Ongoing education about the project status, changes
“For most board updates, your goal is continuing education,” Camp said. “It’s ‘Here’s what we’ve done and here’s where we are in the process.’ At this stage, there are things that the board should be updated on regularly that are task-related.” As important as it is to describe to the board what’s already accomplished in the CECL transition, it’s also critical to make directors aware of what remains to be tackled, as board members likely need continued review of program requirements.
This is especially important considering the timeline for CECL implementation has been pushed out since the standard was first issued. Boards must be mindful of the limited time available to complete model selection, parallel testing, and everything else related to the transition.
'Clock is ticking'
“As recently as the CARES Act, Congress gave filers an optional delay,” Camp said. “So financial institutions need to keep their ears open for potential changes in the timeline, but also not rest their hats on there being another delay. The clock is ticking, and this isn’t something [standard-setters are] going to pull."
Financial institutions are going to be held accountable for what they did with the time they’ve had, he said. "We’ve had this standard since 2016, and while there have been bumps in the timeline, delays have not been to give people more time to procrastinate.”