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    Question

    Under the Expected Credit Loss (ECL) model, how are

    trade receivables without a significant financing component measured for impairment?
    A Lifetime ECL always. Correct Answer Incorrect Answer
    B 12-month ECL only. Correct Answer Incorrect Answer
    C No impairment required. Correct Answer Incorrect Answer
    D Only when default occurs. Correct Answer Incorrect Answer
    E Based on historical cost. Correct Answer Incorrect Answer

    Solution

    For trade receivables without significant financing, Ind AS 109 requires a lifetime ECL measurement, not just 12-month.

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