CECL Model: Strategies for Accurate Credit Loss Estimation
In December 2019, the Financial Accounting Standards Board (FASB) implemented its Accounting Standards Update on Financial Instruments – Credit Losses (ASC 326), commonly known as the Current Expected Credit Loss (CECL) model. The new impairment model fundamentally changed how banks estimate losses and have significant implications for financial institutions and other entities holding financial assets and net investment in leases.
Despite being in effect for many years, many organizations are still grappling with implementing the new CECL model and perfecting their approach to comply with the accounting changes set forth in this new impairment framework. The impact on organizational processes and systems is significant, requiring technical expertise, planning, and strategic and other wide-ranging implementation considerations to implement the expected loss model.
To help professionals understand the new CECL model, its proposed implementation, and the transitional challenges, we have developed this two-day Impairment Workshop. This comprehensive course will provide a clear roadmap for implementing the new CECL model, and highlight lessons learned from previous accounting changes. We will also discuss forward-looking practical and strategic implications of Topic 326, and the regulatory and other major accounting changes affecting it.
Key Learning Features
- Understanding the CECL Model: The workshop will provide participants with a detailed understanding of the CECL model, including its scope, objective, and key components. Participants will learn about the differences between the incurred loss model and the expected credit loss model and how the new model impacts financial institutions.
- Credit Modelling: The workshop will cover credit modelling considerations for different asset classes, alternative modelling options, and the challenges of data requirements and input variables. Participants will gain hands-on experience with group case studies and examples.
- Accounting and Regulatory Impact: Participants will learn about the accounting and regulatory impact of the CECL model, including its impacts on credit risk management, profitability forecasting, and disclosures to investors. The workshop will also cover adjusting strategies to maximize return under a new element of forward-looking risk and emerging industry practices.
- Implementation Issues and Quantification Methodology: The workshop will cover implementation issues, including those related to revolving credit instruments, PCD assets for beneficial interests, reasonable expectation and use of DCF, discount rates, subsequent recoveries, zero expected credit loss factors, refinancing and prepayments, and other challenges. The workshop will also cover the quantification methodology for the CECL model, including the importance of segmentation, synergies between existing and CECL modelling, and reasonable and supportable forecasts and data. Participants will gain hands-on experience with group case studies and examples.
Overall, the CECL workshop is designed to provide participants with a comprehensive understanding of the CECL model and its impact on financial institutions. Participants will gain hands-on experience with group case studies and examples, allowing them to apply their learning to real-world situations.
For More Information
Thank you for your interest in our CECL workshop! To register or learn more about our program, please contact our customer services team. Our team is available to assist you with any questions you may have regarding the workshop, including pricing, schedule, location, and registration process. You can contact our customer services team by phone, email, or online chat. We are dedicated to providing you with all the information you need to advance your professional development and stay current with the evolving CECL standards.
Don’t miss this opportunity to stay ahead of the curve and enhance your professional skills. Contact our customer services team today to register for the CECL workshop and take the first step towards achieving your career goals.
We look forward to hearing from you!
Our trainers have specialist knowledge and first-hand experience in implementing the International Financial Reporting Standards (IFRS), International Public Sector Accounting Standards (IPSAS), Generally Accepted Accounting Principles (USGAAP), UK GAAP, Risk management strategies, Valuations, Mergers & Acquisitions, Corporate Governance, Environmental, social, and corporate governance (ESG) reporting, Supply Chain Management, Prudential regulations, Compliance matters (such as Basel regulations, Solvency II, Anti Money Laundering regulations and a number of other evolving regulatory matters) and a whole range of professional development programs (e.g., Negotiations Skills, Presentation Skills, Data Management, Python, Block-Chain, Digital Assets, Becker CPA etc.)
This ensures an engaging and stimulating learning experience for professionals and senior executives, helping to ensure knowledge is retained. They understand the accounting and regulatory requirements, risk environment, industry issues and challenges, risk management strategies, financial reporting & disclosure requirements, and compliance environment. They impart their knowledge using real-life industry examples, simple and user-friendly presentations of important concepts/approaches and case studies.
Instructor for this course
Our Partners in Learning
Session 1: Overview and Fundamentals of CECL
- Introduction to CECL and its objectives
- Comparison of Incurred Loss Model vs. Expected Credit Loss Model
- Understanding the scope and impact of CECL on financial institutions
- Limitations and drawbacks of the existing impairment model
Session 2: Credit Modelling and Data Requirements
- Modelling considerations by asset class
- Alternative modelling options, benefits, and challenges
- Data requirements and input variables for CECL modelling
- Case studies and examples to illustrate CECL modelling concepts
Session 3: CECL Implementation and Regulatory Impact
- Understanding the accounting and regulatory impact of CECL
- CECL’s impact on credit risk management and profitability forecasting
- Disclosures to investors under CECL
- Adapting strategies to maximize returns under CECL’s forward-looking risk
- Emerging industry practices and regulatory updates
Session 4: CECL Quantification and Methodology
- The importance of segmentation in loss quantification under CECL
- Synergies between the existing and CECL modelling
- Reasonable and supportable forecasts and data for CECL quantification
- Accounting for refinancing, prepayments, and subsequent recoveries under CECL
- Other issues and challenges in implementing CECL
The course agenda provided herein is the proprietary intellectual property of Shasat. It is intended solely for the use of participants enrolled in the respective course. Any reproduction, distribution, or unauthorized use of this course agenda, in whole or in part, without the explicit written consent of Shasat, is strictly prohibited and may result in legal action.
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Why you must attend?
