Practical Aspects in Calculating of Impairment of Financial Assets According to IFRS 9 "Financial Instruments"

Valuation of financial instruments does not have enough of detailed information in the IFRS 9 "Financial Instruments" on what methods have to be used to carry out this valuation. In practice there have been various discussions among specialists on how to cope with practicalities of the economic environment where the reporting companies operate. Based on the above-mentioned points, the objective of this article is to look into the practical aspects in calculating of impairment of financial assets considering the fact that the access to initial data is limited. This article focuses on the methods of valuation of financial assets that are the most efficient when there is a certain degree of uncertainty, especially in the developing countries. A detailed calculation of impairment of financial assets has been prepared and the degree of probability of a default in the next 10 years of a useful life of a financial asset has been identified.