Moodys survey also reveals that data quality and applicability of models pose the biggest challenges in preparing for CECL. The full report is now available in the latest edition of Moodys Analytics Risk Perspectives, The Convergence of Risk, Finance, and Accounting: CECL . The implementation of CECL poses a range of process and methodological challenges for banks. It requires an interdisciplinary approach that leverages expertise from credit risk, accounting, treasury, finance, and technology teams, said Anna Krayn, Senior Director at Moodys Analytics and Editor-in-Chief of Risk Perspectives. Given the potential impact of CECL on earnings and capital, firms must understand the changes required to transition to the new standard and put implementation plans in place ahead of the launch date. With staggered adoption of the CECL standard scheduled to begin in 2019 many institutions expect a major effort to prepare for the new accounting regime. All but the largest banks in the Moodys Analytics survey anticipate challenges related to quantity and quality of data, and in applying life-of-loan loss models. Banks with over $50 billion in assets expect more significant impacts to reporting under CECL. With a more complex stakeholder landscape, larger banks have to manage multiple, overlapping reporting requirements, presenting more compliance challenges.

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