# ASC 810-954-15: Consolidation — Health Care Entities — 15 Scope and Scope Exceptions Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/810/954/#15-scope-and-scope-exceptions) 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): 2026-09-10T01:32:47.021Z to 2026-09-10T01:32:47.021Z Record version: sha256:6aa470c039d20059ff0a2387e3e3c9b44318d094651b08e61cf408d6240c70f0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-954-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/810/954/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [810-954-15-1](https://asc.understandingaccounting.org/asc/810/954/#810-954-15-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:32:47.021Z to 2026-09-10T01:32:47.021Z Record version: sha256:80dd1a239101b662131a47a307fba0c0b611f38d11262e3f1d9dd1b5868854e1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 954-10-15. #### Entities ##### [810-954-15-2](https://asc.understandingaccounting.org/asc/810/954/#810-954-15-2) Pending content: no Source downloaded (UTC): 2026-09-10T01:32:47.021Z to 2026-09-10T01:32:47.021Z Record version: sha256:f83ca826991034eb4f00566514ef78f7d5f2505833d4d2f7583596836a7d6f01 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the reporting entity is an investor-owned health care entity, this Subtopic provides consolidation guidance for reporting relationships with other entities in addition to the guidance in the following locations: 1. a Pursuant to paragraph [810-10-15-3(a)](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-3), if an investor-owned health care entity has an interest in an entity, it must determine whether that entity is within the scope of the Variable Interest Entities Subsections of Subtopic 810-10 pursuant to paragraph [810-10-15-14](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-14). If that entity is within the scope of the Variable Interest Entities Subsections, the investor-owned health care entity shall first apply the guidance in those Subsections. Paragraph [810-10-15-17](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-17) provides specific exceptions to applying the Variable Interest Entities Subsections. 2. b Pursuant to paragraph [810-10-15-3(b)](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-3), if the investor-owned health care entity has an interest in an entity that is not within the scope of the Variable Interest Entities Subsections of Subtopic 810-10 and is not within the scope of the Subsections mentioned in paragraph [810-10-15-3(c)](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-3), it shall use only the guidance in the General Subsections of Subtopic 810-10 to determine whether that interest constitutes a controlling financial interest. 3. c Pursuant to paragraph [810-10-15-3(c)](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-3), if the investor-owned health care entity has a contractual management relationship with another entity (for example, a physician practice) and that other entity is not within the scope of the Variable Interest Entities Subsections of Subtopic 810-10, it shall use the guidance in the Consolidation of Entities Controlled by Contract Subsections of Subtopic 810-10 to determine whether the arrangement constitutes a controlling financial interest. 4. d [Subparagraph superseded by Accounting Standards Update No. 2015-02](https://asc.understandingaccounting.org/updates/asu-2015-02/). 5. e Pursuant to Section 810-30-15, if the investor-owned health care entity is a sponsor in a research and development arrangement, it shall apply the guidance in Subtopic 810-30. ##### [810-954-15-3](https://asc.understandingaccounting.org/asc/810/954/#810-954-15-3) Pending content: yes Source downloaded (UTC): 2026-09-10T01:32:47.021Z to 2026-09-10T01:32:47.021Z Record version: sha256:82ac7da2241853dd2163165debe8a0c531ee026995013af1e12b32abaf8c8030 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the reporting entity is a not-for-profit business-oriented health care entity, this Subtopic provides consolidation guidance for reporting relationships with other entities in addition to the guidance in the following locations: 1. a Pursuant to paragraph [810-10-15-17](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-17), not-for-profit business-oriented health care entities are not subject to the Variable Interest Entities Subsections of Subtopic 810-10 unless the not-for-profit entity is used by a business entity in a manner similar to a VIE in an effort to circumvent the provisions of those Subsections. 2. b If the not-for-profit, business-oriented health care entity has an investment in a for-profit entity, it shall use the guidance in the General Subsections of Subtopic 810-10 to determine whether that interest constitutes a controlling financial interest. 