The Central Bank improves methodology of financial reporting

Two years ago, the powers of the Federal Service for Financial Markets on regulation, control and supervision in the financial markets have been transferred to the Bank of Russia. It became a mega-regulator of the financial markets - the body, which is responsible for control and regulation of the monetary system of the country. It was done as part of the development strategy of the Russian financial market and the creation of the Moscow-based international financial center (IFC) as in London, New York, Tokyo, Frankfurt, Paris, Hong Kong. Now, the Bank of Russia is to improve the level of quality of reporting. The financial accounts and balance of financial assets and liabilities, which allow to complete the macroeconomic model of the system of national accounts of the Russian Federation, were published on the website of the Central Bank. Balance sheet financial assets and liabilities are intended to reflect the estimate of the accumulated financial assets and liabilities of the Russian Federation.

According to Ksenia Yudaeva, First Deputy Chairman of the Central Bank of the Russian Federation, the fact that the Bank of Russia has became a mega-regulator gave an opportunity to use new sources of information: the actual information from other non-banking sectors of the financial sector. ‘‘Now we have wider access to the data of non-banking institutions of financial intermediaries, and we can analyze the sector in detail. Together with the development of statistics of this sector we will improve the financial accounting. The fact that we have become a mega-regulator allowed us to sort a part of the financial corporations of the banking system, but also such organizations as investment funds, insurance companies, private pension funds, and other financial institutions. Today we are publishing annual financial accounts and sectoral balance sheets for the 2012-2013 year.’’ 

Now you can see only two of these years, but in the near future we are due to start publishing information over the next few years. In 2016 we will begin to publish quarterly reports. ‘‘They allow to monitor the dynamics of the financial assets and operations in various sectors more efficiently,’’ says Yudaeva. 

She promises that the mega-regulator will continue to improve methodology. This will happen together with the development of a database on securities. ‘‘This is one of the most important sources of information for the formation of financial accounts and revaluation accounts due to improvement in the reporting of non-credit financial institutions. Now it is a very important project for the Central Bank. We are really trying to increase the level of accountability in order for it to become comparable with the quality of the reports that we receive from other banks. We have agreed with Rosstat about access to centralized resources of annual financial accounts. Accordingly, it will also allow us to improve the whole reporting and in particular the reporting on the financial statements, as well as develop a national system for the classification of its financial assets and instutitsional sectors of economy. It will be implemented in the formats of the accounting and statistical reports, which can also lead to further improvement of the methodology of financial accounts.’’