Page 127 - ACCESS ANNUAL REPORT 2019

NOTES (continued)
A a o nts are in tho sands o hana edis n ess otherwise stated
ritica esti ates and dge ents
Estimates and ud ements are continually evaluated and are ased on historical experience and other actors, includin expectations o uture events that are elieved to e reasona le under the circumstances.
he roup ma es estimates and assumptions concernin the uture. he resultin accountin estimates will, y definition, seldom e ual the related actual results. he estimates and assumptions that have a si nificant ris o causin a material ad ustment to the carryin amounts o assets and lia ilities within the next financial year are addressed elow.
a eas re ent o the e pected credit oss a owance
he measurement o the expected credit loss allowance or financial assets measured at amortised cost and OCI is an area that re uires the use o complex models and si nificant assumptions a out uture economic conditions and credit ehaviour e. . the li elihood o customers de aultin and the resultin losses .
A num er o si nificant ud ements are also re uired in applyin the accountin re uirements or measurin EC , such as
• Determinin criteria or si nificant increase in credit ris
• Choosin appropriate models and assumptions or the measurement o EC
• Esta lishin the num er and relative wei htin s o orward loo in scenarios and the associated
EC .
Re er to ote 2.10 and 3.2.1 or urther details on these estimates and ud ements.
b Deter ining air va es
he determination o air value or financial assets and lia ilities or which there is no o serva le mar et price re uires the use o valuation techni ues as descri ed in ote 2.10. .
or financial instruments that trade in re uently and have little price transparency, air value is less o ective, and re uires varyin de rees o ud ement dependin on li uidity, concentration, uncertainty o mar et actors, pricin assumptions and other ris s affectin the specific instrument. he Ban s accountin policy on air value measurements is discussed in ote 2.10. .
c o d to co ect financia assets
he Ban s accountin policies provide scope or assets and lia ilities to e desi nated at inception into the accountin cate ories respectively descri ed in otes 2.10. he Group s classification o financial assets and lia ilities are iven in ote .
In classi yin financial assets at amortised cost hold to collect , the Ban has determined that it has oth the positive intention and a ility to hold the assets until their maturity date as re uired y accountin policy 2.10.
In ma in this ud ement, the Ban uses the Business model and Solely or Payment o Principal and Interest SPPI model to assess that the purpose or holdin these assets was to collect the contractual cash ows associated with the assets. I the Ban were to ail to eep these investments to maturity other than or the specific circumstances or example, sellin an insi nificant amount close to maturity the Ban is re uired to reclassi y the entire cate ory as hold to collect and sell. Accordin ly, the investments would e measured at air value instead o amortised cost.
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