The US Financial Accounting Standards Board (FASB) aims to expand information on certain loan refinancings, restructurings, and write-offs through a proposed Accounting Standard Update released on November 23.
The changes would affect troubled debt restructurings and public business entity “vintage disclosures” (i.e., disclosure requirements to present financing receivable information by year of origination).
For troubled debt restructurings, the guidance would eliminate certain existing accounting guidance for such restructurings by creditors while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. The changes respond to feedback that the troubled debt restructuring designation has not been useful.
Regarding vintage disclosures, the updates would require public business entities to disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases.
Feedback on the proposal will be accepted until December 23.
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