FASB Accounting Standards Update (ASU), Financial Instruments – Credit Losses (Sub Topic 326)

Published: Jan 14, 2025

TXCPA’s Professional Standards Committee supports the proposed ASU simplifying credit loss accounting, urging broader application for consistency, clear disclosures, and early adoption to cut costs and improve usability.

    The Texas Society of CPAs' Professional Standards Committee (PSC) expressed support for the proposed Accounting Standards Update (ASU) to simplify credit loss accounting for current accounts receivable and contract assets under Topic 606. The PSC praised the Private Company Council's efforts and recommended extending the amendments to include public companies, not-for-profits, and other entities to enhance consistency and simplicity. They emphasized the importance of applying the proposed rules to various transactions, including accounts receivable acquired in business combinations, to avoid counterintuitive results. The PSC supported clear disclosure requirements, prospective transition, and early adoption, believing the amendments would reduce costs and improve the usability of financial information.

    Read the full comment letter here. View TXCPA PSC comment letter here.

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