Banks Back Ditching Special Accounting Rules for Troubled Debt

Banks back a proposal to nix special U.S. accounting requirements for breaks that they offer cash-strapped borrowers, but don’t like the idea of creating new disclosures about these breaks, they told accounting rulemakers.

The Financial Accounting Standards Board in November issued a proposal eliminating separate recognition and measurement requirements for loan modifications that qualify as so-called troubled debt restructurings. The proposal was issued in response to long-running complaints that separate accounting for troubled debt restructurings is not only time consuming and tricky, but also duplicative of new accounting that went into force for publicly traded banks in 2020.

Furthermore, ...