The U.S. accounting rulemaker plans to meet April 8 to discuss pressing accounting questions related to the new coronavirus pandemic.
The Financial Accounting Standards Board didn’t mention the current expected credit losses (CECL) accounting standard by name in its announcement Wednesday evening. But the sudden intervention of Congress into the biggest change to bank accounting in decades is already a top concern for businesses and accountants.
The sweeping coronavirus relief package (H.R. 748) President Donald Trump signed Friday contains a provision overriding FASB’s deadline for new rules on estimating losses on souring loans. The legislation gives banks the option to delay implementing CECL until Dec. 31 or until public health authorities declare the national state of emergency over, whichever is earlier. Large publicly traded banks were supposed to adopt the new rules on Jan. 1.
- FASB also plans to discuss accounting for loan modifications called troubled debt restructurings as well as modifying leases.
- In addition, the board expects to discuss requests to delay when businesses must comply with new accounting standards.
- In March, the American Council of Life Insurers asked FASB to give more time to insurance companies to follow a new insurance accounting standard aimed at long-term insurance like life and disability. Large, publicly traded Insurers are scheduled to adopt the new rules in 2022. All others have until 2024.
- On Wednesday, citing “extraordinary times” and the economic fallout from the pandemic, the Association of General Contractors of America asked FASB to delay by one year the date by which privately held companies have to overhaul how they account for leases. Private companies are due to start reporting lease liabilities on their balance sheets in 2021.