{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/810/958/#55-implementation-guidance-and-illustrations","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":"810","topic_title":"Consolidation","subtopic":"810-958","subtopic_title":"Not-for-Profit Entities","section":{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Implementation Guidance","paragraphs":[{"citation":"810-958-55-1","para":"55-1","html":"
This Section, which is an integral part of the requirements of this Subtopic, provides general guidance to be used by a not-for-profit entity (NFP) in reporting relationships discussed in this Subtopic.
","snippet":"This Section, which is an integral part of the requirements of this Subtopic, provides general guidance to be used by a not-for-profit entity (NFP) in reporting relationships discussed in this Subtopic.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cd0474f267032f4a9904030fe5d8442f3bb201fcd4929a385a60cad96fc62d2d","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-2","para":"55-2","html":"
The following flowcharts are not intended as substitutes for the guidance in this Subtopic or in the Topics referenced in the flowcharts.
","snippet":"The following flowcharts are not intended as substitutes for the guidance in this Subtopic or in the Topics referenced in the flowcharts.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a4f2ef34835d40f076036cadde475e53bf478aad9dfee27fd6378f9f52b069a0","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-3","para":"55-3","html":"
The following flowchart summarizes the guidance in Section 958-810-25.
","snippet":"The following flowchart summarizes the guidance in Section 958-810-25.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:602e1e0d2f87d9cb12b88037aedcdbc07a317be95943515b83e0b776d1c618d8","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-4","para":"55-4","html":"
The following flowchart and related footnote indicate the order in which an NFP applies the guidance elsewhere in the Codification to determine the accounting for its relationship with a for-profit entity.
","snippet":"The following flowchart and related footnote indicate the order in which an NFP applies the guidance elsewhere in the Codification to determine the accounting for its relationship with a for-profit entity.\n*According to …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f5bb37015e08db99571d4476e49fb136528b0a1b030ddee1cceed3fdcc620792","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-4A","para":"55-4A","html":"
This paragraph provides implementation guidance on the application of paragraph 958-810-25-2A to situations in which certain actions require approval by a supermajority vote of the board. That paragraph states that such voting requirements might overcome the presumption of control by the owner or holder of a majority voting interest. An NFP shall exercise judgment in evaluating such situations. If supermajority voting requirements exist—for example, a specified supermajority of the board is needed to approve fundamental actions such as amending the articles of incorporation or dissolving the entity, an NFP shall consider whether those voting requirements have little or no effect on the ability to control the other entity's operations or assets or, alternatively, whether those voting requirements are so restrictive as to call into question whether control rests with the holder of the majority voting interest. The guidance in paragraphs
810-10-25-2 through 25-14
may be helpful in considering whether the inability of the majority voting interest to unilaterally approve certain actions due to supermajority voting requirements is substantial enough to overcome the presumption of control.
","snippet":"This paragraph provides implementation guidance on the application of paragraph 958-810-25-2A to situations in which certain actions require approval by a supermajority vote of the board. That paragraph states that such …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8036dd4a5ec60d40f7efe3988a5f4a4e2b4e9dd9baaeea83d2ac2eb34ec3441d","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-5","para":"55-5","html":"
A majority voting interest in the board of another entity, as referred to in paragraph 958-810-25-3, is illustrated by the following example. Entity B has a five-member board, and a simple voting majority is required to approve board actions. Entity A will have a majority voting interest in the board of Entity B if Entity A has the ability to appoint three or more of Entity B's board members. If three of Entity A's board members, employees, or officers serve on the board of Entity B but Entity A does not have the ability to require that those members serve on the Entity B board, Entity A does not have a majority voting interest in the board of Entity B.
","snippet":"A majority voting interest in the board of another entity, as referred to in paragraph 958-810-25-3, is illustrated by the following example. Entity B has a five-member board, and a simple voting majority is required to …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8f651cbeb7837751e9d1ec126f80307b543f5ff60ec712caac288a3071b58475","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-6","para":"55-6","html":"
The following are examples of economic interests:
  1. a
    Other entities solicit funds in the name of and with the expressed or implied approval of the NFP, and substantially all of the funds solicited are intended by the contributor or are otherwise required to be transferred to the NFP or used at its discretion or direction.
  2. b
    An NFP transfers significant resources to another entity whose resources are held for the benefit of the NFP.
  3. c
    An NFP assigns certain significant functions to another entity.
  4. d
    An NFP provides or is committed to provide funds for another entity or guarantees significant debt of another entity.
  5. e
    An NFP has a right to or a responsibility for the operating results of another entity. Or upon dissolution, an NFP is entitled to the net assets, or is responsible for any deficit, of another entity.
