NAFCU strongly supports FASB reporting decrease
Dec. 23, 2013 – NAFCU Regulatory Affairs Counsel Angela Meyster wrote the Financial Accounting Standards Board on Friday to express NAFCU’s strong support for an exposure draft proposing to eliminate certain financial reporting requirements, decreasing accounting and compliance costs for credit unions classified as development stage entities.
The proposal would remove the definition of a DSE from Topic 915, eliminating the distinction between those and other reporting entities for generally accepted accounting practices. The proposal would then remove certain reporting requirements for those classified as DSEs, including reporting on inception-to-date information on statements of income and cash flows, and on DSE activities.
“NAFCU believes that this proposal will significantly reduce accounting and compliance costs for credit unions that would be DSEs under current accounting guidance,” Meyster wrote. “NAFCU stresses that in proposing new accounting standards updates, the FASB should take into account the unique structure of credit unions as member-owned not-for-profit cooperative entities. Credit unions aim to meet their members’ needs and provide quality service, not to generate profit. Thus, every dollar they use to comply with new regulations and accounting standards is a dollar they cannot use for the greater good of their members and the communities they serve. It is therefore important that the FASB evaluate the costs and benefits of each of its proposals as it relates to credit unions.”
Meyster praised the cost-saving potential of the proposal, and noted that the loss of information to NCUA on financial statements would be minimal.