Twelve-month expected credit losses

Under the IFRS 9 general approach, the loss allowance is normally measured at 12-month expected credit losses when credit risk has not increased significantly since initial recognition; a significant increase generally moves measurement to lifetime expected credit losses. The 12-month measure weights lifetime cash shortfalls resulting from defaults possible in that period, not merely cash shortfalls occurring during the next 12 months. Some receivables and contract assets use the simplified approach, under which lifetime expected credit losses are recognised.