AICPA Issues Financial Reporting Guidance for Credit Unions


The AICPA staff issued guidance to help preparers and auditors consider the financial reporting issues resulting from recent actions taken by the National Credit Union Administration (NCUA) to stabilize the corporate credit union system.

 

The NCUA is injecting $1 billion in cash from the National Credit Union Share Insurance Fund (NCUSIF) into the U.S. Central Federal Credit Union (USC) in the form of capital. The USC and many of its member corporate credit unions made investments in asset-backed securities that became impaired.

 

The NCUA also is offering a voluntary temporary NCUSIF guarantee of member shares in corporate credit unions through Dec. 31, 2010.

 

The guidance, developed by AICPA staff and industry experts, explains how to evaluate capital investments in corporate credit unions for other-than-temporary impairment. Issued as two Technical Practice Aid question-and-answer documents, the guidance explores whether the NCUA’s actions constitute a type 1 or type 2 subsequent event with regard to the valuation of a federally insured credit union’s NCUSIF deposit at Dec. 31, 2008, and when and how the obligation for the insurance premium should be recognized for financial reporting purposes.

 

Where to find June’s flipbook issue

The Journal of Accountancy is now completely digital. 

 

 

 

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