The Central Bank of the Argentine Republic (BCRA) modified accounting standards that led it to recognize a loss of $44 billion in the 2023 balance sheet. According to a press release, these changes were carried out to adjust their numbers to the international methodology.
“These adjustments in terms of accounting valuation meant, as of December 31, 2023, the recognition of a loss of $41,555,355 million with respect to the Non-Transferable Bills, and of $2,315,415 million with respect to the Temporary Advances”specified the monetary authority.
The entity explained that “The main impact of this adaptation is observed in the valuation criteria of Non-Transferable Bills and Other National Treasury Bills in US dollars, as well as Transitional Advances to the National Government.”
“Previously, for the valuation of both exposures with the Public Sector (Nontransferable Bills and Transitory Advances) The criteria of “Technical Value” and “Nominal Value” were usedrespectively, two criteria not accepted by current Argentine professional accounting standards for the valuation of similar credits.”
Consequently, the BCRA established “with effective effect from the financial statements as of December 31, 2023 that the valuation of the aforementioned instruments will be carried out at “amortized cost considering the limit of recoverable value”, criteria provided by current Argentine professional accounting standards.
According to the BCRA, “the measure adopted allowed eliminate significant differences in the valuation of the mentioned instruments with current Argentine professional accounting standards, arriving at an objective measurement of the Net Assets as a diagnosis of the initial situation inherited by the present Board of Directors”.
“This adaptation constitutes the first step in the direction of presenting the financial statements based on the International Financial Reporting Standards (IFRS), as applied to financial entities in Argentina,” added the press release.
Likewise, the BCRA stated that “the recognition of the aforementioned capital loss, eliminates the possibility of resorting to transfers of accounting profits (which poorly reflected the real economic and financial situation of the Institution) as an alternative mechanism for monetary financing to the Treasury, consistent with the commitment to zero deficit and the elimination of monetary financing.”
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
