Year-end bank call report includes updates on accounting for hedging activities

Instructions for year-end 2022 call reports, due to be filed by Jan. 30, will include updates for accounting for hedging activities, according to a letter issued Thursday by the federal bank deposit insurance agency.

The Federal Deposit Insurance Corp. (FDIC), in its financial institution letter (FIL) 54-2022, notes that the year-end call reports are now available for printing and downloading via the Federal Financial Institution Examination Council’s (FFIEC) website.

The letter notes that the report instructions are updated for Accounting Standards Update No. 2017-12, “Targeted Improvements to Accounting for Hedging Activities,” which is now in effect for all banks.

The agency letter stated that there are no new or revised data items that take effect this quarter in the FFIEC 051, FFIEC 041 or FFIEC 031 Call Report.

On the other hand, the letter stated, banks that have adopted Accounting Standards Update No. 2022-02, “Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures” should continue referring to the topic “Accounting for Loan Modifications to Borrowers Experiencing Financial Difficulties” in the supplemental instructions.

“This topic provides guidance on how an institution should report its loan modifications to borrowers experiencing financial difficulties in the Call Report,” the letter states, adding that banks should refer supplemental instructions for December 2022 (attached to the letter) for additional guidance on certain reporting issues.

FIL-54-2022: Consolidated Reports of Condition and Income for Fourth Quarter 2022