Expected Credit Loss Model for Loans and Receivable

The Auditor identified Expected Credit Loss Model for Loans and Receivable as one of the audit issues
because it requires significant management judgement on the interpretation and implementation of the
requirements stated in PFRS 9 particularly in assessing impairment losses on an ECL model. It involves
high degree of estimation uncertainty related to management's use of various inputs and assumptions
applied in ECL model which may be affected by management's estimation bias. Lastly it requires
complex estimation process that entails implementation of internal controls and use of information
system in ensuring the completeness and accuracy of data used in the ECL calculation and in the
preparation of required disclosures in the financial statements.

To address the issue the auditor obtained an understanding of the Group's and the Parent Company's
accounting policies and methodologies applied. They also evaluated whether those are established and
implemented consistent with underlying principles of PFRS 9, if the companies polices and methodology
are appropriate in the context of the Group's lending activities and asset portfolio that takes into
consideration the different segments of credit exposures and the relevant regulatory framework and,
are supported by pertinent processes and controls, including estimation applied in the development of
the ECL model.

Classification and Measurement of Financial Instrument

The auditor assessed the disposal of investment securities at amortized as one of the issue because
based on their professional judgement it is one of the significant items in the company's financial
statement. To address the issue the auditor assessed the appropriateness of disposal by reviewing the
documentation if the said disposal was duly approved by the Parent Company's executive committee as
required by BSP.

Fair Value Measurement of Unquoted Securities classified at fair Value through other comprehensive
income Since unquoted securities classified at fair Value through other comprehensive income was one
of the significant investment of the company and valuation of financial instrument involves complex
valuation technique the auditor assessed it to be one of the audit issues. To address the audit issue the
auditor evaluated the appropriateness of the valuation methodology used by the company by assessing
if it is in accordance with PFRS 13.