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25

Feb, 2016

BCBS Guidelines Impact on ECL Framework

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On 18th December 2015, the Basel Committee for Banking Supervision (BCBS) published its final insights on sound credit risk and accounting practices associated with the implementation of Expected Credit Losses (ECL) accounting frameworks, replacing the earlier guidance issued in June 2006 on ‘Sound credit risk assessment and valuation for loans’. In this post, we will be highlighting and deliberating upon some of the key issues which have been discussed in the BCBS guidance note, and their impact on various banks:

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22

Feb, 2016

Building Blocks of Impairment Modeling

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As highlighted in our previous post, one of the key areas of focus pertaining to IFRS 9 principles is credit risk modeling, which is required for appropriate estimations of Expected Credit Loss (ECL). In this post we will discuss the key components of Impairment Modeling, which will call for significant attention of the Banks’ management to ensure a successful implementation.

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9

Feb, 2016

From IAS 39 to IFRS 9 – Financial Instruments

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On 24 July 2014, IASB issued the fourth and final version of its new accounting standard – IFRS 9 Financial Instruments, which replaces most of the rule-based standards of IAS 39 with principle based guidance. IFRS 9 is built on a logical, single classification and measurement approach for financial assets that reflects the business model in which they are managed and their cash flow characteristics. The fundamental shift from IAS 39 to IFRS 9 standards is “Incurred Loss Approach” to “Forward-looking Expected Loss Approach” for impairment assessment. In the past, […]

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