Note 18 - New Accounting Pronouncements	12 Months Ended
Dec. 31, 2019
Notes to Financial Statements
New Accounting Pronouncements and Changes in Accounting Principles [Text Block]	NOTE 1 8 : NEW ACCOUNTING PRONOUNCEMENTS In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014 - 09, (Topic 606 ): Revenue from Contracts with Customers (“ASU 2014 - 09” ). The scope of the guidance applies to revenue arising from contracts with customers, except for the following: lease contracts, insurance contracts, contractual rights and obligations within the scope of other guidance and nonmonetary exchanges between entities in the same line of business to facilitate sales to customers. The core principle of the new guidance is that an entity should recognize revenue to reflect the transfer of goods and services to customers in an amount equal to the consideration that the entity receives or expects to receive. ASU 2014 - 09 is not expected to significantly impact the timing or approach to revenue recognition for financial institutions. Initially, the amendments were effective for public entities for annual reporting periods beginning after December 15, 2016, however, the FASB issued ASU 2015 - 14 Revenue from Contracts with Customers (Topic 606 ) – Deferral of the Effective Date ” which deferred the effective date of ASU 2014 - 09 by one year to annual and interim periods beginning after December 15, 2017. The guidance does not apply to revenue associated with financial instruments, including loans and securities that are accounted for under GAAP, which comprises a significant portion of our revenue stream. The Company adopted ASU 2014 - 09 during the first quarter of 2018 and completed an evaluation of the impact of the revenue streams which are included in the scope of these updates, such as deposit fees and revenue from the sale of other real estate owned. The Company concluded that the adoption of this update did not change significantly from our current practice of recognizing the in-scope non-interest income. In addition, we did not retroactively revise prior period amount or record a cumulative adjustment to retained earnings upon adoption. In January 2016, the FASB issued ASU 2016 - 01, Financial Instruments- Overall (Subtopic 825 - 10 ): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016 - 01” ). ASU 2016 - 01 simplifies the impairment assessment of equity investments, clarifies reporting disclosure requirements for financial instruments measured at amortized cost, and requires the exit price notion be disclosed when measuring fair value of financial instruments. ASU 2016 - 01 details the required separate presentation in other comprehensive income for the change in fair value of a liability related to change in instrument specific credit risk and details the required separate presentation of financial assets and liabilities by measurement category and clarifies the guidance for a valuation allowance on deferred tax assets related to available-for-sale securities. ASU 2016 - 01 is effective for annual and interim reporting periods beginning after December 15, 2017. ASU 2016 - 01 was effective for the Company on January 1, 2018 and did not have a material impact on our consolidated financial statements but has had an impact on our fair value disclosures. See Note 15 - Disclosures about Fair Value of Assets and Liabilities for further information regarding the valuation method for loans. In February 2016, the FASB issued ASU 2016 - 02, “ Leases (Topic 842 ).” ASU 2016 - 02 establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU 2016 - 02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. In July 2018, the FASB issued ASU 2018 - 11, “Leases (Topic 842 ) Targeted Imp rove ments” which provides additional transition options including allowing entities to not apply the lease standard to the comparative periods presented in their financial statements in the year of adoption. The Company adopted this standard along with certain practical expedients during the quarter ending March 31, 2019 adding operating Right of Use (“ROU”) assets and liabilities of $ 9,655,304. Additionally, the Company recorded initial balances for financing ROU assets and liabilities of $ 481,130 . There was no significant impact made to the income statement. In June 2016, the FASB issued ASU 2016 - 13, Financial Instruments-Credit Losses (Topic 326 ): Measurement of Credit Losses on Financial Instruments . C odification Improvements to Topic 326, Financial Instruments – Credit Losses , have been released in November 2018 ( 2018 - 19 ), November 2019 ( 2019 - 10 and 2019 - 11 ) and a January 2020 Update ( 2020 - 02 ) that provided additional guidance on this Topic. Among other things, the amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. For SEC filers meeting certain criteria, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. For SEC filers that meet the criteria of a smaller reporting company (including this Company) and for non-SEC registrant public companies and other organizations, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early adoption will be permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company has formed a committee that is assessing our data and evaluating the impact of adopting ASU 2016 - 13. The Company has also selected a third -party vendor to assist in generating loan level cash flows and disclosures. Based on the results from larger SEC filers and