RISK-FOCUSED AUDIT PROCEDURES FOR EXAMINING EXPECTED CREDIT LOSSES (ECL) AND RESERVES UNDER IFRS 9 IN THE AUDIT OF COMMERCIAL BANKS
DOI:
https://doi.org/10.5281/zenodo.21239170Keywords:
ECL, IFRS 9, loan provisions, bank audit, risk-focused procedures, ISA 540, audit sampling, model validation, collateral valuation, loan portfolio.Abstract
This article develops a set of risk-focused audit procedures for examining expected credit losses
(ECL) and loan provisions in accordance with IFRS 9 in the audit of commercial banks. The research problem
lies in the absence of a unified methodology and the limited coverage of ECL and provision testing. Based on
case study and analytical methods, a six-block ECL audit program and a differentiated sampling approach by
IFRS 9 stages are proposed and tested using the real loan portfolio of JSCB “Khalq Bank.” As a result, the
quality of the loan portfolio audit is improved.
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