FASC Codification

(a) When did the FASC Codification become effective?
The Codification became effective starting on July 1, 2009

(b) Did the FASC change prior GAAP?
FASC did not change GAAP, but it does now ask non-governmental entities to “apply the American Institute of Certified Public Accountants Technical Inquiry Service Section 5100, Revenue Recognition”.

(c) What did the FASC expect from the new FASC structure and system?
FASC wanted to the codification all in one spot and have it easier for users to view. They also wanted the codification to be up to date.

(d) What are the “topics” used in the ASC?
The topics discussed are the general principles, the presentation area, The Assets, Liabilities, and Equity Areas, The Revenue and Expenses, and the Broad Transactions.

(e) Are Securities and Exchange Commission (SEC) references included in the ASC?
Securities and Exchange Commission is referenced in the ASC.

2. Transfer of Receivables FASC 860-10

(a) Identify relevant Codification section that addresses transfers of receivables.
The transferor gives the transferee an entire or a restricted amount of recourse in the transfer of a full receivable, a class of a full receivable, or a small amount of the full receivable with recourse. The transferor is obliged under the full agreement of the recourse provision to pay the transferee or to just rebuy the receivables bought under convinced circumstances. Ideally this is for defaults that are at a percentage of the amount specified.

(b) Provide definitions for the following:
(i) Transfer
A transfer is the conveyance of a financial asset that is not cash by a person that is not the issuer of that asset. Transfers allow receivables to be sold, put into a securitization trust, and r...

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(b) How is present value determined when an established exchange price is not determinable and a note has no ready market? What is the resulting interest rate often called?
In an open market if notes are traded the quoted prices and the market rate of interest of the notes should come up with enough evidence to get the present value. An interest rate is guessed that may be slightly different from the stated rate. This may have an effect on the financial statement that is material if the face value of the note is large enough and the term of it is long.
(c) Where should a discount or premium appear in the financial statements? What about issue costs?
The discount or premium appears to be directly deducted from the balance sheet, or added to the face value of the note. The issue costs should be a deferred charge on the balance sheet.