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GPPC issues report on banks’ implementation of IFRS 9 impairment requirements

Published on: Jun 17, 2016

The Global Public Policy Committee (GPPC)1 have issued a report, The Im­ple­men­ta­tion of IFRS 9 Im­pair­ment Re­quire­ments by Banks.

Although the report primarily applies to audit com­mit­tees of sys­tem­i­cally im­por­tant banks, much of its content will be rel­e­vant to other banks and fi­nan­cial in­sti­tu­tions as well. The report assists the two key groups in a bank that will be in­stru­men­tal in en­sur­ing a high-qual­ity im­ple­men­ta­tion of IFRS 9:

  • Those charged with gov­er­nance, who will oversee im­ple­men­ta­tion. Section 1 of the report ad­dresses the key areas of focus for this group, such as gov­er­nance and con­trols, so­phis­ti­ca­tion and pro­por­tion­al­ity, and tran­si­tion issues.
  • Finance, risk man­age­ment, IT, and other ex­ec­u­tives who are charged with im­ple­ment­ing the new re­quire­ments. Section 2 of the report dis­cusses key com­po­nents of im­ple­ment­ing ex­pected credit loss ac­count­ing, in­clud­ing ex­pected credit loss method­s, default, prob­a­bil­ity of default, ex­po­sure, loss given default, dis­count­ing, staging as­sess­ment, macroeco­nomic fore­casts, and for­ward-look­ing in­for­ma­tion.

1 The GPPC of the six largest international accounting networks comprises representatives of BDO, Deloitte, EY, Grant Thornton, KPMG and PwC, and focuses on public policy issues for the profession.


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