CERTYNEX IFRS ACADEMY

Sol SA granted a loan whose contractual cash flows are renegotiated during its life, without the loan being derecognised. At the reporting date, Sol assesses whether credit risk has increased significantly since initial recognition. Which comparison does it use?

The risk of default at the reporting date, under the modified terms, compared with that at initial recognition, under the original terms.

The risk of default at the reporting date compared with that at the modification date, both under the modified terms.

The risk of default at the modification date, which becomes the new initial recognition date of a new asset.

The amount of expected loss at the reporting date compared with the amount of expected loss at initial recognition.