MORNBFI Vol. 1 - Planters Development Bank

§§ 4191Q - 4191Q.311.12.31Sec. 4191Q (2008 - 4161Q) Records. QBsshall have a true and accurate account,record or statement of their dailytransactions. The making of any false entryor the willful omission of entries relevant toany transaction is a ground for the impositionof administrative sanctions under Section 37of R.A. No. 7653, without prejudice to thecriminal liability of the director or officerresponsible therefor under Sections 35 and36 of R.A. No. 7653 and/or the applicableprovisions of the Revised Penal Code.Records shall be up-to-date and shall containsufficient detail so that an audit trail isestablished.§ 4191Q.1 (2008 - 4161Q.1) Uniformsystem of accounts. QBs shall strictlyadopt/implement the Uniform System ofAccounts prescribed for QBs in therecording of daily transactions includingreportorial and publication requirements.§ 4191Q.2 (Reserved)§ 4191Q.3 (2008 - 4161Q.2) PhilippineFinancial Reporting Standards/PhilippineAccounting StandardsStatement of policy. It is the policy ofthe BSP to promote fairness, transparencyand accuracy in financial reporting. It is inthis light that the BSP aims to adopt all PFRSand PAS issued by the AccountingStandards Council (ASC) to the greatestextent possible.QBs/FIs shall adopt the PFRS and PASwhich are in accordance with generallyaccepted accounting principles in recordingtransactions and in the preparation offinancial statements and reports to BSP.However, in cases where there aredifferences between BSP regulations andPFRS/PAS as when more than one (1) optionare allowed or certain maximum orminimum limits are prescribed by thePFRS/PAS, the option or limit prescribedby BSP regulations shall be adopted by FIs.For purposes hereof, the PFRS/PASshall refer to issuances of the ASC andapproved by the PRC.Accounting treatment for prudentialreporting. For prudential reporting, FIs shalladopt in all respect the PFRS and PAS exceptas follows:a. In preparing consolidated financialstatements, only investments in financialallied subsidiaries except insurancesubsidiaries shall be consolidated on aline-by-line basis; while insurance andnon-financial allied subsidiaries shall beaccounted for using the equity method.Financial/non-financial allied/non-alliedassociates shall be accounted for using theequity method in accordance with theprovisions of PAS 28 “Investments inAssociates”.b. For purposes of preparing separatefinancial statements, financial/non-financialallied/non-allied subsidiaries/associates,including insurance subsidiaries/associates,shall also be accounted for using the equitymethod; andc. FIs shall be required to meet theBSP recommended valuation reserves.Government grants extended in theform of loans bearing nil or low interestrates shall be measured upon initialrecognition at its fair value (i.e., thepresent value of the future cash flows ofthe financial instrument discounted usingthe market interest rate). The differencebetween the fair value and the netproceeds of the loan shall be recordedunder “Unearned Income-Others”, whichshall be amortized over the term of theloan using the effective interest method.The provisions on government grantsshall be applied retroactively to alloutstanding government grants received. FIsthat adopted an accounting treatment otherthan the foregoing shall consider theadjustment as a change in accountingpolicy, which shall be accounted for inaccordance with PAS 8.Q Regulations Manual of Regulations for Non-Bank Financial InstitutionsPart I - Page 58