FASB Issues Summary of Tentative Board Decisions at January Meetings
FASB published the tentative decisions taken at its Board meetings in January 2020. FASB discussed a summary of comments on seven financial instrument amendments and decided to finalize these amendments separately from the November 2019 proposed Accounting Standards Update related to codification improvements. FASB directed the staff to draft a final Accounting Standards Update for vote by written ballot. The key decisions taken at the meeting are related to leases (Topic 842), measurement of credit losses on financial instruments (Topic 326), and last-of-layer method under hedging.
Interactions of Topics 842 and 326—FASB affirmed its decision on interaction of Topics 842 and 326. The amendments in the proposed Update would align the contractual term to measure expected credit losses for a net investment in a lease under Topic 326 to be consistent with the lease term determined under Topic 842.
Interaction of Topic 326 and Subtopic 860-20 on sale of financial assets—FASB affirmed its decision on interaction of Topic 326 and Subtopic 860-20. The amendments in the proposed Update would clarify that when an entity regains control of financial assets previously sold and an allowance for credit losses should be recorded in accordance with Topic 326.
Last-of-layer method under Hedging—FASB decided not to add or amend the last-of-layer disclosure requirements in Topic 815 on derivatives and hedging, related to the addition of the proposed multiple-hedge model.
Related Links
- Tentative Decisions, January 29, 2020
- Tentative Decisions, January 22, 2020
- Meeting Handout, January 29, 2020 (PDF)
- Meeting Handout, January 22, 2020 (PDF)
Keywords: Americas, US, Banking, Securities, Accounting, Financial Instruments, Leases, Hedging, Credit Losses, Topic 326, Topic 842, Topic 815, Tentative Decisions, Accounting Standards Update, FASB
Featured Experts
Laurent Birade
Advises U.S. and Canadian financial institutions on risk and finance integration, CCAR/DFAST stress testing, IFRS9 and CECL credit loss reserving, and credit risk practices.
Blake Coules
Across 35 years in banking, Blake has gained deep insights into the inner working of this sector. Over the last two decades, Blake has been an Operating Committee member, leading teams and executing strategies in Credit and Enterprise Risk as well as Line of Business. His focus over this time has been primarily Commercial/Corporate with particular emphasis on CRE. Blake has spent most of his career with large and mid-size banks. Blake joined Moody’s Analytics in 2021 after leading the transformation of the credit approval and reporting process at a $25 billion bank.
Scott Dietz
Scott is a Director in the Regulatory and Accounting Solutions team responsible for providing accounting expertise across solutions, products, and services offered by Moody’s Analytics in the US. He has over 15 years of experience leading auditing, consulting and accounting policy initiatives for financial institutions.
Related Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.