What is the meaning of Vie?
What is a Variable Interest Entity? A variable interest entity (VIE) generally refers to an entity in which a public company has a controlling interest even though it doesn’t own majority shares. Therefore, the public company can direct the VIE’s significant activities and control the flow of profits/losses.
What is another word for Vie?
synonyms for vie for. Compare Synonyms. attempt. do one's best. drive for. give a go. give a whirl. go after. go all out.
What is the definition of Vie in accounting?
Variable interest entity (VIE) is a term used by the Financial Accounting Standards Board (FASB) to refer to a legal entity with certain characteristics such that a public company with a financial interest in the entity is subject to certain financial reporting requirements.. VIEs rose to prominence after the Enron scandal. Some Chinese companies, such as Alibaba, use VIEs to get access to ...
What does the VEI stand for?
The Volcanic Explosivity Index (VEI) is a relative measure of the explosiveness of volcanic eruptions.It was devised by Chris Newhall of the United States Geological Survey and Stephen Self at the University of Hawaii in 1982.. Volume of products, eruption cloud height, and qualitative observations (using terms ranging from "gentle" to "mega-colossal") are used to determine the explosivity value.
What is VIE in business?
A variable interest entity (VIE) refers to a legal business structure in which an investor has a controlling interest despite not having a majority of voting rights.
How do you determine if a company is a VIE?
4.1 Determining whether an entity is a VIELack the power to direct activities that most significantly impact the entity's economic performance.Possess nonsubstantive voting rights.Lack the obligation to absorb the entity's expected losses.Lack the right to receive the entity's expected residual returns.
Can a public company be a VIE?
A variable interest entity (VIE) generally refers to an entity in which a public company has a controlling interest even though it doesn't own majority shares. Therefore, the public company can direct the VIE's significant activities and control the flow of profits/losses.
What is VIE stock market?
Variable interest entity (VIE) is a term used by the Financial Accounting Standards Board (FASB) to refer to a legal entity with certain characteristics such that a public company with a financial interest in the entity is subject to certain financial reporting requirements.
What is a VIE US GAAP?
There are two primary consolidation models in US GAAP – the variable interest entity (VIE) and voting interest entity (VOE) models. A reporting entity that has a variable interest in a legal entity not subject to a scope exception would need to first determine whether the VIE model applies.
Who is the primary beneficiary of a VIE?
The primary beneficiary is the variable interest holder that has both (1) the power to direct activities that most significantly impact the economic performance of the VIE, and (2) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE.
What are the advantages of having a VIE being involved in your leasing?
Creating a VIE – Advantages A less risky entity can bargain for credit at a lower rate of interest, drastically decreasing the cost of capital for new investments. A high-risk entity, on the other hand, can shield the company from higher liability.
Why are variable interest entities important?
Variable interest entities are used as special purpose vehicles to finance certain investments without putting the parent entity at risk of loss.
Who consolidates a VIE?
In general, under FIN 46(R), an equity investor consolidates the VIE when that investor retains a majority interest in the VIE's expected losses or a majority interest in the VIE's residual returns.
What are examples of variable interest?
A variable interest may result explicitly from an agreement or instrument or implicitly from a relationship or arrangement. Examples of variable interests include operating leases, service contracts, debt instruments and guarantees. For example, a public company may provide decision-making services to another entity.
Is a variable interest entity a subsidiary?
Variable Interest Entity means any Person that is not a Subsidiary under clause (a) of the definition of such term but the accounts of which are consolidated with those of the Borrower under GAAP as a result of its status as a variable interest entity.
Why do Chinese companies use VIE?
Over the past two decades, Chinese issuers have widely used the variable interest entity (VIE) structure to raise overseas capital while, at the same time, 'satisfying' China's regulation of foreign investment in industries that are closed or restricted to foreign capital.
What is VIE risk?
The VIE risk The VIE structure is of questionable legality in China, and the Chinese government could confiscate foreign investments in BABA if they decide foreign investments made in BABA under the VEI structure are illegal according to Chinese law.
What is the difference between a VIE and ADR?
ADRs are bought and sold on American stock markets just like regular stocks, and are issued/sponsored by a U.S. by a bank or brokerage. A VIE is an entity (the investee) in which the investor holds a controlling interest that is not based on the majority of voting rights.
Is a wholly owned subsidiary a VIE?
ASC 810-10-15-9 clarifies that a wholly- or majority-owned subsidiary is subject to the VIE model and may be a VIE. If the subsidiary is a VIE, a reporting entity other than the subsidiary's legal parent may be required to consolidate it under the VIE model.
When would a reporting entity reconsider whether a legal entity is a VIE?
2 Reconsideration of whether an entity is a variable interest entity. Under the VIE consolidation model, a reporting entity is required to assess whether it is involved with a VIE on the date that it initially becomes involved with an entity.
Is a joint venture a VIE?
A joint venture is generally considered a VIE if it meets one or more of the following conditions: The investors do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support.
Why would a company not want to consolidate?
The directors of a parent company may not wish to consolidate some subsidiaries due to: Poor performance of the subsidiary. Poor financial position of the subsidiary. Differing activities (nature) of the subsidiary from the rest of the group.
Can there be more than one primary beneficiary for a VIE?
A primary beneficiary is a person or entity named to receive the benefit of a will, trust, insurance policy, or investment account. More than one primary beneficiary can be named, with the grantor able to direct particular percentages to each.
When should an entity be consolidated?
Consolidated financial statements provide a true and fair view of an organisation's financial health across all divisions and subsidiaries. They are required when one company owns more than 50% of the outstanding common voting stock of another company, but there are many rules and regulations to account for.
