Scotiabank Trinidad and Tobago : 23 Dec 2022 – Scotiabank Trinidad and Tobago Limited – Audited Financial Statements for the period ended October 31st, 2022

Consolidated Financial Statements of

SCOTIABANK TRINIDAD AND TOBAGO LIMITED

October 31, 2022

SCOTIABANK TRINIDAD AND TOBAGO LIMITED

October 31, 2022

Contents		Page
Statement of Management's Responsibilities		1
Independent Auditors' Report	2	- 11
Consolidated Statement of Financial Position	12	- 13
Consolidated Statement of Profit or Loss and Other Comprehensive Income		14
Consolidated Statement of Changes in Equity	15	- 16
Consolidated Statement of Cash Flows	17	- 18
Notes to the Consolidated Financial Statements	19 - 118

Statement of Management's Responsibilities

Scotiabank Trinidad and Tobago Limited

Management is responsible for the following:

• Preparing and fairly presenting the accompanying consolidated financial statements of Scotiabank Trinidad and Tobago Limited (the Company) and its subsidiaries (collectively, the Group), which comprise the consolidated statement of financial position as at October 31, 2022, the consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for the year then ended, and notes, comprising significant accounting policies and other explanatory information;
• Ensuring that the Group keeps proper accounting records;
• Selecting appropriate accounting policies and applying them in a consistent manner;
• Implementing, monitoring and evaluating the system of internal control that assures security of the Group's assets, detection/prevention of fraud, and the achievement of the Group's operational efficiencies;
• Ensuring that the system of internal control operated effectively during the reporting period;
• Producing reliable financial reporting that complies with laws and regulations, including the Companies Act; and
• Using reasonable and prudent judgement in the determination of estimates.

In preparing these consolidated financial statements, management utilised the International Financial Reporting Standards, as issued by the International Accounting Standards Board and adopted by the Institute of Chartered Accountants of Trinidad and Tobago. Where International Financial Reporting Standards presented alternative accounting treatments, management chose those considered most appropriate in the circumstances.

Nothing has come to the attention of management to indicate that the Group will not remain a going concern for the next twelve months from the reporting date, or up to the date the accompanying consolidated financial statements have been authorised for issue, if later.

Management affirms that it has carried out its responsibilities as outlined above.

Gayle Pazos		Reshard Mohammed
Managing Director		Chief Financial Officer
Date: December 19, 2022		Date: December 19, 2022

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KPMG
Chartered Accountants
Savannah East
11 Queen's Park East
P.O. Box 1328	Tel: (868) 612-KPMG
Port of Spain	Email: [e-mail]
Trinidad and Tobago, W.I.	Web: https://home.kpmg/tt

Independent Auditors' Report

To the Shareholders of Scotiabank Trinidad and Tobago Limited

Report on the Audit of the Consolidated Financial Statements

Opinion

We have audited the consolidated financial statements of Scotiabank Trinidad and Tobago Limited ("the Company") and its subsidiaries (collectively, "the Group"), which comprise the consolidated statement of financial position as at October 31, 2022, the consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for the year then ended, and notes, comprising significant accounting policies and other explanatory information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at October 31, 2022, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRS).

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code) together with the ethical requirements that are relevant to our audit of the consolidated financial statements in the Republic of Trinidad and Tobago and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

KPMG, a Trinidad and Tobago partnership and a member firm of the KPMG global organization of independent member	2
firms affiliated with KPMG International Limited, a private English company limited by guarantee.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

1. Expected Credit Losses on Loans to Customers
   See Notes 3(c), 8 and 29 to the consolidated financial statements for disclosures of related accounting policies, judgements, estimates and balances.
   Description of key audit matter
   The Group's Allowance for Credit Loss (ACL) was $311 million as at October 31, 2022. The Group applies a three-stage approach to measure the ACL, using an expected credit loss (ECL) approach as required under IFRS 9 Financial Instruments.
   The Group's ACL calculations are outputs of complex models. The ACL calculation reflects a probability-weighted outcome that considers multiple scenarios based on the Group's view of forecasts of future events and economic conditions (assumptions). The probability of default (PD), loss given default (LGD) and exposure at default (EAD) inputs used to estimate ACL are modelled based on macroeconomic variables that are most closely related with credit losses in the relevant portfolio.
   The Group assesses when there has been a significant increase in credit risk subsequent to origination or where the financial asset is in default. If there has been a significant increase in credit risk or the financial asset is in default, lifetime ACL is recorded; otherwise, ACL equal to 12 month expected credit losses is recorded. The estimation of ECL for each stage and the assessment of significant increases in credit risk consider information about past events and current conditions as well as forecasts of future events and economic conditions. The estimation and application of forward-looking information requires significant judgment.
   Qualitative adjustments or overlays may also be recorded by the Group using expert credit judgment where the inputs and models do not capture all relevant risk factors.
   Measurement of individual provisions including the assessment of probability weighted scenarios and the impact COVID-19 had on exit strategies, collateral valuations, and time to collect.

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