AICPA says loan splitting does not conform with GAAP.The American Institute of CPAs announced its opposition to a regulatory proposal, known as loan splitting, that would allow banks to return part of a nonperforming loan to accrual status. In letters to the Securities and Exchange Commission and the Federal Financial Institutions Examination Council The Federal Financial Institutions Examination Council, or FFIEC, is a formal interagency body of the United States government empowered to prescribe uniform principles, standards, and report forms for the federal examination of financial institutions by the Board of , the AICPA AICPA See American Institute of Certified Public Accountants (AICPA). stated the proposal does not conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" generally accepted accounting standards and is not suitable for general purpose financial reporting. The letters said the proposal would also "present particular implementation problems for preparers of financial statements and their independent auditors." While the AICPA recognizes that financial information needed by regulatory agencies may be different from information contained in GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). statements, the Institute continues to believe that general purpose financial reporting should not be used to achieve regulatory or public policy objectives. Pointing to the savings and loan savings and loan n. a banking and lending institution, chartered either by a state or the Federal government. Savings and loans only make loans secured by real property from deposits, upon which they pay interest slightly higher than that paid by most banks. industry, Joseph F. Moraglio, AICPA vice president-federal government relations, said, "We have seen what can happen when that approach is taken. " n |
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