preliminary internal calculations there is likely a significant financial impact of adopting this standard. Estimated amounts and decisions pertaining to implementation of this standard will be evaluated over the next several quarters. In August 2016, the FASB issued ASU 2016 - 15, Statement of Cash Flows (Topic 230 ): Classification of Certain Cash Receipts and Cash Payments. The update was intended to reduce the diversity in practice around how certain transactions are classified within the statement of cash flows with respect to eight types of cash flows. This new accounting guidance was effective for interim and annual reporting periods beginning after December 15, 2017. Adoption of ASU 2016 - 15 did not have a material impact on our consolidated financial statements. In January 2017, the FASB issued ASU No. 2017 - 04, Intangibles: Goodwill and Other: Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the amendments eliminate Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, the income tax effects of tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. An entity still has the option to perform the quantitative assessment for a reporting unit to determine if the qualitative impairment test is necessary. The amendments should be applied on a prospective basis. The nature of and reason for the change in accounting principle should be disclosed upon transition. This standard has been delayed and is now effective for fiscal years beginning after December 15, 2022. In May 2017, the FASB issued ASU 2017 - 09, Compensation-Stock Compensation (Subtopic 718 ): Scope of Modification Accounting. ASU 2017 - 09 clarifies when changes to terms or conditions of a share-based payment award must be accounted for as a modification. Under the new guidance, an entity will not apply modification accounting to a share-based payment award if all of the following are the same immediately before and after the change: (i) the fair value of the award, (ii) the vesting conditions of the award, and (iii) the classification of the award as either an equity or liability instrument. ASU 2017 - 09 was effective for the fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The guidance requires companies to apply the requirements prospectively to awards modified on or after the adoption date. ASU 2017 - 09 was effective for the Company on January 1, 2018 and did not have a material impact on our consolidated financial statements. In August 2017, the FASB issued ASU 2017 - 12, Derivatives and Hedging (Topic 815 ): Targeted improvements to accounting for hedging activities. Additional guidance on this Topic was released in October 2018 ( ASU 2018 - 16 ), November 2019 ( 2019 - 10 ) and January 2020 ( 2020 - 01 ). The purpose of this updated guidance is to better align financial reporting for hedging activities with the economic objectives of those activities. The amendments in this update are effective for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. The standard requires the modified retrospective transition approach as of the date of adoption. Implementation of this standard did not have a material impact on the Company’s consolidated financial statements. In February 2018, the FASB issued ASU 2018 - 02, Income Statement-Reporting Comprehensive Income (Topic 220 ): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . This ASU provides financial statement preparers with an option to reclassify stranded tax effects within AOCI to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act (or portion thereof) are recorded. This standard is effective for all organizations for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. Organizations should apply the proposed amendments either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company elected to early adopt ASU 2018 - 02 and, as a result, reclassified $31,818 from accumulated other comprehensive income to retained earnings as of December 31, 2017. The reclassification impacted the Consolidated Balance Sheet and the Consolidated Statement of Stockholder’s Equity as of and for the year ended December 31, 2017. In August 2018, the FASB issued ASU 2018 - 13, Fair Value Measurement (Topic 820 ): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement . This ASU applies to all entities that are required, under existing GAAP, to make disclosures about recurring or nonrecurring fair value measurements. Disclosures removed by this ASU are the amount and reasons for transfers between Level 1 and Level 2, the policy for timing of transfers between levels and the valuation process for Level 3 measurements. This ASU modifies disclosures relating to investments in certain entities that calculate net asset value. Additional disclosures require by the ASU include: 1 ) change in unrealized gains and losses included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and 2 ) range and weighted average of significant observable inputs used to develop Level 3 measurements. The prospective method of transition is required for the new disclosure requirements. The other amendments should be applied retrospectively. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years or January 1, 2020 for the Company. Early adoption is permitted. The Company is currently evaluating the impact of the new standard on our consolidated financial statements, but at this time do not believe the standard will have a significant impact on the financial statements.