","snippet":"The following are examples of economic interests:\n(a) Other entities solicit funds in the name of and with the expressed or implied approval of the NFP, and substantially all of the funds solicited are intended by the co…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:674fc5c3ae961081da14a6aaff3ae133800816edf34b00c1e553e2a49cf11285","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-7","para":"55-7","html":"
For an NFP that is engaged in leasing transactions with a special-purpose-entity (SPE) lessor, this implementation guidance addresses the following matters:
  1. a
    Multiple properties within a single SPE lessor
  2. b
    Multitiered SPE structures
  3. c
    Payments to equity owners of an SPE during the lease term
  4. d
    Fees paid to owners of record of an SPE
  5. e
    Source of initial minimum equity investment
  6. f
    Payment to owners of record of an SPE before the lease term
  7. g
    Subparagraph superseded by Accounting Standards Update No. 2016-02.
","snippet":"For an NFP that is engaged in leasing transactions with a special-purpose-entity (SPE) lessor, this implementation guidance addresses the following matters:\n(a) Multiple properties within a single SPE lessor\n(b) Multitie…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5d56c37f619a44ed30103cdfbb95fb5b403718b134ace0fbfcbd43fff234d91c","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-8","para":"55-8","html":"
This implementation guidance addresses the application of paragraph 958-810-25-8(a) to a transaction involving all of the following characteristics:
  1. a
    An SPE is formed to acquire two separate properties that are to be leased to two unrelated lessees.
  2. b
    The two asset acquisitions are financed with the proceeds from two nonrecourse borrowings that do not contain cross-collateral provisions; that is, in the event of default, each borrowing is collateralized only by a pledge of the respective assets leased to a single lessee and an assignment of the respective lease payments under the related lease.
  3. c
    The SPE has no assets other than the leased properties and the related leases.
","snippet":"This implementation guidance addresses the application of paragraph 958-810-25-8(a) to a transaction involving all of the following characteristics:\n(a) An SPE is formed to acquire two separate properties that are to be …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8cb8e905cd8f7f0f2506d33c4a06f4ea9f38de4b9f490ce6865454d7c4650fb2","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-9","para":"55-9","html":"
The use of nonrecourse debt with no cross-collateral provisions effectively segregates the cash flows and assets associated with the two leases and, therefore, in substance, creates two SPEs. For purposes of applying the provisions of paragraph 958-810-25-8, each lessee would be considered to have satisfied the condition in paragraph 958-810-25-8(a). For either lessee to be in a position of not satisfying that condition, the assets of the SPE (subject to the two leases) would need to be commingled such that, in the event of default, both lenders to the SPE would have equal rights (that is, pari passu) to the cash flows and assets related to both leases of the SPE. In this regard, the amounts of the cash flows from each lease and the fair values of the individual assets subject to the leases must represent more than a minor amount (that is, more than 10 percent) of the aggregate cash flows from all leases and the aggregate fair value of all assets of the SPE, respectively.
","snippet":"The use of nonrecourse debt with no cross-collateral provisions effectively segregates the cash flows and assets associated with the two leases and, therefore, in substance, creates two SPEs. For purposes of applying the…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:50018cc3be768ae13ebd777e6c7bcb1d322a7d60a6a49f39ed0f616a8ed36a1d","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-10","para":"55-10","html":"
This implementation guidance addresses the level at which an entity should apply the conditions in paragraph 958-810-25-8 to a transaction having all of the following characteristics:
  1. a
    Sponsor forms an SPE, SPE A.
  2. b
    SPE A acquires property with the proceeds from nonrecourse debt and leases the property to Lessee A.
  3. c
    SPE A has no other activities and the terms of the lease satisfy the condition in paragraph 958-810-25-8(b), which discusses the residual risks and rewards associated with the leased assets and related debt.
  4. d
    The sponsor owns 100 percent of SPE A's voting common stock.
  5. e
    The sponsor contributes the common stock of SPE A to capitalize another SPE (SPE B) that is formed to own and lease assets to Lessee B.
  6. f
    The other assets of SPE B are financed entirely with nonrecourse debt and are subject to a lease, the terms of which also satisfy the condition in paragraph 958-810-25-8(b).
Thus, SPE B, which is wholly owned by the sponsor, becomes the parent of SPE A.
","snippet":"This implementation guidance addresses the level at which an entity should apply the conditions in paragraph 958-810-25-8 to a transaction having all of the following characteristics:\n(a) Sponsor forms an SPE, SPE A.\n(b)…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1adc07eef8f6a1eddd49d5d1e6dd961702f968fa8fb489a5f5300930e4655a12","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-11","para":"55-11","html":"
Consistent with the implementation guidance in paragraph 958-810-55-8 that addresses multiple properties within a single SPE, the conditions set forth in paragraph 958-810-25-8 shall be applied at the lowest level at which the parties to a transaction create an isolated entity, whether by contract or otherwise. Therefore, in the situation described in the preceding paragraph, the test for compliance with the condition in paragraph 958-810-25-8(a) should be applied to the parent-only financial statements of SPE B.
