Mastering IFRS 9: Advanced Financial Instrument Classification and Impairment Strategies
You're under pressure. Another deadline looms. Another complex financial instrument demands classification. Another credit loss model resists consistency. The risk of misapplication is real. The cost of error is measured in audit findings, restatements, and reputational damage. You know IFRS 9 inside out-on the surface. But when it comes to nuanced equity holdings, hybrid contracts, or lifetime expected credit losses that hinge on forward-looking macro data, confidence fades. You’re not stuck. But you’re not advancing either. This isn’t about memorisation. It’s about mastery. The kind that lets you walk into any boardroom and confidently defend your classification rationale or lead a top-down ECL stress test without hesitation. That’s what Mastering IFRS 9: Advanced Financial Instrument Classification and Impairment Strategies delivers. One Senior Financial Reporting Manager in Dubai used the framework from this course to reclassify a $270 million loan portfolio with embedded prepayment options. The result? A material reduction in Stage 3 exposures and an audit opinion with zero adjustments for credit risk provisions. Her impact was immediate-and career-defining. Imagine turning uncertainty into precise action. Going from interpreting vague amendment guidance to designing board-ready impairment methodologies that withstand auditor scrutiny. This course isn’t just training. It’s a career accelerant. You’ll go from uncertain interpretation to delivering fully documented, defensible financial reporting decisions in under 30 days-with clarity, speed, and precision. No guesswork. No compromises. Here’s how this course is structured to help you get there.Course Format & Delivery Details Flexible, On-Demand Access Built for Demanding Professionals
This is a self-paced course designed for executives, auditors, and accounting leads who operate under tight deadlines and complex reporting environments. From the moment you enrol, you gain structured access to a meticulously curated learning path, engineered to deliver clarity and real-world impact-on your schedule. The course is entirely on-demand. No fixed start dates, no mandatory attendance windows. You control the pace, the timeline, and the depth of engagement. Most learners complete the full programme in 20–25 hours and apply core concepts within the first week. Lifetime Access with Continuous Updates
Enrol once. Learn for life. You receive permanent access to all course materials, including future revisions as IFRS 9 applications evolve and new IASB clarifications emerge. No subscriptions. No renewal fees. Just continuous value. - Access available 24/7 from any location worldwide
- Optimised for desktop, tablet, and mobile-learn during flights, commutes, or between meetings
- Progress tracking ensures you never lose your place
Expert-Led Support with Real-World Relevance
Stuck on bifurcating a compound instrument with a deeply subordinated debt component? Need help validating your probability of default model inputs? You’re not alone. Course enrollees receive direct access to our team of IFRS 9 specialists-former Big 4 partners and global financial reporting leads-with over 70 combined years of implementation experience. Submit technical queries through the learning portal and receive detailed, audit-grade responses within 48 business hours. Responses include precedent references, practical templates, and structured reasoning flows-exactly what you’d expect from a senior technical accounting team. Certificate of Completion Issued by The Art of Service
Upon finishing the course and successfully demonstrating understanding through assessment tasks, you will receive a verified Certificate of Completion issued by The Art of Service-a globally recognised training provider trusted by Fortune 500 firms, national audit regulators, and multinational accounting networks. This certification signals mastery to employers, auditors, and regulators. It demonstrates structured, rigorous, and evidence-based competence in advanced IFRS 9 application-not just exposure. Transparent Pricing with Zero Hidden Costs
We believe clarity should extend beyond accounting standards to purchasing decisions. The price covers everything: full curriculum access, expert support, lifetime updates, and certification. No extras. No upsells. No surprise fees. - Secure payment accepted via Visa, Mastercard, and PayPal
- All transactions protected with end-to-end encryption
- No additional taxes or processing fees beyond listed price
Full 30-Day Satisfied-or-Refunded Guarantee
Your success is our priority. If you complete Module 1 and don’t believe the course delivers exceptional value, clarity, and direct applicability to your role, contact us for a full refund-no questions asked. This is risk-free upskilling at the highest level. What Happens After Enrollment?
Following registration, you’ll receive an email confirmation with your account details. Your access credentials and learning path guide will be delivered separately within one business day of course material availability, ensuring you begin with a fully calibrated, up-to-date experience. Will This Work for Me?
Yes-especially if you’re a financial controller, audit manager, reporting specialist, or capital markets professional navigating complex classification challenges. This programme was designed for individuals who already know IFRS 9 basics but need to move from rule-following to professional judgment. This works even if you work in a jurisdiction with aggressive local GAAP variations, oversee portfolios with volatile credit risk trajectories, or operate under intense audit scrutiny. The frameworks are built to be jurisdiction-agnostic, principle-based, and audit-defensible. - Senior Accountant at a European asset manager: “Applied the ECL calibration toolkit to a private debt fund-reduced PD volatility by 38% using forward scenario weighting”
- Internal Auditor, North American Bank: “Used the classification decision engine to re-evaluate 12 hybrid instruments-uncovered $19M in misclassified fair value exposures”
- Group Financial Reporting Lead, Singapore: “Finalised our IFRS 9 policy documentation in half the projected time using the templates and flowcharts”
We’ve eliminated the risk. All that’s left is the reward: clarity, confidence, and career advancement.
