Under US GAAP, Expected Credit Loss (ECL) refers to the amount of credit loss that an entity anticipates will occur over the life of a financial instrument, as specified by ASC 326-20, 'Credit Losses'. This concept was introduced by the Financial Accounting Standards Board (FASB) through its Accounting Standards Update (ASU) No. 2016-13, 'Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments'. ECL requires entities to estimate and recognize losses upfront, reflecting the possibility of losses from the initial recognition of the financial asset through its maturity. The estimation considers factors such as the likelihood of default, the amount of potential loss, and the time value of money.