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DA AFGHANISTAN BANK GUIDELINES ON FINANCIAL REPORTING FOR ISLAMIC BANKING INSTITUTIONS

Cash Flow Statement: Comparative Analysis for 2015 and 2014

The Central Bank of Afghanistan, DA AFGHANISTAN BANK, has released its guidelines on financial reporting for Islamic banking institutions, highlighting the importance of transparency and compliance with regulatory requirements.

Key Highlights

  • Net increase in cash and cash equivalents for 2015: xxx thousand afghanis
  • Improvement driven by significant increase in financing and advances, generating a profit of xxx thousand afghanis

Cash Flow Analysis

Cash Inflows

  • Financing and advances: xxx% of total inflows
  • Sales of securities, property, plant, and equipment
  • Other operating activities

Cash Outflows

  • Interest payments on financing and advances
  • Salaries and benefits
  • Operating expenses

Guidance Notes

The Central Bank of Afghanistan emphasized the importance of:

  • Classifying non-performing financing and provisioning for such financing
  • Measuring impaired financing at their estimated recoverable amount, with additional allowance provided if the recoverable amount is lower than the net book value of the financing

Additionally, the guidelines provide clarity on income recognition policies for each major type of income earned by Islamic banking institutions, including:

  • Finance income
  • Commission
  • Guarantee and commitment fees
  • Other fees from services rendered
  • Dividend income

Accessing the Guidelines

The full text of the guidelines can be accessed at the Central Bank of Afghanistan’s website.