dec 2011 FA

Can you please kindly explain financial asset part on Dec11 Q1. It says Included in the financial assets of Traveler is a ten year 7% loan held at amortized cost. At 30 Nov 2011, the borrower was in financial difficulties and its credit rating had been downgraded. At this date, the gross carrying amount of the loan asset was and loss allowance was $1 million.Traveler has agreed for loan to be restructured; there will only be three more annual payments of $8 million starting in year’s time.Current market interest rate are 8%, the original effective interest rate is 6.7% and the effective interest rate under the revised payment schedule is 6.3%.