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    Q: In the Financials does the GL Accounts balance with the Sub Ledgers?

    A: Yes the GL Accounts balance with the Sub Ledgers.

    Q: What is our financial position due to COVID-19 and how does VENTURE expect that the COVID-19 event will impact the year 2021 into 2022?

    A: See extract from Board Report 2020, page 33 of the Annual Report 2020:
    “There is still a lot of uncertainty regarding the pandemic
    globally and the road to recovery. Our current strategic planning process is considering this uncertainty and will project potential outcomes. However, the plan is currently a work in progress.

    Q: What are we doing to reduce/ eliminate the large sums of money we allocate for delinquency?

    A: The organization was restructured to support effective credit management and place more focus on performance management and building a culture of service to our valued Members through the recruitment of the Head of Credit Administration. We also advanced in the area of Compliance through the development and implementation of the verification risk framework for both loans and new membership.

    We can never eliminate the allocation for loan provisioning within the IFRS 9 framework. IFRS 9 requires that allowance be made for expected losses, not incurred losses, as was the requirement under the predecessor accounting standard. Therefore, we must provide for all loans, from day one, even if we never expect them to go bad. Under IFRS 9, the provision must take into account not only historical factors, but it must also consider a broader range of information, i.e. current and forward-looking information. For example, the 2020 provision took into account assumptions surrounding the economic impact of the pandemic.

    Nevertheless, irrespective of the requirements for compliance, as we continue to apply the policy and procedures/practices to assure improved asset (loan) quality, it is hoped that going forward, the provisioning may be lessened, all things being equal.

    Under the new IFRS9 framework, allocations for delinquency can never be eliminated since it requires that funds be set aside for each new loan granted.

    The large sums that VCU allocate are to compensate for the large amount of delinquency in our Legacy loan portfolio i.e. those generated pre 2017. VCU will see a significant reduction in the amounts allocated to delinquency when those Legacy Loans are either recovered, rectified or written-off. Our Credit Administration Division is working feverishly to accomplish this result.

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