# ASC 610-20-25: Other Income — Gains and Losses from the Derecognition of Nonfinancial Assets — 25 Recognition Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/610/20/#25-recognition) 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): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:167285df104650885610a5c8fa8954bd5c220e4cce2a69fb3b89b85cb10e503a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 610-20-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/610/20/#25-recognition) SEC content: no ##### [610-20-25-1](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-1) Pending content: no Source downloaded (UTC): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:4a391e0ce07a60626c3d118236f36dc66b2043e13787de9d5debee29c80c1073 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. To recognize a gain or loss from the transfer of nonfinancial assets or [in substance nonfinancial assets](https://asc.understandingaccounting.org/glossary/i/#in-substance-nonfinancial-asset "Paragraphs 610-20-15-5610-20-15-6610-20-15-7610-20-15-8 define an in substance nonfinancial asset.") within the scope of this Subtopic, an entity shall apply the guidance in Topic 810 on consolidation and in Topic 606 on [revenue](https://asc.understandingaccounting.org/glossary/r/#revenue "Inflows or other enhancements of assets of an entity or settlements of its liabilities (or a combination of both) from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations.") from [contracts](https://asc.understandingaccounting.org/glossary/c/#contract "An agreement between two or more parties that creates enforceable rights and obligations.") with [customers](https://asc.understandingaccounting.org/glossary/c/#customer "A party that has contracted with an entity to obtain goods or services that are an output of the entity's ordinary activities in exchange for consideration.") as described in paragraphs [610-20-25-2 through 25-7](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-2) . #### Determining Whether an Entity Has a Controlling Financial Interest ##### [610-20-25-2](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-2) Pending content: no Source downloaded (UTC): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:433886643ed9f1552696116ce10e326d62883480f0665b7050a47a78f9744834 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An entity shall first evaluate whether it has (or continues to have) a controlling financial interest in the [legal entity](https://asc.understandingaccounting.org/glossary/l/#legal-entity "Any legal structure used to conduct activities or to hold assets. Some examples of such structures are corporations, partnerships, limited liability companies, grantor trusts, and other trusts.") that holds the nonfinancial assets and/or [in substance nonfinancial assets](https://asc.understandingaccounting.org/glossary/i/#in-substance-nonfinancial-asset "Paragraphs 610-20-15-5610-20-15-6610-20-15-7610-20-15-8 define an in substance nonfinancial asset.") by applying the guidance in Topic 810 on consolidation. For example, if a [parent](https://asc.understandingaccounting.org/glossary/p/#parent "An entity that has a controlling financial interest in one or more subsidiaries. (Also, an entity that is the primary beneficiary of a variable interest entity.)") transfers ownership interests in a consolidated [subsidiary](https://asc.understandingaccounting.org/glossary/s/#subsidiary "An entity, including an unincorporated entity such as a partnership or trust, in which another entity, known as its parent, holds a controlling financial interest. (Also, a variable interest entity that is consolidated by a primary beneficiary.)"), the parent shall evaluate whether it continues to have a controlling financial interest in that subsidiary. Similarly, when an entity transfers assets directly to a counterparty (or a legal entity formed by the counterparty), the entity shall evaluate whether it has a controlling financial interest in the counterparty (or the legal entity formed by the counterparty). ##### [610-20-25-3](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-3) Pending content: no Source downloaded (UTC): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:381d2ee164dd6a06abe862a4dbf36618997bab1cd74e7ca75992dd720dca7b80 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an entity determines it has (or continues to have) a controlling financial interest in the legal entity that holds the nonfinancial assets or in substance nonfinancial assets, it shall not derecognize those assets and shall apply the guidance in paragraphs [810-10-45-21A through 45-24](https://asc.understandingaccounting.org/asc/810/10/#810-10-45-21A) . ##### [610-20-25-4](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-4) Pending content: no Source downloaded (UTC): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:c7a691bfbbf03a2db80eb1b47f0c5c16405568e6a808e959d55bde40fa52607b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Any nonfinancial assets or in substance nonfinancial assets transferred that are held in a legal entity in which the entity does not have (or ceases to have) a controlling financial interest shall be further evaluated in accordance with the guidance in paragraphs [610-20-25-5 through 25-7](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-5) . #### Applying Revenue Recognition Guidance ##### [610-20-25-5](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-5) Pending content: no Source downloaded (UTC): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:104909fec00f53bf3385fb1205ac39afb3d5d64cdd80c54d5d6f1924040d2d5c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. After applying