Removing Barriers Blog

FASB Releases Final Update Delaying CECL Effective Date
Posted November 16, 2018 by CUNA Advocacy

Yesterday, the Financial Accounting Standards Board (FASB) released an update amending the CECL effective date for credit unions and other non-public business entities (PBE). The update formalizes CUNA-backed changes adopted by FASB in October, which push the effective date for non-PBEs from fiscal years beginning after 12/15/2020 to 12/15/2021. In addition to providing additional time to make necessary system modifications, this change aligns the implementation date for annual financial statements with the implementation date for interim financial statements.

In May, CUNA strongly urged FASB to pursue changes to delay the effective date for non-PBEs. This summer, FASB agreed with our concerns and proposed such changes. In our comment letter on the proposal, we reiterated support for delaying the effective date and restated our long-standing position that application of CECL to credit unions is inappropriate. 

While delay of the CECL effective date is a victory, we are well-aware of continuing challenges credit unions are facing regarding not only compliance with the standard but also the financial impact this new method of calculating credit losses may have on credit unions. As such, we remain engaged on this issue and are active with both NCUA and FASB to determine where we might be able to achieve some relief for credit unions.