NCUA CECL Addendum to the Other Supervisory Committee Audit Guide
If your credit union has adopted the CECL accounting standard for estimating loan and investment losses, this addendum replaces the older allowance-for-loan-loss audit steps with procedures that actually match how CECL works.
Credit unions have been moving from the old “incurred loss” method of setting aside money for bad loans to the Current Expected Credit Losses standard — CECL, formally Accounting Standards Codification 326 — and NCUA’s original 2020 minimum procedures guide was written for the old method. This addendum swaps in audit steps for the allowance for credit losses on loans, leases, and investments under CECL, and it covers the different ways a credit union might estimate that allowance: NCUA’s own Simplified CECL Tool, an internally built model, or a third-party vendor model.
It’s a supplement, not a standalone document — use it together with the main Other Supervisory Committee Audit Minimum Procedures Guide, replacing only the sections CECL changed.
This is not legal, accounting, or compliance advice. Verify against the official source and your own professional advisors.