the guidance in paragraphs [610-20-25-2 through 25-4](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-2) , an entity shall next evaluate a [contract](https://asc.understandingaccounting.org/glossary/c/#contract "An agreement between two or more parties that creates enforceable rights and obligations.") in accordance with the guidance in paragraphs [606-10-25-1 through 25-8](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-1) . If a [contract](https://asc.understandingaccounting.org/glossary/c/#contract "An agreement between two or more parties that creates enforceable rights and obligations.") does not meet all of the criteria in paragraph [606-10-25-1](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-1), an entity shall not derecognize the nonfinancial assets or [in substance nonfinancial assets](https://asc.understandingaccounting.org/glossary/i/#in-substance-nonfinancial-asset "Paragraphs 610-20-15-5610-20-15-6610-20-15-7610-20-15-8 define an in substance nonfinancial asset.") transferred, and it shall apply the guidance in paragraph [350-10-40-3](https://asc.understandingaccounting.org/asc/350/10/#350-10-40-3) to any [intangible assets](https://asc.understandingaccounting.org/glossary/i/#intangible-assets "Assets (not including financial assets) that lack physical substance. (The term intangible assets is used to refer to intangible assets other than goodwill.)") and the guidance in paragraph [360-10-40-3C](https://asc.understandingaccounting.org/asc/360/10/#360-10-40-3C) to any property, plant, and equipment. An entity shall follow the guidance in paragraphs [606-10-25-6 through 25-8](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-6) to determine if and when a contract subsequently meets all of the criteria in paragraph [606-10-25-1](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-1). ##### [610-20-25-6](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-6) Pending content: no Source downloaded (UTC): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:773f1d2cf34dd3837aba8036c7c34a7d9375c07af562ad00fdf6402464ac792c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Once a contract meets all of the criteria in paragraph [606-10-25-1](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-1), an entity shall identify each distinct nonfinancial asset and distinct in substance nonfinancial asset promised to a counterparty in accordance with the guidance in paragraphs [606-10-25-19 through 25-22](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-19) . An entity shall derecognize each distinct asset when it transfers control of the asset in accordance with paragraph [606-10-25-30](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-30). In some cases, control of each asset may transfer at the same time such that an entity may not need to separate and allocate consideration to each distinct nonfinancial asset and in substance nonfinancial asset. That may be the case, for example, when a parent transfers ownership interests in a consolidated subsidiary that holds nonfinancial assets (or nonfinancial assets and in substance nonfinancial assets) and ceases to have a controlling financial interest in the subsidiary in accordance with Topic 810. However, control of each asset may not transfer at the same time if the parent has control of some of the assets in accordance with paragraph [606-10-25-30](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-30) (for example, through repurchase agreements). ##### [610-20-25-7](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-7) Pending content: no Source downloaded (UTC): 2026-09-10T00:55:00.538Z to 2026-09-10T00:55:00.538Z Record version: sha256:43e0594a1c4989ba03f0de79cd044745fe90a46f19129ba8bb9bc478f46e86d3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For purposes of evaluating the indicators of the transfer of control in paragraph [606-10-25-30](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-30), if an entity has (or continues to have) a [noncontrolling interest](https://asc.understandingaccounting.org/glossary/n/#noncontrolling-interest "The portion of equity (net assets) in a subsidiary not attributable, directly or indirectly, to a parent. A noncontrolling interest is sometimes called a minority interest.") in the [legal entity](https://asc.understandingaccounting.org/glossary/l/#legal-entity "Any legal structure used to conduct activities or to hold assets. Some examples of such structures are corporations, partnerships, limited liability companies, grantor trusts, and other trusts.") that holds the nonfinancial assets or in substance nonfinancial assets as a result of the transaction, the entity shall evaluate the point in time at which the legal entity holding the assets obtains (or has) control (for example, by evaluating whether the legal entity can direct the use of, and obtain substantially all of the benefits from, each distinct nonfinancial asset or in substance nonfinancial asset within it). (See Case A of Example 2 in paragraphs [610-20-55-11 through 55-14](https://asc.understandingaccounting.org/asc/610/20/#610-20-55-11) .) If the entity does not have a noncontrolling interest in the legal entity that holds the nonfinancial assets or in substance nonfinancial assets as a result of the transaction, it shall evaluate the point in time at which a counterparty (or counterparties, collectively) obtains control of the assets in the legal entity (for example, by evaluating whether a counterparty \[or counterparties, collectively\] can direct the use of, and obtain substantially all of the benefits from, each distinct nonfinancial asset or in substance nonfinancial asset within the legal entity).