Banking
Loan Restructuring — IFRS 9 Modification Gain/Loss
Restructuring a distressed borrower's loan with extended tenor and reduced installments.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Restructured Loans (New Carrying Amount) | Asset (+) | 48,000.00 | - |
| Loan Modification Loss | Expense (+) | 2,000.00 | - |
| Existing Loan (Old Carrying Amount) | Asset (-) | - | 50,000.00 |
💡 Accountant's Note
Under IFRS 9, a non-substantial modification requires recalculating the carrying amount as the PV of revised cash flows at the original EIR. If lower than the old carrying amount, the difference is an immediate modification loss.
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