The Financial Accounting Standards Board announced Wednesday that credit unions will have an extra yearto implement soon-to-be-revealed rules regarding credit losses.

The standards setter originallyproposed its Current Expected Credit Loss rules takeeffect for fiscal years beginning after Dec. 15, 2019 for creditunions and other nonpublic business organizations. However, therules will now take effect for annual periods beginning after Dec.15, 2020, and interim periods within fiscal years beginning afterDec. 15, 2021. For public companies that file with the Securitiesand Exchange Commission, the rules will be effective for fiscalyears beginning after Dec. 15, 2019. All entities can adopt therules for fiscal years beginning after Dec. 15, 2018.

The FASB also said Wednesday that its board voted to providewhat it called “practical and transitional relief” for certainorganizations disclosing vintages.

The date shift is a win for NAFCU, which asked the FASB back inFebruary to delay the standard's implementation date in light ofthe delay in finalization, which is now expected to be next month.

“NAFCU and our members appreciate [the] FASB implementing ourrecommendation to extend the implementation date of CECL and makingsome disclosure requirements optional for credit unions,” NAFCUPresident/CEO Dan Berger said. “However, we continue to believethat an updated exposure draft on the credit losses accountingstandard should be issued for public comment prior tofinalization.”

The CECL rules incorporate a methodology that couldfundamentally change how credit unions, banks and other financialinstitutions calculate their loan loss reserves and even alter dayto day operations for credit departments. The new methodologyencourages financial institutions to, among other things, take aforward-looking approach to loans and recognize possible creditlosses earlier. CECL would apply to most debt instruments, tradereceivables, lease receivables, reinsurance receivables that resultfrom insurance transactions, financial guarantee contracts and loancommitments.

Once the final standard is issued, stakeholders will be able tosubmit potential implementation issues for discussion by the FASB'sTransition Resource Group. The FASB will evaluate each submissionand prioritize the issues for discussion at public TransitionResource Group meetings, it said.

The FASB has received more than 3,360 comment letters on its2010 and 2012 exposure drafts of the CECL rules, it said Wednesday.It also said it has participated in more than 95 meetings withfinancial statement preparers, hosted eight public roundtables,hosted 15 preparer workshops and met with more than 200 users offinancial statements.