@conference{Rangelova2016638,
author = " L. Rangelova",
abstract = "This paper is dedicated to the current situation and perspectives of accounting of loan impairment in banking sector, in accordance with the amended banking and accounting legislation. Through a comparative analysis we reveal the main changes introduced by IFRS 9 in respect of IAS 39 and the implications for Regulation and Supervision. The principal purpose is identification of focal problem areas in measurement of impaired loans faced by the Bulgarian banks in implementation the new requirements.
Bringing Bulgarian legislation in line with the latest EU legal framework for the activities of credit institutions led to revision and augmentation of the Law on Credit Institutions (LCI). Repealing of old BNB ordinances was encouraged by the fact that they basically did not meet the requirements of the EU Directive and the Regulation, as well as of the new Basel Capital Accord, the so called "Basel III”.
Following the enhanced framework of the Basel capital standards and the application of Directive 2013/36 EU and Regulation (EU) No.575/2013 of the European Parliament and of the Council of 26 June 2013, the International Accounting Standards Board has published IFRS 9 Financial Instruments: Recognition and Measurement, expected to become effective on 01.01.2018. The standard is intended towards greater transparency and achieving unification of supervisory and accounting requirements. The classification and estimation of financial assets are changed along with the approach of taking into account of losses in banks’ loan portfolios due to impairment. The model of incurred loss, as per IAS 39, will be replaced by a model of the expected credit losses. Therefore, occurrence of the event "loss" prior to recognition of impairment will not be needed anymore. This will most likely lead to earlier recognition of credit losses, in response to the existing concerns that now too small loan losses are recognized too late.
The new standard raises a number of challenges for the information systems of banks including in the tracing and systematization of financial data, and the reflection of changing expectations.",
address = "51 Al. Malinov blvd, Sofia, 1712, Bulgaria",
booktitle = "3rd International Multidisciplinary Scientific Conference on Social Sciences and Arts SGEM2016",
chapter = "6.Finance",
doi = "10.5593/SGEMSOCIAL2016/B23/S06.001",
isbn = "978-619-7105-74-2",
issn = "2367-5659 ",
keywords = "bank; loan losses; the expected loan model; recognition of impairment",
month = "24-30 August, 2016",
note = "3rd International Multidisciplinary Scientific Conference on Social Sciences and Arts SGEM2016, 24-30 August, 2016",
number = "2.3",
organization = "SWS Scholarly Society; Acad Sci Czech Republ; Latvian Acad Sci; Polish Acad Sci; Russian Acad Sci; Serbian Acad Sci {\&} Arts; Natl Acad Sci Ukraine; Natl Acad Sci Armenia; Sci Council Japan; European Acad Sci, Arts {\&} Letters; Acad Fine Arts Zagreb Croatia; C",
pages = "3-8",
publisher = "STEF92 Technology",
series = "International Multidisciplinary Scientific Conference on Social Sciences and Arts-SGEM",
title = "  {CONTEMPORARY} {ACCOUNTING} {ISSUES} {ON} {LOAN} {IMPAIRMENT} {IN} {BULGARIAN} {BANKING} {SECTOR}   ",
type = "Proceedings Paper",
url = "https://www.sgemsocial.org/index.php/jresearch-article?citekey=Rangelova2016638",
volume = "16",
year = "2016",
}