BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED | CONSOLIDATED ANNUAL REPORT 2022 108 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED Notes to the Consolidated Financial Statements For the year ended March 31, 2022 (Expressed in Barbados dollars) 77 25. Financial Risk Management, continued 25.2 Credit risk, continued Assessment of Corporate debt securities, continued Key data sources as outlined in the expected credit loss assessment methodology were obtained from Moody’s, a global credit rating agency that provided published statistics and data on corporate and sovereign bonds and investments. Also used were the yield curves from the Central Bank of Barbados (CBB) and the Institute of Accountants of Barbados (ICAB). The expected credit loss computed were $6,387 (2021 - $19,539) as at March 31, 2022. Incorporation of Forward-Looking Information Assessment The Credit Union's forward-looking information, an IFRS 9 requirement, was modelled using its internal due diligence process and was included in the final ECL calculation for the year ended March 31, 2022. The below qualitative and quantitative indicators are used to assess whether it is likely that an investment or group/class of investments would change in the future: External Indicators - Market/Macro-economic specific shocks • Significant change in the performance of the investee compared with that of the market • Changes in expectations that the investee’s technical product milestones will be achieved • A significant change in the market for the investee’s products, global economy, economic environment in which the entity operates • Performance of competitors, matters such as fraud, commercial disputes, litigation, changes in management or strategy • Evidence of external transactions in the investee’s equity (take overs) Internal Indicators - Company specific shocks • Increasing/Declining revenues or margins • Increasing/Decreasing operating risks • Working capital deficiencies or improvements • Increase/Decrease in asset quality • Decreased/Increased balance sheet leverage • Liquidity, management problems or changes in the scope of business or organizational structure (such as the discontinuance of a segment of the business) that results in a significant change in the borrower’s ability to meet its debt obligations (where the opposite is true) • Corporate Credit Rating downgrade or upgrade by CariCRIS or other recognized International Rating Agency The below table provides the Forecast of the Macroeconomic Outlook Scenarios: Scenarios Expected State Upside Positive Base case Stable Downside Negative
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