WASHINGTON—The Financial Accounting Standards Board (FASB) is requesting feedback by Sept. 19 on its proposed update to the current expected credit loss (CECL) effective date for non-public business entities, including credit unions.
This change would make clear that the implementation of the accounting standard is only required for fiscal years after Dec. 15, 2021.
FASB this week said the proposal would "mitigate transition complexity" by aligning the CECL implementation date with entities annual financial statements. The proposal would also "clarify that receivables arising from operating leases are not within the scope of the credit losses standard, but rather, should be accounted for in accordance with the leases standard.”
NAFCU noted that credit unions are still waiting for substantive guidance on the CECL standard.
“NAFCU has remained in close communication with the FASB over its standard and still strongly believes that credit unions should not be included within its scope,” the trade association said.
In a letter, CUNA had also earlier urged FASB to clarify CECL’s effective date for credit unions, with CUNA noting FASB Chairman Russell Golden agreed with association’s comments during the July meeting.
FASB Statement
In a release issued Monday, FASB said the proposal would "mitigate transition complexity" by aligning the CECL implementation date with entities annual financial statements. The proposal would also "clarify that receivables arising from operating leases are not within the scope of the credit losses standard, but rather, should be accounted for in accordance with the leases standard."
According to NAFCU's latest Economic & CU Monitor data, credit unions are still waiting for substantive guidance on the CECL standard. NAFCU has remained in close communication with the FASB over its standard and still strongly believes that credit unions should not be included within its scope.