Analytical accounts of the Central Bank
I. Methodological framework, concepts, definitions and classifications
The Analytical Accounts of the NB are based on the NB's Accounting Accounts. National Fund assets managed by the NB are included in the analytical accounts of the NB.
The NB monetary survey data include:
- monetary base, which is formed from cash outside the NB, commercial bank deposits, transferable deposits from non-bank financial institutions, and current accounts in national currency of public and non-public non-financial institutions;
- net claims on the central government (until December 2001 the data were presented as a whole for the government, without a breakdown);
- domestic credit to the rest of the economy, including claims on banks, non-bank financial institutions and households;
- foreign assets and foreign liabilities of the National Bank (including foreign assets of the National Fund of the Republic of Kazakhstan managed by the National Bank);
- other net domestic assets (including other financial assets, non-financial assets, other liabilities and equity accounts).
In accordance with the requirements of the Monetary and Financial Statistics Manual (MFSM), monetary statistics in Kazakhstan distinguish between claims and liabilities of banks with regard to residents and non-residents. The definition of "resident-non-resident" in effect in Kazakhstan does not correspond to the definition published in the Balance of Payments Manual (5th edition 1993). The main difference concerns the center of economic interest. The Balance of Payments Manual considers that in most cases an institutional unit has a center of economic interest in a country if it already carries out or intends to carry out economic activities and economic transactions in that country on a large scale (individuals for at least one year).
According to the Law of RK of December 24, 1996 "On currency regulation" residents are individuals with a permanent residence in the Republic of Kazakhstan, including those temporarily located abroad or in the public service of the Republic of Kazakhstan abroad, as well as all legal entities established in accordance with the laws of the Republic of Kazakhstan, with a location in Kazakhstan, as well as their branches and representative offices located in Kazakhstan and abroad. In addition, residents are diplomatic, trade and other official representative offices of the Republic of Kazakhstan located outside the Republic of Kazakhstan.
Non-residents are all legal entities, their representative offices and branches, as well as individuals who are not specified in the concept of "residents".
Transactions with other sectors of the economy are grouped as claims and liabilities of the NB to residents (domestic economic entities) by mutually balancing sectors according to the MFSM: banks (second level banks), non-bank financial institutions, state non-financial institutions, non-state non-financial institutions, central government, households. One minor exception is that the NB survey does not fully classify some claims by sector (in the Statistical Bulletin, these claims are reported under "claims on other sectors of the economy"). In addition, liabilities of the NFRK (National Fund of the Republic of Kazakhstan) are not classified by any sector of the economy.
II. Data coverage
The central bank review covers the consolidated accounts of the NB's head office in Astana and its 17 branches; the remaining 11 subsidiaries are included in the NB's consolidated balance sheet.
Assets belonging to the National Fund of the Republic of Kazakhstan are not included in the NB's balance sheet, but are included as a separate line item in the NB's Monetary Survey with a balancing entry in the Net Foreign Assets line item for liabilities under Net Domestic Assets to ensure balance sheet transparency.
The balance sheets of the NB and commercial banks include accounts of head offices and branches located in Kazakhstan. In addition, in accordance with the statutory definition of residency under the Law of the Republic of Kazakhstan "On Currency Regulation", accounts of branches located outside Kazakhstan are also included in the balance sheets of commercial banks. This inconsistency in reflecting the economic attribute of residency under the MFSM and the fifth edition of the Balance of Payments Manual (BPM5) currently results in transactions of a foreign branch of a commercial bank being erroneously included in monetary accounts.
The NB is aware of the deviations of the national monetary statistics rules in the field of institutional coverage from the good international practice. The NB is considering amending the relevant instructions on reporting rules in order to use for statistical purposes a definition of residency that would be consistent with the recommendations of the BPM5. In addition, the NB has expanded institutional coverage (beginning with data for December 2003) to include accounts of credit partnerships in the survey of depository institutions (money supply survey).
III. Accounting principles
At the National Bank, financial assets are measured at fair value, i.e. at actual cost. Securities are recorded at fair value and revalued at least once a month on the date of sale/maturity. The securities are revalued according to the quotations (prices) established at the time of closing of trading on the financial market, on the penultimate working day of the calendar month and/or the day preceding the day of sale of the securities. From the moment the securities accounting is automated, revaluation of the securities is made on a daily basis. From the moment the Kazakhstan Stock Exchange establishes official quotations (prices) for the securities in national currency issued for circulation in Kazakhstan, revaluation of these securities is carried out at the quotations (prices) established at the moment of closing of trading at the domestic stock exchange on the last business day of the calendar month or the last day of trading these securities and the day of sale of these securities.
Securities acquired for the purpose of making capital investments are accounted for at their acquisition price. Throughout the holding period, the value of this category of securities shall not be reevaluated, except for organizations having negative equity capital.
With regard to the formation and use of special and general provisions (provisions). At the end of a financial year or in the period of final turnovers special provisions (provisions) are formed at the expense of the National Bank on the basis of the decision of the standing inventory commission of the National Bank on the results of the annual inventory of banking and non-banking assets against doubtful banking and non-banking assets and possible losses of the National Bank, and general provisions (provisions) are formed at the expense of the National Bank at the expense of retained net income of the National Bank for the reporting period.
Valuation of instruments denominated in foreign currencies.
Items denominated in foreign currency are converted on a daily basis into national currency using market exchange rate of tenge - weighted average exchange rate of tenge to foreign currencies, formed at the morning (main) session of the Kazakhstan Stock Exchange as of 11.00 a.m. Almaty time of the previous business day. The valuation of foreign currencies not traded on the Kazakhstan Stock Exchange is calculated on the basis of cross-rates formed as of 3 p.m. Almaty time on the evaluation day, in accordance with the quotations received through the REUTERS information agency channels.
IV. Main sources of information
The NB's analytical accounts are based on the National Bank's balance sheet. Assets of the National Fund of the Republic of Kazakhstan managed by the NB are recorded on a separate balance sheet, but are included in the NB review as a separate line item in net foreign assets and a balancing entry in the liabilities section of net domestic assets.
V. Practical features of data development
Year-end data are presented twice. The final end-of-December data for the NB (including final turnovers) are compiled later due to the established rules for auditing year-end data. Preliminary end-of-December data are used to compile the NB review until the final end-of-December data are available. The basis for compiling the NB's monetary review is its monthly balance sheet.