FASB agrees to delay CECL implementation until 2023
The Financial Accounting Standard Board agreed to delay the current expected credit loss (CECL) standard until January 2023 at its Wednesday meeting. CUNA supports the delay, but continues to have concerns about CECL, which would use an “expected loss” measurement for the recognition of credit losses.
“While a formal Board vote is still to come, based on unanimous support of the standard at today’s meeting we expect a final standard to become official in the coming weeks,” said CUNA Deputy Chief Advocacy Officer Elizabeth Eurgubian. “However, CUNA’s longstanding position has been and continues to be that application of CECL to credit unions is inappropriate, and that implementation of the new standard will create compliance challenges, as well as alter the financial standing of credit unions.”
CUNA shared its specific concerns in a September comment letter on the proposed delay, noting that CECL could hinder credit unions and other lenders’ service to low- and moderate-income borrowers.
CUNA also requested that FASB collaborate with NCUA to assist in the development of compliance resources so credit unions have sufficient guidance well ahead of the effective date.