Trade Groups Seek Changes to FASB Proposal

The Bond Market Association and the American Securitization Forum are recommending changes to an accounting proposal they say would, among other things, "unnecessarily harm mortgage securitization programs."The concerns of the two related trade groups center on their belief that proposed amendments to Financial Accounting Standards Board Statement 140 would prevent transferors or decision-makers from meeting the qualifying standards for special-purpose entities that allow them to "derecognize" securitized assets for accounting purposes "no matter how immaterial" their continuing connection is to a financial asset transferred to an SPE. FASB proposed the changes to provide more "specific guidance" on the requirements an entity must meet to be considered a QSPE. It is accepting comments on the proposal through July 31. The organizations can be found online at http://www.bondmarkets.com, http://www.americansecuritization.com., and http://www.fasb.org.