Scope sheet
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Credit loss and fair value
CECL for trade receivables and contract assets: provision matrix and ASU 2025-05
Finbryn provides CECL allowance models for companies that are not banks but carry trade receivables, building an aging-based provision matrix under ASC 326-20 and applying the ASU 2025-05 practical expedient for annual periods beginning after December 15, 2025 (FASB, checked 2026-10-16). Management approves the allowance and your auditor tests it.
What is included
- Receivable pools, aging buckets and historical loss rates built from your own write-off history
- Side-by-side allowance under the ASU 2025-05 expedient, with and without the collections election
- Allowance policy memo and draft disclosure note for management to approve
- Quarterly refresh workbook that ties to the receivables aging and the general ledger
The process
- 1.
Collect the receivables history
Aging reports at each look-back date, write-offs, credit memos, cash receipts, payment terms and customer segments, for as many periods as your data covers.
- 2.
Tie the data out
We reconcile the aging to the general ledger at each date and hand your controller a list of exceptions to clear before any rate is calculated.
- 3.
Frame the elections
A one-page memo sets out the expedient and the collections election with their effect on last quarter's allowance, so management chooses with the numbers in front of it.
- 4.
Build and run the matrix
Pools, buckets and loss rates, with distressed accounts assessed individually, and a journal entry for the true-up.
- 5.
Draft the policy and disclosures
The allowance policy paragraph, the election disclosure and the support schedule your auditor will request.
- 6.
Refresh and back-test each quarter
The workbook reruns from the new aging, compares predicted with actual write-offs and flags pools whose behavior has drifted.
Software
Microsoft Excel, QuickBooks Online, NetSuite, Sage Intacct, Xero
Pricing
Scoped per engagement from the number of receivable pools, the length of the data history and whether the quarterly refresh is included. It runs separately from the monthly tiers on the /us/pricing rate card, and the fee is confirmed in writing before model work starts.
Finbryn is a brand of Northlane Solutions Inc., a Delaware corporation.
Reviewed October 2026