows under the new terms and solving for the discount rate that equates the present value of the cash flows under the new terms to the debtor's current [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 old debt. ##### [470-60-55-11](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-11) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:92272c63336898264535ec2a55c09fda533dfc4a1fd29b555957ceebe8213370 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The carrying amount for purposes of this test would not include any hedging effects (including basis adjustments to the old debt) but would include any unamortized premium, discount, issuance costs, accrued interest payable, and so forth. ##### [470-60-55-12](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-12) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:8fe14bc0dd7a8c52eeb7b90d112c34a1d72dd6220b640d22f25b2e7d673d546b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. When determining the effect of any new or revised sweeteners (options, warrants, guarantees, letters of credit, and so forth), the current fair value of the new sweetener or change in fair value of the revised sweetener would be included in day-one cash flows. If such sweeteners are not exercisable for a period of time, that delay is typically considered within the estimation of the initial fair value as of the debt's modification date. ##### [470-60-55-13](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-13) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:c6cf53a9fee85b5ea53a4d292195a57c2596ba662bb7102413f00223bd20660d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Although considered rare, if there is persuasive evidence that the decrease in the effective borrowing rate is due solely to a factor that is not captured in the mathematical calculation (for example, additional collateral), the creditor may not have granted a concession and the modification or exchange should be evaluated based on the substance of the modification. ##### [470-60-55-14](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-14) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:d502b52b701cf057ccec12940fe9000cfe30be0f2627e58062b1ad92215d5e63 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Notwithstanding the guidance in this Section, if an entity has recently restructured the debt and is currently restructuring that debt again, the effective borrowing rate of the restructured debt (after giving effect to all the terms of the restructured debt including any new or revised options or warrants, any new or revised guarantees or letters of credit, and so forth) should be calculated by projecting all the cash flows under the new terms and solving for the discount rate that equates the present value of the cash flows under the new terms to the debtor's previous carrying amount of the debt immediately preceding the earlier restructuring. In addition, the effective borrowing rate of the restructured debt should be compared with the effective borrowing rate of the debt immediately preceding the earlier restructuring for purposes of determining whether the creditor granted a concession (that is, whether the effective borrowing rate decreased). ##### [470-60-55-15](https://asc.understandingaccounting.org/asc/470/60/#470-60-55-15) Pending content: no Source downloaded (UTC): 2026-09-10T00:33:31.252Z to 2026-09-10T00:33:31.252Z Record version: sha256:b8243e4cda79957b4744031438607e75b0672bb12e8bc9b4963ddc7702ab8e61 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2022-02](https://asc.understandingaccounting.org/updates/asu-2022-02/).