SPE vs VIE

SPE entity --has special purpose and it can only engage in specified and restricted business --equity holders of SPEvoting rights often are of little or no importance --primary bearers of risks and rewards are not their equity holders but parties with contractual relationships with them. --consolidation: controlling financial interest - ownership of a majority voting equity interest VIE --majority of SPEs are VIE because equity holders lack contro rights --no restrictions on business activies --consolidation is not based on equity voting rights (equity, risky debt or beneficial interstest of the eqntity, guarantees of entity's assets, ...