CECL Standard Expected to Make A Major Impact

Jonathan Jacobs, Managing Director in Duff & Phelps’ Valuation Advisory Services practice and Jennifer Press and John Schrader, Managing Directors in Duff & Phelps’ Alternative Asset Advisory practice recently shared their views on the FASB issued Accounting Standard Update (ASU) 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), which requires a new method for recognizing credit losses. This new method is referred to as the current expected credit loss (CECL) method.

CECL represents a significant change from prior GAAP, which is still used by most entities. Under prior GAAP, loss reserves are recognized when it is probable a loss has already been incurred. The CECL method requires the recognition of all losses expected over the life of a financial instrument upon origination or purchase of the instrument, unless the company elects to recognize such instruments at fair value with changes in profit and loss (the fair value option).

Public companies that are not included as smaller reporting companies will require to implement CECL in fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Other entities are permitted to wait until their first fiscal year beginning after December 15, 2022.

Read the full story here.

2019-11-19T00:00:00.0000000 0001-01-01T00:00:00.0000000 /about-us/news/cecl-standard-expected-make-major-impact /-/media/assets/images/news/featured-images/2019/cecl-standard-expected-major-impact.ashx news {B062D54C-1425-4A04-8F9F-95EA14068E6D} {E010DCD9-B7BA-4B98-9F3C-A51506B5C1D8} {5BF06FE7-E88C-4627-A701-3E042F076F1F} {502FDC26-D8B6-47FD-B273-79319899D636}

Related Services

Valuation Advisory

Valuation and consulting for financial reporting, federal, state and local tax, investment and risk management purposes.

Valuation Advisory

Valuation Services

Objective valuations for financial reporting, tax and management planning purposes.

Valuation Services

Alternative Asset Advisory

Transparent valuations of illiquid investments and complex securities and liquidity solutions through secondary market transactions.

Alternative Asset Advisory

News