Page 16 - 23. COMPILER QB - IND AS 109_32

The amortised cost calculation at 1st April, 20X1 is as follows:
Period Carrying Interest Cash Carrying
amount at at 5% inflow amount at
1st April 31st March
20X1-20X2 4,32,000 21,600 – 4,53,600
20X2-20X3 4,53,600 22,680 – 4,76,280
20X3-20X4 4,76,280 23,720* (5,00,000) –

*Difference of Rs. 94 (Rs. 23,814 – Rs. 23,720) is due to approximation.
On 31st March, 20X3, the carrying amount of the loan receivable is Rs. 4,76,280.
As a result of that modification, on 31st March, 20X3, the present value of estimated cash flows is
recalculated to be Rs. 2,05,750 using the asset’s original effective interest rate of 5% (Rs. 2,50,000 ÷
(1.05)4).

An impairment loss of Rs. 2,70,530 (Rs. 4,76,280 – Rs. 2,05,750) is recognised in profit or loss in the year
20X2-20X3.
The carrying amount of the loan receivable may be reduced directly, as follows:
Rs. Rs.
Profit or loss - impairment loss Dr. 2,70,530

To Loan receivable 2,70,530
(Being impairment loss recognised)

In this case, the loan receivable will be measured at Rs. 2,05,750 at 31st March, 20X3. The revised amortised
cost calculation at 1st April, 20X3 is as follows:
Period Carrying Interest at 5% Cash inflow Carrying
amount at (the original amount at
1st April effective 31st March
interest rate)
20X3-20X4 2,05,750 10,288 – 2,16,038
20X4-20X5 2,16,038 10,802 – 2,26,840
20X5-20X6 2,26,840 11,342 – 2,38,182
20X6-20X7 2,38,182 11,818 (2,50,000) –

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