","snippet":"Consistent with the implementation guidance in paragraph 958-810-55-8 that addresses multiple properties within a single SPE, the conditions set forth in paragraph 958-810-25-8 shall be applied at the lowest level at whi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:07df26e83e4fe2bcd4c78271940268b219460cd9ffa0345b887366a8c8c4df7b","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-12","para":"55-12","html":"
In the transaction described in paragraph 958-810-55-10, assume the assets of SPE B will include the common stock of SPE A and the assets leased to Lessee B. Ownership of the stock of another SPE that is engaged in leasing property would not constitute an activity contemplated by the condition in paragraph 958-810-25-8(a). Accordingly, in this situation, the lessee shall consider that condition to be satisfied in evaluating the activities of SPE B. In addition, the sponsor's contribution of the stock of SPE A to capitalize SPE B shall not be considered an initial substantive residual equity capital investment, as contemplated by the condition in paragraph 958-810-25-8(c), because a sponsor's investment shall not be used to capitalize more than one SPE for purposes of applying that condition.
","snippet":"In the transaction described in paragraph 958-810-55-10, assume the assets of SPE B will include the common stock of SPE A and the assets leased to Lessee B. Ownership of the stock of another SPE that is engaged in leasi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:67431fb00da3bc2c915a20641b05faf5ae6cae153a8ff42a8d45b4226ca43ce5","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-13","para":"55-13","html":"
The characterization of any payments made by the SPE-lessor to its owners of record shall be based on the SPE's GAAP basis financial statements. That is, distributions of the SPE-lessor's GAAP basis change in net assets shall be considered a return on equity capital, but any distribution in excess of previously undistributed GAAP change in net assets shall be considered a return of equity capital, which would reduce the amount of the equity capital investment that is at risk. If the amount of the equity capital investment is reduced below the minimum amount required as a result of a distribution in excess of previously undistributed GAAP change in net assets, the owner of record would have to make an additional investment to continue to avoid the condition in paragraph 958-810-25-8(c). An owner of record would not be required to make an additional equity capital investment if residual equity capital is reduced below the minimum amount required because of losses recorded by the SPE in accordance with generally accepted accounting principles.
","snippet":"The characterization of any payments made by the SPE-lessor to its owners of record shall be based on the SPE's GAAP basis financial statements. That is, distributions of the SPE-lessor's GAAP basis change in net assets …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4a393318cc88b009f7f6298c564dd68d03c61c5df7b5bff337bfbf110b4d1e7c","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-14","para":"55-14","html":"
Paragraph 842-10-30-5(e) states that, for a lessee, lease payments include fees that are paid by the lessee to the owners of the special-purpose entity for structuring the lease transaction. Paragraph 842-10-30-5(e) states that such fees shall be included as part of lease payments (but shall not be included in the fair value of the underlying asset) for purposes of applying the criterion in paragraph 842-10-25-2(d). With respect to the SPE and the application of the guidance in paragraph 958-810-25-8, the fees paid by the lessee to the owners of the SPE shall be considered a return of the owners' initial equity capital investment. To the extent that the fees reduce the equity capital investment below the minimum amount required, the owners of record would not be considered to have a substantive residual equity capital investment that is at risk during the entire term of the lease.
","snippet":"Paragraph 842-10-30-5(e) states that, for a lessee, lease payments include fees that are paid by the lessee to the owners of the special-purpose entity for structuring the lease transaction. Paragraph 842-10-30-5(e) stat…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fd0447ad51b604fd465398c22e1b425e45302ba61599d45d0583a2dbd35a00fa","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-15","para":"55-15","html":"
If the source of the funds used to make the initial minimum equity investment in an SPE lessor is financed with nonrecourse debt that is collateralized by a pledge of the investment, the investment shall not meet the at-risk requirement in paragraph 958-810-25-8(c). Similarly, that at-risk requirement shall not be met if the owners purchased residual insurance or obtained a residual guarantee in an amount that would ensure recovery of their equity investment. If the initial minimum equity investment is financed with recourse debt from a party not related to the lessee, the owners (borrowers) shall have other assets at risk to support the borrowing to avoid the condition in paragraph 958-810-25-8(c). Thus, if the loans were full recourse loans and if the fair value of the residual equity investment serves as collateral for the debt, the lessor-owner shall be considered at risk to the extent that the owners of record are liable for any decline in the fair value of the residual interest and have, and are expected to continue to have during the term of the lease, other significant assets, in addition to and of a value that exceeds their equity investment, that are at risk.
