FAS 167 intends to clear up accounting disclosures under Interpretation having to do with Variable Interest Entities

• specifically to determine if an entities variable interests given it a controlling financial interest in a variable interest entity
• eliminates exception for troubled debt restructuring
• clarifies what qualifies as variable interest entity
• requires more extensive disclosure on variable interest entities

**variable interest entities allow financial firms to keep assets such as subprime-mortgage securities off their balance sheets. VIEs used to be known as special purpose vehicles - the instruments that were part of the Enron debacle.