FASB issued the Accounting Standards Update No. 2018-19 to amend the transition requirements and scope of the credit losses standard, which was issued in 2016. The 2016 standard was issued via the Accounting Standards Update No. 2016-13, titled "Financial Instruments—Credit Losses (Topic 326)." FASB had consulted on the revision, with a 30-day comment period that ended in September 2018.
The new Accounting Standards Update mitigates transition complexity by requiring entities other than public business entities—including not-for-profit organizations and certain employee benefit plans—to implement it for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. This aligns the implementation date for their annual financial statements with the implementation date for their interim financial statements. Additionally, the Accounting Standards Update clarifies 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.
The amendments in the new Accounting Standards Update include items brought to the attention of FASB by stakeholders. The effective date and transition requirements are the same as the effective dates and transition requirements in the credit losses standard, as amended by the new Accounting Standards Update.
Keywords: Americas, US, Accounting, Banking, Accounting Standards Update, Credit Losses Standard, Topic 326, IFRS 9, FASB
Previous ArticleEIOPA Publishes Report on Use of Capital Add-Ons Under Solvency II
EU published Directive 2021/338, which amends the Markets in Financial Instruments Directive (MiFID) II and the Capital Requirements Directives (CRD 4 and 5) to facilitate recovery from the COVID-19 crisis.
The Standing Committee of the European Free Trade Association (EFTA) recommended that a systemic risk buffer level of 4.5% for domestic exposures can be considered appropriate for addressing the identified systemic risks to the stability of the financial system in Norway.
In a recent statement, PRA clarified its approach to the application of certain EU regulatory technical standards and EBA guidelines on standardized and internal ratings-based approaches to credit risk, following the end of the Brexit transition.
In a recently published letter addressed to the G20 finance ministers and central bank governors, the FSB Chair Randal K. Quarles has set out the key FSB priorities for 2021.
EU published, in the Official Journal of the European Union, a corrigendum to the revised Capital Requirements Regulation (CRR2 or Regulation 2019/876).
ESAs published a joint supervisory statement on the effective and consistent application and on national supervision of the regulation on sustainability-related disclosures in the financial services sector (SFDR).
EC published a public consultation on the review of crisis management and deposit insurance frameworks in EU.
HKMA announced that enhancements will be made to the Special 100% Loan Guarantee of the SME Financing Guarantee Scheme (SFGS) and the application period will be extended to December 31, 2021.
EBA launched consultations on the regulatory and implementing technical standards on cooperation and information exchange between competent authorities involved in prudential supervision of investment firms.
BoE issued a letter to the CEOs of eight major UK banks that are in scope of the first Resolvability Assessment Framework (RAF) reporting and disclosure cycle.