6SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr Financial Accounting Standards Board (FASB) has issued a new accounting standard called Current Expected Credit Loss (CECL) that will go into effect December 15, 2021. Here are three steps you can take to ensure your credit union is on track to stay compliant with this new standard. Assess your data collection and infrastructureSet aside at least several months – even up to a year – to ensure you have time to analyze your data and infrastructure and start collecting the data you need to determine the credit profile of your credit union. Not only is this step the hardest and costliest to adjust, but many of the CECL models require data that credit unions have not been collecting nor saving.Choose the CECL model that fits your needsCarefully evaluate which CECL model is best for your credit union – there is no one size fits all solution. There are a range of CECL models with differing complexities, data limitations and assumptions that you’ll need to consider while taking in account the loan portfolio of your credit union.Test your CECL model and make necessary adjustmentsOnce you select your CECL model, don’t stop there. Test your model by running data to determine if the results match your expectations and risk profile. If the data generated does not meet your expectations, then you will need to reassess and adjust how loans are marked. You’ll also want have procedures in place for handling these new reports to streamline work processes. While these steps will help you on your way to confidently implementing CECL at your credit union, they are complex. Gain confidence by attending CUNA Current Expected Credit Loss (CECL) School or eSchool, you can learn everything that goes into each of these steps to help make your transition smoother and create an action plan to take back to your credit union.