Module: General Practice
Q62: Regarding the provisioning norms for "Doubtful Assets," consider the following matching of Doubtful Categories (based on age) with their required provision percentages on the secured portion:
Doubtful-I (Up to 1 year) — 25%
Doubtful-II (1 to 3 years) — 40%
Doubtful-III (More than 3 years) — 100%
Which of the above pairs are correctly matched?
Doubtful-II (1 to 3 years) — 40%
Doubtful-III (More than 3 years) — 100%
Which of the above pairs are correctly matched?
✅ Correct Answer: D
🎯 Quick Answer:
All three pairs are correctly matched.Provisioning on the secured portion increases as the asset stays in the Doubtful category longer.
Structural Breakdown: 1. D1 (0-1 year in Doubtful): 25% provision.
2. D2 (1-3 years in Doubtful): 40% provision.
3. D3 (>3 years in Doubtful): 100% provision.
Causal Reasoning: The "sliding scale" logic implies that the longer an asset remains unpaid, the realizable value of the security (collateral) likely deteriorates or becomes difficult to liquidate, necessitating a higher coverage ratio.