What Is the Difference between ASC 450-20 (FAS 5) and ASC 310-10-35 (FAS 114) Reserve Loans?
Jan 21, 2015
This video covers the differences between the two underlying accounting guidances factoring into the ALLL calculation. While there are some gray areas, typically the existence of an impairment, or the knowledge that the loan will not be paid back in full, including both principle and interest, is the determining factor as to whether a loan will be deemed as an ASC 310-10-35 versus an ASC 450-20. The video goes into more detail.