Credit Union Annual Report 2022 - Flipbook - Page 55
THE CAYMAN ISLANDS CIVIL SERVICE ASSOCIATION (CICSA)
CO-OPERATIVE CREDIT UNION LIMITED
NOTES TO FINANCIAL STATEMENTS (continued)
July 31, 2022
2.4 Summary of accounting policies (continued)
When incorporating forward looking information, such as macroeconomic forecasts, into determination of ECL, the
Credit Union considers the relevance of macroeconomic indicators for the loans, which include but are not limited to
unemployment rate. In addition to the base scenario, the Credit Union also incorporated upside and downside scenarios
along with scenario weightings. The attributes of scenarios are reassessed at each reporting date. The scenario weightings
take account of the range of possible outcomes each chosen scenario is representative of.
Collateral repossessed
Credit Union’s policy is to determine whether a repossessed asset can be best used for its internal operations or should be
sold. Assets determined to be useful for the internal operations are transferred to their relevant asset category at the lower
of their repossessed value or the carrying value of the original secured asset. Assets for which selling is determined to be
a better option are transferred to assets held for sale at their fair value (if financial assets) and fair value less cost to sell
for non-financial assets at the repossession date in line with the Credit Union’s policy.
Write-offs
Financial assets are written off either partially or in their entirety only when the Credit Union has stopped pursuing the
recovery. If the amount to be written off is greater than the accumulated loss allowance, the difference is first treated as
an addition to the allowance that is then applied against the gross carrying amount. Any subsequent recoveries are credited
to credit loss expense.
There were no other such standards, interpretations or amendments to existing standards that are expected to have a
significant impact on the Credit Union.
Investment in securities
All investments in securities are initially recognized at fair value and are classified as securities at fair value through the
profit and loss. Such investments are subsequently re-measured at fair value with gains and losses arising in the year
included in the Statement of Comprehensive Income. Securities which are listed are fair valued by reference to the price
as quoted on the principal exchange on which they are traded. The Credit Union has elected to recognize the gains and
losses through the Statement of Comprehensive Income as they arise. Dividends are recognized on the ex-dividend date
and recorded as dividend income in Statement of Comprehensive Income.
Purchases and sales of investments are accounted for on a trade date basis. Financial assets ar e derecognized when the
rights to receive cash flows from the financial assets have expired or have been transferred and the Credit Union has
transferred substantially all the risks and rewards of ownership. Realized gains or losses arising from the sale o f
investments are calculated using on gross proceeds less the average cost of securities sold. Unrealized gains or losses
are included in other non-operating income.
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