Luanda — The Angolan banking sector has adapted to the harmonised accounting system of the International Accounting Standards Board (IASB), a European body responsible for drawing up and publishing standards used by over 140 countries around the world.
The IASB established the International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS), elements that guide the preparation and presentation of companies' financial statements.
According to the deputy director of the Regulation and Organisation Department of the Financial System, Pedro NTiama, the full adoption of the IAS/IFRS by the sector has allowed the country to join the group of countries that require or allow the application of such tools.
Pedro NTiama was speaking at the 3rd edition of the training seminar for economic journalists having addressed the theme on the theme "Accounting Standardisation and Harmonisation in the Angolan Financial Sector".
To adopt the harmonised accounting tool, the National Bank of Angola (BNA) took 14 years (2005-2009), a process that required the acquisition of new software and over 60 training sessions for banking sector staff.
Pedro Ntiama added that Angola went through several stages before reaching its full capacity, undergoing a diagnosis at a national level.
Prior to this step, the official said, the financial sector had a general account plan (PGC) that caused huge difficulties for commercial banks, namely with accounting records, whenever new products were created, which required new sub-accounts to be opened.
Taking into account the role of the Central Bank and the recommendations of the International Monetary Fund (IMF), the World Bank and other multilateral organisations said Angola was not meeting the international demands.
"We worked on it until we converged. This work led initially to us changing our general accounting plan, which has now been revoked", Ntiama said.
Today, Ntiama said, commercial banks and the BNA no longer need to create sub-accounts, after the current plan of accounts has been aligned with international standards.
"(...) in a way it has facilitated the activity carried out by commercial banks", he said, adding that it worked as a database, containing all available codes.
As an example, the official said that if someone wanted to find out how much credit a commercial bank had granted to a certain location, it was possible to obtain the information from the system without difficulty.
With the adoption of the IASB, Ntiama said that any foreign investor can now make a clear reading of the financial statements published by commercial banks, as the principles are universal.
"Nowadays, a foreign investor no longer has difficulties in reading the reports and accounts published by the banks, since they also publish the documents in English", he said.
Angola is on the map
In September 2014, the IFRS Foundation published on its website the profile of Angola with regard to the adoption of IAS/IFRS, a publication updated in September 2015.
For Pedro NTiama, the publication of Angola's profile is a relevant milestone in the process of international recognition of the full adoption of the IAS/IFRS, having pointed out that the country is now on the world map of the countries that have adopted those standards.
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In Angola, the application of the criteria defined by the BNA resulted in a total of 14 banking financial institutions eligible for the full adoption of IAS/IFRS in the 2016 financial year.
According to the list, in the first phase they integrated the banks BFA, BAI, BIC, BPC, Economic Bank, BNI, Standard Bank, the VTB Africa, Finibanco, Standard Chartered, the BDA, Banco Sol, the Atlântico and Caixa Angola.
These banks embraced the BNA's criteria, including having assets of over Kz 300 billion being listed on the stock exchange and to have a subsidiary represented abroad, among other requirements.
The institutions that did not meet any of those criteria managed to do so in 2017, and the list at the time included BCI, BANC, BCA, Banco Prestígio, Banco Pungo Angondo (off the market),Banco Keve, BMF, BCS and BIR, some of which are currently off the financial circuit.
