An entity shall provide information that enables a financial statement user to do both of the following:- a
- b
Assess the quantitative and qualitative risks arising from the credit quality of its financial assets.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1For interim and annual reporting periods, an entity shall provide information that enables a financial statement user to do both of the following:- a
- b
Assess the quantitative and qualitative risks arising from the credit quality of its financial assets.
To meet the objectives in paragraph 326-20-50-4, an entity shall provide quantitative and qualitative information by class of financing receivable and major security type about the credit quality of financial assets within the scope of this Subtopic (excluding off-balance-sheet credit exposures and repurchase agreements and securities lending agreements within the scope of Topic 860), including all of the following:- a
- b
- c
For each credit quality indicator, the date or range of dates in which the information was last updated for that credit quality indicator.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1To meet the objectives in paragraph 326-20-50-4, an entity shall provide quantitative and qualitative information in interim and annual reporting periods by class of financing receivable and major security type about the credit quality of financial assets within the scope of this Subtopic (excluding off-balance-sheet credit exposures and repurchase agreements and securities lending agreements within the scope of Topic 860), including all of the following:- a
- b
- c
For each credit quality indicator, the date or range of dates in which the information was last updated for that credit quality indicator.
When disclosing credit quality indicators of financing receivables and net investment in leases (except for reinsurance recoverables and funded or unfunded amounts of line-of-credit arrangements, such as credit cards), a public business entity shall present the amortized cost basis within each credit quality indicator by year of origination (that is, vintage year). For purchased financing receivables and net investment in leases, an entity shall use the initial date of issuance to determine the year of origination, not the date of acquisition. For origination years before the fifth annual period, a public business entity may present the amortized cost basis of financing receivables and net investments in leases in the aggregate. For interim-period disclosures, the current year-to-date originations in the current reporting period are considered to be the current-period originations. A public business entity shall present the gross writeoffs recorded in the current period, on a current year-to-date basis, for financing receivables and net investments in leases by origination year. For origination years before the fifth annual period, a public business entity may present the gross writeoffs in the current period for financing receivables and net investments in leases in the aggregate. The requirement to present the amortized cost basis within each credit quality indicator by year of origination is not required for an entity that is not a public business entity. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1When disclosing credit quality indicators of financing receivables and net investment in leases (except for reinsurance recoverables and funded or unfunded amounts of line-of-credit arrangements, such as credit cards), a public business entity shall present the amortized cost basis within each credit quality indicator by year of origination (that is, vintage year) in interim and annual reporting periods. For purchased financing receivables and net investment in leases, an entity shall use the initial date of issuance to determine the year of origination, not the date of acquisition. For origination years before the fifth annual period, a public business entity may present the amortized cost basis of financing receivables and net investments in leases in the aggregate. For interim-period disclosures, the current year-to-date originations in the current reporting period are considered to be the current-period originations. A public business entity shall present the gross writeoffs recorded in the current period, on a current year-to-date basis, for financing receivables and net investments in leases by origination year. For origination years before the fifth annual period, a public business entity may present the gross writeoffs in the current period for financing receivables and net investments in leases in the aggregate. The requirement to present the amortized cost basis within each credit quality indicator by year of origination is not required for an entity that is not a public business entity.For the purpose of the disclosure requirement in paragraph 326-20-50-6, a public business entity shall present the amortized cost basis of line-of-credit arrangements that are converted to term loans in a separate column (see Example 15 in paragraph 326-20-55-79). A public business entity shall disclose in each reporting period, by class of financing receivable, the amount of line-of-credit arrangements that are converted to term loans in each reporting period and the total of these financing receivables that were written off in the current reporting period in accordance with paragraph 326-20-50-6. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1For the purpose of the disclosure requirement in paragraph 326-20-50-6, a public business entity shall present the amortized cost basis of line-of-credit arrangements that are converted to term loans in a separate column (see Example 15 in paragraph 326-20-55-79). A public business entity shall disclose in each interim and annual reporting period, by class of financing receivable, the amount of line-of-credit arrangements that are converted to term loans in each reporting period and the total of these financing receivables that were written off in the current reporting period in accordance with paragraph 326-20-50-6.Except as provided in paragraph 326-20-50-6A, a public business entity shall use the guidance in paragraphs when determining whether a modification, extension, or renewal of a financing receivable should be presented as a current-period origination. A public business entity shall use the guidance in paragraphs when determining whether a lease modification should be presented as a current-period origination. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1Except as provided in paragraph 326-20-50-6A, for interim and annual reporting periods, a public business entity shall use the guidance in paragraphs when determining whether a modification, extension, or renewal of a financing receivable should be presented as a current-period origination. A public business entity shall use the guidance in paragraphs when determining whether a lease modification should be presented as a current-period origination.If an entity discloses internal risk ratings, then the entity shall provide qualitative information on how those internal risk ratings relate to the likelihood of loss.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1If an entity discloses internal risk ratings, then the entity shall provide qualitative information in interim and annual reporting periods on how those internal risk ratings relate to the likelihood of loss. The requirements to disclose credit quality indicators in paragraphs do not apply to receivables measured at the lower of amortized cost basis or fair value, or trade receivables due in one year or less, except for credit card receivables, that result from revenue transactions within the scope of Topic 605 on revenue recognition or Topic 606 on revenue from contracts with customers. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1The requirements to disclose credit quality indicators in paragraphs for interim and annual reporting periods do not apply to receivables measured at the lower of amortized cost basis or fair value, or trade receivables due in one year or less, except for credit card receivables, that result from revenue transactions within the scope of Topic 605 on revenue recognition or Topic 606 on revenue from contracts with customers.An entity shall provide information that enables a financial statement user to do the following:- a
Understand management's method for developing its allowance for credit losses
- b
Understand the information that management used in developing its current estimate of expected credit losses
- c
Understand the circumstances that caused changes to the allowance for credit losses, thereby affecting the related credit loss expense (or reversal) reported for the period.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1For interim and annual reporting periods, an entity shall provide information that enables a financial statement user to do the following:- a
Understand management's method for developing its allowance for credit losses
- b
Understand the information that management used in developing its current estimate of expected credit losses
- c
Understand the circumstances that caused changes to the allowance for credit losses, thereby affecting the related credit loss expense (or reversal) reported for the period.
To meet the objectives in paragraph 326-20-50-10, an entity shall disclose all of the following by portfolio segment and major security type:- a
A description of how expected loss estimates are developed
- b
A description of the entity's accounting policies and methodology to estimate the allowance for credit losses, as well as a discussion of the factors that influenced management's current estimate of expected credit losses, including:
- 1
Past events
- 2
Current conditions
- 3
Reasonable and supportable forecasts about the future.
- c
A discussion of risk characteristics relevant to each portfolio segment
- d
A discussion of the changes in the factors that influenced management's current estimate of expected credit losses and the reasons for those changes (for example, changes in portfolio composition, underwriting practices, and significant events or conditions that affect the current estimate but were not contemplated or relevant during a previous period)
- e
Identification of changes to the entity's accounting policies, changes to the methodology from the prior period, its rationale for those changes, and the quantitative effect of those changes
- f
Reasons for significant changes in the amount of writeoffs, if applicable
- g
A discussion of the reversion method applied for periods beyond the reasonable and supportable forecast period
- h
The amount of any significant purchases of financial assets during each reporting period - i
The amount of any significant sales of financial assets or reclassifications of loans held for sale during each reporting period.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1To meet the objectives in paragraph 326-20-50-10, an entity shall disclose all of the following by portfolio segment and major security type in interim and annual reporting periods: - a
A description of how expected loss estimates are developed
- b
A description of the entity's accounting policies and methodology to estimate the allowance for credit losses, as well as a discussion of the factors that influenced management's current estimate of expected credit losses, including:
- 1
Past events
- 2
Current conditions
- 3
Reasonable and supportable forecasts about the future.
