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April 15, 2021

BNR and IMF call that banks’ profit from switch to IFRS be exempt from taxes

The National Bank of Romania (BNR) and the National Monetary Fund (IMF) agreed that the state should not tax the profit made by banks out of the release of provisions in the context of the switch from Romanian accounting standards (RAS) to IFRS, at the beginning of the 2012, is stated in the letter of intent that the Romanian authorities and the IMF agreed upon in February. Apart from the gradual release of provisions based on certain criteria to be set by the central bank in the first half of the year, BNR and the IMF propose that the releases of provisions, in the switch from RAS to IFRS, should not be reported as supplementary revenue, in the profit and losses account, but under the capital account. The head of the Romanian Banking Association (ARB), Radu Ghetea, stated, for Mediafax, that talks were in the preliminary stage, but that the working draft proposed that the amounts released should be reported in the bank reserve as retained earnings, and not as profit.

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