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The following scenarios describe ledger entries for Sell transactions when you use asset-level expected credit loss (ECL) with a GAAP accounting basis.

The following notes apply to these Sell scenarios:

  • These Sell examples illustrate what should occur for a full sell.

  • For a partial sell across multiple lots, the expected credit losses are reduced proportional to the portion sold.

  • Position-level ECL is reduced accordingly.

Sell for US GAAP – AFS

The entity holds an asset, par of 1,000 and a cost of $900, and expected credit losses of $30 applied to it.

Ledger entries follow for a lot with expected credit losses of $30 applied for a GAAP accounting basis with an AFS (Available for Sale) regulatory category. 

Ledger Account

Ledger Acct Name

Dr

Cr

1010000100

COST OF INVESTMENTS-AFS

900


2002000100

INVESTMENT PAYABLE


900

5001000902

IMPAIRMENT EXPENSE FOR ECL-AFS

 30


1010010419

ALLOWANCE FOR ECL-AFS


 30

Sell with Realized Loss

Excusing any subsequent amortization, the lot is fully sold for $850 with the same amortized cost of $900.

The following transaction occurs.

Ledger Account

Ledger Acct Name

Dr

Cr

1010000100

COST OF INVESTMENTS-AFS


 900

1002000100

INVESTMENT RECEIVABLE

 850


4004000102

REALIZED LOSSES-AFS

50


1010010419

ALLOWANCE FOR ECL-AFS

30


5001000902

IMPAIRMENT EXPENSE FOR ECL-AFS


30

3003000302UNREALIZED LOSSES - AFS - OCI50
3006000104   REALIZED LOSSES- AFS FROM OCI
50

Sell with Realized Gain

Excusing any subsequent amortization, the lot is fully sold for $950 with the same amortized cost of $900.

The following transaction occurs.

Ledger Account

Ledger Acct Name

Dr

Cr

1010000100

COST OF INVESTMENTS-AFS


 900

1002000100

INVESTMENT RECEIVABLE

 950


4004000101

REALIZED GAINS-AFS


50

1010010419

ALLOWANCE FOR ECL-AFS

30


5001000902

IMPAIRMENT EXPENSE FOR ECL-AFS


30

3003000301UNREALIZED GAINS-AFS-OCI
??
3006000103  REALIZED GAINS-AFS FROM OCI??

Sell for US GAAP – HTM

The entity holds an asset, par of 1,000 and a cost of $900, and expected credit losses of $30 applied to it.

Ledger entries follow for a lot with expected credit losses of $30 applied for a GAAP accounting basis with an HTM (Held to Maturity) regulatory category. 

Ledger Account

Ledger Acct Name

Dr

Cr

1010000100

COST OF INVESTMENTS-HTM

900


2002000100

INVESTMENT PAYABLE


900

5001000902

IMPAIRMENT EXPENSE FOR ECL-HTM

30


1010010419

ALLOWANCE FOR ECL-HTM


30 

Sell with Realized Loss

Excusing any subsequent amortization, the lot is fully sold for $850 with the same amortized cost of $900.

The following transaction occurs.

Ledger Account

Ledger Acct Name

Dr

Cr

1010000100

COST OF INVESTMENTS-HTM


 900

1002000100

INVESTMENT RECEIVABLE

 850


4004000102

REALIZED LOSSES-HTM 

50


1010010419

ALLOWANCE FOR ECL-HTM

30


5001000902

IMPAIRMENT EXPENSE FOR ECL-HTM


30

Sell with Realized Gain

Excusing any subsequent amortization, the lot is fully sold for $950 with the same amortized cost of $900.

The following transaction occurs.

Ledger Account

Ledger Acct Name

Dr

Cr

1010000100

COST OF INVESTMENTS-HTM


 900

1002000100

INVESTMENT RECEIVABLE

 950


4004000101

REALIZED GAINS-HTM


50

1010010419

ALLOWANCE FOR ECL-HTM

30


5001000902

IMPAIRMENT EXPENSE FOR ECL-HTM


30

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