Note: This question is based on optional Section 7.5.4 re: loan loss provisioning Under IAS 39, the IASB financial instrument standard in effect at the time, loans receivable were valued at amortized cost. That is, valuation was based on expected future receipts from the loan discounted at the effective rate of interest established at loan acquisition. If the loan became impaired (i.e., expected future receipts fell), the loan would be written down to its new expected value, discounted at the original effective rate. During the 2007-2008 market meltdowns, loan impairment writedowns were criticized for waiting "too long." That is, writedowns were delayed until the financial institution holding the loan decided that impairment had occurred. This often generated Note: This question is based on optional Section 7.5.4 re: loan loss provisioning Under IAS 39, the IASB financial instrument standard in effect at the time, loans receivable were valued at amortized cost. That is, valuation was based on expected future receipts from the loan discounted at the effective rate of interest established at loan acquisition. If the loan became impaired (i.e., expected future receipts fell), the loan would be written down to its new expected value, discounted at the original effective rate. During the 2007-2008 market meltdowns, loan impairment writedowns were criticized for waiting "too long." That is, writedowns were delayed until the financial institution holding the loan decided that impairment had occurred. This often generated