Extensive and Detailed Course Curriculum
Module 1: Foundations of IFRS 9 and Strategic Implementation Context - Evolution from IAS 39 to IFRS 9: key driver analysis
- Scope and applicability across asset classes and entities
- Timeline of mandatory adoption and early application pathways
- Interaction with other IFRS standards: IAS 1, IAS 32, IFRS 7
- Role of professional judgment in absence of bright-line rules
- Overview of the three pillars: classification, impairment, hedge accounting
- Strategic importance of IFRS 9 for financial statement integrity
- Common misinterpretations and regulatory scrutiny hotspots
- Structure of the standard: initial recognition vs subsequent measurement
- Link between business model assessment and financial reporting outcomes
Module 2: Business Model Assessment for Financial Assets - Defining the business model: purpose and evidence gathering
- Key indicators: hold-to-collect, hold-to-sell, combined model
- Management approach vs actual holding patterns
- Documentation requirements for audit defence
- Frequency and volume of sales as indicative evidence
- Impact of market conditions on business model validity
- Assessment for groups of assets vs individual instruments
- Treatment of transient vs strategic portfolio reallocations
- Management monitoring metrics and performance evaluation
- Interaction between business model and SPPI assessment
Module 3: SPPI (Solely Payments of Principal and Interest) Test - Understanding the SPPI criterion under IFRS 9.4.1.2(b)
- Economic relationship between principal and interest
- Time value of money: core components and adjustments
- Introduction to benchmark reform and fallback rates
- SPPI evaluation for inflation-linked instruments
- Application to floating-rate notes with credit-sensitive floors
- Contracts indexed to equity or commodity prices
- Debt instruments with contractual cash flows linked to recovery value
- Impact of prepayment features on SPPI eligibility
- Non-guaranteed returns: dividends, profit shares, or participation features
- Forward-looking credit adjustments: permitted vs prohibited structures
- SPPI treatment for assets with interest rate caps and floors
- Embedded derivatives that fail to meet separation criteria
- How to document SPPI conclusions for external audit
- Case study: evaluating a convertible loan with cash conversion option
Module 4: Classification of Financial Assets - Amortised cost criteria: business model + SPPI
- Fair value through profit or loss (FVTPL): mandatory and optional designation
- Fair value through other comprehensive income (FVOCI): debt instruments
- Treatment of equity investments under IFRS 9.5.7.1
- Irrevocable election for equity instruments
- Disclosure requirements for FVOCI equity reclassifications
- Impact of changes in business model on asset reclassification
- Reclassification procedures and effective date implications
- Interaction between classification and hedging relationships
- Disclosure templates for asset categorisation
- Common audit challenges in classification documentation
- Case study: reclassifying a distressed debt portfolio
- Securities held for trading: bright-line indicators
- Debt instruments with modest equity conversion features
- Structured notes with capital protection mechanisms
Module 5: Special Classification Scenarios - Lease receivables under IFRS 16 and IFRS 9 alignment
- Loan commitments accounted for as financial guarantees
- Undrawn credit lines and off-balance sheet exposures
- Receivables factored with and without recourse
- Transfer of credit risk: derecognition vs continued involvement
- Reverse repurchase agreements and collateralised lending
- Structured investment vehicles and VIE considerations
- Participating mortgages with surplus sharing features
- Debt instruments with loss-absorbing capacity (TLAC eligible)
- Contracts to buy or sell non-financial items
- Forward foreign exchange contracts with deferred settlement
- Interest rate swaps accounted at fair value
- Equity method investments and related party finance
- Investments in funds with variable returns
- Derivatives embedded in non-derivative host contracts
Module 6: Accounting for Financial Liabilities - Initial recognition and transaction costs
- Amortised cost measurement using effective interest method
- Fair value option under IFRS 9.4.2.1
- Hedging gains and losses in own credit risk
- Disclosure requirements for liabilities carried at FVTPL
- Treatment of convertible debt instruments
- Liabilities with equity conversion features
- Debt restructuring and modification accounting
- Early repayment penalties and fees
- Guaranteed investment contracts and repurchase obligations
- Subordinated debt and capital adequacy rules
- Debt instruments with contingent interest clauses
- Interaction with IFRS 9 hedge accounting
- Impact of credit spreads on liability valuation
- Analysis of non-performance risk adjustments
Module 7: Expected Credit Loss (ECL) Model Fundamentals - Overview of the three-stage impairment model
- Stage 1: assets not credit-impaired, low increase in credit risk
- Stage 2: significant increase in credit risk
- Stage 3: credit-impaired financial assets
- 12-month expected credit losses vs lifetime ECL
- Components: PD, LGD, EAD, and discount rate
- Data requirements for robust ECL estimation
- Use of external vs internal credit ratings
- Migration between impairment stages
- Derecognition of financial assets following default
- Role of management overlay in ECL models
- Treatment of purchased or originated credit-impaired assets
- Look-through approach for securitised assets
- Discounting techniques and time value of money
- Peer benchmarking and model validation
Module 8: Probability of Default (PD) Modelling - Definition and statistical foundations of PD
- Forward-looking macroeconomic scenarios
- Historical default data sources and reliability
- Mapping internal ratings to external benchmarks
- Time horizons: 1-year, 3-year, and lifetime PD
- Segmentation by industry, geography, and collateral
- Adjustments for cyclical and structural economic changes
- Use of rating agencies: Moody’s, S&P, Fitch
- Internal rating systems and governance requirements
- Backtesting and goodness-of-fit evaluation
- PD calculation for sovereign exposures
- Corporate bond default curves and extrapolation
- Probability transition matrices
- PD treatment for unrated or privately held entities
- Stress testing across baseline, adverse, and severely adverse scenarios
Module 9: Loss Given Default (LGD) Calculation - Definition and recovery rate assumptions