","snippet":"If the source of the funds used to make the initial minimum equity investment in an SPE lessor is financed with nonrecourse debt that is collateralized by a pledge of the investment, the investment shall not meet the at-…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f5474262256a67806937ca1eb871d86d0e05fc900801fdccf7303123719b29c5","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16","para":"55-16","html":"
In some build-to-suit lease transactions involving SPEs, the lease or related construction agreement provides that the SPE will construct, or cause to be constructed, the property that is to be leased. The terms of the construction or lease agreements provide that payments are to be made by the SPE to the owners of record during the construction period, which, in some cases, may be several years. Such payments generally are made to provide the owners of record with a cash yield on their equity capital investments. Payments made by the SPE to the owners of record of the SPE during the construction period shall be deemed to be a return of their initial equity capital investment as opposed to a return on their equity capital investment. To the extent that those payments reduce the equity capital investment below the minimum amount required under paragraph 958-810-25-8, the owners of record of the SPE shall not be considered to have made an initial substantive residual equity capital investment that is at risk during the entire lease term.
","snippet":"In some build-to-suit lease transactions involving SPEs, the lease or related construction agreement provides that the SPE will construct, or cause to be constructed, the property that is to be leased. The terms of the c…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:806ce16a35ae7fa500011a09a157924bded58123b872e54ddb27849c6289479b","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16A","para":"55-16A","html":"
The following implementation guidance is intended to facilitate the understanding of how to assess whether the rights of the limited partners should be considered protective rights or participating rights and, if participating rights, whether the rights are substantive. Although this guidance illustrates possible assessments of individual limited partners' rights, the evaluation of limited partners' rights should consider all of the factors identified in paragraph 958-810-25-27 to determine whether the limited partners' rights, individually or in the aggregate, provide for the limited partners to effectively participate in significant decisions that would be expected to be made in the ordinary course of business.
","snippet":"The following implementation guidance is intended to facilitate the understanding of how to assess whether the rights of the limited partners should be considered protective rights or participating rights and, if partici…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d89cdd7e080afde785e508b3384bf89bc2ece0955fdbebf4db12d1f5a71e7a4b","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16B","para":"55-16B","html":"
The rights of the limited partners relating to the approval of acquisitions and dispositions of assets that are expected to be undertaken in the ordinary course of business may be substantive participating rights. Rights related only to acquisitions that are not expected to be undertaken in the ordinary course of business usually are protective and do not overcome the presumption of control by the general partners in the limited partnership. Determining whether the right to approve the acquisition or disposition of assets is in the ordinary course of business should be based on an evaluation of the relevant facts and circumstances. In addition, if approval by the limited partners is necessary to incur additional indebtedness to finance an acquisition that is not in the limited partnership's ordinary course of business, then the approval by the limited partners is considered a protective right.
","snippet":"The rights of the limited partners relating to the approval of acquisitions and dispositions of assets that are expected to be undertaken in the ordinary course of business may be substantive participating rights. Rights…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0da7443d3d9c502ea4b3543db41c468688696a2e07f76c21d58d51b75a30c623","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16C","para":"55-16C","html":"
Existing facts and circumstances should be considered in assessing whether the rights of the limited partners relating to a limited partnership incurring additional indebtedness are protective or participating rights. For example, if it is reasonably possible or probable that the limited partnership will need to incur the level of borrowing that requires limited partner approval in its ordinary course of business, the rights of the limited partners are viewed as substantive participating rights.
","snippet":"Existing facts and circumstances should be considered in assessing whether the rights of the limited partners relating to a limited partnership incurring additional indebtedness are protective or participating rights. Fo…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:793e664e1156980f282276df76cd3d6ca6b0e1a4ee979288cdf99a25ce4510b9","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16D","para":"55-16D","html":"
The rights of the limited partners relating to dividends or other distributions may be protective or participating and should be assessed in light of the available facts and circumstances. For example, rights to block customary or expected dividends or other distributions may be substantive participating rights, while rights to block extraordinary distributions are protective rights.
","snippet":"The rights of the limited partners relating to dividends or other distributions may be protective or participating and should be assessed in light of the available facts and circumstances. For example, rights to block cu…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1feee9f42de538fffdc446d03bb34c053e48f56c08ea4084e35738839213cd69","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16E","para":"55-16E","html":"
The rights of the limited partners relating to a limited partnership's specific action (for example, to lease property) in an existing business may be protective or participating and should be assessed in light of the available facts and circumstances. For example, if the limited partnership had the ability to purchase, rather than lease, the property without requiring the approval of the limited partners, then the rights of the limited partners to block the limited partnership from entering into a lease are not substantive participating rights.
","snippet":"The rights of the limited partners relating to a limited partnership's specific action (for example, to lease property) in an existing business may be protective or participating and should be assessed in light of the av…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:991ae61094da9e9a77126308f03e7592bec7e871e2e67b0357864ced01cf2d4d","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16F","para":"55-16F","html":"
The rights of the limited partners relating to a limited partnership's negotiation of collective-bargaining agreements with unions may be protective or participating and should be assessed in light of the available facts and circumstances. For example, if a limited partnership does not have a collective-bargaining agreement with a union or if the union does not represent a substantial portion of the limited partnership's work force, then the rights of the limited partners to approve or veto a new or broader collective-bargaining agreement are not substantive participating rights.
