Changes in the 1985 accounts.
Determination of results
Interest and commission are recognised in the
year to which they relate, unless payment there
of is in doubt.
Differences between spot and forward rates on
forward transactions entered into in connection
with funds borrowed and funds deposited are
recognised as interest to the extent to which the
terms of the associated money market trans
actions have elapsed.
Net gains realised on the premature sale of assets
held in the investment portfolio (treasury paper,
debentures and private loans to public
authorities) in connection with swap trans
actions are apportioned over the remaining
terms of the investments sold.
In the determination of expenses, account is
taken of expenses still payable and prepaid.
In the calculation of the tax burden the amount
of the Addition to the Provision for general
contingencies is taken as a charge. Taxation is
calculated, taking into account the prevailing
statutory fiscal equity allowance.
The method of calculation of a number of profit
and loss account items has already been covered
in the preceding paragraphs.
With effect from 1 January 1985, the legislation
implementing the Fourth EEC Directive on
company financial reporting has also applied to
credit institutions. The model accounts
produced by the Nederlandsche Bank under the
provisions of section 11 (2) of the Act on the
Supervision of the Credit System have been
revised accordingly. In addition, a number of
other changes has been made.
The most important changes are:
Prior to 1985, after allowing for effects of
taxation, translation differences on the balance
of monetary assets and liabilities of foreign
establishments together with the results on the
forward exchange transactions concluded in
connection therewith were included as a charge
or an addition to the Reserve for exchange
differences (in Shareholders' equity). If the
balance of the Reserve for exchange differences
was insufficient, the translation differences were
taken to Other income.
Commencing with the financial statements for
1985, these movements are accounted for in the
Exchange differences reserve regardless of the
balance of this reserve; however, translation
differences relating to establishments in
countries with an exceptionally high rate of
inflation are now taken to the result.
Prior to 1985, results on the premature sale of
assets held in the investment portfolio (treasury
paper, debentures and private loans to public
authorities) in connection with swap trans
actions were recognised in the profit and loss
account in the year of disposal.
Commencing in 1985, net gains on these sales
are apportioned over the remaining terms of
the investments sold.
The premiums in respect of investments in
property and equipment released to the result in
the year under review are now no longer
accounted for in Taxation but in Depreciation.
In the consolidated financial statements, the
items "Group equity" and "Group profit" are
introduced, these items including Third party
interests.
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