ASC 326 provides guidance on how an entity should measure credit losses on financial instruments and comprises three Subtopics (Overall, Measured at Amortized Cost, and Available-for-Sale Debt Securities). Below is an overview of each Subtopic.
326-10 Overall
ASC 326-10 provides definitions for terms used within ASC 326 and it provides information on the transition requirements for ASU 2016-13.
326-20 Measured at Amortized Cost
ASC 326-20 provides guidance on "how an entity should measure expected credit losses on financial instruments measured at amortized cost and on leases." The guidance is applicable to financial assets measured at amortized cost, net investments in leases recognized by a lessor in accordance with ASC 842, and off-balance-sheet credit exposures not accounted for as insurance.
326-30 Available-for-Sale Debt Securities
ASC 326-30 provides guidance on "how an entity should measure credit losses on available-for-sale debt securities." The guidance is also applicable to loans that meet the definition of debt securities and are classified as available-for-sale.