- Collateral valuation methodologies
- Seniority and priority of claims
- Legal enforceability and jurisdiction risk
- LGD for secured vs unsecured exposures
- Market-based vs workout-based LGD estimation
- Use of historical recovery data
- Impact of insolvency regimes and resolution procedures
- Net vs gross LGD
- LGD for revolving credit facilities
- Project finance and non-recourse lending considerations
- Intercompany loans and group support assumptions
- Application of haircuts and volatility adjustments
- LGD stress calibrations
- Documentation standards for LGD model policies
Module 10: Exposure at Default (EAD) Estimation - Definition and practical estimation challenges
- Drawn amounts and committed undrawn balances
- Estimating utilisation rates for revolving facilities
- Conversion factors and credit conversion factors (CCF)
- Time-weighted average EAD over the loan lifecycle
- Behavioural patterns in overdraft usage
- EAD for off-balance sheet instruments
- Contingent exposures and performance guarantees
- Use of historical drawdown data
- Impact of line size and customer behaviour
- Stress testing EAD assumptions
- Interim and covenant-driven drawdown risks
- Loan equivalency for derivative exposures
- Internal models for EAD calibration
- Regulatory benchmarks for CCF application
Module 11: Discounting and Present Value Calculations - Effective interest rate (EIR) as discount rate
- Consistency between EIR and discounting methodology
- Adjustments for credit deterioration post inception
- Use of contractual vs market rates
- Fixed vs floating rate discounting
- Forward rate application in multi-period models
- Time slicing and cash flow segmentation
- Handling prepayments and early defaults
- Present value calculation spreadsheets
- Alignment with amortised cost tracking
- Discounting financial guarantees and loan commitments
- Use of spot vs forward curves
- Curve construction from market data
- Negative interest rate environments
- Sensitivity analysis on discount rate assumptions
Module 12: Forward-Looking Information Integration - Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
Module 1: Foundations of IFRS 9 and Strategic Implementation Context - Evolution from IAS 39 to IFRS 9: key driver analysis
- Scope and applicability across asset classes and entities
- Timeline of mandatory adoption and early application pathways
- Interaction with other IFRS standards: IAS 1, IAS 32, IFRS 7
- Role of professional judgment in absence of bright-line rules
- Overview of the three pillars: classification, impairment, hedge accounting
- Strategic importance of IFRS 9 for financial statement integrity
- Common misinterpretations and regulatory scrutiny hotspots
- Structure of the standard: initial recognition vs subsequent measurement
- Link between business model assessment and financial reporting outcomes
Module 2: Business Model Assessment for Financial Assets - Defining the business model: purpose and evidence gathering
- Key indicators: hold-to-collect, hold-to-sell, combined model
- Management approach vs actual holding patterns
- Documentation requirements for audit defence
- Frequency and volume of sales as indicative evidence
- Impact of market conditions on business model validity
- Assessment for groups of assets vs individual instruments
- Treatment of transient vs strategic portfolio reallocations
- Management monitoring metrics and performance evaluation
- Interaction between business model and SPPI assessment
Module 3: SPPI (Solely Payments of Principal and Interest) Test - Understanding the SPPI criterion under IFRS 9.4.1.2(b)
- Economic relationship between principal and interest
- Time value of money: core components and adjustments
- Introduction to benchmark reform and fallback rates
- SPPI evaluation for inflation-linked instruments
- Application to floating-rate notes with credit-sensitive floors
- Contracts indexed to equity or commodity prices
- Debt instruments with contractual cash flows linked to recovery value
- Impact of prepayment features on SPPI eligibility
- Non-guaranteed returns: dividends, profit shares, or participation features
- Forward-looking credit adjustments: permitted vs prohibited structures
- SPPI treatment for assets with interest rate caps and floors
- Embedded derivatives that fail to meet separation criteria
- How to document SPPI conclusions for external audit
- Case study: evaluating a convertible loan with cash conversion option
Module 4: Classification of Financial Assets - Amortised cost criteria: business model + SPPI
- Fair value through profit or loss (FVTPL): mandatory and optional designation
- Fair value through other comprehensive income (FVOCI): debt instruments
- Treatment of equity investments under IFRS 9.5.7.1
- Irrevocable election for equity instruments
- Disclosure requirements for FVOCI equity reclassifications
- Impact of changes in business model on asset reclassification
- Reclassification procedures and effective date implications
- Interaction between classification and hedging relationships
- Disclosure templates for asset categorisation
- Common audit challenges in classification documentation
- Case study: reclassifying a distressed debt portfolio
- Securities held for trading: bright-line indicators
- Debt instruments with modest equity conversion features
- Structured notes with capital protection mechanisms
Module 5: Special Classification Scenarios - Lease receivables under IFRS 16 and IFRS 9 alignment
- Loan commitments accounted for as financial guarantees
- Undrawn credit lines and off-balance sheet exposures
- Receivables factored with and without recourse
- Transfer of credit risk: derecognition vs continued involvement
- Reverse repurchase agreements and collateralised lending
- Structured investment vehicles and VIE considerations
- Participating mortgages with surplus sharing features
- Debt instruments with loss-absorbing capacity (TLAC eligible)
- Contracts to buy or sell non-financial items
- Forward foreign exchange contracts with deferred settlement
- Interest rate swaps accounted at fair value
- Equity method investments and related party finance
- Investments in funds with variable returns
- Derivatives embedded in non-derivative host contracts
Module 6: Accounting for Financial Liabilities - Initial recognition and transaction costs
- Amortised cost measurement using effective interest method
- Fair value option under IFRS 9.4.2.1
- Hedging gains and losses in own credit risk
- Disclosure requirements for liabilities carried at FVTPL
