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An investor may issue a guarantee to a third party on behalf of an equity method investee. In such situations, the investor should consider the guidance in ASC 460, Guarantees, and if applicable record a liability to reflect its obligation.
Although a parent’s guarantee of its subsidiary’s debt is not subject to ASC 460, as noted in ASC 460‑10‑25‑1(g), an investor’s guarantee of the debt of an equity method investee is subject to that guidance as the equity method investee is not a subsidiary.

ASC 460‑10‑25‑4

At the inception of a guarantee, a guarantor shall recognize in its statement of financial position a liability for that guarantee. This Subsection does not prescribe a specific account for the guarantor’s offsetting entry when it recognizes a liability at the inception of a guarantee. That offsetting entry depends on the circumstances in which the guarantee was issued. See paragraph 460‑10‑55‑23 for implementation guidance.

Excerpt from ASC 460‑10‑55‑23

Although paragraph 460‑10‑25‑4 does not prescribe a specific account, the following illustrate a guarantor’s offsetting entries when it recognizes the liability at the inception of the guarantee:
a. If the guarantee were issued in conjunction with the formation of a partially owned business or a venture accounted for under the equity method, the recognition of the liability for the guarantee would result in an increase to the carrying amount of the investment.

If an investor issued a guarantee in connection with the formation of the equity method investment, or provided the guarantee as part of consideration transferred to the investee in return for the shares, the guarantee should be viewed as part of the total consideration provided in return for the investment. Accordingly, the recognized guarantee would be reflected as an increase to the carrying value of the investment.
After the initial recognition of the guarantee, all subsequent accounting for the guarantee would be in accordance with ASC 460, and therefore would not impact the carrying amount of the equity method investment.
If a guarantee is issued by the investor after the formation of the equity method investment, see EM 4.5.

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