Page 203 - Full Book_24.4.2021

NOTES TO THE
FINANCIAL STATEMENTS in retrospect

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for the financial year ended 31 december 2020 (continUed)
the Will to Suceed

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2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2.12 Impairment (continued)
Impairment of financial assets (continued) achieving a leading repute
(c) Incorporation of forward-looking information (continued)
Selected mevs are projected over the forecast period, and they could have a material impact in determining ecls. |
forecasted mevs are derived by economist using time series econometrics. the data series are procured from the
official source such as department of Statistics malaysia (“doSm”), bnm and other government agencies. Prior to
mev forecast, economists would gather his or her intelligence from discussion with the policy makers, institutional
investors and other news flow (main stream and social media) in order to form an opinion. the opinion may cover Paving the Way for a Sustainable future
the economic policies, business cycle and financial market condition. this will be the main input before embarking
mev forecast exercise.
the methodology and assumptions including any forecasts of future economic conditions are reviewed regularly.
(d) Credit impaired financial assets
at each reporting date, the Group assesses whether financial assets carried at amortised cost and debt instruments
at fvoci are credit-impaired. a financial asset is ‘credit-impaired’ when one or more events that have a negative 197
impact on the estimated future cash flows of the financial asset have occurred.
the criteria that the Group uses to determine that there is objective evidence of an impairment loss include:
• significant financial difficulty of the issuer or obligor;

• a breach of contract, such as default or delinquency in profit or principal payments;
• the restructuring of a financing or advance by the Group on terms that the Group would not consider otherwise; adhering to the best Governance Practices
• it is probable that the borrower will enter bankruptcy or other financial reorganisation; or
• based on external credit assessment institutions rating which indicates high likelihood of default.
(e) presentation of allowance for ECL in the statement of financial position
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loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of
the assets.
for debt instruments at fvoci, the loss allowance is charged to profit or loss and is recognised in other
comprehensive income. Laying the Foundation for Financial Growth

(f) Restructured financing
a financing that is renegotiated is derecognised if the existing agreement is cancelled and a new agreement made
on substantially different terms or if the terms of an existing agreement are modified such that the renegotiated
financing is a substantially different instrument. Where such financing are derecognised, the renegotiated contract
is a new financing and impairment is assessed in accordance with the Group accounting policy. |
Where the renegotiation of such financing are not derecognised, the gross carrying amount is recalculated based
on the revised cash flows with gain or loss on modification recognised in profit or loss. impairment continues to be
assessed for significant increases in credit risk compared to the initial origination credit risk rating.
(g) Write-off additional information & disclosure Summary
the gross carrying amount of a financial asset is written off when the Group has no reasonable expectations of
recovering a financial asset in its entirety or a portion thereof. for individual customers, the Group has a policy of
writing off the gross carrying amount when the financial asset is 180 days past due based on historical experience of
recoveries of similar assets. for commercial and corporate customers, the Group individually makes an assessment with |
respect to the timing and amount of write-off based on whether there is a reasonable expectation of recovery. the
Group expects no significant recovery from the amount written off. however, financial assets that are written off could
still be subject to enforcement activities in order to comply with the Group’s procedures for recovery of amounts due. 24 th aGm information