Financial reporting, accountability and independence in central banking

Financial reporting, accountability and independence in central banking

Financial Reporting, Accountability and Independence in Central Banking

October 07 - 08

“Do central banks have the financial resources they need to fulfil their mandate?” Once an abstract, academic question, this became front page news in March 2020 following official sector responses to Covid-19.

For those charged with overseeing their central bank’s balance sheet, the impact of the crisis will be felt for years to come. More broadly, central bankers now question long-held tenets on reporting of risks, compliance with international standards and capital and profit-sharing. They are rethinking approaches to new developments such as CBDCs.

Agenda

Participants will have access to pre-recorded presentations two weeks before the course

00:0000:00

General accounting frameworks for central banks (Part 1)
Pre-recorded presentation

00:00 - 00:30

  • Update on accounting frameworks in central banks and the private sector
  • Identifying issues with adapting accounting frameworks
  • Strategies and processes for adapting these frameworks
  • Workshop: practical examples of implementation
Robin Darbyshire

former Financial Accountant

Bank of England

Robin Darbyshire is a chartered accountant who has worked, as an independent consultant for 10 years, mainly on central bank issues. He has undertaken a number of projects for the International Monetary Fund, including implementation of International Financial Reporting Standards (IFRS) in central banks. He has also worked on a payments system at a middle eastern central bank. Previously he spent 19 years with the Bank of England, for 17 of which he was responsible for the Bank’s accounts. He was a founder member of the committee that devised the accounting framework and policies for the European System of Central Banks and has recently undertaken projects for the European Central Bank related to Eurosystem accounting. He has written a number of articles on issues in central bank accounting and regularly speaks at conferences on central bank finances.

Current accounting developments (Part 2)
Pre-recorded presentation

00:00 - 00:30

Robin Darbyshire

former Financial Accountant

Bank of England

Robin Darbyshire is a chartered accountant who has worked, as an independent consultant for 10 years, mainly on central bank issues. He has undertaken a number of projects for the International Monetary Fund, including implementation of International Financial Reporting Standards (IFRS) in central banks. He has also worked on a payments system at a middle eastern central bank. Previously he spent 19 years with the Bank of England, for 17 of which he was responsible for the Bank’s accounts. He was a founder member of the committee that devised the accounting framework and policies for the European System of Central Banks and has recently undertaken projects for the European Central Bank related to Eurosystem accounting. He has written a number of articles on issues in central bank accounting and regularly speaks at conferences on central bank finances.

Accounting framework of the European System of Central Banks (ESCB)
Pre-recorded presentation

00:00 - 00:30

  • Overview of the ESCB accounting framework
  • The Eurosystem financial reporting since the crisis and during 2020
  •  A new framework for marketable investment funds
  • Case study: ESCB framework in contrast to IFRS accounting
Nuno Ludovico

Senior Finance Expert, Financial Reporting Division

European Central Bank

Challenges for central banks under a multi-mandate framework
Pre-recorded presentation

00:00 - 00:30

  • The key issues facing financial reporting in the modern central bank
  • Operational challenges central banks face in adapting to the new environment
  • Implications for balance sheets, contingent liabilities and shareholder relations
  • Discussion: impact of Covid-19 measures on balance sheets in participants’ home jurisdictions
Valeria Gontareva

former Governor

National Bank of Ukraine

Timings are subject to change as we evaluate geographic limitations of participants

12:0012:30

Course introduction
Opening remarks with the course chair

00:00 - 00:30

  • Introduction of the chairman
  • Overview of the training course
  • Discussion of the delegate expectations

12:3013:30

Effective reporting of performance by function
Presentation followed by Q&A

00:00 - 01:00

  • Strategies and examples of changing a central bank’s laws
  • Strengthening central banks legal accountability frameworks
  • Implications for independent decision-making structure
  • Case study: changes in the Bank of Israel’s legal framework  
Henrik Gardholm

Head of Accounting Division

Sveriges Riksbank

Henrik Gardholm is the head of the Accounting Division of the Sveriges Riksbank, which is responsible for the central bank’s financial reporting and budgeting. He is also a member of the Accounting and Monetary Income Committee at the European Central Bank (ECB). Mr. Gardholm joined Sveriges Riksbank in April 1998, in a role responsible for financial reporting. He was then promoted to his current position in February 2006. Prior to joining Sveriges Riksbank, he was an internal auditor at a commercial bank called Nordea as well as an authorised public accountant at KPMG.

13:3013:45

Break

12:00 - 12:15

13:4514:45

IFRS 9: impact and implementation
Presentation followed by Q&A

00:00 - 00:30

  • Key differences between IFRS 9 and other accounting standards
  • Assessing the implementation of IFRS 9
  • Tips to overcome challenges associated with the implementation of IFRS 9  
  • Discussion: IFRS 9 in delegates’ home jurisdictions
Robin Darbyshire

former Financial Accountant

Bank of England

Robin Darbyshire is a chartered accountant who has worked, as an independent consultant for 10 years, mainly on central bank issues. He has undertaken a number of projects for the International Monetary Fund, including implementation of International Financial Reporting Standards (IFRS) in central banks. He has also worked on a payments system at a middle eastern central bank. Previously he spent 19 years with the Bank of England, for 17 of which he was responsible for the Bank’s accounts. He was a founder member of the committee that devised the accounting framework and policies for the European System of Central Banks and has recently undertaken projects for the European Central Bank related to Eurosystem accounting. He has written a number of articles on issues in central bank accounting and regularly speaks at conferences on central bank finances.

