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78 e Financial Accounting Standards Board announced its unanimous decision to extend the Current Expected Credit Loss (CECL) accounting standard deadline, giving certain organizations more time to collect and store historically vast amounts of data required for CECL compliance. Most entities, including non-SEC filing public organizations, non-public business entities, and smaller SEC-filing public organizations, now have until 2023 before CECL goes into effect. (e extension did not pertain to large SEC-filing organizations, which are generally defined as having market capitalizations above $250 million. eir deadline remained January 2020.) e new accounting standard was previously scheduled to go into effect in 2020 for SEC-filing organizations, 2021 for non- SEC filing public organizations, and 2022 for non-public business entities such as community banks and credit unions. e timeline extension certainly affords much-needed relief for smaller institutions that were scrambling to prepare for CECL. However, regulators recognize that it may also encourage some to further delay their preparation. As a result, regulators have started incorporating CECL preparedness into soundness examinations. at added scrutiny may eventually increase as the industry learns from large SEC filers' CECL results and as we move closer to the 2023 deadline. TURN COMPLIANCE INTO AN OPPORTUNITY Forward-thinking institutions recognize that, with the proper methodology, the additional data required for CECL provides much deeper insights in their institution's loan portfolio and risk profile. New intelligence can be leveraged for competitive purposes as they glean clearer understandings of asset trends, risk components, and the profitability of different segments. With more detailed views, they can, for instance, implement strategic pricing and tactically promote or pull back on specific products or product groups. ose tempted to delay their CECL compliance strategies in light of the extension may risk falling short in future soundness examinations and compromise their ability to take full advantage of opportunities presented by CECL. However, effectively recognizing and acting on these opportunities can be easier said than done. ere is no one-size-fits-all methodology for fitting vast amounts of CECL data together, and methodologies can change at any moment due to external factors. Instead, testing against a range of different scenarios is needed to determine the most appropriate method for fitting the data together to optimize long-term performance. Testing against a range of "what ifs" that DON'T PUT CECL ON THE BACK BURNER An extended deadline for the Current Expected Credit Loss accounting standard deadline is no reason to delay a focus on compliance. Quick Take By: Rick Martin