Current Expected Credit Losses

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Since the issuance of ASU 2016-13 (codified in ASC 326) on June 16, 2016, the FASB has focused on implementation efforts related to the adoption of this ASU. Over the past few years, the FASB has held three transition resource group (TRG) meetings, seven public board meetings, and numerous public roundtables and credit losses workshops to discuss implementation questions raised and challenges identified by stakeholders. In response to the feedback received, the FASB has issued (as of the date of this publication) five final ASUs and one proposed ASU to amend certain aspects of ASC 326.

The body of the Roadmap combines the requirements in ASC 326 with Deloitte’s interpretations and examples in a comprehensive, reader-friendly format. We hope that this publication will help readers navigate some of the more challenging aspects of the new credit losses standard. This publication has been developed for readers who have been following every development of the standard, as well as for readers who have not been following all developments and may be working through the standard for the first time. That is, it may function as a quick resource guide for those who have a specific question and are looking for a clear answer, or it may serve as an all-encompassing guide for those who are still building up their knowledge base to lead or work through an implementation.

Although we are nearly at the beginning of the mandatory effective date for calendar-year-end public companies, challenging questions remain. Accordingly, we will continue to develop guidance that we believe will help stakeholders with their implementation challenges.

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