3. c If the not-for-profit, business-oriented health care entity has a contractual management relationship with another entity (for example, a physician practice), it shall use the guidance in the Consolidation of Entities Controlled by Contract Subsections of Subtopic 810-10 to determine whether the arrangement constitutes a controlling financial interest. 4. d [Subparagraph superseded by Accounting Standards Update No. 2015-02](https://asc.understandingaccounting.org/updates/asu-2015-02/). 5. dd If the not-for-profit, business-oriented health care entity is the general partner or limited partner of a for-profit limited partnership or similar [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.") (such as a limited liability company that has governing provisions that are the functional equivalent of a limited partnership), it shall apply the guidance in paragraphs [958-810-25-11 through 25-29](https://asc.understandingaccounting.org/asc/810/958/#810-958-25-11) and [958-810-55-16A through 55-16I](https://asc.understandingaccounting.org/asc/810/958/#810-958-55-16A) . 6. e If the not-for-profit, business-oriented health care entity is a sponsor in a research and development arrangement, it shall apply the guidance in Subtopic 810-30. 7. f If the not-for-profit, business-oriented health care entity has a relationship with another not-for-profit entity that involves [control](https://asc.understandingaccounting.org/glossary/c/#control "The direct or indirect ability to determine the direction of management and policies through ownership, contract, or otherwise."), an [economic interest](https://asc.understandingaccounting.org/glossary/e/#economic-interest "A not-for-profit entity's (NFP's) interest in another entity that exists if any of the following criteria are met: The other entity holds or utilizes significant resources that must be used for the purposes of the NFP, either directly or indirectly by producing income or providing services. The NFP is responsible for the liabilities of the other entity. See paragraph 958-810-55-6 for examples of economic interests."), or both, it shall apply the guidance in Subtopic 958-810. 8. g If the not-for-profit, business-oriented health care entity is engaged in leasing transactions with a special-purpose-entity (SPE) lessor, it shall consider whether it should consolidate the lessor in accordance with the guidance in paragraphs [958-810-25-8 through 25-10](https://asc.understandingaccounting.org/asc/810/958/#810-958-25-8) . 9. h Except where it elects to report such interests at fair value in accordance with the Fair Value Option Subsections of Subtopic 825-10, a not-for-profit, business-oriented health care entity that owns 50 percent or less of the common voting stock of an investee and can exercise significant influence over operating and financial policies shall apply the guidance in Subtopic 323-10. 10. i Except where it elects to report such interests at fair value in accordance with the Fair Value Option Subsections of Subtopic 825-10, a not-for-profit, business-oriented health care entity shall report noncontrolling interests in for-profit real estate partnerships, limited liability entities, and similar entities over which the reporting entity has more than a minor interest under the equity method in accordance with the guidance in Subtopic 970-323. A not-for-profit, business-oriented health care entity shall apply the guidance in paragraph [970-323-25-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-2) to determine whether its interest in a for-profit partnership, limited liability entity, or similar entity is a controlling interest or a noncontrolling interest. A not-for-profit, business-oriented health care entity shall apply the guidance in paragraph [323-30-35-3](https://asc.understandingaccounting.org/asc/323/30/#323-30-35-3) to determine whether a limited liability entity should be viewed as similar to a partnership, as opposed to a corporation, for purposes of determining whether a noncontrolling interest in a limited liability entity or a similar entity should be accounted for in accordance with Subtopic 970-323 or Subtopic 323-10. Transition date:(P) December 16, 2026; (N) December 16, 2026Transition guidance: [105-10-65-10](https://asc.understandingaccounting.org/asc/105/10/#105-10-65-10)If the reporting entity is a not-for-profit business-oriented health care entity, this Subtopic provides consolidation guidance for reporting relationships with other entities in addition to the guidance in the following locations: 1. a Pursuant to paragraph [810-10-15-17](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-17), not-for-profit business-oriented health care entities are not subject to the Variable Interest Entities Subsections of Subtopic 810-10 unless the not-for-profit entity is used by a business entity in a manner similar to a VIE in an effort to circumvent the provisions of those Subsections. 