NOTE

: NEW ACCOUNTING PRONOUNCEMENTS

May 2014,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

2014

09,

(Topic

606

Revenue from Contracts with Customers

(“ASU

2014

09”

). The scope of the guidance applies to revenue arising from contracts with customers, except for the following: lease contracts, insurance contracts, contractual rights and obligations within the scope of other guidance and nonmonetary exchanges between entities in the same line of business to facilitate sales to customers. The core principle of the new guidance is that an entity should recognize revenue to reflect the transfer of goods and services to customers in an amount equal to the consideration that the entity receives or expects to receive. ASU

2014

not

expected to significantly impact the timing or approach to revenue recognition for financial institutions. Initially, the amendments were effective for public entities for annual reporting periods beginning after

December 15, 2016,

however, the FASB issued ASU

2015

Revenue from Contracts with Customers (Topic

606

) – Deferral of the Effective Date

” which deferred the effective date of ASU

2014

one

year to annual and interim periods beginning after

December 15, 2017.

The guidance does

not

apply to revenue associated with financial instruments, including loans and securities that are accounted for under GAAP, which comprises a significant portion of our revenue stream. The Company adopted ASU

2014

during the

first

quarter of

2018

and completed an evaluation of the impact of the revenue streams which are included in the scope of these updates, such as deposit fees and revenue from the sale of other real estate owned. The Company concluded that the adoption of this update did

not

change significantly from our current practice of recognizing the in-scope non-interest income. In addition, we did

not

retroactively revise prior period amount or record a cumulative adjustment to retained earnings upon adoption.

January 2016,

the FASB issued ASU

2016

01,

Financial Instruments- Overall (Subtopic

825

): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU

2016

01”

). ASU

2016

simplifies the impairment assessment of equity investments, clarifies reporting disclosure requirements for financial instruments measured at amortized cost, and requires the exit price notion be disclosed when measuring fair value of financial instruments. ASU

2016

details the required separate presentation in other comprehensive income for the change in fair value of a liability related to change in instrument specific credit risk and details the required separate presentation of financial assets and liabilities by measurement category and clarifies the guidance for a valuation allowance on deferred tax assets related to available-for-sale securities. ASU

2016

is effective for annual and interim reporting periods beginning after

December 15, 2017.

ASU

2016

was effective for the Company on

January 1, 2018

and did

not

have a material impact on our consolidated financial statements but has had an impact on our fair value disclosures. See Note

- Disclosures about Fair Value of Assets and Liabilities for further information regarding the valuation method for loans.

February 2016,

the FASB issued ASU

2016

02,

“

Leases

(Topic

842

).” ASU

2016

establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than

months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU

2016

is effective for fiscal years beginning after

December 15, 2018,

including interim periods within those fiscal years. In

July 2018,

the FASB issued ASU

2018

11,

“Leases (Topic

842

) Targeted Imp

rove

ments”

which provides additional transition options including allowing entities to

not

apply the lease standard to the comparative periods presented in their financial statements in the year of adoption. The Company adopted this standard along with certain practical expedients during the quarter ending

March 31, 2019

adding operating Right of Use (“ROU”) assets and liabilities of

9,655,304.

Additionally, the Company recorded initial balances for financing ROU assets and liabilities of

481,130

There was

significant impact made to the income statement.

June 2016,

the FASB issued ASU

2016

13,

Financial Instruments-Credit Losses (Topic

326

Measurement of Credit Losses on Financial Instruments

odification Improvements to Topic

326,

Financial Instruments – Credit Losses

have been released in

November 2018 (

2018

November 2019 (

2019

and

2019

) and a

January 2020

Update (

2020

) that provided additional guidance on this Topic. Among other things, the amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. For SEC filers meeting certain criteria, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2019.

For SEC filers that meet the criteria of a smaller reporting company (including this Company) and for non-SEC registrant public companies and other organizations, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2022.

Early adoption will be permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2019.

The Company has formed a committee that is assessing our data and evaluating the impact of adopting ASU

2016

13.

The Company has also selected a

third

-party vendor to assist in generating loan level cash flows and disclosures. Based on the results from larger SEC filers and preliminary internal calculations there is likely a significant financial impact of adopting this standard. Estimated amounts and decisions pertaining to implementation of this standard will be evaluated over the next several quarters.

