FASB talks credit-loss proposal with NAFCU reps
Oct. 24, 2013 – The Financial Accounting Standards Board discussed the board’s proposed credit-loss proposal by teleconference last week with NAFCU’s Regulatory Committee and staff.
The Regulatory Committee includes 25 NAFCU member credit union representatives and is chaired by At-Large Director Cutler Dawson, president and CEO of Navy FCU. It has a direct role in shaping NAFCU’s policy on regulations affecting members.
This May, NAFCU told FASB its proposed statement of accounting standards on credit losses – which would replace the current credit-loss impairment model with an expected loss model – would be difficult and costly for credit unions to implement. In a comment letter, NAFCU said the proposal would:
NAFCU said credit unions don’t have the resources required to project credit losses as envisioned by FASB. Carrie Hunt, the association’s senior vice president of government affairs and general counsel, said preventing implementation of this proposal remains a “key priority” of NAFCU’s regulatory affairs program.
- result in an increase in credit unions’ allowances, misleading members and possibly affecting regulatory capital requirements; and
- impose significant costs on credit unions by requiring increased data collection and triggering added costs for recording systems and the hiring and training of personnel to conduct forecasts.
NAFCU says FASB proposal too burdensome