XN000022-1994-08-31 — Page 4

نيا

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WEDNESDAY, AUGUST 31, 1994

THE BANKING SECTOR AND THE ACCOUNTING PROFESSION HAVE BEEN FULLY CONSULTED IN THE PREPARATION OF THE PACKAGE. THE HONG KONG ASSOCIATION OF BANKS, THE HONG KONG DEPOSIT-TAKING COMPANIES ASSOCIATION AND THE HONG KONG SOCIETY OF ACCOUNTANTS HAVE ENDORSED THE PACKAGE IN PRINCIPLE.

THE JOINT PACKAGE INCLUDES FULL DISCLOSURE OF AUTHORISED INSTITUTIONS' PROFITS AND MORE DETAILED BALANCE SHEET INFORMATION,

ADDITIONAL INFORMATION TO BE DISCLOSED IN THE PROFIT AND LOSS ACCOUNT AIMS TO PRESENT A FULL PICTURE OF THE FINANCIAL PERFORMANCE OF AUTHORISED INSTITUTIONS AND THE SOURCES OF THEIR INCOME (SUCH AS THOSE DERIVED FROM INTEREST EARNINGS, DEALING ACTIVITIES AND FEES) AND EXPENSES (SUCH AS STAFF COST, PREMISES AND EQUIPMENT EXPENSE AND DEPRECIATION) IN THE REPORTING PERIOD.

FROM

IN PARTICULAR, INSTITUTIONS WILL DISCLOSE ANY TRANSFERS TO AND INNER RESERVES WHICH WILL REVEAL THEIR ACTUAL PROFITS FOR THE

REPORTING PERIOD.

THE PACKAGE RECOMMENDS A MORE DETAILED BREAKDOWN OF ASSETS AND LIABILITIES IN THE BALANCE SHEET.

IN

PARTICULAR, THE LIABILITY ITEM "CURRENT, DEPOSIT AND OTHER ACCOUNTS" WILL BE ANALYSED INTO ITS MAIN CONSTITUENTS: CUSTOMER DEPOSITS, INTERBANK DEPOSITS AND OTHER ACCOUNTS (INCLUDING INNER RESERVES).

ON THE ASSETS SIDE, ADDITIONAL BREAKDOWN WILL BE PROVIDED IN RESPECT OF ADVANCES TO CUSTOMERS AND BANKS (INCLUDING PROVISIONS FOR BAD AND DOUBTFUL DEBTS) AND INSTITUTIONS' PORTFOLIO OF SECURITIES WILL BE ANALYSED INTO THOSE HELD FOR DEALING AND INVESTMENT PURPOSES.

PROPERTY REVALUATION RESERVES, WHICH FORM PART OF THE RESERVES OF SOME BANKS, WILL ALSO BE DISCLOSED.

INNER

THE EXCHANGE'S LISTING RULES WILL BE AMENDED TO MAKE COMPLIANCE WITH THE DISCLOSURE PROVISIONS IN THE PACKAGE MANDATORY FOR LISTED BANKS.

THE HKMA WILL INCORPORATE THE RECOMMENDATIONS IN A BEST PRACTICE GUIDE ON FINANCIAL DISCLOSURE TO BE ISSUED TO AUTHORISED INSTITUTIONS IN SEPTEMBER 1994.

NON-LISTED BANKS AND LARGER RESTRICTED LICENCE BANKS AND DEPOSIT-TAKING COMPANIES WILL BE ASKED TO APPLY THE RECOMMENDATIONS ON A VOLUNTARY BASIS STARTING WITH THEIR 1994 ACCOUNTS.

SUCH INSTITUTIONS WILL BE ASKED TO INCLUDE A STATEMENT IN THEIR DIRECTORS' REPORT ON THE EXTENT OF COMPLIANCE WITH THE GUIDE AND THE REASONS FOR ANY NON-COMPLIANCE.

DISCUSSION WILL CONTINUE AMONG THE HKMA, THE EXCHANGE AND SFC ON THE NATURE OF ADDITIONAL DISCLOSURES TO BE INCLUDED IN THE 1995 ACCOUNTS INCLUDING ADDITIONAL INFORMATION ON OFF-BALANCE SHEET EXPOSURES, SEGMENTAL ANALYSIS OF ASSETS BY GEOGRAPHICAL AREAS AND INDUSTRY SECTORS AND CASH FLOW STATEMENT.

/THE HKMA