- c
A discussion of risk characteristics relevant to each portfolio segment
- d
A discussion of the changes in the factors that influenced management's current estimate of expected credit losses and the reasons for those changes (for example, changes in portfolio composition, underwriting practices, and significant events or conditions that affect the current estimate but were not contemplated or relevant during a previous period)
- e
Identification of changes to the entity's accounting policies, changes to the methodology from the prior period, its rationale for those changes, and the quantitative effect of those changes
- f
Reasons for significant changes in the amount of writeoffs, if applicable
- g
A discussion of the reversion method applied for periods beyond the reasonable and supportable forecast period
- h
The amount of any significant purchases of financial assets during each reporting period - i
The amount of any significant sales of financial assets or reclassifications of loans held for sale during each reporting period.
Paragraph 326-20-45-3 explains that a creditor that measures expected credit losses based on a discounted cash flow method is permitted to report the entire change in present value as credit loss expense (or reversal of credit loss expense) but also may report the change in present value attributable to the passage of time as interest income. Creditors that choose the latter alternative shall disclose the amount recorded to interest income that represents the change in present value attributable to the passage of time. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1Paragraph 326-20-45-3 explains that a creditor that measures expected credit losses based on a discounted cash flow method is permitted to report the entire change in present value as credit loss expense (or reversal of credit loss expense) but also may report the change in present value attributable to the passage of time as interest income. Creditors that choose the latter alternative shall disclose the amount recorded to interest income that represents the change in present value attributable to the passage of time in interim and annual reporting periods.(P) December 16, 2025; (N) December 16, 2025
326-10-65-6An entity shall disclose that it has elected the practical expedient described in paragraphs or, for an entity other than a public business entity, that it has elected both the practical expedient and the accounting policy election described in paragraphs . (P) December 16, 2025; (N) December 16, 2025
326-10-65-6In annual reporting periods, an entity other than a public business entity that has elected the accounting policy described in paragraphs shall disclose the date through which it has considered subsequent collection activity.Furthermore, to enable a financial statement user to understand the activity in the allowance for credit losses for each period, an entity shall separately provide by portfolio segment and major security type the quantitative disclosures of the activity in the allowance for credit losses for financial assets within the scope of this Subtopic, including all of the following:- a
The beginning balance in the allowance for credit losses
- b
Current-period provision for expected credit losses
- c
- d
Writeoffs charged against the allowance
- e
Recoveries collected
- f
The ending balance in the allowance for credit losses.
(P) December 16, 2026; (N) December 16, 2026
220-40-65-1Furthermore, to enable a financial statement user to understand the activity in the allowance for credit losses for each period, an entity shall separately provide by portfolio segment and major security type the quantitative disclosures of the activity in the allowance for credit losses for financial assets within the scope of this Subtopic, including all of the following:- a
The beginning balance in the allowance for credit losses
- b
Current-period provision for expected credit losses
- c
- d
Writeoffs charged against the allowance
- e
Recoveries collected
- f
The ending balance in the allowance for credit losses.
See paragraphs for additional disclosure requirements. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1Furthermore, to enable a financial statement user to understand the activity in the allowance for credit losses for each period, an entity shall separately provide by portfolio segment and major security type the quantitative disclosures of the activity in the allowance for credit losses for financial assets within the scope of this Subtopic, including all of the following in interim and annual reporting periods: - a
The beginning balance in the allowance for credit losses
- b
Current-period provision for expected credit losses
- c
- d
Writeoffs charged against the allowance
- e
Recoveries collected
- f
The ending balance in the allowance for credit losses.
