IFRS measurement

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Challenges

High requirements due to international accounting standards

The International Accounting Standards Board imposes a considerable burden on many credit institutions when it comes to the measurement of transactions. The IFRS 9 and IFRS 13 international accounting standards and other regulations must be fulfilled. The required calculation functionalities make considerable adaptation efforts within the institutions’ IT system landscape necessary. When analyzing existing loan agreements to determine their fair value, the measurement must take into account the creditworthiness of all parties to a financial instrument.

Solutions

Individually mastering the challenges with zeb.control

Modular and individually applicable calculation logic for valuation at full fair value as well as at amortized cost for lending and deposit business and proprietary trading
Reusable standard valuation algorithms (function modules) from zeb or customized by the client
Amortized cost functionalities
Support of all IFRS-relevant valuation methods for mapping all product types in commercial business and proprietary trading
Determination of effective interest rate and book value calculation for client business
Constant effective interest rate or linear amortization differentiated according to flexibly configurable transaction cost components such as (discounts), fees or commissions
Special amortization in the event of default
Fair value measurement functionalities
IFRS13 fair value measurement with Level 1 (use of quoted prices) and Level 3 (mark-to-model) measurement
Consideration of spreads or spread curves (risk cost spread, liquidity spread, administrative cost spread, cost of equity spread)
Differentiation between secured and unsecured fair value
Valuation of optional components, consideration of interest rate options and termination rights via the Bachelier model

Benefits

Support of the entire IFRS measurement process—integrated in one solution
Posting information for the balance sheet included
Traceable results via details and intermediate results
Reliable basis for controlling, impairment and other areas
You benefit from zeb’s best practice expertise and IFRS 9 and IFRS 13 expert knowledge