FASB to Address Additional CECL Concerns

During a Financial Accounting Standards Board's (FASB) Transition Resource Group for Credit Losses meeting Thursday, FASB staff indicated it would spend additional time working on certain operational challenges associated with the current expected credit loss (CECL) standard.

These concerns were brought up by credit unions and other financial institutions attending the meeting.

FASB recently agreed to proceed to a vote to finalize changes sought by credit unions including a delay in the standard's effective date for the industry. The changes would make clear that the implementation of the standard for non-public business entities (PBEs) is only required for fiscal years after Dec. 15, 2021 – so credit unions would not need to begin reporting data on call reports until the beginning of 2022 – and would also clarify that operating lease receivables are not covered within the scope of CECL.

A final update is expected to be issued before the end of the year.

Credit unions have expressed a need for more substantive guidance on the CECL standard. CUNA continues to urge the FASB to coordinate with NCUA on guidance.

in Compliance & Regulatory News