","snippet":"The rights of the limited partners relating to a limited partnership's negotiation of collective-bargaining agreements with unions may be protective or participating and should be assessed in light of the available facts…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e108265fbaa483d53093b986bfd6ace98d720cc99eb55a8078286eab83dba411","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16G","para":"55-16G","html":"
Provisions that govern what will occur if the limited partners block the action of the general partners need to be considered to determine whether the rights of the limited partners to block have substance. For example, if both of the following circumstances exist, then the rights of the limited partners to block the approval of the operating and capital budgets do not allow the limited partners to effectively participate and, thus, are not substantive participating rights:
  1. a
    The limited partnership agreement provides that if the limited partners block the approval of operating and capital budgets, then the budgets simply default to last year's budgets adjusted for inflation.
  2. b
    The limited partnership operates in a mature business for which year-to-year operating and capital budgets would not be expected to vary significantly.
","snippet":"Provisions that govern what will occur if the limited partners block the action of the general partners need to be considered to determine whether the rights of the limited partners to block have substance. For example, …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a1655b16982bc2178f2455aab3b1ce55f63be83fed549b7176e5741b15cf2eb5","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16H","para":"55-16H","html":"
Limited partners' rights relating to the initiation or resolution of a lawsuit may be considered protective or participating depending on the available facts and circumstances. For example, if lawsuits are a part of, or are expected to be a part of, the limited partnership's ordinary course of business, as is the case for some insurance entities, then the limited partners' rights may be considered substantive participating rights.
","snippet":"Limited partners' rights relating to the initiation or resolution of a lawsuit may be considered protective or participating depending on the available facts and circumstances. For example, if lawsuits are a part of, or …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cd30c9e78e546db9ed6f8c0376801accce0c47e9593aaf409995b9081d9d90b0","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-16I","para":"55-16I","html":"
The limited partners have the right to veto the annual operating and capital budgets for the first X years of the limited partnership. Based on the facts and circumstances, during the first X years of the limited partnership, this right may be a substantive participating right. However, following Year X there is a significant change in the exercisability of the limited partners' right (for example, the veto right terminates). As of the beginning of the period following Year X the presumption that the general partners control the partnership no longer is overcome because that right no longer exists.
","snippet":"The limited partners have the right to veto the annual operating and capital budgets for the first X years of the limited partnership. Based on the facts and circumstances, during the first X years of the limited partner…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:edcc2c891bf63e083a04e376659f2f1d256b7df9a3c2f16ebb0dd366c4fe749f","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7f141c0b5ad9c55634c663e078b0930e7841810bf07d0ed89c37125b77ce4f41","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"block":null,"heading":"Illustrations","paragraphs":[{"citation":"810-958-55-17","para":"55-17","html":"
This Example illustrates one way in which the consolidated financial statements of an NFP might satisfy the presentation and disclosure requirements for noncontrolling interests in a consolidated subsidiary and subsequent changes in ownership interests of that subsidiary. This Example uses simplified assumptions and highly aggregated amounts to illustrate how to apply the provisions of Topic 810 and Subtopic 958-810.
","snippet":"This Example illustrates one way in which the consolidated financial statements of an NFP might satisfy the presentation and disclosure requirements for noncontrolling interests in a consolidated subsidiary and subsequen…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ebb33a0dce6f312df91e6496afbc0dbffc74cb8a50654006e1bb3a38058fe52c","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-18","para":"55-18","html":"
For example, the consolidated statement of financial position in paragraph 958-810-55-23 shows relatively few highly aggregated amounts of assets and liabilities, and the consolidated statement of operations and other changes in net assets without donor restrictions in paragraph 958-810-55-24 shows relatively few highly aggregated amounts of revenues and expenses rather than details such as expenses by function or nature. The consolidated statement of financial position also does not classify assets and liabilities, which is required for a not-for-profit, business-oriented health care entity by paragraph 954-210-45-1. This Example also omits a statement of cash flows, which does not bear on the presentation and disclosure requirements for noncontrolling interests.
","snippet":"For example, the consolidated statement of financial position in paragraph 958-810-55-23 shows relatively few highly aggregated amounts of assets and liabilities, and the consolidated statement of operations and other ch…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:dd2d7dc47db72f336a142ee517bdf970f21b905e3ff805ff379e2e89f1437c8a","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-19","para":"55-19","html":"
Formats or levels of detail other than those presented in this Example may be appropriate for other situations. For example, the related net assets and noncontrolling interest would be presented in net assets with donor restrictions if donor-imposed restrictions on the use of the subsidiary's net assets existed in this Example (see paragraph 958-810-45-1).
