Just before the holidays, the Financial Accounting Standards Board (FASB) proposed Accounting Standards Update—Financial Instruments—Credit Losses (Subtopic 825-15) for public comment.
The proposed ASU presents “a new accounting model intended to require more timely recognition of credit losses” on loans and other financial assets held by banks, financial institutions, and other public and private organizations, says the FASB release. It should also provide additional transparency about credit risk. Stakeholders are asked to review and provide comments by April 30, 2013.
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