2. b If the not-for-profit, business-oriented health care entity has an investment in a for-profit entity (other than a limited partnership or similar [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.") \[such as a limited liability company that has governing provisions that are the functional equivalent of a limited partnership\]), it shall use the guidance in the General Subsections of Subtopic 810-10 to determine whether that interest constitutes a controlling financial interest. 3. c If the not-for-profit, business-oriented health care entity has a contractual management relationship with another entity (for example, a physician practice), it shall use the guidance in the Consolidation of Entities Controlled by Contract Subsections of Subtopic 810-10 to determine whether the arrangement constitutes a controlling financial interest. 4. d [Subparagraph superseded by Accounting Standards Update No. 2015-02](https://asc.understandingaccounting.org/updates/asu-2015-02/). 5. dd If the not-for-profit, business-oriented health care entity is the general partner or limited partner of a for-profit limited partnership or similar legal entity (such as a limited liability company that has governing provisions that are the functional equivalent of a limited partnership), it shall apply the guidance in paragraphs [958-810-25-11 through 25-29](https://asc.understandingaccounting.org/asc/810/958/#810-958-25-11) and [958-810-55-16A through 55-16I](https://asc.understandingaccounting.org/asc/810/958/#810-958-55-16A) . 6. e If the not-for-profit, business-oriented health care entity is a sponsor in a research and development arrangement, it shall apply the guidance in Subtopic 810-30. 7. f If the not-for-profit, business-oriented health care entity has a relationship with another not-for-profit entity that involves [control](https://asc.understandingaccounting.org/glossary/c/#control "The direct or indirect ability to determine the direction of management and policies through ownership, contract, or otherwise."), an [economic interest](https://asc.understandingaccounting.org/glossary/e/#economic-interest "A not-for-profit entity's (NFP's) interest in another entity that exists if any of the following criteria are met: The other entity holds or utilizes significant resources that must be used for the purposes of the NFP, either directly or indirectly by producing income or providing services. The NFP is responsible for the liabilities of the other entity. See paragraph 958-810-55-6 for examples of economic interests."), or both, it shall apply the guidance in Subtopic 958-810. 8. g If the not-for-profit, business-oriented health care entity is engaged in leasing transactions with a special-purpose-entity (SPE) lessor, it shall consider whether it should consolidate the lessor in accordance with the guidance in paragraphs [958-810-25-8 through 25-10](https://asc.understandingaccounting.org/asc/810/958/#810-958-25-8) . 9. h Except where it elects to report such interests at fair value in accordance with the Fair Value Option Subsections of Subtopic 825-10, a not-for-profit, business-oriented health care entity that owns 50 percent or less of the common voting stock of an investee and can exercise significant influence over operating and financial policies shall apply the guidance in Subtopic 323-10. 10. i Except where it elects to report such interests at fair value in accordance with the Fair Value Option Subsections of Subtopic 825-10, a not-for-profit, business-oriented health care entity shall report noncontrolling interests in for-profit real estate partnerships, limited liability entities, and similar entities over which the reporting entity has more than a minor interest under the equity method in accordance with the guidance in Subtopic 970-323. A not-for-profit, business-oriented health care entity shall apply the guidance in paragraph [970-323-25-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-2) to determine whether its interest in a for-profit partnership, limited liability entity, or similar entity is a controlling interest or a noncontrolling interest. A not-for-profit, business-oriented health care entity shall apply the guidance in paragraph [323-30-35-3](https://asc.understandingaccounting.org/asc/323/30/#323-30-35-3) to determine whether a limited liability entity should be viewed as similar to a partnership, as opposed to a corporation, for purposes of determining whether a noncontrolling interest in a limited liability entity or a similar entity should be accounted for in accordance with Subtopic 970-323 or Subtopic 323-10.