","snippet":"Formats or levels of detail other than those presented in this Example may be appropriate for other situations. For example, the related net assets and noncontrolling interest would be presented in net assets with donor …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b4cd6f38ee898b2561d34e12c4a575519259033b20f1c9602338900a72cf2f6a","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-20","para":"55-20","html":"
The following assumptions are applicable to all years:
  1. a
    Hospital A, a tax-exempt NFP has one subsidiary, Subsidiary A. That ownership interest in Subsidiary A was purchased; there are no donor-imposed restrictions on the use of Subsidiary A's net assets.
  2. b
    Subsidiary A is an investor-owned entity that is subject to income taxes. The tax rate for all years is 40 percent.
  3. c
    Subsidiary A has 10,000 shares of common stock outstanding and does not pay dividends.
","snippet":"The following assumptions are applicable to all years:\n(a) Hospital A, a tax-exempt NFP has one subsidiary, Subsidiary A. That ownership interest in Subsidiary A was purchased; there are no donor-imposed restrictions on …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:df9beeefbf3c81b64b09b807ae42f0e1c96d51feef092e9de4e4339947737c53","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-21","para":"55-21","html":"
The following assumptions are applicable to 20X2:
  1. a
    On January 1, 20X2, Hospital A sells 2,000 of its 10,000 shares in Subsidiary A to an unrelated entity for $50,000 in cash, reducing its ownership interest from 100 percent to 80 percent. Immediately before the sale, Subsidiary A's equity was as follows.
    • \"
      Subsidiary A Common stock \" $25,000 \" Paid-in capital \" 50,000 \" Retained earnings \" 125,000 \" Accumulated other comprehensive income \" 5,000 \" Total equity \" $205,000 \"
  2. b
    The accumulated other comprehensive income balance of $5,000 represents an unrealized gain on a portfolio of debt securities purchased by Subsidiary A for $100,000, which it classifies as available-for-sale debt securities at the carrying amount of $105,000 and are the only investment securities of the consolidated group.
  3. c
    The sale of Subsidiary A's shares is accounted for as an equity transaction (within net assets without donor restrictions) in the consolidated financial statements of Hospital A, as follows:
    1. 1
      A noncontrolling interest is recognized in net assets without donor restrictions in the amount of $41,000 ($205,000 × 20 percent).
    2. 2
      Net assets without donor restrictions attributable to Hospital A are increased by $9,000, calculated as the difference between the cash received ($50,000) and the carrying amount of the noncontrolling interest ($41,000).
    3. 3
      The top-level (consolidated) journal entry to record the sale of Subsidiary A's shares to the noncontrolling shareholder is as follows:
      • \"
        Cash \" $50,000 \" Net assets without donor restrictions (noncontrolling interest) \" $41,000 \" Net assets without donor restrictions (Hospital A) \" 9,000 \"
  4. d
    For the year ended December 31, 20X2, the amount of Subsidiary A's net income included in the consolidated financial statements is $20,000, which included a net loss for discontinued operations of $7,000.
","snippet":"The following assumptions are applicable to 20X2:\n(a) On January 1, 20X2, Hospital A sells 2,000 of its 10,000 shares in Subsidiary A to an unrelated entity for $50,000 in cash, reducing its ownership interest from 100 p…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4faced244fcb5150c14b586a663342dd2ff83db198654dc440f00801c3e2cc25","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-22","para":"55-22","html":"
The following assumptions are applicable to 20X3:
  1. a
    On January 1, 20X3, Hospital A purchases 1,000 shares in Subsidiary A from the noncontrolling shareholders (50 percent of the noncontrolling interest) for $30,000 cash, increasing its ownership interest from 80 percent to 90 percent. Immediately before that purchase, the carrying amount of the noncontrolling interest in Subsidiary A was $48,000. The purchase of shares from the noncontrolling shareholders is accounted for as an equity transaction in the consolidated financial statements, as follows:
    1. 1
      The noncontrolling interest balance within net assets without donor restrictions is reduced by $24,000 ($48,000 × 50 percent interest acquired by Hospital A).
    2. 2
      Net assets without donor restrictions attributable to Hospital A are decreased by $6,000, calculated as the difference between the cash paid ($30,000) and the adjustment to the carrying amount of the noncontrolling interest ($24,000).
    3. 3
      The top-level (consolidated) journal entry to record that purchase of Subsidiary A's shares from the noncontrolling shareholders is as follows:
      • \"
        Net assets without donor restrictions (noncontrolling interest) \" $24,000 \" Net assets without donor restrictions (Hospital A) \" 6,000 \" Cash \" $30,000 \"
  2. b
    For the year ended December 31, 20X3, the amount of Subsidiary A's net income included in the consolidated financial statements is $15,000.
