How shall accumulated write-offs be reported in the first reporting reference dates when all data may not be available?

We understand that the numbers to be reported are loans written-off in the accounting systems but total extinguishment of the bank’s rights towards the customer has not taken place. Such numbers are not collected in the banks’ systems at present. On this basis it would be most helpful if a starting date could be set.

According to FINREP instructions for template 7 (Annex V of the Regulation (EU) No 680/2014 13 ITS on supervisory reporting of institutionsDraft ITS on Supervisory reporting), under the column "accumulated write-offs " the cumulative amount of principal and past due interest of any debt instrument that the institution is no longer recognising, because they are considered uncollectible, shall be reported.

The instructions also specify that these amounts shall be reported until the total extinguishment of all the institution 's rights (by expiry of the statute-of 13limitations period, forgiveness or other causes) or until recovery.

The criterion according to which write-offs shall be reported is the existence of institution 's right over the financial instrument subject to write-offs. Therefore, write-offs originated before the effective entry into force of FINREP and on which the reporting institution already maintains rights shall be reported in this column.

Reporting institutions should in principle be able to determine the amount of accumulated write-offs of any debt instrument. However, if such information does not exist or is not possible to retrieve without incurring into significant costs, following the principles of IAS 8 the reporting institution shall carry out a reliable estimation of this amount. If a reliable estimate is not possible, reporting institutions should apply the requirements retrospectively from the earliest period practicable.

*As of 1/8/2014 the content of this answer was modified to reflect the publication of the final ITS on supervisory reporting of institutions in the Official Journal of the European Union. As a result, the references to the ITS were updated and the disclaimer deleted. For reasons of transparency, revisions are highlighted in track changes.