The Financial Accounting Standards Board has finalized some targeted improvements to the accounting requirements around consolidations, or the rules around when a company must add another entity to its financial statements because it controls the entity.

FASB published Accounting Standards Update No. 2015-02 to provide guidance for entities such as limited partnerships, limited liability corporations, and securitization structures, like collateralized debt or loan obligations, and mortgage-backed security transactions. The new rules, expected in 2014 but delayed into the new year, focus on the evaluation reporting entities must perform to determine whether they should consolidate certain other legal entities.

FASB said existing rules led to situations where companies were consolidating legal entities even when the reporting company appeared to be directly the activities of the consolidated entity on behalf of others. “Such a situation could occur, for example, when the reporting company does not have the right to act primarily on its own behalf, does not hold a majority of the legal entity’s voting rights, or is not exposed to the majority of the legal entity’s economic gains or losses,” FASB wrote in a summary of the new guidance.

FASB Chairman Russell Golden said in a statement that stakeholders believed the existing guidance led to information that wasn’t useful, leaving them to request supplemental deconsolidated financial statements so they could better understand a company’s economic and operational results. “This new standard simplifies consolidation accounting by reducing the number of consolidation models, providing incremental benefits to stakeholders,” he said.

In addition to reducing the number of consolidation models, the new standard places more emphasis on risk of loss when determining a controlling financial interest, intended to reduce instances where a reporting organization would consolidate a legal entity based solely on its fee arrangement. The new standard also reduces the use of related-party guidance when determining a controlling financial interest in a variable interest entity, and it changes consolidation conclusions for public and private companies in several industries that typically make use of limited partnerships or VIEs.

FASB says the new guidance may change the consolidation conclusions for companies in several industries, including investment management, banking, insurance, life sciences, technology, media and entertainment, oil and gas, real estate, aerospace and defense, professional services, and manufacturing.

The new guidance will be effective for public companies in periods beginning after December 15, 2015, with early adoption permitted, even in interim periods.