Chart of Accounts and the principles of its construction

In the previous article discussed the unique elements of financial statements - assets, liabilities, capital, income and expenses, which are a means to financial disclosure by the bank, set out their economic substance. It was also found with the help of financial statements and economic performance of the information provided by banks own managers and external users. Unanswered question still remains, how is the preparation of financial statements, as can a large number of business transactions, the bank performs over a given accounting period, submit to a system of interrelated economic indicators in the form of financial statements. For the preparation of financial statements using accounting tools such as the expense, which was mentioned when considering the functions of financial accounting. Account (balance) is the basic unit of information storage accounting. For each type of assets, liabilities, equity, revenues and expenses of the bank is assigned a separate account. For example, there are separate accounts for these types of assets: "cash", "precious metals", "loans to economic entities," "securities held for trading", etc. Examples of accounts for accounting obligations "means the bank's clients' securities own debt issued by the bank," "bank subordinated debt," etc. To account for the equity capital using the following account: "charter capital", "issuing a difference," etc. So, the account - this is the tool used to gather information about the elements of financial statements in a standardized format. In the financial account with the accounts provided by: 1) a comprehensive recording of transactions affecting the financial condition, 2) verification of the accuracy of transactions. The account allows you to display and trace the changes of each indicator of financial reporting that occurred during the reporting period. One of the key elements of the national accounting system is a chart of accounts that lead to systematize the accounting records in accordance with the elements and in the context of the financial statements. Chart of Accounts - this is a systematic list of accounts that is used to record bank transactions. A new chart of accounts developed by the National Bank of Ukraine introduced in the banks from 1 January 1998 he agreed with the generally accepted international practice in accounting principles and international accounting standards. Structure Chart of Accounts is built to meet the requirements for a typical structure of the bank's financial statements as set out in IAS number AOR. Topic: The role of accounting in the management of the bank, its types and purpose | Tags: Chart of Accounts