Regulatory Alerts2024-02-01
On Accrued Receivables and Payables
The Central Bank of Djibouti mandates that microfinance institutions identify and record accrued interest receivable and payable on transactions with financial entities, members, and clients at the end of each financial year. The directive requires that such accrued interest be classified under specific balance sheet sub-categories for receivables or payables once recognized in the profit and loss statement. Furthermore, interest on non-performing receivables must be excluded from accounting records and tracked off-book in compliance with Instruction No. 2022-09 regarding loan downgrading and provisioning.
CENTRAL BANK OF DJIBOUTI
INSTRUCTION NO. 2022-10/IMF
ON ACCRUED RECEIVABLES AND PAYABLES
The Governor of the Central Bank of Djibouti,
Having regard to Law No. 118/AN/11/6ème L of 22 January 2011 amending the statutes of the Central Bank of Djibouti;
Having regard to Law No. 179/AN/07/5ème L of 16 May 2007 regulating microfinance activities on the territory of the Republic of Djibouti;
Having regard to Law No. 117/AN/11/6ème L of 25 May 2011 regulating financial cooperatives;
Having regard to the Commercial Code, Book 3 on Company Law;
Having regard to Law No. 119/AN/11/6ème L of 22 January 2011 on the establishment and supervision of credit institutions and financial auxiliaries;
Having regard to Decree No. 2018-171/PRE of 08 May 2018 appointing the Governor of the Central Bank of Djibouti.
Hereby decrees:
Article 1: Microfinance institutions (MFIs) are required to identify accrued interest receivable or payable for transactions with their financial institutions and equivalents, as well as those with their members, clients, or users.
Article 2: At the end of each financial year, accrued interest, once included in the statement of profit or loss formation, must be recorded under the sub-categories of accrued receivables or payables provided for in the balance sheet.
Article 3: Interest on non-performing receivables shall not be recognized in the accounts but shall be subject to off-book monitoring in accordance with the provisions of INSTRUCTION NO. 2022-09 on the downgrading of non-performing loans and their provisioning.
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Article 4: This instruction shall enter into force upon its signature.
Done in Djibouti, on 14 March 2022
The Governor