No more qualified special purpose entities

[Rabbitisrich]

FASB announced today that they will no longer allow these investment vehicles to be held off the books.

 

It will be interesting to see the long term effect of this rule. In the short run, lending will definitely decline as companies renegotiate covenants. In the long run, the optimist in me hopes that investors will learn to read financial statements more carefully.

 

 

http://www.fasb.org/news/051809_fas140_and_fin46r.shtml

 

http://www.washingtonpost.com/wp-dyn/content/article/2009/05/17/AR2009051701779.html