BoG to Enforce International Financial Reporting Standards This Year
The Bank of Ghana (BoG) has stressed that it will enforce the implementation of the International Financial Reporting Standards (IFRS 9) among banks in the country, this year.
The IFRS is a tool which requires all financial institutions to comply with a common financial reporting standard which will among others reduce their exposures to Non-Performing Loans (NPLs).
The move also comes at a time that the Bank of Ghana has reviewed upwards, the minimum capital for commercial banks in the country from a previous one hundred and twenty million Ghana cedis to four hundred million Ghana cedis.
The Research Advisor to the Governor of the Bank of Ghana, Mrs. Grace Akrofi , who made this known said the BoG would take the needed steps to ensure the implementation of the policy this year.
“The Bank of Ghana will also ensure that banks comply with the International Financial Reporting Standards (IFRS). This is to guarantee uniformity in the presentation of financial accounts. Consequently, the Bank would take the necessary steps for implementation of the newly issued accounting standard on financial instruments (IFRS 9) in 2018”.
She further explained that such a move would help the banks avoid huge losses,
“By so doing banks will take advantage of the expected credit loss model which better reflects the fact that credit risk builds in a bank’s portfolio and credit quality deterioration occurs far earlier than when loss events are evidenced”