Are you prepared for the impact of the new Current Expected Credit Loss (CECL) model on your organization? Join our CECL workshop and gain valuable insights into the new accounting standards and how they will impact your organization. This workshop is designed for professionals who are responsible for credit risk management, accounting, and financial reporting, including CFOs, CROs, internal auditors, external auditors, and risk managers.
By attending this workshop, you will learn the key components of the new CECL model, including its scope, objective, and implementation challenges. You will also gain insights into the credit modeling considerations, alternative modeling options, and data requirements needed to successfully implement the new model. Our expert instructors will guide you through a series of real-world examples and group case studies to help you understand the impact of the new accounting standards on credit risk management and profitability forecasting.
In addition, you will learn about the regulatory and accounting impact of the new CECL model, including the disclosures required for investors. Our instructors will also share best practices for adjusting your strategies to maximize return under the new element of forward-looking risk. Don’t miss this opportunity to stay ahead of the curve and learn how to successfully implement the new CECL model in your organization. Register now and join us for this comprehensive workshop.
The teaching methodology for the CECL workshop is carefully designed to ensure that you gain a deep understanding of the new CECL model and how it affects your organization. Our experienced instructors use a variety of teaching methods to make the learning experience engaging and effective. These methods include:
- Interactive Lectures: Our instructors use interactive lectures to deliver the course material in a way that allows you to learn at your own pace while also participating in discussions and asking questions.
- Real-Life Examples: Our instructors use real-life examples to help you understand how to apply the CECL model in practical scenarios. This approach enables you to see how the new standard affects your organization and prepares you to handle complex issues.
- Group Case Studies: Our instructors lead you through group case studies that challenge you to apply your knowledge of CECL to practical scenarios. This approach helps you develop critical thinking skills and prepares you to handle complex credit modeling challenges.
- Breakout Sessions: Our instructors facilitate small group discussions through breakout sessions, allowing you to interact with your peers and share insights. This approach promotes collaboration and helps you build professional connections.
- Assessments: Our instructors use assessments to test your understanding of the course material. This approach allows you to gauge your progress and identify areas where you may need additional support.
Overall, our teaching methodology is designed to help you become proficient in credit modeling and confident in your organization’s ability to implement the CECL model. We are committed to your success and will work with you every step of the way to help you achieve your goals.
Who Should Attend?
The CECL workshop is designed for a wide range of professionals in the financial industry who are involved in credit risk management, accounting, financial reporting, and auditing. This includes, but is not limited to:
- Accounting and Finance Professionals: CFOs, financial analysts, accountants, and other financial professionals who are responsible for the preparation and reporting of financial statements.
- Risk Management Professionals: Risk managers, credit analysts, and other professionals who are responsible for assessing and managing credit risk in financial institutions.
- Auditors: Internal and external auditors who are responsible for reviewing financial statements and assessing compliance with accounting and regulatory requirements.
- Regulators: Representatives from regulatory agencies who are responsible for overseeing financial institutions and ensuring compliance with regulatory requirements.
- Consultants: Professionals who provide consulting services to financial institutions on credit risk management, accounting, and financial reporting.
Whether you are new to the CECL standard or have experience with its implementation, this workshop is an excellent opportunity to deepen your understanding of the new requirements and gain practical insights into how to apply them in practice. Attendees will benefit from the expertise of experienced instructors and interact with peers from various organizations, making this workshop a valuable networking opportunity.
Upon completion of the course, all delegates will receive an evaluation questionnaire aimed at gathering valuable feedback. This feedback is crucial to Shasat’s ongoing commitment to improving the quality of its learning solutions. By analyzing the trends in the responses, we are able to continuously enhance and refine our offerings to meet the evolving needs of our clients.
Venue & other info
Our training programs take place at the most prestigious professional training facilities in the city. Our venues have been meticulously chosen and expertly crafted to deliver an unparalleled and sophisticated learning experience. To further elevate your training journey, we will offer an array of refreshments including gourmet tea/coffee, delectable snacks, and a sumptuous lunch to sustain you throughout the course. Your comfort and satisfaction are of the utmost importance to us. One week before the program begins, you will receive comprehensive joining instructions that include the exact venue details.
Please note that accommodation arrangements are the responsibility of the attendee.
Workshop Delivery (Online Programs)
The workshop will be delivered via the WebEx platform. Upon registration, all participants will receive comprehensive joining instructions for the live workshop. This fully virtual event will encompass a live-streamed presentation, personalized networking opportunities, interactive Q&A sessions, engaging polls, and post-event consultation to address specific concerns and support your continued growth.
Please be advised that for all in-person training programs, joining instructions will be sent via email to registered participants one week prior to the program’s commencement. These instructions will provide comprehensive information regarding the venue location, date, and time, as well as other important details such as parking arrangements, dress code, and any necessary equipment or materials. Kindly ensure that you carefully review the joining instructions and follow the guidelines provided to ensure a smooth and well-organized experience during the program.
Changes to the conference
Shasat reserves the right, at its sole discretion, to make modifications to the format, speakers, participants, content, venue location, program, or any other aspect of the conference, at any time and for any reason, without incurring any liability. This policy has been implemented due to recent events such as the Covid-19 pandemic and other jurisdictional restrictions. These modifications may include but are not limited to, changes necessitated by a Force Majeure Event
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Upon successful completion of the training course, each participant will receive a certificate of completion that attests to the number of hours spent in training and serves as a valuable representation of their dedication to professional development. The certificate is not only a symbol of their achievement but also serves as proof of continuous professional development (CPD) and demonstrates their commitment to staying current in their field. We believe that CPD is a crucial aspect of career advancement and personal growth, and are proud to provide our participants with this important document.
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