Download This PaperBenefits and Challenges of the “CECL” Approach
12 Pages Posted: 4 Feb 2025
Date Written: March 08, 2019
Abstract
This note provides an overview of the Current Expected Credit Loss ("CECL") accounting approach for credit losses. It also discusses the potential benefits and challenges of the CECL approach to financial institutions and users of their financial statements.
Keywords: accounting standards; CECL; current expected credit losses; procyclicality; incurred loss; allowance for credit losses; loans; debt securities; financial modelling
Suggested Citation: Suggested Citation
Walker, Michael, Benefits and Challenges of the “CECL” Approach (March 08, 2019). FRB of Boston Supervisory Research & Analysis Unit Notes No. 2019-01, Available at SSRN: https://ssrn.com/abstract=5124207 or http://dx.doi.org/10.2139/ssrn.5124207
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