Separate Annual Report 2021

44 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED | SEPARATE FINANCIAL STATEMENTS 2021 BARBADOS PUBLIC WORKERS' CO-OPERATIVE CREDIT UNION LIMITED Notes to the Separate Financial Statements For the year ended March 31, 2021 (Expressed in Barbados dollars) 21 2. Accounting Policies, continued (e) Significant accounting judgments, estimates and assumptions The preparation of the financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the amounts reported in the financial statements and accompanying notes. Actual amounts may differ from these estimates. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. The estimates and judgments that have a significant risk of causing material adjustment to the carrying amount of assets and liabilities within the next financial year are discussed below. COVID-19: Impact on Use of Estimates and Judgments COVID-19, a global pandemic, has materially impacted and continues to materially impact the market in which the Credit Union operates. Governments around the world, including Barbados, imposed a number of measures designed to contain the outbreak, including business closures, travel restrictions, quarantines and cancellations of gatherings and events. These measures have caused increased volatility and uncertainty in financial markets. This has given rise to heightened uncertainty as it relates to the key areas of estimation uncertainty. The Credit Union has utilized estimates, assumptions and judgments that reflect this uncertainty. While management makes its best estimates and assumptions, given the dynamic and evolving nature of COVID-19 and limited recent experience of the economic and financial impacts of such a pandemic, the actual outcomes for the Credit Union in the future may differ from assumptions that have been applied in the measurement of the Credit Union’s assets and liabilities. The Credit Union has taken into account the impact of COVID-19 and related market volatility in preparing these financial statements. While the methodologies and assumptions applied in the measurement of various items within the financial statements remain unchanged from those applied in the 2020 financial statements, the impact of COVID-19 has resulted in the application of further judgment and the incorporation of estimates and assumptions specific to the impact of COVID-19. Principally this has resulted in updates to the Credit Union’s economic assumptions used in determining expected credit losses (ECL).