Banks to plan consolidated statements

By Our Banking Bureau | 07 Feb 2002

1

Mumbai: The Reserve Bank of Indias working group on consolidated accounting has recommended that all banks, listed or unlisted, should prepare and disclose consolidated financial statements (CFSs) from the fiscal beginning April 2002, in addition to the present solo financial statements.

A parent entity presenting CFS should consolidate all subsidiaries domestic as well as foreign except those specifically permitted to be excluded. The reasons for not consolidating a subsidiary should be disclosed in CFSs.

Referring to the scope of consolidation, the group, which submitted the report in December 2001, said banks having a network of subsidiaries are clear candidates for consolidated supervision.

The issue for supervisory policy decision should apply to banks that are subsidiaries in group structures, with non-banks as parents or holding companies as in financial conglomerates or mixed conglomerates and non-bank deposit-taking credit institutions that have networks of subsidiaries providing para-banking or other financial services, it added.

 

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