Wiley GAAP 2019

22ASC 326 FINANCIAL INSTRUMENTS—CREDIT LOSSES

PERSPECTIVE AND ISSUES

Technical Alert

ASU 2017-03.

See the Technical Alert in the chapter on ASC 250 for information on SEC pre-adoption disclosures for this new standard.

ASU 2016-13.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments. This ASU makes changes to several topics, and adds a new topic—ASC 326.

Effective Date

The ASU is effective:

• For public business entities that meet the definition of an SEC filer, annual periods beginning after December 15, 2019, and interim periods therein.
• For other public business entities, annual periods beginning after December 15, 2020, and interim periods therein.
• For all other entities, annual periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021.

Early adoption is allowed for all entities for fiscal years beginning after December 15, 2018, including interim periods therein.

Transition

Except where noted in the table below, entities should use modified-retrospective approach and record a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period that the entity adopts the guidance. For example, a calendar-year private company that adopts the standard in 2021 records the cumulative effect adjustment on January 1, 2020.

Prospective Transition Approach Required
Circumstance	Accounting ...