How do you identify a variable interest entity?
In order to identify whether an entity is a VIE, the FASB focused on two main features: insufficiency of equity at risk and lack of control by the apparent voting shareholders.
Is Alibaba a VIE?
The company's status as a Variable Interest Entity (VIE). When you buy stock in BABA, you technically don't own shares in Alibaba Group itself, but in an offshore shell company that has a claim to its profits.
Is a wholly owned subsidiary a VIE?
ASC 810-10-15-9 clarifies that a wholly- or majority-owned subsidiary is subject to the VIE model and may be a VIE. If the subsidiary is a VIE, a reporting entity other than the subsidiary's legal parent may be required to consolidate it under the VIE model.
When would a reporting entity reconsider whether a legal entity is a VIE?
2 Reconsideration of whether an entity is a variable interest entity. Under the VIE consolidation model, a reporting entity is required to assess whether it is involved with a VIE on the date that it initially becomes involved with an entity.
What is a VIE in accounting?
Summary. A variable interest entity (VIE) may be any type of legal business structure created to protect the business from legal action by its creditors. A VIE may also be an accounting structure wherein the equity investors are unable to finance the working capital needs or operating costs of the business.
Why is a vie created?
A VIE is almost always created to protect a business from legal action by its creditors.
What are the advantages of a VIE?
If done properly, a VIE can create a completely new risk category for the business. A less risky entity can bargain for credit at a lower rate of interest, drastically decreasing the cost of capital for new investments. A high-risk entity, on the other hand, can shield the company from higher liability.
What is a corporation?
Corporation. Corporation A corporation is a legal entity created by individuals, stockholders, or shareholders, with the purpose of operating for profit. Corporations are allowed to enter into contracts, sue and be sued, own assets, remit federal and state taxes, and borrow money from financial institutions. Entity.
What is variable interest entity?
A variable interest entity (VIE) may be any type of legal business structure. It can be, for instance, a trust, a partnership, a corporation, or joint venture. Joint Venture (JV) A joint venture (JV) is a commercial enterprise in which two or more organizations combine their resources to gain a tactical and strategic edge in the market.
Do public companies have to disclose their relationships with VIEs?
Public companies are required to disclose their relationships with VIEs according to the accounting rules to be followed by corporations with respect to VIEs, as per the FASB .
What is VIE in France?from careers.societegenerale.com
The Volunteer for International Experience (VIE) scheme (also called the “International Internship Programme) is a highly enriching and rewarding system for the career path for students and graduates. Societe Generale is the leading provider of VIE in France and offers opportunities all over the world: United States, Canada, Great Britain, ...
How many interns are there in a VIE?from careers.societegenerale.com
By benefiting from a VIE, you are joining an international community of 2,000 interns, work-study participants and VIEs. You will also receive special support: integration into the teams, networking, career counselling, exploration.
What is Patina Vie?from acronyms.thefreedictionary.com
Since 2014, Patina Vie, whose tagline is "history and style collide," has created artistic designs for some of the most recognizable home and housewares brands. VIE, based solely on the presence of a contractual relationship.
What does "vying for the title" mean?from dictionary.com
to strive in competition or rivalry with another; contend for superiority: Swimmers from many nations were vying for the title.
Is "outvie" a verb?from dictionary.com
vier, noun outvie, verb (used with object), out·vied, out·vy·ing.
Is "to vie" becoming less popular?from grammar-monster.com
Of interest, the verb "to vie," which was popular in the 19th century, is getting less popular. [ evidence] The government is heading for serious political instability as its rival party vies for power. The top students in the class vied for the title of valedictorian.
Is "to vie" a participle?from grammar-monster.com
The verb "to vie" is like "to lie," the present participle of which is "lying."
VIE stands for Variable Interest Entity (US Financial Accounting Standards Board)
This definition appears very frequently and is found in the following Acronym Finder categories:
Samples in periodicals archive
46 and notes that the primary beneficiary in a variable interest entity is always the acquirer.
Variable Interest Entity – Formation
- A VIE is usually formed with a limited scope and purpose. For instance, a VIE may be established to finance a project – purchasing a large asset to lease it back to another entity without putting the entire business at risk. It is done by establishing special purpose vehicles that enable the company to hold financial assetspassively or to conduct r...
Creating A Vie – Advantages
- If done properly, a VIE can create a completely new risk category for the business. A less risky entity can bargain for credit at a lower rate of interest, drastically decreasing the cost of capital for new investments. A high-risk entity, on the other hand, can shield the company from higher liability.
Creating A Vie – Disadvantages
- There exists a propensity to misuse structures such as VIE, for instance, to keep securitized assets off the balance sheets of corporates. Regulatory reforms that followed the 2008 global financial crisis sought to curtail the excessive use of asset-backed securities in the financial industry. However, due to lobbying efforts by banks, the Financial Accounting Standards Board (…
Variable Interest Entity – Disclosure Requirements
- Public companiesare required to disclose their relationships with VIE according to the accounting rules to be followed by corporations with respect to VIEs, as per the FASB. In a situation where the company owns a majority interest in a VIE, the holdings are to be disclosed in the consolidated balance sheet of the company. The consolidation is not mandatory in situations where the comp…
Related Readings
- CFI is the official provider of the global Commercial Banking & Credit Analyst (CBCA)™certification program, designed to help anyone become a world-class financial analyst. To keep learning and advancing your career, the additional CFI resources below will be useful: 1. Corporation 2. Entity 3. Partnership 4. Special Purpose Vehicle (SPV)