- Treatment of convertible debt instruments
- Liabilities with equity conversion features
- Debt restructuring and modification accounting
- Early repayment penalties and fees
- Guaranteed investment contracts and repurchase obligations
- Subordinated debt and capital adequacy rules
- Debt instruments with contingent interest clauses
- Interaction with IFRS 9 hedge accounting
- Impact of credit spreads on liability valuation
- Analysis of non-performance risk adjustments
Module 7: Expected Credit Loss (ECL) Model Fundamentals - Overview of the three-stage impairment model
- Stage 1: assets not credit-impaired, low increase in credit risk
- Stage 2: significant increase in credit risk
- Stage 3: credit-impaired financial assets
- 12-month expected credit losses vs lifetime ECL
- Components: PD, LGD, EAD, and discount rate
- Data requirements for robust ECL estimation
- Use of external vs internal credit ratings
- Migration between impairment stages
- Derecognition of financial assets following default
- Role of management overlay in ECL models
- Treatment of purchased or originated credit-impaired assets
- Look-through approach for securitised assets
- Discounting techniques and time value of money
- Peer benchmarking and model validation
Module 8: Probability of Default (PD) Modelling - Definition and statistical foundations of PD
- Forward-looking macroeconomic scenarios
- Historical default data sources and reliability
- Mapping internal ratings to external benchmarks
- Time horizons: 1-year, 3-year, and lifetime PD
- Segmentation by industry, geography, and collateral
- Adjustments for cyclical and structural economic changes
- Use of rating agencies: Moody’s, S&P, Fitch
- Internal rating systems and governance requirements
- Backtesting and goodness-of-fit evaluation
- PD calculation for sovereign exposures
- Corporate bond default curves and extrapolation
- Probability transition matrices
- PD treatment for unrated or privately held entities
- Stress testing across baseline, adverse, and severely adverse scenarios
Module 9: Loss Given Default (LGD) Calculation - Definition and recovery rate assumptions
- Collateral valuation methodologies
- Seniority and priority of claims
- Legal enforceability and jurisdiction risk
- LGD for secured vs unsecured exposures
- Market-based vs workout-based LGD estimation
- Use of historical recovery data
- Impact of insolvency regimes and resolution procedures
- Net vs gross LGD
- LGD for revolving credit facilities
- Project finance and non-recourse lending considerations
- Intercompany loans and group support assumptions
- Application of haircuts and volatility adjustments
- LGD stress calibrations
- Documentation standards for LGD model policies
Module 10: Exposure at Default (EAD) Estimation - Definition and practical estimation challenges
- Drawn amounts and committed undrawn balances
- Estimating utilisation rates for revolving facilities
- Conversion factors and credit conversion factors (CCF)
- Time-weighted average EAD over the loan lifecycle
- Behavioural patterns in overdraft usage
- EAD for off-balance sheet instruments
- Contingent exposures and performance guarantees
- Use of historical drawdown data
- Impact of line size and customer behaviour
- Stress testing EAD assumptions
- Interim and covenant-driven drawdown risks
- Loan equivalency for derivative exposures
- Internal models for EAD calibration
- Regulatory benchmarks for CCF application
Module 11: Discounting and Present Value Calculations - Effective interest rate (EIR) as discount rate
- Consistency between EIR and discounting methodology
- Adjustments for credit deterioration post inception
- Use of contractual vs market rates
- Fixed vs floating rate discounting
- Forward rate application in multi-period models
- Time slicing and cash flow segmentation
- Handling prepayments and early defaults
- Present value calculation spreadsheets
- Alignment with amortised cost tracking
- Discounting financial guarantees and loan commitments
- Use of spot vs forward curves
- Curve construction from market data
- Negative interest rate environments
- Sensitivity analysis on discount rate assumptions
Module 12: Forward-Looking Information Integration - Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Defining the business model: purpose and evidence gathering
- Key indicators: hold-to-collect, hold-to-sell, combined model
- Management approach vs actual holding patterns
- Documentation requirements for audit defence
- Frequency and volume of sales as indicative evidence
- Impact of market conditions on business model validity
- Assessment for groups of assets vs individual instruments
- Treatment of transient vs strategic portfolio reallocations
- Management monitoring metrics and performance evaluation
- Interaction between business model and SPPI assessment
Module 3: SPPI (Solely Payments of Principal and Interest) Test - Understanding the SPPI criterion under IFRS 9.4.1.2(b)
- Economic relationship between principal and interest
- Time value of money: core components and adjustments
- Introduction to benchmark reform and fallback rates
- SPPI evaluation for inflation-linked instruments
- Application to floating-rate notes with credit-sensitive floors
- Contracts indexed to equity or commodity prices
- Debt instruments with contractual cash flows linked to recovery value
- Impact of prepayment features on SPPI eligibility
- Non-guaranteed returns: dividends, profit shares, or participation features
- Forward-looking credit adjustments: permitted vs prohibited structures
- SPPI treatment for assets with interest rate caps and floors
- Embedded derivatives that fail to meet separation criteria
- How to document SPPI conclusions for external audit
- Case study: evaluating a convertible loan with cash conversion option
Module 4: Classification of Financial Assets - Amortised cost criteria: business model + SPPI
- Fair value through profit or loss (FVTPL): mandatory and optional designation
- Fair value through other comprehensive income (FVOCI): debt instruments
- Treatment of equity investments under IFRS 9.5.7.1
- Irrevocable election for equity instruments
- Disclosure requirements for FVOCI equity reclassifications
- Impact of changes in business model on asset reclassification
- Reclassification procedures and effective date implications
- Interaction between classification and hedging relationships
- Disclosure templates for asset categorisation
- Common audit challenges in classification documentation
- Case study: reclassifying a distressed debt portfolio
