Manage Expected Credit Losses

Expected Credit Losses (ECL) provides a more forward-looking impairment model. Under the impairment approach in IFRS 9, it is no longer necessary for a credit event to have occurred before credit losses are recognized. Instead, an entity always accounts for expected credit losses, and changes in those expected credit losses. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition and, consequently, more timely information is provided about expected credit losses. You can use group-level and/or asset-level ECL as follows:

• Group Level (Available for IFRS). With Group-Level Expected Credit Losses, Eagle’s accounting solutions supports Expected Credit Losses grouping functionality for IFRS accounting bases. Expected Credit Losses grouping functionality involves the creation of a dummy asset using the processing security type, ECLGRP, which represents a group of assets/individual securities held by a portfolio for which expected credit losses exist. It provides a way for an entity to account for expected credit losses within its portfolio without having to book those expected losses to securities actually held by the entity - at the lot level.

• Asset Level (Available for IFRS or US GAAP). With Asset-Level Expected Credit Losses, Eagle’s accounting solution extends its Expected Credit Losses capabilities and allows you to book expected losses at the individual lot level for debt securities held by the entity.