“The new standard is intended to provide users of financial statements with more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. It improves the accounting model to better meet the requirements of today’s complex economic environment.”
FASB Chairman Russell G. Golden / January 5, 2016
On January 5, the Financial Accounting Standards Board (FASB) issued a new Accounting Standards Update (ASU) – the Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. According to FASB, the update is intended to improve the reporting model for financial instruments, giving users of the financial statements with more practical information. The ASU mandates a number of items that affect banks, with implementation set for 2017 for public companies and 2018 comprehensively.
Changes Imposed by the FASB Accounting Standards Update
While all of the following changes are relevant and must be addressed by the deadline, the first three in particular warrant special attention for private and public banks.
For the majority of banks in the country, the changes listed above could have a significant impact on your accounting and financial reporting function, your investment decisions, and ultimately your shareholders. There are a few other ASU topics that may be lower in priority to your bank, but still warrant mention. If you need additional information around any of the following points, please do not hesitate to contact the HORNE Banking team.
The FASB updates have a host of implications for privately held and public companies. We recommend that you stay connected and subscribe to the HORNE Banking blog because we will continue to proactively monitor, report and explain regulatory updates that impact your organization.
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