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Banks wrangle models, data in early stages of CECL prep

Tammy Whitehouse | August 22, 2017

While the majority of public companies are dealing with revenue recognition and lease accounting changes coming in the next year or more, the banking sector is trying to tame an even bigger beast.

A new standard on credit impairment doesn’t take effect until 2020, but banks believe it to be a far bigger accounting change for them, commanding even more attention ahead of other big accounting changes that will happen sooner. The new standard requires banks to take a more forward-looking approach to their debt instruments and calculate a “current expected credit loss” to reflect in financial statements. The American Bankers Association characterizes it as the most sweeping change to bank accounting — ever.

The...

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