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REQUIREMENTS FOR ACCOUNTING POLICIES AND FINANCIAL STATEMENTS
OF COMMERCIAL BANKS
Qo’shimova Laylo Iskandar kizi
The Banking and Finance academy of the Republic of Uzbekistan.
https://doi.org/10.5281/zenodo.13911798
Commercial banks, like other companies, follow accounting standards to ensure
transparency and consistency in their financial reporting.
In the same way, in the banking system of Uzbekistan, IFRS is used in accounting and
financial reporting
So that here is a breakdown of the key requirements for their accounting policies and
financial statements:
Accounting Standards:
Commercial banks primarily adhere to one of two major accounting frameworks:
1.
Generally Accepted Accounting Principles (GAAP):
2.
This is the dominant standard in the United States.
1
3.
International Financial Reporting Standards (IFRS):
4.
Used widely outsided the US, including many developed economies.
2
5.
Accounting Policies:
Within these frameworks, banks establish specific accounting policies for various aspects,
including:
Loan loss provisions: Accounting for potential defaults on loans. Investment valuation:
Methods for valuing securities held by the bank.
Off-balance sheet activities:
Disclosures on activities not reflected on the main financial statements.
Revenue recognition:
Timing of recognizing income from fees and interest.
These policies should be chosen in accordance with the relevant accounting standards and
consistently applied year after year. Transparency in disclosing these policies is crucial for
financial statement users to understand the bank's financial health accurately.
Financial Statements:
1
«Generally Accepted Accounting Principles (GAAP) Guide Sheet», б. д.
2
«INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)», б. д.
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Commercial banks typically prepare the following core financial statements:
Balance Sheet: This shows the bank's assets (loans, cash, investments), liabilities (deposits,
borrowings), and shareholders' equity at a specific point in time. Income Statement: This
summarizes the bank's revenue (interest income, fees) and expenses (interest expense, salaries)
over a specific period, resulting in net income (profit).
Cash Flow Statement: This details the bank's cash inflows and outflows from operating,
investing, and financing activities.
Additional Requirements:
Beyond the core standards, some regulatory bodies may impose additional reporting
requirements specific to commercial banks. These can focus on capital adequacy ratios or liquidity
metrics.
Overall, the requirements for accounting policies and financial statements of commercial
banks aim to provide clear and accurate information about their financial performance and
position. This information is vital for investors, depositors, regulators, and other stakeholders to
make informed decisions.
Adaptation of financial statements of Uzbekistan banks to international standards should
help to increase measures, changes in the field of financial reporting, ensuring correct results and
increasing financial transparency. It will be important to take steps to implement improvement and
training programs, train staff, and develop tools for reviewing and auditing financial statements
for Uzbekistan's transition to international financial accounting standards.
It is very important for commercial banks to ensure the application of accounting policies
and financial statements. These requirements will help to implement changes in the financial
structure of the bank, adequate training of its employees in financial reporting and accounting,
financial transparency and reform. These requirements are determined based on the financial
reporting standards and the rules and conditions established by the financial control authorities.
Financial reporting for commercial banks helps to learn business plans, financial
development management, risk assessment and strategic decision making.
