In December 2012 the FASB published its proposed model on current expected credit losses, which was followed by the IASB's expected losses impairment model in March 2013. Despite global calls for a converged standard, the FASB model calls for more upfront recognition of expected credit losses than the IASB model.

In order to back its comment letter to the IASB and the FASB, the CFA Institute conducted a survey of its membership to ascertain investor preferences related to financial reporting for credit losses. More than 300 of its members responded to the survey. The key findings were:

• Respondents were almost evenly split on which proposed model they preferred (47% preferred the IASB's model, 44% backed the FASB's model).
• Respondents from the Americas preferred the FASB's proposed model (53%) to the IASB's model (41%), while the IASB's proposed model was preferred by Asia-Pacific respondents (49% to 42%) and Europe, Middle East and Africa participants (50% to 40%).
• Respondents supported fair value as a measurement method that is most decision-useful for measuring credit losses slightly more than an expected-loss model (46% to 41%). The current incurred-loss approach was supported by just 5% of respondents.
• Despite a lack of agreement regarding the model to use, 92% said the FASB and the IASB should arrive at a converged method of estimating credit losses.

Respondents also commented on which disclosures related to impairments of financial assets they felt were needed.

Please click for the following documents on the CFA Institute website:

• Credit loss and impairment survey
• Comment letter to the IASB and the FASB with a detailed analysis of the survey results