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ASU also establishes new disclosure requirements.
The Financial Accounting Standards Board (FASB) on January 17, 2014, updated its Accounting Standards Codification to clarify, among other things, that a foreclosure of a consumer mortgage may occur, requiring a reclassification of the relevant asset, when a creditor receives a deed in lieu of foreclosure, in addition to when legal title is conveyed as a result of an involuntary foreclosure. Accounting Standards Update (ASU) No. 2013-04, Receivables-Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassificat ion of Resident i a l Rea l Esta te Collateralized Consumer Mortgage Loans upon Foreclosure, also enhanced disclosure requirements incident to a foreclosure.
Based on a consensus of the Emerging Issues Task Force (EITF), the standard is embodied in new FASB ASC paragraph 310-40-55-10A, which provides as follows:
A creditor is...