Research On Application Of Expected Credit Loss Model In Securities Companies

The procyclicality and Hysteresis caused by the incurred loss model have played an important role in fueling the global financial crisis.In order to solve this problem,the International Accounting Standards Board has adjusted the financial instrument impairment standards accordingly.In 2017,the Accounting Standards for Business Enterprises No.22 were successively issued.The revised standards have optimized the recognition and measurement of financial asset impairment,which is conducive to the orderly operation of the capital market and has achieved convergence with international standards.As the expected credit loss model has not been fully promoted and applied at home and abroad,the implementation of the new standard will be a huge challenge to our market,and there is no experience for each company to learn from.As an important part of the financial industry,the reform of the financial asset impairment model will undoubtedly have a huge impact on the securities industry.In order to give full play to the theoretical advantages of the expected credit loss model,reduce the impact on securities companies,and ensure the sound operation of the securities industry,it is urgent to study the application of the model in the securities industry.Based on this,the questions to be studied in this article are: What impact will the implementation of the new financial instrument standards have on the impairment provision of securities companies,what problems may be brought about by the implementation of the new standards,and how the internal and external supervision of the securities industry should be smoothly integrated? This new standard.The main research ideas of this article are: to sort out relevant literature,clarify the relevant theories of financial instrument impairment,and then compare the new and old standards to conduct research around the "incurred loss method" and "expected credit loss method";The comparison of financial asset impairment provision data before and after the implementation of the expected credit loss model at the end of 2017 and the beginning of 2018 analyzed the impact of the implementation of the Expected credit loss model on securities industry statements.Subsequently,taking A Securities Company as a case study object,through simulation calculation of its financial asset impairment provision during 2007-2016,the volatility of impairment provision under the new and old standards was compared.Then,through analysis of the annual report of Company A,the common problems existing in the securities industry during the implementation of the new standard were obtained and suggestions were made on how to promote the specific implementation of the new standard.Few existing studies have performed specific calculations on the detailed data before and after the implementation of the new standard by a single securities company to analyze the impact of the implementation of the new standard."A + H" listed securities companies have just implemented the new expected credit loss model for one year as a policy Pioneer of progressive implementation,studying the impact of the new standard on the securities industry and how to deal with possible problems with relevant parties,it is important for other securities companies in China to implement the new standard and the subsequent revisions,improvements and improvements Significance of reference.