At this stage, most organisations are well on their way to coming up with a compliant solution for the new accounting standard IFRS 9, which becomes mandatory on 1 January 2018. Management teams are also starting to understand the direct impact of IFRS 9 to their profit and loss (P&L) and as a result, thought naturally leans towards the secondary impacts of the implementation of this regulation.
There are of course many secondary impacts to consider, both operational and financial, such as the opportunities for improved pricing or collections strategies and the use of forbearance, the implications of debt sales, the requirements for monitoring and validation of more sophisticated models and the impact on capital.
One of the most difficult impacts for a business to predict is the impact on collections strategy and performance and the knock-on effect that this could have on debt sale across the industry.
This is an area that requires much discussion and one that we are speaking to industry journals about right now, look out for future updates on this topic…