Banks need to know on what foundation to plan their futureactivity, so it is necessary to draw up legislation to clarify ifthe state levies tax or not on the banks' earnings from the releaseof provisions after they switch to international financialreporting standards (IFRS), from 2012 onwards, believes ŞerbanToader, senior partner of KPMG Romania.
He says a more balanced approach should be tried, one that wouldnot put significant pressure on banks.
"It is important for these matters to be clarified as soon aspossible because banks need to apply the new requirements and needtime to implement them and they also need to know on whatfoundation they will plan their future activity. As far as I know,fiscal and prudential aspects are still being worked on. But if itis left until the last moment, there will be surprises, pleasant orunpleasant...," Toader told ZF in an interview.
As of January 1, 2012, banks will use the IFRS as the solefinancial and accounting reporting system, which not only meansdrawing up financial statements according to IFRS once or twice ayear, but on a daily basis.
The NBR discussed with IMF representatives the alternative ofgradual release of provisions from 2012 onwards, when the switch toIFRS is made.
What would be the impact of a sudden release of provisions? Itwould impact the banks' profitability, and would be linked to thepayment of the 16% corporate tax, explains Toader.
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