FASB
July 18, 2019

FASB to Propose Extension of Effective Dates for Four Key Standards

8/15/2019 Update: The Financial Accounting Standards Board (FASB) has issued an Exposure Draft that, if adopted, would extend the effective dates for three significant standards related to lease, credit loss, and hedge accounting for certain entities.  Read the FASB news release.

The Journal of Accountancy is reporting that the Financial Accounting Standards Board (FASB) will propose delaying the effective dates for four significant standards related to accounting for leases, credit losses, derivatives and hedging, and long-duration insurance contracts.  The proposed delays would most significantly benefit non-Securities and Exchange Commission (SEC) filers and private companies.  It is anticipated that the proposed delays will be included in Exposure Drafts with a 30-day comment period.  The delays would become effective only upon final issuance.

FASB’s proposed plans will include the following:

  • Lease accounting: Proposed effective date for non-public business entities would be delayed one year until fiscal years beginning after December 15, 2020, (January 1, 2021, for calendar-year-end entities). The effective date for public business entities, employee benefit plans, and not-for-profit conduit bond obligors would remain unchanged (fiscal years beginning after December 15, 2018).
  • Accounting for credit losses: Proposed effective date for all entities that are non-SEC filers would be delayed until fiscal years beginning after December 15, 2022, (January 1, 2023, for calendar-year-end entities). This delay would also apply to smaller reporting companies as defined by the SEC.
  • Derivatives and hedging: Proposed effective date for non-public business entities would be extended one year until fiscal years beginning after December 15, 2020, (January 1, 2021, for calendar-year-end entities).
  • Long-duration insurance contracts: Proposed effective date for non-public business entities would be delayed until fiscal years beginning after December 15, 2023, (January 1, 2024, for calendar-year-end entities), and fiscal years beginning after December 15, 2021, for public business entities.

For additional details surrounding FASB’s decision to propose these extensions and information regarding the preparation and comment periods for Exposure Drafts, view the entire Journal of Accountancy article.

If you have any questions about how these proposed extensions would affect your organization or have any questions related to audit and accounting, business management, or compliance, contact one of our PYA executives below at (800) 270-9629.

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