FASB CECL Roundtable

Feb 2, 2016

The Financial Accounting Standards Board (FASB) is scheduled to meet for a roundtable discussion on Thursday, February 4, 2016, with community bankers, the American Bankers Association (ABA) and other parties concerned with the proposed current expected credit loss (CECL) model.

In January, the FASB confirmed its plans to issue the final CECL standard in the first half of 2016 although not in the first quarter. The board declined to identify specifically what caused the delay but noted that issuance dates are always estimates. These estimates can be affected by various factors, said FASB spokeswoman Christine Klimek, including the workload related to publishing standards and updating online codification for all of the board’s projects.

In preparation for the February 4 roundtable meeting, the ABA has produced two documents. These documents include a background on CECL and an updated discussion paper, both of which can be found here.

The ABA and other organizations such as the NAFCU have openly communicated concerns to the FASB about the CECL model and the ability for smaller banking organizations to transition to the more complicated requirements in a timely and cost-effective manner.

In a letter from Rob Nichols, ABA President and CEO, to FASB Chairman Russell Golden dated January 13, Nichols stated, “The CECL model represents the biggest change – ever – to bank accounting”. He went on to question the impact of CECL implementation on organizations and requested the FASB to consider addressing a number of concerns in the upcoming roundtable discussion. Read the full letter here.

The NAFCU recently urged the FASB to reconsider its CECL model proposal. In a letter addressed to the FASB from NAFCU President and CEO Dan Berger, the board was encouraged to consider credit unions’ unique structure as not-for-profit and member-owned institutions. He also urged the FASB to extend the implementation of the CECL model by one year to account for the delay in expected finalization of the standard.

The Public Meeting on the FASB Project on Accounting for Financial Instruments: Impairment will take place on February 4 at 12:30 p.m. (ET) and can be watched online via the FASB live webcast.

Related Asset - Blog

Webinar: The CECL workshop series

Excerpt Pulled From Blog:

"A complimentary, webinar series presented by Abrigo and CliftonLarsonAllen.

The FASB’s CECL guidance is expected to be released in the first half of 2016. Implementation will be required in 2019 or 2020, but it is imperative to start readying a plan now. You know the basics of CECL, now learn actionable ways to prepare your institution. In this two-part webinar CECL workshop series, professionals from Abrigo and CliftonLarsonAllen, provided the latest information, key insights and examples to help you prepare your institution for compliance."

Resource Center