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Hi,
A question within the Kaplan SBR exam kit.
Could you explain their accounting treatment for the expected credit loss? Why is $400k being charged under the PL, and the remainder under OCI?
Thanks
Hi, would it be possible to get a response on this question? I’m still struggling to understand
Thanks,
Hi,
Sorry, the total fall in value is the $0.7million. Of this decrease $0.4m is due to the ECL and so recognised through profit or loss, and so the remainder is then recognised through OCI as it is held at FVTOCI.
Thanks
Hi,
I am having a problem regarding the same question.Can you explain why the impairment of $0.7million is being charged like this ‘$0.4million in P&L and $0.3 in OCI’
And if your saying that $0.4million is due to ECL then why it is being recognised through P&L not OCI because it is mentioned above in the question that ECL allownace in recognised in OCI?
You also mentioned that decrease of $0.4m is due to ECL they why its mentioned that ECL does not effect the carrying value of the instrument.
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