User:Sulmues/Sandbox/FAS 91

Statements of Financial Accounting Standards No. 91, Accounting for Nonrefundable Fees and Costs Associated with Originating or Acquiring Loans and Initial Direct Costs of Leases, commonly known as FAS 91, was an accounting standard issued in December 1986 by the Financial Accounting Standards Board (FASB), that conserved its value until the FASB recodification of 2009.

The main provisions of FAS 91 are the following:

Loan Origination Fees/Costs & Premiums/Discounts

 * 1) Loan origination fees and certain direct loan origination costsare all recognized as an adjustment of yield using the interest method, unless, in certain cases, repayments of these fees are anticipated. Purchase premiums and discounts on loans are also recognized as an adjustment of yield using the interest method.
 * 2) Certain direct loan origination costs are recognized over the life of the loan as a reduction of the loan’s yield.

Commitment Fees

 * 1) All loan commitment fees are deferred, except for certain retrospectively determined fees ;
 * 2) Commitment fees such as credit card fees are recognized over the loan commitment period;
 * 3) All other commitment fees, such as Syndication Fees  or Fees and Costs of Refinancing or Restructuring are recognized as an adjustment of yield over the loan’s life. However if the commitment expires unexercised, such fees are recognized in income upon expiration of the commitment.