Roll Rate-Based Expected Credit Loss Analytics for Sustainable Trade Receivables Governance in a Non-Financial Firm

DOI

10.2991/978-2-38476-620-8_14How to use a DOI?

Keywords

expected credit loss; roll rate method; trade receivables; credit risk analytics; sustainable receivables governance

Abstract

This study evaluates the application of the roll rate method for measuring expected credit loss (ECL) on trade receivables and examines its role in supporting sustainable trade receivables governance in a non-financial firm. A descriptive case study approach was used based on anonymized secondary case documentation from PT A. The analysis examined a 36-month aging schedule, receivables migration across aging buckets, probability of default (PD), loss given default (LGD), exposure at default (EAD), forward-looking adjustment, and final ECL/allowance calculation. The findings show that roll rate-based ECL analytics can transform static aging schedule data into dynamic credit risk in-formation. In the case analyzed, the final probability-weighted ECL was Rp83,455,523, or approximately 1.58% of total trade receivables. The results also show that receivables in the 1–30 days bucket produced the largest ECL contribution due to high exposure, while older aging buckets showed higher risk intensity. The study demonstrates that the roll rate method supports credit risk monitoring, impairment estimation, internal control, data traceability, and cash flow planning. However, the reliability of the method depends on data quality, consistency of aging classification, adequacy of historical observations, reasonableness of PD and LGD assumptions, and model validation. This study contributes to accounting analytics and ECL literature by showing how trade receivables data in non-financial firms can be transformed into decision-useful credit risk information for sustainable receivables governance.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Titis Wahyuni
AU  - Adief Ghifari Syahviar
PY  - 2026
DA  - 2026/10/23
TI  - Roll Rate-Based Expected Credit Loss Analytics for Sustainable Trade Receivables Governance in a Non-Financial Firm
BT  - Proceedings of the 8th International Conference of Vocational Education, Applied Science and Technology (ICVEAST 2026)
PB  - Atlantis Press
SP  - 171
EP  - 187
SN  - 2352-5398
UR  - https://doi.org/10.2991/978-2-38476-620-8_14
DO  - 10.2991/978-2-38476-620-8_14
ID  - Wahyuni2026
ER  -