The SPV is a separate legal entity created specially to handle a venture on behalf of a company. In many cases, the SPV belongs from a legal standpoint to banks or to Investors rather that to the company. The IASB has however stipulated that the company should consolidate the SPV if it enjoys the majority of the benefits or if it incurs the residual risks arising from the SPV even if it does not own a single Share of the SPV.

(See Chapter 6 Getting to grips with consolidated accounts of the Vernimmen)

To know more about it, look at what we have already written on this subject