hgoertz Newbie
Joined: 18 Aug 2010
Online Status: Offline Posts: 1
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Posted: 18 Aug 2010 at 14:17 | IP Logged
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From:
ASC topic 860-50-05
- Servicing
Assets
A contract to service financial assets
under which the benefits of servicing are expected to more than
adequately
compensate the servicer for performing the servicing. A servicing contract is either:
- a. Undertaken in
conjunction with selling or
securitizing the financial assets being serviced
- b. Purchased or assumed
separately.
-
Servicing
Liabilities
A contract to service financial assets
under which the estimated future revenues from contractually specified
servicing fees, late charges, and other ancillary revenues (benefits
of servicing) are not expected to adequately compensate the servicer
for performing the servicing.
General
Currently Viewing:
860 Transfers and Servicing
50 Servicing Assets and Liabilities
05 Overview and Background General
05-1
This Subtopic provides accounting
guidance for servicing assets and servicing liabilities.
Currently Viewing:
860 Transfers and Servicing
50 Servicing Assets and Liabilities
05 Overview and Background General
05-2
Servicing is inherent in all financial assets; it
becomes a distinct asset or liability for accounting purposes only
in the circumstances described in paragraph 860-50-25-1.
Currently Viewing:
860 Transfers and Servicing
50 Servicing Assets and Liabilities
05 Overview and Background General
05-3
Servicing of mortgage loans, credit
card receivables, or other financial
assets commonly includes, but is not limited to, the following
activities:
- a. Collecting principal,
interest, and escrow payments from borrowers
- b. Paying taxes and
insurance from escrowed funds
- c. Monitoring
delinquencies
- d. Executing
foreclosure if necessary
- e. Temporarily
investing funds pending distribution
- f. Remitting fees
to guarantors, trustees, and others providing services
- g. Accounting for
and remitting principal and interest payments to the
holders of beneficial interests in the financial
assets.
Pending Content:
Transition Date: November
15, 2009
Transition Guidance:
860-10-65-3
Servicing of mortgage loans, credit
card receivables, or other financial assets commonly includes, but
is not limited to, the following activities:
- a. Collecting principal,
interest, and escrow payments from borrowers
- b. Paying taxes and
insurance from escrowed funds
- c. Monitoring
delinquencies
- d. Executing
foreclosure if necessary
- e. Temporarily
investing funds pending distribution
- f. Remitting fees
to guarantors, trustees, and others providing services
- g. Accounting for
and remitting principal and interest payments to the
holders of beneficial interests or participating interests in the
financial assets.
Currently Viewing:
860 Transfers and Servicing
50 Servicing Assets and Liabilities
05 Overview and Background General
05-4
A servicer of financial assets
commonly receives the following benefits of servicing:
A servicer is entitled to
receive all
of those benefits of servicing only if it performs the servicing and
incurs the costs of servicing the
financial assets.
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