IFRS 16 compliance for your bank for swift Bank of Uganda reporting requirements

Effective 1st January 2019, your bank is required to account for all leases under the requirement of the new International Financial Reporting Standards Sixteen (IFRS 16). The standard requires that your bank accounts for leased assets (Right-of-Use Assets) and Lease liability on the financial statements.

Bank of Uganda, the banking regulator under Instruction Circular EDS.306.2 dated 20th February 2019 requires all Supervised Financial Institutions to submit a return in respect to IFRS 16 by 31st July 2019. The closer the deadline, the higher the cost for Your bank. To comply, you must urgently review all her assets for IFRS 16 specifically classification and measurement. In addition, your bank must decide on the first adoption approach.

To avoid possible late submission penalties, and/ or increased regulatory oversight for poor responsiveness, Summit Consulting Ltd presents this proposal to support IFRS 16 Tool modelling to facilitate IFRS 16 compliance and swift reporting to Bank of Uganda as per requirements.

to register for the upcoming IFRS 16 practical class, click here

Scope of assignment 

Working as your IFRS 16 tool modeler and implementer, we will undertake the following;

  1. Review of all rental property contracts and existing lease agreements, if any so as to effectively classify your leases for appropriate accounting treatment.
  2. IFRS 16 modelling and application to your bank; including measurement and disclosures summary
  3. We will conduct IFRS 16 briefing and training to your specified staff to empower them to meet the requirements of IFRS 16.
  4. Update your accounting and finance policy in respect to IFRS 16 compliance
  5. Make an easy to use IFRS 16 Ms Excel model for right to use and lease liability modelling based on your bank’s business model. This will facilitate swift IFRS 16 reporting and compliance
  6. Board and top management briefing on impact of IFRS 16 on your bank – after analysis of the results.

Appendix 1: 

Our fees are negotiable.  To comply easily with Bank of Uganda reporting requirements, your bank shall adopt the modified retrospective approach for IFRS 16 modelling.

PhasesDescriptionValue to you Fees (US $.) net of taxes
Phase 1: summitIFRS 16 Readiness Assessment to clarify whether contracts meet the lease criteriaReview of all rental property contracts and existing lease agreements, if any so as to effectively classify your bank leases for appropriate accounting treatmentClear understanding of your bank leases for classification, and measurementComplementary
Phase 2: summitIFRS 16 modellingIFRS 16 modelling and application to Your bank; including measurement and disclosures summaryIFRS 16 model with clear impact on your bank’s profit & equity as at 31st December, 2018Negotiable depending on the number of leased assets
Phase 3: summitIFRS 16 TrainingWe will conduct IFRS 16 briefing and training to your specified staff to empower them to meet the requirements of IFRS 16.Empower your team, and reduce on-going compliance costsNegotiable
Phase 4: summitIFRS 16

Policy updates

Update your bank’s accounting and finance policy in respect to IFRS 16 complianceIFRS 16 lease accounting aligned to your bank’s finance policyNegotiable
Phase 5: IFRS 16 Tool brandingMake an easy to use IFRS 16 Ms Excel model for right to use and lease liability modelling based on your business model. This will facilitate swift IFRS 16 reporting and complianceFacilitate on-going reporting requirements by Bank of UgandaNegotiable
Phase 6: summitBOARD BRIEFINGBoard and top management briefing on impact of IFRS 16 on your bank – after analysis of the results.Get buy in for budget approvals from the Board in relation to compliance needs for your bankNegotiable
Phase 7: IFRS 16 on going compliance supportYou have an option to retain Summit Consulting for the first-year effective contract signing date to deal with any BOU requests and reporting requirementsTrain your finance team on the job by seeing how we respond to BOU issuesNegotiable depending on the number of months

 

 

 

Leave a Comment

Your email address will not be published. Required fields are marked *