A broad-based project to update generally accepted accounting principles to better reflect an institution’s intangible assets is not needed as there is no demand for the information across all industries, the American Bankers Association said in a recent letter to the Financial Accounting Standards Board.
In U.S. GAAP, “intangible assets” is used to refer to intangible assets other than goodwill. Late last year, FASB issued a request for comment on whether it should pursue a project to update GAAP to improve how intangible assets are recognized, accounted for and publicly disclosed. ABA said it does not support such a project given there is no demand for the information from bank investors. The cost of preparing and auditing the information far outweighs any benefits that might be derived from the GAAP changes, the association said.
At the same time, ABA cited the success of narrow scope projects – such as cryptocurrency – and noted that standard setting in this area should be limited to narrow scope projects.
“Entities in some industries provide supplemental and voluntary disclosure to effectively meet investor needs and to fill some of the perceived gaps in intangible reporting,” ABA said. “To the extent improvement is needed in GAAP, ABA believes any approach should have a narrow scope focus, rather than considering sweeping changes.”
