Yes it is true. As per IAS 39, trade recivebles are financial assets. IAS 39 states: 59 A financial asset or a group of financial assets is impaired and impairment losses are incurred if, and only if, there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset ... Therefore general provisions are no longer allowed. However if you have hundreds of debtors then evaluating each & every debtor for impairment is not practical. Therefore in most cases induvidual impairment is done for major debtors only. Minor debtors are generally grouped into homogenous groups and assessed for impairment collectively. The calculation is normally based on historical data. There are many mathamatical loss forecasting models that you can use to calculate the impairment (or expected loss) in debtos groups. Some of these techniques are:
- *** flow rate method
- Vintage loss curve method
- Score distribution method
For your reference check this simple collective impairment calculation example using *** flow rate method, which seems to be more popular.
IAS 39 reference given is no longer valid as disclosure requirements of impairment has been moved to IFRS 7 Financial Instruments: Disclosures
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