FASB Aims to Eliminate Guidance for Bad Debt Reserves Regarding Savings and Loans
A new Financial Accounting Standards Board (“FASB”) proposal seeks to replace out-of-date deferred tax guidance regarding bad debt reserves for savings and loans that began after December 31, 1987, as well as guidance concerning the Comptroller of the Currency’s Banking Circular 202, Accounting for Net Deferred Tax Charges (Circular 202).
The amendments under the Proposed Accounting Standards Update, Technical Corrections and Improvements to Topic 942, Financial Services—Depository and Lending: Elimination of Certain Guidance for Bad Debt Reserves of Savings and Loans, are similar to the technical corrections and improvements being made to clarify the FASB Accounting Standards Codification. As a result, the FASB agreed to release a separate proposal to improve awareness of the proposed changes to Topic 942, Financial Services—Depository and Lending.
Feedback on the proposal is due Monday, August 28.