# ASC 810-970: Consolidation — Real Estate—General Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/810/970/) 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): 2026-09-10T01:33:31.428Z to 2026-09-10T01:33:47.563Z Record version: sha256:eb964242177a3dff28e7ccb5ace5f538dce1b9cf8d30f6a78447388779ec3696 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-970: Consolidation — Real Estate—General ### Machine-generated study aids ```json { "summary": "ASC 810-970 gives real-estate-specific consolidation guidance layered on top of ASC 810-10. It explains when an investor controls a general or limited partnership that holds real estate (majority voting interest, or majority of profit/loss interests when voting interests are unclear), when substantive participating rights of other partners overcome the presumption of control, and when a noncontrolling investor instead uses the equity method. It also sets the five conditions that permit proportionate (undivided interest) presentation of an investment in real property.", "key_points": [ "A general partnership controlled directly or indirectly by an investor is in substance a subsidiary; ownership of over 50 percent of voting shares points toward consolidation, and if partnership voting interests are not clearly indicated, ownership of a majority of the financial interests in profits or losses usually indicates control (810-970-25-1).", "Control may exist with less than a majority ownership by contract, lease, agreement with other stockholders or partners, or court decree (810-970-25-1).", "The presumption of control by the majority interest holder is overcome if other partners hold substantive participating rights over significant financial and operating decisions made in the ordinary course of business, evaluated under 810-10-25-2 through 25-14 (810-970-25-2).", "A controlling investor accounts for the investment under the principles applicable to investments in subsidiaries and eliminates interentity profits and losses on assets remaining within the group; a noncontrolling investor in a general partnership uses the equity method under Topic 323 (810-970-25-2).", "For a limited partnership that is not a VIE under 810-10-15-14, limited partners assess a controlling financial interest under 810-10-15-8A: if no single partner controls, general and limited partners apply the equity method (except an interest so minor that the limited partner has virtually no influence, see 323-30-S99-1); if a single limited partner controls, that partner consolidates (810-970-25-3).", "Proportionate (undivided interest) presentation of assets, liabilities, revenue, and expenses is permitted only if the property is owned by undivided interests, approval of two or more owners is not required for financing/development/sale/operating decisions, each investor is entitled to only its pro rata share of income, pays only its pro rata share of expenses, and is severally liable only for debt it incurs (810-970-45-1)." ], "categories": [ "Consolidation", "Presentation", "Industry-specific", "Recognition" ], "audience_level": "intermediate", "student_note": "Real estate ventures are the classic setting for partnership consolidation questions: a majority profits interest can signal control when voting interests are unclear, but substantive participating rights held by other partners defeat consolidation. A common misunderstanding is assuming proportionate (undivided interest) presentation is generally available for joint ventures—it is allowed only when all five conditions in 810-970-45-1, including several (not joint) liability, are met.", "related_topics": [ "810-10", "323-30", "970-323", "970-10", "323-10" ], "key_concepts": [ "controlling financial interest", "general partnership control", "limited partnership consolidation", "substantive participating rights", "equity method", "undivided interest presentation", "variable interest entity", "interentity profit elimination" ] } ``` Source downloaded (UTC): 2026-09-10T01:33:31.428Z to 2026-09-10T01:33:31.428Z Record version: sha256:3191e934360acd7b9e763de3ddedd06a0bb5070245b4b95f23250e716996fe9d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-970-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/810/970/#00-status) SEC content: no ##### [810-970-00-1](https://asc.understandingaccounting.org/asc/810/970/#810-970-00-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:31.428Z to 2026-09-10T01:33:31.428Z Record version: sha256:f6090c06cc67e90384dd0edf58e3610051396ffcdf97a991f353b022a081a285 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Ordinary Course of BusinessAddedAccounting Standards Update No. 2015-0202/18/2015
970-810-25-2AmendedAccounting Standards Update No. 2015-0202/18/2015
970-810-25-3AmendedAccounting Standards Update No. 2015-0202/18/2015
Source downloaded (UTC): 2026-09-10T01:33:35.268Z to 2026-09-10T01:33:35.268Z Record version: sha256:66059271cca940673eca197a8f551a5b7d5ca12159a20fcdd2cdfed44be963df Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-970-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/810/970/#05-overview-and-background) SEC content: no ##### [810-970-05-1](https://asc.understandingaccounting.org/asc/810/970/#810-970-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:35.268Z to 2026-09-10T01:33:35.268Z Record version: sha256:8d547294a8b403e16ba982fdebb3490b81d45b84230be75f877ef22f4d96d70e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance on consolidation matters incremental to the real estate industry. Source downloaded (UTC): 2026-09-10T01:33:38.563Z to 2026-09-10T01:33:38.563Z Record version: sha256:e5de1c6fe834300624e23a56a0d48980cbfcf4bb386c035c1c6193827a37e63b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-970-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/810/970/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [810-970-15-1](https://asc.understandingaccounting.org/asc/810/970/#810-970-15-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:38.563Z to 2026-09-10T01:33:38.563Z Record version: sha256:50ed8489da93c6fac56c3dad7d1e2d748a90addaf9bbaa32d7613502d43ae8c3 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 970-10-15. Source downloaded (UTC): 2026-09-10T01:33:44.267Z to 2026-09-10T01:33:44.267Z Record version: sha256:f6080f466e692644dc6fd708f6a0dc0c5b940b5535e0ebd111e5c66e696dffac Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-970-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/810/970/#25-recognition) SEC content: no #### General Partnerships ##### [810-970-25-1](https://asc.understandingaccounting.org/asc/810/970/#810-970-25-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:44.267Z to 2026-09-10T01:33:44.267Z Record version: sha256:4d3933d550c767865c46a146e36b8c67cd14114d7d485c529974d4ec0d4b61ff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A [general