Pub. 2 2011 Issue 3

fall 2011 19 Further, a bank is required to provide the following new disclosures about its loan portfolio: • Credit quality indicators of loans at the end of the reporting period by class. • The aging of past due loans at the end of the reporting period by class. • The nature and extent of troubled debt restructurings that occurred during the period by class and their effect on the allowance for loan losses. • The nature and extent of loans modified as a result of troubled debt restructurings within the previous 12 months that defaulted during the reporting period by class, and their effect on the allowance for loan losses. • Significant purchases and sales of loans during the reporting period disaggregated by portfolio segment. It is expected that management will need to design and im- plement new and enhanced processes to meet the disclosure requirements of this new standard. These enhancements will include developing new and modified reports from the information technology system and making modifications to various spreadsheets. Management may need to imple- ment completely new processes to obtain some of the data needed to meet the disclosure requirements. If your bank has not started to accumulate the information required for these new disclosures, we strongly encourage you to de- vote the necessary resources to do so immediately and not wait until the end of the year, because it may be too late to capture the information needed to be disclosed if the reports are not generated until after year end. For public companies, the amendments that require dis- closures as of the end of a reporting period were effective for periods ending on or after December 15, 2010. The amendments that require disclosures about activity that occurs during a reporting period were effective for periods beginning on or after December 15, 2010. For nonpublic companies, the amendments are effective for periods end- ing on or after December 15, 2011. In other words, all of this is applicable for the December 31, 2011 financial state- ments so the time is now to get ready for these increased disclosures. ASU 2010-20 is available in full at www.fasb.org . Q Q Accounting Standards — continued from page 18 Christopher Nice is a P.L.L.C. Member of Arnett & Foster, P.L.L.C., Certi- fied Public Accountants, in Charleston, West Virginia. ACertified Public Accountant andCertified Information SystemAuditor, Mr. Nice has over fifteen years experience in providing audit and consulting services in the financial institutions industry. Mr. Nice can be contacted at 800-642-3601 or through email: chris.nice@afnetwork.com .