46
BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED
ANNUAL REPORT 2013
Notes to the Consolidated Financial Statements
For the year ended March 31, 2013, with comparative figures for 2012
(Expressed in Barbados dollars)
25. FINANCIAL RISK MANAGEMENT (CONTINUED)
25.2Credit risk
(continued)
Aging analysis of past due but not impaired loans and advances:
2013
1-30 days
31-60 days
61-90 days
Total
Loans and advances:
Consumer
$ 46,331,063
11,238,111
4,241,175
61,810,349
Mortgage
22,911,341
6,982,495
3,563,579
33,457,415
Business
243,939
334,209
594,457
1,172,605
Total
$ 69,486,343
18,554,815
8,399,211
96,440,369
2012
1-30 days
31-60 days
61-90 days
Total
Loans and advances:
Consumer
$ 40,878,208
12,078,325
4,995,932
57,952,465
Mortgage
22,017,540
5,778,200
8,180,930
35,976,670
Business
913,394
185,871
133,883
1,233,148
Total
$ 63,809,142
18,042,396
13,310,745
95,162,283
Impairment assessment
For accounting purposes, the Group uses an incurred loss model for the recognition of losses on impaired financial assets. This
means that losses can only be recognised when objective evidence of a specific loss event has been observed. Triggering events
include the following:
- Significant financial difficulty of the customer.
- A breach of contract such as a default of payment.
- Where the Group grants the customer a concession due to the customer experiencing financial difficulty.
- It becomes probable that the customer will enter bankruptcy or other financial reorganisation.
- Observable data that suggests that there is a decrease in the estimated future cash flows from the loans.
Individually assessed allowances
The Group determines the allowances appropriate for each individually significant loan or advance on an individual basis,
including any overdue payments of interest or infringement of the original terms of the contract. Items considered when
determining allowance amounts include the sustainability of the counterparty’s business plan, its ability to improve performance
once a financial difficulty has arisen, projected receipts and the expected payout should bankruptcy ensue, the availability of
other financial support, the realisable value of collateral and the timing of the expected cash flows. Impairment allowances are
evaluated at each reporting date, unless unforeseen circumstances require more careful attention.
Collectively assessed allowances
Impairment allowances are assessed collectively for losses on loans and advances, held-to-maturity debt investments and loans
and receivable investments that are not individually significant and for individually significant loans and advances that have
been assessed individually and found not to be impaired.
The Group generally bases its analyses on historical experience. However, when there are significant market developments, the
Group would include macroeconomic factors within its assessments. These factors include, depending on the characteristics
of the individual or collective assessment: unemployment rates, current levels of bad debts, changes in laws, changes in
regulations, bankruptcy trends, and other consumer data. The Group may use the aforementioned factors as appropriate to
adjust the impairment allowances.
