Notice No. 06/2016: Full Adoption of International Accounting Standards/International Financial Reporting Standards

Published in the Official Gazette, First Series, No. 102, of June 22

NOTICE NO. 06/2016

SUBJECT: FULL ADOPTION OF INTERNATIONAL ACCOUNTING STANDARDS/INTERNATIONAL FINANCIAL REPORTING STANDARDS

Given the need to harmonize the accounting regime of Financial Institutions under the supervision of the Bank of Angola with International Accounting Standards/International Financial Reporting Standards and to adopt international best practices in order to contribute to strengthening the credibility of the national financial system.

Considering that the conclusion of that harmonization process will allow compliance with recommendations from international Financial Institutions, the comparability and transparency of the financial performance of national Financial Institutions on a global scale, and the continuous improvement of information provided to users of the financial statements of Financial Institutions.

In these terms, and under the combined provisions of item f) of Article 21st and Article 51st, both of Law No. 16/10 of July 15 – Law of the Bank of Angola, and Article 93rd of Law No. 12/15 of June 17 – Basic Law of Financial Institutions.

I DETERMINE:

Article 1.
(Object)
This Notice establishes the general principles to be observed, from the 2016 fiscal year inclusive, by Banking Financial Institutions, regarding the

CONTINUATION OF NOTICE NO. 06/2016 Page 2 of 5 full adoption of International Accounting Standards/International Financial Reporting Standards, hereinafter abbreviated as IAS/IFRS.

Article 2.
(Scope)
This Notice applies to Banking Financial Institutions, hereinafter abbreviated as Institutions, under the terms and conditions provided in the Basic Law of Financial Institutions.

Article 3.
(Information Provision)

1. Institutions must provide periodic information to the Bank of Angola regarding their respective IAS/IFRS adoption processes.
2. For the purposes of the preceding paragraph, Institutions must submit:
   a) reports regarding the degree of implementation of the IAS/IFRS adoption process, highlighting the degree of compliance with the detailed action plan already submitted to the Bank of Angola; b) monitoring reports on the IAS/IFRS adoption process; c) the pro-forma opening balance sheet with reference to January 01, 2015, prepared on an individual basis and on a consolidated basis in accordance with IAS/IFRS, with regard to Institutions that proceed with the full adoption of IAS/IFRS in the 2016 fiscal year. The remaining Institutions must submit the pro-forma opening balance sheet with reference to January 01, 2016, prepared on an individual basis and on a consolidated basis in accordance with IAS/IFRS; d) the pro-forma financial statements regarding the 2015 fiscal year, excluding their annexed notes, prepared on an individual basis and on a consolidated basis in accordance with IAS/IFRS, with regard to Institutions that proceed with the full adoption of IAS/IFRS in the 2016 fiscal year. The remaining Institutions must submit the

CONTINUATION OF NOTICE NO. 06/2016 Page 3 of 5 pro-forma financial statements regarding the 2016 fiscal year, excluding their annexed notes, prepared on an individual basis and on a consolidated basis in accordance with IAS/IFRS.
3. Without prejudice to the information requested in items c) and d) of the preceding paragraph, the financial statements regarding the 2016 fiscal year, on an individual basis and on a consolidated basis, of Institutions that proceed with the full adoption of IAS/IFRS in the 2017 fiscal year, must be prepared in accordance with the Financial Institutions Accounting Plan in force.
4. The Bank of Angola will make available to Institutions the models regarding the reports on the degree of implementation and monitoring of the IAS/IFRS adoption process referred to in items a) and b) of paragraph 2 of this Article.

Article 4.
(Instructions)
Without intending to make any interpretations of the IAS/IFRS issued by the International Accounting Standards Board (IASB), and without dispensing with consultation of the same, the Bank of Angola will issue in specific regulations the instructions it deems necessary for the compliance with this Notice.

Article 5.
(Final Provisions)

1. Institutions must adopt IAS/IFRS as issued by the IASB.
2. Institutions that meet at least one of the criteria indicated below must adopt IAS/IFRS, from the 2016 fiscal year:
   a) Institutions with a total asset on an individual basis, determined at the end of the 2015 fiscal year, exceeding three hundred billion Kwanzas, according to the Financial Institutions Accounting Plan in force;

CONTINUATION OF NOTICE NO. 06/2016 Page 4 of 5 b) Institutions with securities admitted to quotation on a regulated market; c) Institutions that are subsidiaries of entities with securities admitted to quotation on a regulated market; d) Institutions that are subsidiaries of entities headquartered abroad; e) Institutions headquartered in the national territory with subsidiaries headquartered abroad; f) Institutions that are subsidiaries of Institutions headquartered in the national territory that meet any of the criteria set out in the preceding items.
3. Institutions that do not meet any of the criteria presented in the preceding paragraph must adopt IAS/IFRS by the 2017 fiscal year, although it is permitted for these Institutions to adopt IAS/IFRS in the 2016 fiscal year.
4. The adoption of IAS/IFRS will be carried out by reference, and therefore it is not necessary to reproduce IAS/IFRS in the regulation issued by the Bank of Angola, or to carry out any process of endorsement of IAS/IFRS by the Bank of Angola.
5. New standards, interpretations, and future amendments to IAS/IFRS issued by the IASB must be adopted by Institutions, according to what is defined by the IASB in the respective standard or interpretation, including their respective effective dates.
6. Without prejudice to the provisions in the preceding paragraphs, Institutions are prohibited from early adoption of IAS/IFRS and/or interpretations issued by the IASB before their respective effective dates.

CONTINUATION OF NOTICE NO. 06/2016 Page 5 of 5

Article 6.
(Sanctions)
Non-compliance with the mandatory standards established in this Notice constitutes an offense punishable under the Basic Law of Financial Institutions and other applicable legislation.

Article 7.
(Doubts and Omissions)
Doubts and omissions resulting from the interpretation and application of this Notice are resolved by the Bank of Angola.

Article 8.
(Entry into Force)
This Notice enters into force on the date of its publication.

PUBLISH
Luanda, May 16, 2016

THE GOVERNOR
VALTER FILIPE DUARTE DA SILVA