Banks need to know on what foundation to plan their future activity, so it is necessary to draw up legislation to clarify if the state levies tax or not on the banks' earnings from the release of provisions after they switch to international financial reporting standards (IFRS), from 2012 onwards, believes Şerban Toader, senior partner of KPMG Romania.
He says a more balanced approach should be tried, one that would not put significant pressure on banks.
"It is important for these matters to be clarified as soon as possible because banks need to apply the new requirements and need time to implement them and they also need to know on what foundation they will plan their future activity. As far as I know, fiscal and prudential aspects are still being worked on. But if it is left until the last moment, there will be surprises, pleasant or unpleasant...," Toader told ZF in an interview.
As of January 1, 2012, banks will use the IFRS as the sole financial and accounting reporting system, which not only means drawing up financial statements according to IFRS once or twice a year, but on a daily basis.
The NBR discussed with IMF representatives the alternative of gradual release of provisions from 2012 onwards, when the switch to IFRS is made.
What would be the impact of a sudden release of provisions? It would impact the banks' profitability, and would be linked to the payment of the 16% corporate tax, explains Toader.
Banks need to know on what foundation to plan their future activity, so it is necessary to draw up legislation to clarify if the state levies tax or not on the banks' earnings from the release of provisions after they switch to international financial reporting standards (IFRS), from 2012 onwards, believes Şerban Toader, senior partner of KPMG Romania.
He says a more balanced approach should be tried, one that would no
