The Financial Accounting Standards Board’s (FASB) Accounting Standards Update (ASU) to delay the current expected credit loss (CECL) standard by an additional year has been published and is now official. As a result of the update, the implementation date for not-for-profits, including credit unions, is now 2023.
NAFCU maintains that credit unions should not be subject to CECL due to the negative impact it will have on institutions’ capital. The association will continue to ask FASB to consider less burdensome alternatives for the industry and work with the NCUA to provide more resources for credit unions.
The ASU also includes new timetables for hedging and lease standards, which extends and simplifies how effective dates for future major standards are staggered between larger public companies and all other entities.
Following FASB’s decision to move forward with the delay, federal financial regulators – including the NCUA – issued a proposed interagency policy statement for CECL and proposed guidance on credit risk review systems.
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