{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/720/974/#25-recognition","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":"720","topic_title":"Other Expenses","subtopic":"720-974","subtopic_title":"Real Estate—Real Estate Investment Trusts","section":{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":null,"heading":"Operating Support of the Real Estate Investment Trust by the Adviser","paragraphs":[{"citation":"720-974-25-1","para":"25-1","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_2CCB8DD4-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Various methods are employed by advisers to ensure a certain return to the <a href=\"/glossary/r/#real-estate-investment-trust\" class=\"term\" title=\"Real estate investment trusts generally are formed as trusts, associations, or corporations. They employ equity capital, coupled with substantial amounts of debt financing, in making real estate loans and investments. Real estate investment trusts must distribute substantially all of their taxable income to their shareholders annually in order to retain their favorable tax status (that is, dividends paid are treated as deductions in arriving at taxable income).\"><span>real estate investment trust</span></a> for certain periods. Some of these methods are: </span></span><ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_2CCB8F52-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Purchasing a loan or a property at an amount in excess of fair value</span></span></div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_2CCB90A5-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Forgiving indebtedness</span></span></div></li><li class=\"li-norm\"><span class=\"linum\">c</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_2CCB91DA-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Reducing advisory fees</span></span></div></li><li class=\"li-norm\"><span class=\"linum\">d</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_2CCB92DD-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Providing required compensating balances</span></span></div></li><li class=\"li-norm\"><span class=\"linum\">e</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_2CCB93D9-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Making outright cash payments.</span></span></div></li></ol></div></div>","snippet":"Various methods are employed by advisers to ensure a certain return to the real estate investment trust for certain periods. Some of these methods are:\n(a) Purchasing a loan or a property at an amount in excess of fair v…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a86bd06f92b34d69b9dd4b53a1981c898ef4e440279a12b03e92c85f3ace2006","downloaded_from":"2026-09-10T01:14:03.031Z","last_downloaded_at":"2026-09-10T01:14:03.031Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478690","source_sha256":"ab1263d3ea38c8272a895f80a971bdd967663ad3ff335bc05d744810600f0f01"}},{"citation":"720-974-25-2","para":"25-2","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_2CCB94AD-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Accounting by a real estate investment trust for operating support from its adviser would include either of the following: </span></span><ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_2CCB9573-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Adjustment of any assets (or liabilities) which will be transferred between the entities to fair value as of the date of the transaction </span></span></div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_2CCB9670-6E94-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Recognition, as income or as a reduction of advisory fees, of the operating support effectively obtained. </span></span></div></li></ol></div></div>","snippet":"Accounting by a real estate investment trust for operating support from its adviser would include either of the following:\n(a) Adjustment of any assets (or liabilities) which will be transferred between the entities to f…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b50f126a56bfb58776d5eeef32c5638283691be56e93a7b6954236e9b5455ee3","downloaded_from":"2026-09-10T01:14:03.031Z","last_downloaded_at":"2026-09-10T01:14:03.031Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478690","source_sha256":"ab1263d3ea38c8272a895f80a971bdd967663ad3ff335bc05d744810600f0f01"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:061d03b54f17a481c6ed151aca430a1fd9db7b9a43729e393f357de5d06098af","downloaded_from":"2026-09-10T01:14:03.031Z","last_downloaded_at":"2026-09-10T01:14:03.031Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478690","source_sha256":"ab1263d3ea38c8272a895f80a971bdd967663ad3ff335bc05d744810600f0f01"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8ac1cc4bb6da0efd3b0251934fed1875bf4b7b9961467132c3345cda1511975a","downloaded_from":"2026-09-10T01:14:03.031Z","last_downloaded_at":"2026-09-10T01:14:03.031Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478690","source_sha256":"ab1263d3ea38c8272a895f80a971bdd967663ad3ff335bc05d744810600f0f01"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8ac1cc4bb6da0efd3b0251934fed1875bf4b7b9961467132c3345cda1511975a","downloaded_from":"2026-09-10T01:14:03.031Z","last_downloaded_at":"2026-09-10T01:14:03.031Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478690","source_sha256":"ab1263d3ea38c8272a895f80a971bdd967663ad3ff335bc05d744810600f0f01"}}