CHICAGO (Feb. 13, 2018) –Baker Tilly Virchow Krause, LLP (Baker Tilly) and MIAC Analytics recently conducted a flash poll of depository institutions. Of those indicating the new standard is applicable, over two thirds specified their institution has not started preparation or is only beginning to implement the Financial Accounting Standards Board’s (FASB) Accounting Standard Update (ASU) 2016-13 Financial Instruments (Topic 326) – Measurement of Credit Losses on Financial Instruments. ASU 2016-13 is commonly referred to as the current expected credit loss (CECL) standard.
“No matter what size the institution, its paramount organizations begin implementing CECL,” Ivan Cilik, CPA, partner in Baker Tilly’s specialized financial services practice, said.
“An array of new governance policies and processes will be required as a result of CECL,” MIAC Analytics’ Structured Products Group Managing Director Dean Hurley, JD, MBA, said. “Although functional areas of banking institutions such as finance, originations, credit, operations and technology tend to operate separately, cross coordination among these areas will be necessary to meet the information and system requirements.”
“While going through the CECL implementation process, we recommend institutions not only provide updates to their audit committee, but to also have discussions with their auditor,” Cilik added. “Proactive and open communication will help identify areas early on where stakeholders may challenge an institution’s interpretation of the new standard.”
Baker Tilly and MIAC Analytics, a provider of valuation, transaction and software solutions, recently held an educational webinar, “CECL: 2017 financial statement requirements,” to assist depository and lending institutions in understanding what their organizations should do in 2018 to prepare for the standard’s Dec. 15, 2019 effective date.
The webinar presenters discussed:
Presentation slides and a recording of the webinar are available at bakertilly.com/insights/cecl-2017-financial-statement-requirements/.
Founded in 1989, MIAC Analytics a nationally recognized preferred provider of whole loan valuation and hedging software, MIAC Analytics™, MSR and whole loan brokerage services, secondary market risk management, DFAST, ALM and CECL solutions. MIAC Analytics is relied upon by both private and governmental entities to provide clear solutions to risk issues they face.
Baker Tilly US, LLP (Baker Tilly) is a leading advisory, tax and assurance firm whose specialized professionals guide clients through an ever-changing business world, helping them win now and anticipate tomorrow. Headquartered in Chicago, Baker Tilly, and its affiliated entities, have operations in North America, South America, Europe, Asia and Australia. Baker Tilly is an independent member of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 145 territories, with 34,700 professionals. The combined worldwide revenue of independent member firms is $3.6 billion. Visit bakertilly.com or join the conversation on LinkedIn, Facebook and Twitter.