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FASB seeks public comment on proposal to delay effective dates for private and certain public companies and organizations
Written on Aug 23, 2019
FASB has issued a proposed Accounting Standards Update (ASU) that would grant private companies, not-for-profit organizations, and certain small public companies additional time to implement FASB standards on current expected credit losses (CECL), leases and hedging.
The proposed ASU describes a new FASB philosophy that extends and simplifies how effective dates for major standards are staggered between larger public companies and all other entities. Those other entities include private companies, smaller public companies, not-for-profit organizations, and employee benefit plans. Under this philosophy, a major standard would first be effective for larger public companies. For all other entities, the Board would consider requiring an effective date staggered at least two years later. Generally, it is expected that early application would continue to be permitted for all entities.
FASB proposes to amend the effective dates for CECL, leases, and hedging as follows (chart assumes calendar-year end):
Standard | SEC Filers | All Other Public Business Entities (PBEs) | Private & All Others |
Hedging | January 2019 (no change) | January 2019 (no change) | January 2020 January 2021 |
Leases | January 2019 (no change) | January 2019* | January 2020 January 2021 |
CECL | January 202 (no change except SRCs January 2023) | January 2021 January 2023 | January 2021 January 2023 |
*Also includes Employee Benefit Plans and Not-for-Profit Conduit Bond Obligors that file or furnish financial statements with or to the SEC.
Stakeholders are encouraged to review and provide comment on the proposed ASU by Sept. 16, 2019.