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Please refer to our CECL page and our Leases page for current implementation deadlines.

Today, the Financial Accounting Standards Board (FASB) issued two Accounting Standards Updates (ASUs) that finalize various effective date delays for standards on current expected credit losses (CECL), leases, hedging, and long-duration insurance contracts.

  • ASU No. 2019-10, Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates, finalizes various effective date delays for private companies, not-for-profit organizations, and certain smaller reporting companies applying the credit losses (CECL), leases, and hedging standards.
  • ASU No. 2019-09, Financial Services-Insurance (Topic 944): Effective Date, finalizes insurance standard effective date delays for all insurance companies that issue long-duration contracts, such as life insurance and annuities.

The final issued ASUs follow a two-bucket approach to stagger effective dates:

  • Bucket One includes public business entities that meet the definition of an SEC Filer, as defined by U.S. Generally Accepted Accounting Principles (GAAP), excluding entities eligible to be smaller reporting companies (SRCs) as defined by the SEC. For existing major ASUs not yet effective, the one-time determination of whether an entity is an SRC should be based on an entity's most recent determination as of November 15, 2019 (the issuance date of these Updates).
  • Bucket Two includes all other entities, such as SRCs, public business entities (PBEs) that are not SEC filers, private companies, all not-for-profit entities – including conduit bond obligors – and all employee benefit plans.

The final issued ASUs address effective dates for the following major standards:

  • For Leases and the Derivatives and Hedging standards, PBEs have already adopted and will not be provided additional time for implementation. However, the effective date for non-public business entities will be extended an additional year to January 1, 2021, for calendar year-end entities.
  • For Credit Losses (CECL), Bucket One entities will still remain effective for annual reporting and interim reporting periods beginning January 1, 2020, for calendar year-end entities. However, Bucket Two entities will be granted additional time, with an effective date beginning January 1, 2023, for calendar year-end entities.
  • For Long-Duration Insurance Contracts, Bucket One entities will be granted an additional year, with an effective date beginning January 1, 2022, for calendar year-end entities. For Bucket Two entities, the effective date will extend out to January 1, 2024, for calendar year-end entities.
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DHG is supportive of FASB's effort to provide additional time for entities to evaluate impact and effectively implement these significant accounting standards. However, despite the additional time, entities should not slow down or delay their implementation efforts. This additional time should be utilized to enhance entities' efforts to implement a robust approach in adopting these accounting standards that meets all their compliance and system needs.

For questions and more information regarding implementation efforts of these new accounting standards, reach out to us at, or contact the authors.

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