What are the main accounting standards on securitization?
Internationally, the most comprehensive accounting standard on securitization is the SFAS 140 from Financial Accounting Standards Board, USA. The UK accounting standards body has issued FRS 5, which is essentially not dedicated to securitization but provides the substance-over-form approach, wherein it also contains provisions on securitization. The International Accounting Standards Committee has issued IAS 32/ IAS 39, again generally on accounting for financial instruments, which also contains sections on securitization. There are number of other countries which have implemented their own accounting standards, but mostly a replica of IAS 32 or FAS 140. For example, Canada has adapted its own version of FAS 140 – see here for details: http://www.acsbcanada.org/ What is the crux of these accounting standards? The essential question in securitization is: whether the transfer of receivables involved in the securitization transaction is a sale, or should the asset be retained on books? If
