Course detail

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Contents

• Introduction
• Prerequisites
  
• Course Level
  
• Topics
  
• Course Benefits
  
• Teaching Method
  
• Continuing Professional Education
  
• Venue
  
  

Introduction

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The recent credit crisis has resulted in an increasing spotlight on financial institution accounting practices. In response, the Financial Accounting Standards Board (FASB) has issued and proposed several new standards and is proposing changes to others. Utilizing a highly interactive format, this course provides a comprehensive overview of the effects that the current and impending standards have on the financial statements of financial institutions. In addition, proposed standards will be reviewed based on the FASB’s agenda.

This two-day program offers invaluable guidance in meeting current and likely future US GAAP rules and disclosure requirements. Coverage includes lending and repossessed assets, accounting implications of regulatory requirements, disclosures, and fair value measurement. The current and proposed impairment models for financial instruments are explained. Numerous examples and illustrations are provided, including how to identify and account for TDRs, retained servicing, loan commitments and financial guarantees, loan impairment, and derivatives and hedging. Where applicable, the aforementioned GAAP accounting rules are contrasted with those under IFRS.

The theory and application of the standards is demonstrated with illustrative examples, complemented by application of the standards in an interactive group environment utilizing case studies, model financial statements, practical exercises and break-out sessions.

This course answers questions such as:

• What are the current and likely future US GAAP reporting requirements for financial institutions?

• What are the current impairment models for financial instruments?

• What are the accounting requirements for loan losses, repossessed assets, and fee income?

• What are troubled debt restructurings and how are they evaluated for impairment?

• What rules apply to the recognition, measurement, impairment, and de-recognition of financial instruments?

• How are the disclosure requirements for investment securities and the credit quality of financing receivables met in practice?

Prerequisites

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Some familiarity with financial reporting for banks or other financial institutions under US GAAP. No advance preparation is required for this course.

Course Level

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Intermediate

Topics

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• Applying Current GAAP Applicable to Financial Institutions
• Financial Instruments
• Classification and reclassification of financial instruments
• Fair value option
• Fair value measurement
• Recognition and measurement
• De-recognition (including retained servicing and REPOs)
• Financial guarantees
• Loan commitments
• Loans Receivable
• Recognition and measurement
• Fee income and loan origination costs
• Troubled Debt Restructurings
• Impairment and the allowance for loan losses
• Other Real Estate Owned and Repossessed assets
• Mortgage banking activities – mortgage servicing rights and interest rate lock commitments
• Derivatives and Hedging
• Accounting for derivatives and embedded derivatives
• Overview of accounting for the three types of hedges (cash flow, fair value, and net investment)
• Hedge accounting documentation requirements
• Termination of hedge accounting
• Financial Statements
• Financial statement presentation
• Review and practical application investment security disclosure requirements
• Review and practical application of credit quality disclosure requirements
• Review of real world and model GAAP financial statements
• Brief Comparison of GAAP and IFRS Requirements
• Future Developments: Financial Instrument project, Financial statement presentation project

Course Benefits

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• Classify and measure financial assets
• Prepare the quantitative and qualitative disclosures for investment securities
• Calculate impairment of loans and other financial assets, including in-depth discussion of common practices in estimating an allowance for loan losses
• Identify troubled debt restructurings and perform impairment calculations
• Differentiate embedded derivatives between those that must be accounted separately and those that do not require separation from their host instruments
• Apply the stringent requirements for hedge accounting
• Plan for changes in accounting and disclosure requirements by identifying likely future GAAP changes affecting financial institutions

Teaching Method

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• Live group instruction and interactive participation
• Description and explanation of GAAP technical requirements in clear and simple language
• Real-world financial statements of financial institutions to demonstrate GAAP presentation and disclosure requirements
• Case studies:
• Recognition, measurement and fair value adjustments for financial instruments
• Identify and record impairment on Troubled Debt Restructurings
• Determination of impairment for loans and investments
• Exercises to provide hands-on application practice
• Active participation is encouraged
• All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials

Bring This Course In House

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To bring this course in-house please contact us and we will be pleased to assist.

Continuing Professional Education (CPE)

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16 hours

Venue

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All of our Miami seminars take place in 4 star professional conference facilities, usually in city-centre downtown hotels like the Marriott, Sheraton or Hilton brands. Detailed Joining Instructions are generally sent to all registered participants approximately one month before the event, which include exact venue details and nearby (or onsite) hotel recommendations with bedroom rates where available. Coffee and lunch will be provided. .