- Securities held for trading: bright-line indicators
- Debt instruments with modest equity conversion features
- Structured notes with capital protection mechanisms
Module 5: Special Classification Scenarios - Lease receivables under IFRS 16 and IFRS 9 alignment
- Loan commitments accounted for as financial guarantees
- Undrawn credit lines and off-balance sheet exposures
- Receivables factored with and without recourse
- Transfer of credit risk: derecognition vs continued involvement
- Reverse repurchase agreements and collateralised lending
- Structured investment vehicles and VIE considerations
- Participating mortgages with surplus sharing features
- Debt instruments with loss-absorbing capacity (TLAC eligible)
- Contracts to buy or sell non-financial items
- Forward foreign exchange contracts with deferred settlement
- Interest rate swaps accounted at fair value
- Equity method investments and related party finance
- Investments in funds with variable returns
- Derivatives embedded in non-derivative host contracts
Module 6: Accounting for Financial Liabilities - Initial recognition and transaction costs
- Amortised cost measurement using effective interest method
- Fair value option under IFRS 9.4.2.1
- Hedging gains and losses in own credit risk
- Disclosure requirements for liabilities carried at FVTPL
- Treatment of convertible debt instruments
- Liabilities with equity conversion features
- Debt restructuring and modification accounting
- Early repayment penalties and fees
- Guaranteed investment contracts and repurchase obligations
- Subordinated debt and capital adequacy rules
- Debt instruments with contingent interest clauses
- Interaction with IFRS 9 hedge accounting
- Impact of credit spreads on liability valuation
- Analysis of non-performance risk adjustments
Module 7: Expected Credit Loss (ECL) Model Fundamentals - Overview of the three-stage impairment model
- Stage 1: assets not credit-impaired, low increase in credit risk
- Stage 2: significant increase in credit risk
- Stage 3: credit-impaired financial assets
- 12-month expected credit losses vs lifetime ECL
- Components: PD, LGD, EAD, and discount rate
- Data requirements for robust ECL estimation
- Use of external vs internal credit ratings
- Migration between impairment stages
- Derecognition of financial assets following default
- Role of management overlay in ECL models
- Treatment of purchased or originated credit-impaired assets
- Look-through approach for securitised assets
- Discounting techniques and time value of money
- Peer benchmarking and model validation
Module 8: Probability of Default (PD) Modelling - Definition and statistical foundations of PD
- Forward-looking macroeconomic scenarios
- Historical default data sources and reliability
- Mapping internal ratings to external benchmarks
- Time horizons: 1-year, 3-year, and lifetime PD
- Segmentation by industry, geography, and collateral
- Adjustments for cyclical and structural economic changes
- Use of rating agencies: Moody’s, S&P, Fitch
- Internal rating systems and governance requirements
- Backtesting and goodness-of-fit evaluation
- PD calculation for sovereign exposures
- Corporate bond default curves and extrapolation
- Probability transition matrices
- PD treatment for unrated or privately held entities
- Stress testing across baseline, adverse, and severely adverse scenarios
Module 9: Loss Given Default (LGD) Calculation - Definition and recovery rate assumptions
- Collateral valuation methodologies
- Seniority and priority of claims
- Legal enforceability and jurisdiction risk
- LGD for secured vs unsecured exposures
- Market-based vs workout-based LGD estimation
- Use of historical recovery data
- Impact of insolvency regimes and resolution procedures
- Net vs gross LGD
- LGD for revolving credit facilities
- Project finance and non-recourse lending considerations
- Intercompany loans and group support assumptions
- Application of haircuts and volatility adjustments
- LGD stress calibrations
- Documentation standards for LGD model policies
Module 10: Exposure at Default (EAD) Estimation - Definition and practical estimation challenges
- Drawn amounts and committed undrawn balances
- Estimating utilisation rates for revolving facilities
- Conversion factors and credit conversion factors (CCF)
- Time-weighted average EAD over the loan lifecycle
- Behavioural patterns in overdraft usage
- EAD for off-balance sheet instruments
- Contingent exposures and performance guarantees
- Use of historical drawdown data
- Impact of line size and customer behaviour
- Stress testing EAD assumptions
- Interim and covenant-driven drawdown risks
- Loan equivalency for derivative exposures
- Internal models for EAD calibration
- Regulatory benchmarks for CCF application
Module 11: Discounting and Present Value Calculations - Effective interest rate (EIR) as discount rate
- Consistency between EIR and discounting methodology
- Adjustments for credit deterioration post inception
- Use of contractual vs market rates
- Fixed vs floating rate discounting
- Forward rate application in multi-period models
- Time slicing and cash flow segmentation
- Handling prepayments and early defaults
- Present value calculation spreadsheets
- Alignment with amortised cost tracking
- Discounting financial guarantees and loan commitments
- Use of spot vs forward curves
- Curve construction from market data
- Negative interest rate environments
- Sensitivity analysis on discount rate assumptions
Module 12: Forward-Looking Information Integration - Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Amortised cost criteria: business model + SPPI
- Fair value through profit or loss (FVTPL): mandatory and optional designation
- Fair value through other comprehensive income (FVOCI): debt instruments
- Treatment of equity investments under IFRS 9.5.7.1
- Irrevocable election for equity instruments
- Disclosure requirements for FVOCI equity reclassifications
- Impact of changes in business model on asset reclassification
- Reclassification procedures and effective date implications
- Interaction between classification and hedging relationships
- Disclosure templates for asset categorisation
- Common audit challenges in classification documentation
- Case study: reclassifying a distressed debt portfolio
- Securities held for trading: bright-line indicators
- Debt instruments with modest equity conversion features
- Structured notes with capital protection mechanisms
Module 5: Special Classification Scenarios - Lease receivables under IFRS 16 and IFRS 9 alignment
