FASB proposes delay in Accounting Standards
The Financial Accounting Standards Board voted on July 17, 2019, to propose delaying the effective dates for both the leases and credit losses standards. The Board asked the FASB staff to develop an Exposure Draft delaying implementation of both standards. If approved by the Board, the Exposure Draft would be issued with 30-day comment period.
Coupled with the recent implementation of a highly challenging revenue recognition standard, FASB’s numerous new rules have created significant difficulties, especially for private companies whose financial reporting staffs have limited capacity.
If approved, the new effective date for the leases standard for calendar-year-end preparers that are not public business entities would be Jan. 1, 2021. The effective date for calendar-year-end public business entities, employee benefit plans, and not-for-profit conduit bond obligors is Jan. 1, 2019, and would remain unchanged.
For the credit losses standard (CECL), the new effective date for all calendar-year-end entities would be Jan. 1, 2023. This change would apply to smaller reporting companies, private companies, and other non-SEC filers. The effective date for calendar-year-end SEC filers, excluding smaller reporting companies as defined by the SEC, would remain Jan. 1, 2020.
