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Credit Loss Accounting

Comprehensive, audit-ready, low-touch credit loss accounting for securities and loans

Rooted in decades of fixed-income analytics for investors at global institutions, Edge delivers audit-ready credit loss accounting for all debt securities, major loan types, and more. It covers:

  • Loans, held-to-maturity (HTM) debt securities, receivables, and other financial instruments carried at cost under ASC 326-20 (“CECL”)

  • Available-for-sale (AFS) debt securities under 326-30 and the 320-10 (OTTI) framework

Edge automates the process illustrated below to turn around granular credit loss estimates for large portfolios on tight deadlines, while preserving user discretion and explainability of results:

  • Many asset classes

    with our data and model partners:
  • ASC 326-20 (“CECL”), 326-30, and 320-10 (“OTTI”)

    • Accounting rules engine designed by CPAs and CFOs
    • Report package with instrument-level granularity, methodology, and disclosures
  • Fast turnaround

    • On-demand processing in the cloud
    • Scalable compute speed
    • Easy interface and user support
  • Audit support

    • Fully documented, SOC 1 and SOC 2 Certified application

    • Model support team to explain results and address validator, auditor, and examiner questions

Run Settings

  • Macro scenarios

  • Credit and call/prepay model selections or overrides

  • Loans only: Accounting elections

Data Intake

  • Portfolio by feed or file

  • Terms, conditions, asset descriptions

  • Qualitative exclusions

  • Securities only: AFS impairment screen

Default, Severity, Call/Prepay Rates

  • Model results or user overrides

  • Structured securities only: underlying collateral is modeled

Cash Flow Engine

  • Integration of terms and conditions and default, severity, and call/prepay rates expected cashflows, losses

Accounting Rules Engine

  • Translation of forecast to book entries per accounting rules

  • Required disclosures

  • Day 1 or Day 2 outputs

  • Loans only: Mgmt. allowance adjustments

Reports

  • Audit-ready package

  • Export or feed

SOC 1 and 2 Certified

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