","snippet":"The following assumptions are applicable to 20X3:\n(a) On January 1, 20X3, Hospital A purchases 1,000 shares in Subsidiary A from the noncontrolling shareholders (50 percent of the noncontrolling interest) for $30,000 cas…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3e373e444dc1a1300bf20308e0f3dcc6f6ae91e663879be5d05913606bcee15b","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-23","para":"55-23","html":"
The following consolidated statement of financial position illustrates the requirement in paragraph 958-810-45-1 that Hospital A present the noncontrolling interest in the consolidated statement of financial position within net assets, but separately from the parent's net assets.
","snippet":"The following consolidated statement of financial position illustrates the requirement in paragraph 958-810-45-1 that Hospital A present the noncontrolling interest in the consolidated statement of financial position wit…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f9abda9f3b35b9988258e54fefaa7861ac7daebb23f282515a0e7b1f33d12bf0","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-24","para":"55-24","html":"
The following consolidated statement of operations and other changes in net assets without donor restrictions illustrates how the requirements in paragraph 958-810-50-5(a) for disclosure of the amounts of a performance indicator of a health care entity for an excess of revenues over expenses from continuing operations and in paragraph 958-810-50-5(b) for discontinued operations might be presented on the face of a consolidated statement of operations and other changes in net assets.
","snippet":"The following consolidated statement of operations and other changes in net assets without donor restrictions illustrates how the requirements in paragraph 958-810-50-5(a) for disclosure of the amounts of a performance i…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:57dc7d13d9624fc9a4a6e88575cae5280d12483cc550f27746abd80c253707d4","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-25","para":"55-25","html":"
The following note depicts the changes in consolidated net assets attributable to the controlling financial interest of Hospital A (parent) and the noncontrolling interests. It illustrates the requirements in paragraph 958-810-50-4 that an NFP present a schedule that reconciles the beginning and the end of the period carrying amounts of the parent's controlling interest and the noncontrolling interests for each class of net assets for which a noncontrolling interest exists. This note also illustrates the disclosure requirements in paragraph 958-810-50-5(a) through (b) and (d) through (e) for the amounts of a performance indicator of a health care entity (which is equivalent to income from continuing operations), for the amounts of discontinued operations, changes in ownership interests in a subsidiary, and the aggregate amount of all other changes in net assets without donor restrictions and net assets with donor restrictions for the period.
","snippet":"The following note depicts the changes in consolidated net assets attributable to the controlling financial interest of Hospital A (parent) and the noncontrolling interests. It illustrates the requirements in paragraph 9…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f80335569bfa52897c1fd3a9fbaa9e6f2601e0106175d2b91fe816818e6fcd55","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-26","para":"55-26","html":"
This Example illustrates the guidance in paragraphs
958-810-25-19 through 25-20
. To illustrate the application of the simple majority threshold, consider the following Cases A, B, and C in which the limited partnership agreement requires a simple majority of the limited partners' voting interests to remove the general partner and Case D in which a supermajority of the limited partners' voting interests is required for such removal:
  1. a
    Three equal-interest limited partners (Case A)
  2. b
    Two equal-interest limited partners (Case B)
  3. c
    One hundred equal-interest limited partners (Case C)
  4. d
    Required limited partner voting percentages greater than 50 percent (Case D).
","snippet":"This Example illustrates the guidance in paragraphs 958-810-25-19 through 25-20. To illustrate the application of the simple majority threshold, consider the following Cases A, B, and C in which the limited partnership a…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4d5cf9f5239d7fa9d3f333f1159405f8137a58cfe4254f81829b8b2c42a66c46","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-27","para":"55-27","html":"
Assume that a limited partnership has 3 limited partners, none of which have any relationship to the general partners, and that each holds an equal amount of the limited partners' voting interests (33.33 percent). In this Case, applying the simple majority requirement in the partnership agreement would require a vote of no more than two of the three limited partners to remove the general partners. Accordingly, a provision that entitles any individual limited partner to remove the general partner or a provision that requires a vote of two of the limited partners to remove the general partner would meet the requirements of paragraph 958-810-25-19(a) for a substantive kick-out right. However, if a vote of all three limited partners is required to remove the general partner, the right would not meet the requirements of that paragraph for a substantive kick-out right because the required vote is greater than a simple majority of the limited partners voting interests.
","snippet":"Assume that a limited partnership has 3 limited partners, none of which have any relationship to the general partners, and that each holds an equal amount of the limited partners' voting interests (33.33 percent). In thi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f2dbffc4ceee3ace6e76fe2a767844dd3e7450372acb241b9ece17bd8f35b82c","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-28","para":"55-28","html":"
Consider the same facts as in Case A, except that there are two limited partners that each hold an equal interest. In this Case, a simple majority of the limited partners' voting interests would require a vote of both limited partners, so a provision entitling any individual limited partner to remove the general partner or a provision that requires a vote of both limited partners to remove the general partner would meet the requirements of paragraph 958-810-25-19(a) for a substantive kick-out right.
