IFRS 9 Credit Impairment Modelling (3 days)

Course code: 1216

Introduction

The single most complex aspect of IFRS 9 is credit loss impairment. This is because IFRS 9 represents a very significant departure from the principles of its predecessor IAS 39. In terms of IFRS 9, entities are now required to estimate future losses. This requires very significant modelling and data capabilities in order to forecast the future.

Over 120 countries now require or permit the use of IFRSs. Over 7,000 public companies in the European Union have complied with IFRS since 2005. Most other countries are either adopting IFRSs or have decided to converge their national standards with IFRSs. Every one of these companies will be forced to confront the complexities of applying the impairment rules of IFRS 9. Implementation of IFRS9 impairment without a detailed understanding of its likely impact my result in adverse unforeseen consequences.

This program answers questions such as:

  • How are the new rules different from IAS 39?
  • What did IAS 39 require?
  • What does IFRS 9 require?
  • Why are the provisions so difficult to apply in practice?
  • What are the key functions in Excel required to model IFRS 9 impairment?
  • How to apply these functions in building an appropriate model?
  • How does one model expected losses?
  • What journal entries are required for IFRS 9 purposes?
  • What will happen to interest income recognition under IFRS 9?

Topics

  • Introduction to IAS 39
    • Classification
    • Recognition
    • Derecognition
    • Embedded derivatives
    • Hedge Accounting
    • Impairment
    • Fair value measurement (IFRS 13)
  • Introduction to IFRS 9
    • Classification
    • Recognition
    • Derecognition
    • Embedded derivatives
    • Hedge Accounting
    • Impairment
  • A more detailed analysis of IFRS 9 impairment
    • What is an expected loss?
    • 3 stages of loans and the impact on accounting
    • Time value of money and PV of losses
    • Interest in suspense
    • The impact of impairment on interest income recognition
    • Indicators of impairment
    • Portfolio impairment
    • Individual impairment
    • Write offs
    • Detailed case study: Excel model of IFRS9 impairment

Teaching method

  • Group live instruction by specialist instructor
  • Each delegate is required to bring a laptop with Excel
  • Delegates will build a worked example of an impairment model with the assistance of the instructor
  • They will also be provided with a useful working model
  • Use of case studies and real-world examples to illustrate practical application of the standard
  • All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials

Prerequisites

No advance preparation is required for this course.

Course benefits

  • Understand what the new rules are and how to interpret them in practice
  • Obtain a working model that illustrates the manner in which IFRS 9 models impairment
  • Apply the requirements of the standards to prepare IFRS compliant financial statements, including the determination of appropriate accounting impact on Profit or Loss and the Statement of Financial Position
  • Obtain tools to assist in quantifying the potential impact of IFRS 9 on first-time adoption
  • Acquire key insights to enable you to build an appropriate impairment model for your company
  • Become more competent at Excel modelling

Who should attend?

  • Financial and management accountants in corporate and financial institutions
  • Staff in treasury, operations, risk management, IT or compliance departments
  • Internal auditors of entities reporting under IFRSs
  • External auditors with clients facing the complexities and challenges in adopting and implementing IFRS 9
  • Staff and management of Central Banks, Deposit Insurance Entities, and other agencies with regulatory responsibility in the financial services sector
  • Financial analysts seeking to improve their understanding of the accounting and disclosures related to financial instruments and the changes introduced by IFRS 9
  • Professors and other instructors with educational facilities
  • First-time adopters of IFRSs, seeking to analyze the implications of applying IFRS 9 initially

CPE / CPD Accreditation

NASBA

IASeminars is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org. 


Field of study: Accounting

ICAEW Partner in Learning

IASeminars is proud to have been named as an ICAEW Partner in Learning, working together to offer the ICAEW IFRS Certificate to our clients worldwide. ICAEW (The Institute of Chartered Accountants in England and Wales) is a world leading professional membership organisation that promotes, develops and supports over 145,000 chartered accountants worldwide. CPE certificates obtained from attending IASeminars courses are an ideal way for ICAEW members and others to demonstrate their continuing professional development, provided that the topic is relevant to their learning and development needs.

Texas State Board of Public Accountancy

IASeminars is registered with the Texas State Board of Public Accountancy as a CPE sponsor. Our CPE Sponsor ID is: 009689. This registration does not constitute an endorsement by the Board as to the quality of our CPE Program.

Venue

  • This event will be held at Radisson Blu Edwardian Vanderbilt Hotel. Detailed Joining Instructions are sent to all registered delegates by email approximately one month before the event. The Joining Instructions will confirm exact venue details and nearby (or onsite) hotel recommendations with bedroom rates where available. Coffee and lunch will be provided.

Instructor(s)

  • Richard Cohen

    Richard Cohen (South Africa) is a Chartered Accountant and a Chartered Financial Analyst who consults on a wide range of technical topics and provides training on these same areas. His expertise spans advanced financial instrument accounting under IFRS, credit analysis, impairment, hedging, hedge accounting, financial modelling and Excel. He is the CEO of a consultancy that assists a number of major banks to implement IFRS, focussing particularly on IFRS9 and IAS39. He was previously a partner at KPMG in both London and South Africa, where he was one of the youngest people ever to be promoted to Partner at the firm. His experience includes external auditing due to his role as an Audit Partner on one of the major banks, and he has spent many years advising on a treasury, derivatives and Global Markets. Richard has a number of degrees including Bachelor of Commerce, Post Graduate Diploma in Accounting, Master of Commerce, CA(SA), CFA. He has lectured at the University of the Witwatersrand where he was an Adjunct Professor for a number of years.

In House

To bring this course in-house please contact us and we will be pleased to assist

Course details

Course schedule

Select a start date for more details

22 Oct 2018 London

Course level:
Advanced
CPE / CPD:
24 hours
Start date:
22 Oct 2018
Start time:
09:00
Finish date:
24 Oct 2018
Finish time:
18:00
Location:
London
Price:
GBP 4,500
Subject to UK VAT (Read more)
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