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New FASB Repurchase Disclosure Standard Released

Recently issued by the Financial Accounting Standards Board (“FASB”), Accounting Standards Update (ASU) No. 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures changes the accounting for repurchase-to-maturity transactions to secured borrowing accounting. In addition, the ASU requires separate accounting separate accounting for a transfer executive with a repurchase agreement with the same counter party resulting in secured borrowing accounting for the repurchase agreement. Finally, the ASU adds new disclosures to provide for transparency with respect to the transaction.

The effective dates are as followed:

Public Private Public Interim Private Interim
Accounting Changes beginning after December 15, 2014 beginning after Decem­ber 15, 2014 beginning after December 15, 2014 beginning after December 15, 2015
Disclosures for transactions accounted for as a sale beginning after December 15, 2014 beginning after December 15, 2014 beginning after Decem­ber 15, 2014 beginning after December 15, 2015
Disclosures for repurchase agreements, securities lending transactions, and repur­chase-to-maturity transactions accounted for as secured borrowings periods beginning after December 15, 2014 beginning after December 15, 2014 beginning after March 15, 2015 beginning after December 15, 2015

Public entities are excluded from early application of the ASU. Unlike public entities, all other entities will be allowed early application and use the requirements for interim periods starting after December 15th of this year. Additionally, the new disclosures are not required to be comparative for all entities’ to periods prior to the effective date.

For the FASB’s news release, click here.

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