The Expected Credit Losses Standard

Learning Goal: I’m working on a accounting report and need an explanation to help me learn.

please read the annual reports (attached) and answer the question below, the answer must be in word + excel.

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Q) Auswide adopted the expected credit losses standard (AASB 9) during the year ending June 30, 2019 (see note 4.5.5). Suppose they had not adopted the standard. What would have been the ratio of loss allowance to gross carrying value of loans and advances at amortized cost for fiscal year end June 30, 2019?

the calculation MUST be correct


Our Financial Performance
We are pleased to report that our statutory Net
Profit after Tax (NPAT) was up 7.6% to $18.5 million
compared to $17.2 million in the 2018/19 year.
Our NPAT excluding the effects of COVID-19 was up
16.9% to $20.1 million.
The positive result was based on growth with the
loan book increasing by 4.3% to $3.26 billion, or 1.5
x system growth in a highly competitive market.
We achieved this in conjunction with a 10 basis point
increase in the Net Interest Margin (NIM), up to 197
basis points from 187 basis points in 2018/2019, as
active management of our funding costs continued
to deliver significant benefits.
Based on growth in our loan book and the significant
increase in our NIM, our Net Interest Revenue
was $70.5 million, up by $7.3 million compared to
2018/19, an increase of 11.6%.
The competitive environment has not affected our
ability to grow our customer deposit base which
increased by 10.4% to $2.62 billion, taking our selffunding ratio to 74.5%. This represents an increase
of more than 300 basis points over the prior year
allowing us to reduce more expensive funding lines
such as securitisation.
Our Cost to Income Ratio continues to fall and at
62.5% we are making good progress towards our
60% goal.


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