troubled debt restructuring


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troubled debt restructuring

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Because of the increased volume of delinquencies and the concern regarding TDR reporting requirements, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2011-02, A Creditor's Determination of Whether a Restructuring Is a Troubled Debt Restructuring, to help clarify what factors trigger TDR classification.
16 letter to the Financial Accounting Standards Board (FASB) that a proposed rule for troubled debt restructurings and in substance foreclosures should not be extended to commercial real estate loans and other forms of collateralized borrowings.
In accordance with ASC subtopic 470-60, Troubled Debt Restructuring by Debtors, this debt for equity exchange was a troubled debt restructuring and thus an extinguishment of the notes for which we recognized a net gain of $400.
The amendments would preclude a creditor from using the borrower's effective rate test in ASC paragraph 470-60-55-10 in its evaluation of whether a restructuring constitutes a troubled debt restructuring.
In such circumstances, an other-than-temporary impairment usually should be recognized prior to a troubled debt restructuring.
EXHIBIT 1 Number of Filers Audited by Big Four Issuing APB Opinion 30 Extraordinary Items, 2005-2009 Type Gain on Troubled Debt Restructuring 3 Expropriation 3 Audit Opinion Unqualified 4 Going Concern 2 Impact Gain * 4 Loss 2 Total Occurrence 6 * For one expropriation, insurance proceeds exceeded the book value of assets lost.
In the view of other entities, each modified loan should be evaluated against the troubled debt restructuring criteria, and if the loan modification is a troubled debt restructuring, the modified loan should be removed from the pool and accounted for as a separate asset.
The disclosures "put a little bit more pressure to have companies consistently identify troubled debt restructurings," according to Cosper.
For example, ASC 310-40-15-5 states: "A restructuring of a debt constitutes a troubled debt restructuring for purposes of this Subtopic if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider.
It is because of public comments changes were made to the reg flex and troubled debt restructuring rules that resulted in rules better suited to the needs of credit unions.
In addition, two consensuses on the treatment of minority interests in certain real estate investment trusts (REITs) and accounting for the conversion of a loan into a debt security in a troubled debt restructuring are summarized.
It applies to most types of loans, including collateralized and uncollateralized, as well as loans whose terms are modified in a troubled debt restructuring.