88. IFRS 9 defines an amount equal to 12-month ECL as ‘the portion of lifetime expected credit …

IFRS 9 defines an amount equal to 12-month ECL as ‘the portion of lifetime expected credit losses that represent the expected credit losses that result from default events on a financial instrument that are possible within the 12 months after the reporting date’²⁸ . For these purposes, credit institutions must note that an amount equal to the 12-month ECL is not only the losses expected in the next 12 months; rather, in accordance with IFRS 9, paragraph B5.5.43, it is the expected cash shortfalls over the life of the lending exposure or group of lending exposures, due to loss events that could occur in the next 12 months. Credit institutions must also note that, in accordance with IFRS 9, paragraph 5.5.9, to assess whether a financial instrument should move to a lifetime ECL measure, the change in the risk of a default occurring over the expected life of the financial instrument must be considered. In some circumstances, IFRS 9 allows changes in the risk of a default occurring over the next 12 months to be used to make this assessment; however, this may not always be appropriate, and particular attention should be given to the examples set out in IFRS 9, paragraph B5.5.14.

²⁸ See IFRS 9, Appendix A, Defined terms.

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2. Ceanglais aitheanta

3. Caighdeáin ghaolmhara

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