See paragraphs for additional disclosure requirements.To enable a financial statement user to understand the extent of financial assets that are past due, an entity shall provide an aging analysis of the amortized cost basis for financial assets that are past due as of the reporting date, disaggregated by class of financing receivable and major security type. An entity also shall disclose when it considers a financial asset to be past due. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1To enable a financial statement user to understand the extent of financial assets that are past due, an entity shall provide an aging analysis of the amortized cost basis for financial assets that are past due as of the reporting date, disaggregated by class of financing receivable and major security type. An entity also shall disclose when it considers a financial asset to be past due. The disclosures in this paragraph are required in interim and annual reporting periods.The requirements to disclose past-due status in paragraph 326-20-50-14 do not apply to receivables measured at the lower of amortized cost basis or fair value, or trade receivables due in one year or less, except for credit card receivables, that result from revenue transactions within the scope of Topic 605 on revenue recognition or Topic 606 on revenue from contracts with customers. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1The requirements to disclose past-due status in paragraph 326-20-50-14in interim and annual reporting periods do not apply to receivables measured at the lower of amortized cost basis or fair value, or trade receivables due in one year or less, except for credit card receivables, that result from revenue transactions within the scope of Topic 605 on revenue recognition or Topic 606 on revenue from contracts with customers.To enable a financial statement user to understand the credit risk and interest income recognized on financial assets on nonaccrual status, an entity shall disclose all of the following, disaggregated by class of financing receivable and major security type:- a
The amortized cost basis of financial assets on nonaccrual status as of the beginning of the reporting period and the end of the reporting period - b
The amount of interest income recognized during the period on nonaccrual financial assets
- c
The amortized cost basis of financial assets that are 90 days or more past due, but are not on nonaccrual status as of the reporting date
- d
The amortized cost basis of financial assets on nonaccrual status for which there is no related allowance for credit losses as of the reporting date.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1To enable a financial statement user to understand the credit risk and interest income recognized on financial assets on nonaccrual status, an entity shall disclose all of the following, disaggregated by class of financing receivable and major security type, in interim and annual reporting periods: - a
The amortized cost basis of financial assets on nonaccrual status as of the beginning of the reporting period and the end of the reporting period - b
The amount of interest income recognized during the period on nonaccrual financial assets
- c
The amortized cost basis of financial assets that are 90 days or more past due, but are not on nonaccrual status as of the reporting date
- d
The amortized cost basis of financial assets on nonaccrual status for which there is no related allowance for credit losses as of the reporting date.
An entity's summary of significant accounting policies for financial assets within the scope of this Subtopic shall include all of the following:- a
Nonaccrual policies, including the policies for discontinuing accrual of interest, recording payments received on nonaccrual assets (including the cost recovery method, cash basis method, or some combination of those methods), and resuming accrual of interest, if applicable
- b
The policy for determining past-due or delinquency status
- c
The policy for recognizing writeoffs within the allowance for credit losses.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1For interim and annual reporting periods, an entity's summary of significant accounting policies for financial assets within the scope of this Subtopic shall include all of the following:- a
Nonaccrual policies, including the policies for discontinuing accrual of interest, recording payments received on nonaccrual assets (including the cost recovery method, cash basis method, or some combination of those methods), and resuming accrual of interest, if applicable
- b
The policy for determining past-due or delinquency status
- c
The policy for recognizing writeoffs within the allowance for credit losses.
The requirements to disclose nonaccrual status in paragraphs do not apply to receivables measured at lower of amortized cost basis or fair value, or trade receivables due in one year or less, except for credit card receivables, that result from revenue transactions within the scope of Topic 605 on revenue recognition or Topic 606 on revenue from contracts with customers. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1The requirements to disclose nonaccrual status in paragraphs in interim and annual reporting periods do not apply to receivables measured at lower of amortized cost basis or fair value, or trade receivables due in one year or less, except for credit card receivables, that result from revenue transactions within the scope of Topic 605 on revenue recognition or Topic 606 on revenue from contracts with customers.In addition to disclosures required by other Topics, an entity shall disclose a description of the accounting policies and methodology the entity used to estimate its liability for off-balance-sheet credit exposures and related charges for those credit exposures. Such a description shall identify the factors that influenced management's judgment (for example, historical losses, existing economic conditions, and reasonable and supportable forecasts) and a discussion of risk elements relevant to particular categories of financial instruments.