Approved by board decision of National Bank of the Azerbaijan Republic of April 19, 2001 No. 14

Rules of accounting of off-balance transactions in bank system of the Azerbaijan Republic

1. General provisions

1.1. These rules are prepared according to the laws of the Azerbaijan Republic "About National Bank of the Azerbaijan Republic", "About banks and banking activity in the Azerbaijan Republic", other legal acts of the Azerbaijan Republic and determine policy of accounting of off-balance transactions in bank system of the Azerbaijan Republic (further - "Bank").

1.2. These rules regulate financial accounting of off-balance transactions and are applied for the purpose of reflection of these transactions in financial statements.

2. Concepts

2.1. Off-balance transactions are transactions which at the time of their approach are not recognized the accounting (balance sheet) report in asset type or obligations.

2.2. The uncertain event is such event or provision which result (profit or loss) is recognized only upon approach or not approach of this event in the future.

2.3. Contractual (conditional) commitments are the consent of bank to issue or receipt of means under certain conditions - during certain period in the future.

3. Classification of off-balance accounts

3.1. Off-balance transactions are classified by availability of bank risk in the following procedure:

* obligations and conditional off-balance transactions;

* memorandumny off-balance transactions;

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