The impact of IFRS 9 on accounting, business processes and systems of banks: The expected credit loss model

• Main Authors: Lin, Wei Chi, 林維琪
• Other Authors: 蘇瓜藤
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/88tm59

碩士 === 國立政治大學 === 經營管理碩士學程(EMBA) === 104 === IFRS 9 “Financial Instruments” will be effective from 1 January 2018. Hence, the regulators and banks are under pressure to apply it, are concerned about its impact and effects, and, as a result, must start coming up with relevant and effective action plans. Many banks have not yet commenced the training, planning and implementation processes for adoption of IFRS 9. For those that have, the progress is slow because they do not have a full understanding of the processes required for the implementation of IFRS 9, nor its profit and loss impact. Adopting IFRS 9 will present banks with both accounting and business challenges, which will affect their profit and loss accounts, capital requirements, business strategy and lending operations. The "Expected credit loss model" can arrive at a fair evaluation of impairment of financial assets to reflect the economic substance of business operations. In addition, senior management of banks will need to decide how much risk their institution is prepared to take as IFRS 9 will present new challenges and opportunities. Banks will need to balance client selection, business expansion and risk assumption. This paper provides a better understanding of the impacts and application of the "expected credit loss model". It analyzes the impacts and proposes solutions on accounting, business processes and systems from the view of business practice. It not only provides implementation solutions for banks, but also provides regulators with a good reference on banking supervision.