FASB's guidance for estimating expected credit losses, ASU 326, is not definitive in its requirements for credit unions' allowance for loan and lease losses. The good news, then, is that it is unlikely NCUA examiners will ask for immediate answers as to how your credit union will calculate the reserve under CECL.
However, even if methodology decisions are a future task for credit unions, institutions do need to tackle loan-level data collection now as a first step toward compliance under future GAAP.
Data adequacy starts with evaluating data-collection methods available to the credit union, determining the quality of data that is being collected and filling any gaps that are identified.
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