How to Justify an Expected Monthly Payment When Performing a Cash Flow Impairment Analysis
Jan 21, 2015
The monthly payment from a loan's amortization schedule is not the same as a loan's expected monthly payment when performing the ASC 310-10-35 (FAS 114) impairment analysis. Thus, to expect the full amortization schedule is highly unlikely, so you must be able to arrive at a number that is defensible with regards to expected monthly payments. The speaker recommends looking backwards at the last twelve months and averaging the payments in order to arrive at a monthly amount that is defensible to examiners.