partnership](https://asc.understandingaccounting.org/glossary/g/#general-partnership "An association in which each partner has unlimited liability.") that is controlled, directly or indirectly, by an investor is, in substance, a subsidiary of the investor. Paragraph [810-10-15-8](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-8) states that the usual condition for a controlling financial interest is ownership of a majority voting interest, and, therefore, as a general rule ownership by one entity, directly or indirectly, of over 50 percent of the outstanding voting shares of another entity is a condition pointing toward consolidation. However, if partnership voting interests are not clearly indicated, a condition that would usually indicate control is ownership of a majority (over 50 percent) of the financial interests in profits or losses (see paragraphs [970-323-35-16 through 35-17](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-16) ). Paragraph [810-10-15-8](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-8) states that the power to control may also exist with a lesser percentage of ownership, for example, by contract, lease, agreement with other stockholders, or by court decree. The power to control may also exist with a lesser percentage of ownership by agreement with other partners. ##### [810-970-25-2](https://asc.understandingaccounting.org/asc/810/970/#810-970-25-2) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:44.267Z to 2026-09-10T01:33:44.267Z Record version: sha256:32d3a18143374824514cb9ba4e88e8d1c3f09b0948a1ee41a7dd2a01a3be879f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. On the other hand, the majority interest holder may not control the entity if one or more of the other partners have substantive participating rights that permit those other partners to effectively participate in certain significant financial and operating decisions that are made in the [ordinary course of business](https://asc.understandingaccounting.org/glossary/o/#ordinary-course-of-business "Decisions about matters of a type consistent with those normally expected to be addressed in directing and carrying out current business activities, regardless of whether the events or transactions that would necessitate such decisions are expected to occur in the near term. However, it must be at least reasonably possible that those events or transactions that would necessitate such decisions will occur. The ordinary course of business does not include self-dealing transactions."). The determination of whether the rights of the other partners are substantive participating rights shall be evaluated in accordance with the guidance for substantive participating rights in paragraphs [810-10-25-2 through 25-14](https://asc.understandingaccounting.org/asc/810/10/#810-10-25-2) . If the other partners have substantive participating rights, the presumption of control by the majority interest holder is overcome. A controlling investor shall account for its investment under the principles of accounting applicable to investments in subsidiaries. Accordingly, interentity profits and losses on assets remaining within the group shall be eliminated. A noncontrolling investor in a general partnership shall account for its investment by the equity method and should be guided by the provisions of Topic 323. #### Limited Partnerships ##### [810-970-25-3](https://asc.understandingaccounting.org/asc/810/970/#810-970-25-3) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:44.267Z to 2026-09-10T01:33:44.267Z Record version: sha256:0efa6eeac27eda8262479d4c3bfe68e7144c9d95297cac7770600770157364eb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a [limited partnership](https://asc.understandingaccounting.org/glossary/l/#limited-partnership "An association in which one or more general partners have unlimited liability and one or more partners have limited liability. A limited partnership is usually managed by the general partner or partners, subject to limitations, if any, imposed by the partnership agreement.") does not meet the conditions in paragraph [810-10-15-14](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-14) and, therefore, is not a variable interest entity, limited partners shall evaluate whether they have a controlling financial interest according to paragraph [810-10-15-8A](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-8A). The guidance in Subtopic 810-10 on consolidation shall be used to determine whether any limited partners control the limited partnership: 1. a If no single partner controls the limited partnership, the general and limited partners shall apply the equity method of accounting to their interests, except for instances when a limited partner's interest is so minor that the limited partner may have virtually no influence over partnership operations and financial policies (see paragraph [323-30-S99-1](https://asc.understandingaccounting.org/asc/323/30/#323-30-S99-1)). 2. b [Subparagraph superseded by Accounting Standards Update No. 2015-02](https://asc.understandingaccounting.org/updates/asu-2015-02/). 3. c If a single limited partner controls the limited partnership, that limited partner shall consolidate the limited partnership and apply the principles of accounting applicable for investments in subsidiaries in Topic 810. Source downloaded (UTC): 2026-09-10T01:33:47.563Z to 2026-09-10T01:33:47.563Z Record version: sha256:381775a782927721b38c3a66383e818f9d42386824c26dcc5c8f41a62d7e231b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-970-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/810/970/#45-other-presentation-matters) SEC content: no #### Undivided Interests ##### [810-970-45-1](https://asc.understandingaccounting.org/asc/810/970/#810-970-45-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:47.563Z to 2026-09-10T01:33:47.563Z Record version: sha256:3c220370f739bed5e0a96e3b4e56d5e4de35caef03f96e439a957fe77b6dff4d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An investment in real property may be presented by recording the undivided interest in the assets, liabilities, revenue, and expenses of the venture if all of the following conditions are met: 1. a The real property is owned by [undivided interests](https://asc.understandingaccounting.org/glossary/u/#undivided-interest "An ownership arrangement in which two or more parties jointly own property, and title is held individually to the extent of each party's interest."). 2. b The approval of two or more of the owners is not required for decisions regarding the financing, development, sale, or operations of real estate owned. 3. c Each investor is entitled to only its pro rata share of income. 4. d Each investor is responsible to pay only its pro rata share of expenses. 5. e Each investor is severally liable only for indebtedness it incurs in connection with its interest in the property.