","snippet":"Consider the same facts as in Case A, except that there are two limited partners that each hold an equal interest. In this Case, a simple majority of the limited partners' voting interests would require a vote of both li…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:30bee93bca8d5df5c306f44e3d0780e7fa97fc5603e4ecedd745984958d8445e","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-29","para":"55-29","html":"
Consider the same facts as in Case A, except that there are 100 limited partners that each hold an equal interest. In this Case, a simple majority of the limited partners' voting interests would require a vote of 51 limited partners; therefore, a provision that requires a vote of less than 52 limited partners to remove the general partner would meet the requirements of paragraph 958-810-25-19(a) for a substantive kick-out right. However, if a vote of 52 or more limited partners is required to remove the general partner, that provision would not meet the requirements of that paragraph for a substantive kick-out right because the required vote is greater than a simple majority of the limited partners' voting interests.
","snippet":"Consider the same facts as in Case A, except that there are 100 limited partners that each hold an equal interest. In this Case, a simple majority of the limited partners' voting interests would require a vote of 51 limi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:827611145f0bf7ad0a1758074e637b40862101027981455b6c7c448f0bc15491","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-30","para":"55-30","html":"
In this Case, consider the following situations based on a limited partnership agreement that requires a vote of 66.66 percent of the limited partners' voting interests to remove the general partner:
  1. a
    Equal-interest limited partners (Case D1)
  2. b
    Limited partners with unequal interests (Case D2).
","snippet":"In this Case, consider the following situations based on a limited partnership agreement that requires a vote of 66.66 percent of the limited partners' voting interests to remove the general partner:\n(a) Equal-interest l…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:240de63eea9f0b416f163737b781a48b6c21f37dd4cbf356a8de38d6afe72b6b","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-31","para":"55-31","html":"
There are 3 independent limited partners that each hold an equal percentage (33.33 percent) of the limited partner voting interest. A vote of 2 of the 3 limited partners represents 66.66 percent of the limited partners voting interests, which also represents the smallest possible combination of voting interests that is at least a simple majority of the limited partners' voting interests. Assuming there are no barriers to the exercise of the kick-out rights, the kick-out rights in this Case meet the simple majority requirement and, therefore, represent substantive kick-out rights that overcome the presumption of control by the general partners.
","snippet":"There are 3 independent limited partners that each hold an equal percentage (33.33 percent) of the limited partner voting interest. A vote of 2 of the 3 limited partners represents 66.66 percent of the limited partners v…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c09f132220fbe6c0568313bab3d3c9ae577a5f2d2c5a78da55d9784f63b3ee59","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},{"citation":"810-958-55-32","para":"55-32","html":"
There are 3 independent limited partners that hold 45 percent (Limited Partner 1), 25 percent (Limited Partner 2), and 30 percent (Limited Partner 3) of the limited partners' voting interests, respectively. To remove the general partners, a vote of Limited Partner 1 in combination with either Limited Partner 2 or Limited Partner 3 would be a simple majority of the limited partners' voting interests and would satisfy the 66.66 percent contractual requirement. In contrast, a vote to exercise the kick-out right by Limited Partner 2 and Limited Partner 3 also would represent a simple majority of the limited partners' voting interests, but their 55 percent voting interests would not meet the contractually required threshold of 66.66 percent to remove the general partners. Accordingly, the kick-out right in this Case would be assessed as nonsubstantive because the smallest possible combination (Limited Partner 2 and Limited Partner 3) that represents at least a simple majority of the limited partners' voting interests cannot remove the general partners. Assuming the limited partners do not possess substantive participating rights, the presumption of control by the general partners would not be overcome.
","snippet":"There are 3 independent limited partners that hold 45 percent (Limited Partner 1), 25 percent (Limited Partner 2), and 30 percent (Limited Partner 3) of the limited partners' voting interests, respectively. To remove the…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f5ed486ec5a56b812cbf714f9e79a6174d64447b7227d92292fc17b2f348e4bb","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:494d209fb8198ca5489e0eb6d0054659d5faf767a4245cd5eb024edecfd7c54e","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c6e730fcd5cb9d9bd78664f5e83608365a1b0249879aa62da280b861ed659495","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c6e730fcd5cb9d9bd78664f5e83608365a1b0249879aa62da280b861ed659495","downloaded_from":"2026-09-10T01:33:24.821Z","last_downloaded_at":"2026-09-10T01:33:24.821Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477601","source_sha256":"8f6cc918802cea77f700df850b9b441a05461cb149eaa559f555a621b11da393"}}