Expected credit loss: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson m (Categorise.) |
(Add link.) |
||
(One intermediate revision by one other user not shown) | |||
Line 24: | Line 24: | ||
==See also== | ==See also== | ||
* [[Credit ]] | |||
*[[Credit loss]] | |||
*[[Default]] | *[[Default]] | ||
*[[Discount factor]] | *[[Discount factor]] |
Latest revision as of 22:18, 14 July 2024
Financial reporting - impairment of financial assets - IFRS 9.
(ECL).
Expected credit loss is a calculation of the present value of the amount expected to be lost on a financial asset, for financial reporting purposes.
It is calculated as:
ECL = PD x EAD x LGD x Discount Factor
Where:
ECL = expected credit loss
PD = probability of default
EAD = exposure at default
LGD = loss given default
Discount Factor is based on the expected date of default