Ann: Investor briefing transcript, page-6

Hi Portfolio,
As I understand it, Management are publishing the CIV rate together with rationale and further information as there is an element of mistrust/disbelief in the market around the accounting treatment of the PDLs.
The blip up in the average cost of the PDLs is in part I believe as a result of the purchase of the new LMI book which has a higher percentage of payment arrangements. The sale price will not have been determined by the original bank lender but by the LMI insurer (my guess Genworth or QBE) who has taken on the debt and wants to offload it.

There is definitely an element of 'backing the Management' until it can be proven that their accounting treatment is justified as the book matures and the rate of growth in PDL starts to slow (and with it the CIV rate will start to climb). Given Keith John and snr management have quite a bit of skin in the game, any fudging of numbers will eventually bite them hard. I do like the move to eliminate all STI for management and move to LTI (where the impacts of their PDL purchasing acumen will be measured).
In the meantime I track a few metrics including cumulative cash collections/cumulative PDL purchases and difference in actual vs forecast cashflows (which is published in the annual report)
If you have any specific questions on the accounting treatment or numbers worth giving the CFO a call (he's pretty receptive to queries)

cheers

T