EFRAG-FEE paper on expected loss model

  • News default Image

10 Dec 2009

The European Financial Reporting Advisory Group (EFRAG) and the European Federation of Accountants FEE have published Impairment of Financial Assets – The Expected Loss Model.

The two groups prepared the paper jointly as part of their pro-active work to provide European stakeholders with a perspective on the IASB's Proposals for the impairment of financial assets. It is intended to promote discussion and debate on those proposals. The paper describes the proposals but does not present the views of either EFRAG or FEE. Click for Press Release (PDF 34k).

This joint FEE-EFRAG paper firstly provides detail on the context of the recent IASB proposals and then goes on to give a general description of the expected loss model (including two worked computations). This high-level analysis is followed by a discussion about what information is generated by the model, including a description of how the results would be presented and disclosed in the financial statements and associated notes. Finally the Paper compares the expected loss model with other kinds of impairment models.... The aim of the paper is to provide general characteristics of the expected loss model, highlight the potential complexities and challenges, and stress the key differences from other models, rather than provide the assessment of its suitability, which would be provided in the comment letters to IASB by both FEE and EFRAG next year.

Click for Impairment of Financial Assets – The Expected Loss Model (PDF 368k).


Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.