Businesses looking to implement four new accounting standards will have a brief reprieve. During July 2019, the Financial Accounting Standards Board (FASB) voted to propose delaying the effective dates of four upcoming standards. This was a result of the large burden placed on preparers in relation to the new standards.
The new standards, which focused on lease accounting, derivatives and hedging, long-duration insurance contracts and accounting for credit losses, were significant in nature. The impact and implementation of these new standards represented a major shift in accounting methods for several organizations.
New Dates for Accounting Standard Implementation
The FASB’s proposal is as follows (all effective dates noted below are based on calendar-year-end entities):
While the exposure draft has not yet been released, it is expected to have a short comment period and is unlikely to have significant objections.
Why Your Organization Should Care About the New Accounting Standards
While several of these standards are delayed, it is still important to prepare your business in advance. These standards affect a vast majority of industries and companies of all sizes.
Many of these standards, once finalized, will have significant impact to an organization’s accounting and finance policies. The additional time given by FASB is meant to allow organizations to not only implement, but also improve their approach to the new accounting standards.
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Even though the standard is delayed, there’s still plenty to do to prepare for the new lease standard. Learn more at our webinar.