August 2016,

the FASB issued ASU

2016

15,

Statement of Cash Flows (Topic

230

Classification of Certain Cash Receipts and Cash Payments.

The update was intended to reduce the diversity in practice around how certain transactions are classified within the statement of cash flows with respect to

eight

types of cash flows. This new accounting guidance was effective for interim and annual reporting periods beginning after

December 15, 2017.

Adoption of ASU

2016

did

not

have a material impact on our consolidated financial statements.

January 2017,

the FASB issued ASU

No.

2017

04,

Intangibles: Goodwill and Other: Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the amendments eliminate Step

from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should

not

exceed the total amount of goodwill allocated to that reporting unit. In addition, the income tax effects of tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. An entity still has the option to perform the quantitative assessment for a reporting unit to determine if the qualitative impairment test is necessary. The amendments should be applied on a prospective basis. The nature of and reason for the change in accounting principle should be disclosed upon transition. This standard has been delayed and is now effective for fiscal years beginning after

December 15, 2022.

May 2017,

the FASB issued ASU

2017

09,

Compensation-Stock Compensation (Subtopic

718

Scope of Modification Accounting.

ASU

2017

clarifies when changes to terms or conditions of a share-based payment award must be accounted for as a modification. Under the new guidance, an entity will

not

apply modification accounting to a share-based payment award if all of the following are the same immediately before and after the change: (i) the fair value of the award, (ii) the vesting conditions of the award, and (iii) the classification of the award as either an equity or liability instrument. ASU

2017

was effective for the fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2017.

The guidance requires companies to apply the requirements prospectively to awards modified on or after the adoption date. ASU

2017

was effective for the Company on

January 1, 2018

and did

not

have a material impact on our consolidated financial statements.

August 2017,

the FASB issued ASU

2017

12,

Derivatives and Hedging (Topic

815

Targeted improvements to accounting for hedging activities.

Additional guidance on this Topic was released in

October 2018 (

ASU

2018

November 2019 (

2019

) and

January 2020 (

2020

). The purpose of this updated guidance is to better align financial reporting for hedging activities with the economic objectives of those activities. The amendments in this update are effective for fiscal years beginning after

December 15, 2018,

with early adoption, including adoption in an interim period, permitted. The standard requires the modified retrospective transition approach as of the date of adoption. Implementation of this standard did

not

have a material impact on the Company’s consolidated financial statements.

February 2018,

the FASB issued ASU

2018

02,

Income Statement-Reporting Comprehensive Income (Topic

220

Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income

. This ASU provides financial statement preparers with an option to reclassify stranded tax effects within AOCI to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act (or portion thereof) are recorded. This standard is effective for all organizations for fiscal years beginning after

December 15, 2018,

and interim periods within those fiscal years. Early adoption is permitted. Organizations should apply the proposed amendments either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company elected to early adopt ASU

2018

and, as a result, reclassified

$31,818

from accumulated other comprehensive income to retained earnings as of

December 31, 2017.

The reclassification impacted the Consolidated Balance Sheet and the Consolidated Statement of Stockholder’s Equity as of and for the year ended

December 31, 2017.

August 2018,

the FASB issued ASU

2018

13,

Fair Value Measurement (Topic

820

): Disclosure Framework –

Changes to the Disclosure Requirements for Fair Value

Measurement

. This ASU applies to all entities that are required, under existing GAAP, to make disclosures about recurring or nonrecurring fair value measurements. Disclosures removed by this ASU are the amount and reasons for transfers between Level

and Level

the policy for timing of transfers between levels and the valuation process for Level

measurements. This ASU modifies disclosures relating to investments in certain entities that calculate net asset value. Additional disclosures require by the ASU include:

) change in unrealized gains and losses included in other comprehensive income for recurring Level

fair value measurements held at the end of the reporting period and

) range and weighted average of significant observable inputs used to develop Level

measurements. The prospective method of transition is required for the new disclosure requirements. The other amendments should be applied retrospectively. This ASU is effective for fiscal years beginning after

December 15, 2019,

including interim periods within those fiscal years or

January 1, 2020

for the Company. Early adoption is permitted. The Company is currently evaluating the impact of the new standard on our consolidated financial statements, but at this time do

not

believe the standard will have a significant impact on the financial statements.