- Loan commitments accounted for as financial guarantees
- Undrawn credit lines and off-balance sheet exposures
- Receivables factored with and without recourse
- Transfer of credit risk: derecognition vs continued involvement
- Reverse repurchase agreements and collateralised lending
- Structured investment vehicles and VIE considerations
- Participating mortgages with surplus sharing features
- Debt instruments with loss-absorbing capacity (TLAC eligible)
- Contracts to buy or sell non-financial items
- Forward foreign exchange contracts with deferred settlement
- Interest rate swaps accounted at fair value
- Equity method investments and related party finance
- Investments in funds with variable returns
- Derivatives embedded in non-derivative host contracts
Module 6: Accounting for Financial Liabilities - Initial recognition and transaction costs
- Amortised cost measurement using effective interest method
- Fair value option under IFRS 9.4.2.1
- Hedging gains and losses in own credit risk
- Disclosure requirements for liabilities carried at FVTPL
- Treatment of convertible debt instruments
- Liabilities with equity conversion features
- Debt restructuring and modification accounting
- Early repayment penalties and fees
- Guaranteed investment contracts and repurchase obligations
- Subordinated debt and capital adequacy rules
- Debt instruments with contingent interest clauses
- Interaction with IFRS 9 hedge accounting
- Impact of credit spreads on liability valuation
- Analysis of non-performance risk adjustments
Module 7: Expected Credit Loss (ECL) Model Fundamentals - Overview of the three-stage impairment model
- Stage 1: assets not credit-impaired, low increase in credit risk
- Stage 2: significant increase in credit risk
- Stage 3: credit-impaired financial assets
- 12-month expected credit losses vs lifetime ECL
- Components: PD, LGD, EAD, and discount rate
- Data requirements for robust ECL estimation
- Use of external vs internal credit ratings
- Migration between impairment stages
- Derecognition of financial assets following default
- Role of management overlay in ECL models
- Treatment of purchased or originated credit-impaired assets
- Look-through approach for securitised assets
- Discounting techniques and time value of money
- Peer benchmarking and model validation
Module 8: Probability of Default (PD) Modelling - Definition and statistical foundations of PD
- Forward-looking macroeconomic scenarios
- Historical default data sources and reliability
- Mapping internal ratings to external benchmarks
- Time horizons: 1-year, 3-year, and lifetime PD
- Segmentation by industry, geography, and collateral
- Adjustments for cyclical and structural economic changes
- Use of rating agencies: Moody’s, S&P, Fitch
- Internal rating systems and governance requirements
- Backtesting and goodness-of-fit evaluation
- PD calculation for sovereign exposures
- Corporate bond default curves and extrapolation
- Probability transition matrices
- PD treatment for unrated or privately held entities
- Stress testing across baseline, adverse, and severely adverse scenarios
Module 9: Loss Given Default (LGD) Calculation - Definition and recovery rate assumptions
- Collateral valuation methodologies
- Seniority and priority of claims
- Legal enforceability and jurisdiction risk
- LGD for secured vs unsecured exposures
- Market-based vs workout-based LGD estimation
- Use of historical recovery data
- Impact of insolvency regimes and resolution procedures
- Net vs gross LGD
- LGD for revolving credit facilities
- Project finance and non-recourse lending considerations
- Intercompany loans and group support assumptions
- Application of haircuts and volatility adjustments
- LGD stress calibrations
- Documentation standards for LGD model policies
Module 10: Exposure at Default (EAD) Estimation - Definition and practical estimation challenges
- Drawn amounts and committed undrawn balances
- Estimating utilisation rates for revolving facilities
- Conversion factors and credit conversion factors (CCF)
- Time-weighted average EAD over the loan lifecycle
- Behavioural patterns in overdraft usage
- EAD for off-balance sheet instruments
- Contingent exposures and performance guarantees
- Use of historical drawdown data
- Impact of line size and customer behaviour
- Stress testing EAD assumptions
- Interim and covenant-driven drawdown risks
- Loan equivalency for derivative exposures
- Internal models for EAD calibration
- Regulatory benchmarks for CCF application
Module 11: Discounting and Present Value Calculations - Effective interest rate (EIR) as discount rate
- Consistency between EIR and discounting methodology
- Adjustments for credit deterioration post inception
- Use of contractual vs market rates
- Fixed vs floating rate discounting
- Forward rate application in multi-period models
- Time slicing and cash flow segmentation
- Handling prepayments and early defaults
- Present value calculation spreadsheets
- Alignment with amortised cost tracking
- Discounting financial guarantees and loan commitments
- Use of spot vs forward curves
- Curve construction from market data
- Negative interest rate environments
- Sensitivity analysis on discount rate assumptions
Module 12: Forward-Looking Information Integration - Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Initial recognition and transaction costs
- Amortised cost measurement using effective interest method
- Fair value option under IFRS 9.4.2.1
- Hedging gains and losses in own credit risk
- Disclosure requirements for liabilities carried at FVTPL
- Treatment of convertible debt instruments
- Liabilities with equity conversion features
- Debt restructuring and modification accounting
- Early repayment penalties and fees
- Guaranteed investment contracts and repurchase obligations
- Subordinated debt and capital adequacy rules
- Debt instruments with contingent interest clauses
- Interaction with IFRS 9 hedge accounting
- Impact of credit spreads on liability valuation
- Analysis of non-performance risk adjustments
Module 7: Expected Credit Loss (ECL) Model Fundamentals - Overview of the three-stage impairment model
- Stage 1: assets not credit-impaired, low increase in credit risk
- Stage 2: significant increase in credit risk
- Stage 3: credit-impaired financial assets
- 12-month expected credit losses vs lifetime ECL
- Components: PD, LGD, EAD, and discount rate
- Data requirements for robust ECL estimation
- Use of external vs internal credit ratings
- Migration between impairment stages
