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Summary
Objective
Indian Accounting Standard (Ind AS) will bring about a significant change in the financial statements of banks and financial companies.
Non-performing assets are currently provisioned based on the Reserve Bank of India’s (RBI’s) directives - a rule based system - driven by the number of days for which the assets are overdue. In contrast, Ind AS envisions a look-ahead system, determining expected losses through: (a) statistical analysis and (b) deep management judgement about the quantum and timing of future cash flows. In addition, the expected credit loss (ECL) model will substantially impact a Balance Sheet’s profit and quality. In terms of human and IT efforts, the process is resource intensive.
A key change is the development of effective interest rate (EIR) mechanisms for each loan. Under Indian GAAP, upfront fees and costs are recognized either : (a) in the profit and loss account on the day of accrual; or (b) straight lined over the loan tenure. Ind AS directs such fees and costs to be rolled into the regular interest rate to determine an EIR for each loan. This exhaustive process requires a deep understanding of each cost, income and the loan itself. Floating interest rates pose additional challenges in determination of the EIR.
Derivatives, marking to market various positions, hedging, and hedge accounting are exceptional challenges in the financial sector. To help you implement Ind AS in your organization, these topics and more, will be covered in the programme.
Target participants
Finance and accounts officers of banks and non-bank finance companies (NBFCs)
Credit officers and credit risk managers
Financial institutions group at banks
Investors in financial sector and fixed income analysts
Programme highlights
Live lecture by subject expert
Participants join from their location
Graphs and charts explained by the expert on the whiteboard
Presentation and case studies shared
Feedback uploaded by participants
Real-time Q&A session
Live chat facility for having individual /group conversations