14:4515:00

Break

13:15 - 13:30

15:0016:00

FinTech Revolution: the Future and Potential for Accounting
Presentation followed by Q&A

00:00 - 01:00

  • Implications of disruptive innovation for central banking
  • Risk and opportunities of FinTech for accounting processes
  • Strategies to successfully integrate FinTech tools into accounting practices
  • Case study: new application of DLT and blockchain in accounting
Pierre-Edouard Wahl

former Head of Blockchain

PwC Switzerland

16:0016:00

End of day 1

00:00 - 00:01

Timings are subject to change as we evaluate geographic limitations of participants

12:0013:00

The question of capital: profit (and loss) sharing
Presentation followed by Q&A

00:00 - 00:30

  • Evaluating the relationship between a central bank's capital arrangements and its functions
  • Overview of models of profit and loss sharing across central banking
  • The impact of Covid-19 measures on central bank balance sheet and results
  • Hands on exercise: how can capital arrangements be improved in participants’ home institutions?
Kenneth Sullivan

Director

Central Bank Consulting (and former Senior Financial Expert, International Monetary Fund)

Kenneth Sullivan was until 2015 a senior financial sector expert with the International Monetary Fund. Previously, he spent seven years at the Reserve Bank of New Zealand as chief manager of both Accounting and Corporate Services where the bank won accounting prizes for the transparency of its published financial statements. Prior to that he provided a financial management information system consultancy, held senior accounting roles in insurance and wholesaling, and worked in education. Starting in 1993 he served as accounting expert on IMF missions, providing accounting technical assistance to central banks around the world, organized and presented at central bank accounting workshops and participated in Financial Sector Assessment Program and Safeguard Assessment

13:0013:15

Break

12:00 - 12:15

13:1514:15

Managing the audit process in a central bank
Presentation followed by Q&A

08:00 - 09:00

  • What an auditor expects from central bank accountants
  • How should central bank accounts communicate with audit function
  • What criteria the auditors use to assess the appropriateness of the reporting frameworks
  • Strategies to deal with the challenges of the audit process at central banks
Jeremy Foster

former Financial Services Capital Markets Partner

PwC

14:1514:30

Break

13:15 - 13:30

14:3015:30

Board executives and managers: effective frameworks for co-operation
Presentation followed by Q&A

13:00 - 14:01

  • How do accountants work effectively with the board?
  • What are the needs of the board and how can they encouraged to be an effective part of financial reporting?
  • Understanding independence: how can those in financial reporting help the board maintain its independence
  • Discussion: practical examples from delegates home jurisdictions
Livingstone Morrison

Deputy Governor

Bank of Jamaica

Livingstone Morrison is the chairman of the National Payments Council (NPC) of Jamaica which plays a critical role in facilitating the contribution of industry participants in the oversight and development of National Payments System Infrastructure. Through the work of the NPC he guided the modernisation of the National Payment System of Jamaica to meet international standards of safety and efficiency.  

He currently chairs the Bank of Jamaica FinTech Work Group as well as the CARICOM FinTech Work Group. Mr Morrison is a member of the Financial Inclusion Steering Committee of Jamaica and Chairman of the Retail Payments and Financial Market Infrastructure Working Group. Mr Morrison holds the position of deputy governor of Bank of Jamaica, with responsibility for administration and technical services, finance and technology, and payment system and risk management. He also heads the Bank’s Strategic Planning Team. He is a member of the Management Committee and chairs the Committee of Administration.

15:3016:00

Break

12:00 - 12:15

16:0016:30

Delegate action points and course conclusion
Course conclusion

14:45 - 15:15

  • Summary of the training course
  • Discussion of the observed trends and case studies
  • Application of learning points in the delegates’ home organisations
  • Preparation of action points

Participants will continue their learning post-event

00:0000:00

Post training survey and feedback

00:00 - 00:30

Course alumni group

00:00 - 00:30

CPE/CPD certificate

00:00 - 00:30

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Kenneth Sullivan

Sullivan Consulting

Director

Kenneth Sullivan's central banking career is built around periods as a senior financial sector expert with the International Monetary Fund and seven years at the Reserve Bank of New Zealand as chief manager of both accounting and corporate services. During his tenure the RBNZ developed new reporting frameworks that won accounting prizes for their transparency and completed a fundamental reorganisation of the bank. Prior to that he provided a financial management information system consultancy, held senior accounting roles in insurance and wholesaling, and worked in education. He has written on issues of central bank financial reporting, capital adequacy, organisation and accountability. 2014 saw publication of the book Financial Independence and Accountability for Central Banks that he edited with Martina Horakova of Central Bank Publications. Whilst at the IMF he represented the IMF on the International Financial Reporting Standards Advisory Council for 7 years and provided advice to over 90 central banks along with a secondment to a London bank working on structured finance.

Learning outcomes

By the end of the training course, participants will have gained new knowledge and a more comprehensive understanding of:

  • Understanding how to tackle the challenges in a multi-mandate environment
  • The state of the art in fintech
  • Best practice of accounting standards for modern central banks
  • Optimizing IT applications for central bank reporting 
  • Implementation experiences of IFRS 9
  • How to manage the the audit process

What to do next?

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