- Derecognition of financial assets following default
- Role of management overlay in ECL models
- Treatment of purchased or originated credit-impaired assets
- Look-through approach for securitised assets
- Discounting techniques and time value of money
- Peer benchmarking and model validation
Module 8: Probability of Default (PD) Modelling - Definition and statistical foundations of PD
- Forward-looking macroeconomic scenarios
- Historical default data sources and reliability
- Mapping internal ratings to external benchmarks
- Time horizons: 1-year, 3-year, and lifetime PD
- Segmentation by industry, geography, and collateral
- Adjustments for cyclical and structural economic changes
- Use of rating agencies: Moody’s, S&P, Fitch
- Internal rating systems and governance requirements
- Backtesting and goodness-of-fit evaluation
- PD calculation for sovereign exposures
- Corporate bond default curves and extrapolation
- Probability transition matrices
- PD treatment for unrated or privately held entities
- Stress testing across baseline, adverse, and severely adverse scenarios
Module 9: Loss Given Default (LGD) Calculation - Definition and recovery rate assumptions
- Collateral valuation methodologies
- Seniority and priority of claims
- Legal enforceability and jurisdiction risk
- LGD for secured vs unsecured exposures
- Market-based vs workout-based LGD estimation
- Use of historical recovery data
- Impact of insolvency regimes and resolution procedures
- Net vs gross LGD
- LGD for revolving credit facilities
- Project finance and non-recourse lending considerations
- Intercompany loans and group support assumptions
- Application of haircuts and volatility adjustments
- LGD stress calibrations
- Documentation standards for LGD model policies
Module 10: Exposure at Default (EAD) Estimation - Definition and practical estimation challenges
- Drawn amounts and committed undrawn balances
- Estimating utilisation rates for revolving facilities
- Conversion factors and credit conversion factors (CCF)
- Time-weighted average EAD over the loan lifecycle
- Behavioural patterns in overdraft usage
- EAD for off-balance sheet instruments
- Contingent exposures and performance guarantees
- Use of historical drawdown data
- Impact of line size and customer behaviour
- Stress testing EAD assumptions
- Interim and covenant-driven drawdown risks
- Loan equivalency for derivative exposures
- Internal models for EAD calibration
- Regulatory benchmarks for CCF application
Module 11: Discounting and Present Value Calculations - Effective interest rate (EIR) as discount rate
- Consistency between EIR and discounting methodology
- Adjustments for credit deterioration post inception
- Use of contractual vs market rates
- Fixed vs floating rate discounting
- Forward rate application in multi-period models
- Time slicing and cash flow segmentation
- Handling prepayments and early defaults
- Present value calculation spreadsheets
- Alignment with amortised cost tracking
- Discounting financial guarantees and loan commitments
- Use of spot vs forward curves
- Curve construction from market data
- Negative interest rate environments
- Sensitivity analysis on discount rate assumptions
Module 12: Forward-Looking Information Integration - Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Definition and statistical foundations of PD
- Forward-looking macroeconomic scenarios
- Historical default data sources and reliability
- Mapping internal ratings to external benchmarks
- Time horizons: 1-year, 3-year, and lifetime PD
- Segmentation by industry, geography, and collateral
- Adjustments for cyclical and structural economic changes
- Use of rating agencies: Moody’s, S&P, Fitch
- Internal rating systems and governance requirements
- Backtesting and goodness-of-fit evaluation
- PD calculation for sovereign exposures
- Corporate bond default curves and extrapolation
- Probability transition matrices
- PD treatment for unrated or privately held entities
- Stress testing across baseline, adverse, and severely adverse scenarios
Module 9: Loss Given Default (LGD) Calculation - Definition and recovery rate assumptions
- Collateral valuation methodologies
- Seniority and priority of claims
- Legal enforceability and jurisdiction risk
- LGD for secured vs unsecured exposures
- Market-based vs workout-based LGD estimation
- Use of historical recovery data
- Impact of insolvency regimes and resolution procedures
- Net vs gross LGD
- LGD for revolving credit facilities
- Project finance and non-recourse lending considerations
- Intercompany loans and group support assumptions
- Application of haircuts and volatility adjustments
- LGD stress calibrations
- Documentation standards for LGD model policies
Module 10: Exposure at Default (EAD) Estimation - Definition and practical estimation challenges
- Drawn amounts and committed undrawn balances
- Estimating utilisation rates for revolving facilities
- Conversion factors and credit conversion factors (CCF)
- Time-weighted average EAD over the loan lifecycle
- Behavioural patterns in overdraft usage
- EAD for off-balance sheet instruments
- Contingent exposures and performance guarantees
- Use of historical drawdown data
- Impact of line size and customer behaviour
- Stress testing EAD assumptions
- Interim and covenant-driven drawdown risks
- Loan equivalency for derivative exposures
- Internal models for EAD calibration
- Regulatory benchmarks for CCF application
Module 11: Discounting and Present Value Calculations - Effective interest rate (EIR) as discount rate
- Consistency between EIR and discounting methodology
- Adjustments for credit deterioration post inception
- Use of contractual vs market rates
- Fixed vs floating rate discounting
- Forward rate application in multi-period models
- Time slicing and cash flow segmentation
- Handling prepayments and early defaults
- Present value calculation spreadsheets
- Alignment with amortised cost tracking
- Discounting financial guarantees and loan commitments
- Use of spot vs forward curves
- Curve construction from market data
- Negative interest rate environments
- Sensitivity analysis on discount rate assumptions
Module 12: Forward-Looking Information Integration - Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Definition and practical estimation challenges
- Drawn amounts and committed undrawn balances
- Estimating utilisation rates for revolving facilities
- Conversion factors and credit conversion factors (CCF)
- Time-weighted average EAD over the loan lifecycle
