Credit risk

This topic has 3 replies, 2 voices, and was last updated 8 years ago by MikeLittle.

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June 1, 2014 at 3:26 pm #172367
Nizar
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hello mike,

suddenly i remembered about this “credit risk” term while doing my revision.
my lecturer somehow mention about it, of being, if the loss of financial asset/liability(can’t remember which one) is related to credit risk, then it is account in the profit or loss/OCI(also can’t remember which one)

could you explain further about this area?

and somehow, i noticed that starting on Dec 2012 onwards, Q2 & Q3 is quite tough compared to June 12 and below. The examiner changed in dec 2012 is it??
June 1, 2014 at 5:46 pm #172408
MikeLittle
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No change in the examiner for about the last 70 years (slight exaggeration, but there really has not been a change for a LONG time)

As for your tutor’s comments …… I can’t remember me ever saying anything like this. Is it too late to ask your tutor?
June 1, 2014 at 6:19 pm #172426
Nizar
- Topics: 49
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Ya, i send an email and luckily it was quickly replied.

IFRS 9 permits Financial Liability(FL) which are not held for trading to be measured at FVTPL, and this designation must be made at initial recognition and is irrevocable.

Any changes in FV will be seperated into 2 elements, where the changes in FV result from credit risk will be recognise in OCI
and the other changes in FV(balance) will be recognised to PL(usually due to market speculation)
June 1, 2014 at 6:51 pm #172438
MikeLittle
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Ah, ok!

Good luck in 10 days’ time
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