Chapter 6: Special Purpose and Variable Interest Entities

In this section

• Characteristics of Variable Interest Entities (VIEs)
  Explore the identification and purpose of Variable Interest Entities (VIEs), focusing on key attributes, real-world examples, and the IFRS/US GAAP frameworks that guide consolidation decisions. Understand how VIEs influence financial statement analysis and learn best practices for recognizing and evaluating them.
• Primary Beneficiary Determination and Risks
  Explore how to identify the primary beneficiary of a Variable Interest Entity under US GAAP and IFRS, focusing on control, power, and the implications of consolidation, with real-world examples and exam tips.
• Consolidation Policies for SPEs and VIEs
  Delve into the consolidation requirements for Special Purpose Entities (SPEs) and Variable Interest Entities (VIEs) under both US GAAP and IFRS, examining primary beneficiary determination, risk exposures, and the critical financial reporting implications for CFA Level II candidates.
• Vignette Application: Identifying VIE-Related Disclosures
  Explore how to identify Variable Interest Entities (VIEs), determine the primary beneficiary, and assess the financial statement impact under IFRS and US GAAP using a vignette approach.