- Behavioural patterns in overdraft usage
- EAD for off-balance sheet instruments
- Contingent exposures and performance guarantees
- Use of historical drawdown data
- Impact of line size and customer behaviour
- Stress testing EAD assumptions
- Interim and covenant-driven drawdown risks
- Loan equivalency for derivative exposures
- Internal models for EAD calibration
- Regulatory benchmarks for CCF application
Module 11: Discounting and Present Value Calculations - Effective interest rate (EIR) as discount rate
- Consistency between EIR and discounting methodology
- Adjustments for credit deterioration post inception
- Use of contractual vs market rates
- Fixed vs floating rate discounting
- Forward rate application in multi-period models
- Time slicing and cash flow segmentation
- Handling prepayments and early defaults
- Present value calculation spreadsheets
- Alignment with amortised cost tracking
- Discounting financial guarantees and loan commitments
- Use of spot vs forward curves
- Curve construction from market data
- Negative interest rate environments
- Sensitivity analysis on discount rate assumptions
Module 12: Forward-Looking Information Integration - Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Requirement to incorporate reasonable and supportable forecasts
- Sources: government data, central bank outlooks, internal forecasts
- Determining the forecast horizon
- Weighting scenarios: probabilities and materiality
- Documenting assumptions and governance processes
- Use of recession, growth, and baseline paths
- Incorporating inflation, unemployment, and GDP trends
- Credit risk linkages to macro variables
- Sector-specific risk sensitivities
- Geopolitical and climate risk adjustments
- Handling unexpected events (pandemics, wars)
- Interdepartmental data sharing: finance, risk, strategy
- Time decay in forecast reliability
- Model governance and internal audit sign-off
- Reporting ECL assumptions to the audit committee
Module 13: Management Overlay and Expert Adjustment - Role of management judgment in ECL
- Distinguishing expert judgment from bias
- Structured overlay frameworks
- Documentation requirements for adjustments
- Use of credit watchlists and early warning indicators
- Treatment of new business trends or portfolio shifts
- Adjustments for data limitations or model gaps
- Overlays for model instability or regime changes
- Applying conservatism in high uncertainty
- Audit defence of subjective inputs
- Separation of quantitative models and qualitative factors
- Approval processes and governance thresholds
- Threshold-based triggers for overlay application
- Historical precedent for adjustment ranges
- Reporting overlays in financial statement disclosures
Module 14: Simplified Approaches and Practical Shortcuts - Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Accounts receivable and trade payables exemption
- Receivables with original maturity ≤ 12 months
- Measurement at cost minus impairment
- Use of loss rate pools and ageing schedules
- PPNRs (Pre-Default Probability of Non-Payment)
- Statistical approximations under IFRS 9.5.5.4
- SME borrower pools and collective assessment
- Practical experience-based loss rates
- Lifetime loss rates as proxy for 12-month ECL
- Portfolio segmentation for simplified ECL
- Automation of simplified models in ERP systems
- Ideal use cases for simplified ECL application
- Transitioning from incurred loss to expected loss
- Comparison with local GAAP treatments
- When not to use simplified approaches
Module 15: Transition and Opening Balances - Hedged items and fair value hedge accounting
- Rebalancing and discontinuation of hedging relationships
- Disclosures under IFRS 9.7
- Rolling hedge strategies
- Macro hedge accounting for portfolios
- Time value and forward points in hedging
- Hedge effectiveness testing methodologies
- Regression analysis and dollar offset
- Documentation of risk management objectives
- Prospective and retrospective assessments
- Use of critical terms match method
- FVOCI for interest rate risk on financial liabilities
- Hedging foreign currency components of net investments
- Cash flow hedge accounting reservations
- Application of hedging to commodity price exposures
Module 16: Tax and Disclosure Implications - Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Deferred tax impacts of fair value movements
- Temporary differences from ECL provisions
- Tax base of financial assets and liabilities
- Disclosure requirements under IFRS 7
- Quantitative and qualitative ECL disclosures
- Impairment stage rollforwards
- Segmental reporting of credit risk
- Sensitivity analysis of key assumptions
- Liquidity and market risk disclosures
- Narrative explanations of policy choices
- Classification decision trees in footnotes
- Comparison with prior period information
- Materiality thresholds for disclosure
- Treatment of immaterial adjustments
- Interaction with segment reporting under IFRS 8
Module 17: Audit and Regulatory Scrutiny - Auditor expectations on ECL model validation
- Substantive testing of impairment assumptions
- Review of management overlay documentation
- Testing of SPPI conclusions
- Sampling methodologies for classification
- External verification of PD/LGD models
- Regulatory capital implications of ECL
- Basel III and IFRS 9 alignment
- PRA, ECB, and MAS supervisory expectations
- Challenges from internal and external auditors
- Pre-audit preparation checklist
- Responding to audit queries on forward-looking inputs
- Compilation of technical files for inspection
- Use of control self-assessment tools
- Peer review and benchmarking utilities
Module 18: Practical Implementation Projects & Certification - Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications
- Project 1: Full classification of a mixed-asset portfolio
- Project 2: ECL model build for a corporate loan book
- Project 3: Review of fair value election impacts on P&L
- Project 4: Documentation of business model assessment
- Project 5: SPPI evaluation for 5 complex instruments
- Project 6: Impairment stage assignment and migration
- Project 7: Macro scenario integration into ECL
- Project 8: Audit response package preparation
- Final assessment: case study under exam conditions
- Review of peer-submitted solutions and expert feedback
- Compilation of personal policy templates and flowcharts
- Creation of individual ECL model validation report
- Certification entry requirements and process
- Certificate of Completion issued by The Art of Service
- Post-course reference library and update notifications