Citigroup Restructures Entities
Aug. 04, 2003
WASHINGTON (AP) _ Citigroup Inc. has restructured some off-balance sheet entities to avoid having to consolidate them on the balance sheet under a new accounting rule, according to a regulatory filing Monday.
Citigroup's filing said it could be required to consolidate about $5 billion of off-balance sheet entities because of the new rule, down from a previous estimate of $55 billion.
Additional entities may be identified that would need to be consolidated, the filing with the Securities and Exchange Commission said.
Under the rule, FASB Interpretation 46, an entity is subject to consolidation if it has insufficient equity to permit it to finance its operations without support from others or its investors can't make significant decisions about its operations.
Off-balance sheet entities, also called special-purpose entities, drew attention after the collapse of Enron, which had used them to hid liabilities.
Shares of Citigroup rose 42 cents, or 1 percent, to close Monday at $43.87 on the New York Stock Exchange.