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Financial statements include the following:
a. Profit and Loss account which shows the performance of an institution over a time period,
b. Balance Sheet which shows the financial position of the institution at a given point in time,
c. Cash flow statement which shows the actual cash received from various sources and how the amounts generated were spend,
d. Statement of Changes in Equity which shows the movements in shareholders’ interests in the company including capital injections, dividend payments and increases or decreases in retained reserves, and
e. Accounting policies and Notes which provide additional information on the basis, assumptions, principles and detailed disclosures of what is disclosed on the faces of the financial statements.
The disclosures mandated include liquidity ratios, capital adequacy ratios, levels of nonperforming loans and advances, insider loans and advances, and off balance sheet items.
Licensed Commercial Banks and Mortgage Finance Companies are mandated on a quarterly basis to:
- Submit consolidated Profit and Loss account, Balance Sheet and prescribed disclosures to the Central Bank of Kenya; and
- Publish the consolidated Profit and Loss account, Balance Sheet and the prescribed disclosures in a newspaper of national circulation.
The quarterly submissions and publication are required to be done within two months of end of every calendar quarter whereas for the annual audited financial statements, they are required to submit and publish within four months of the end of the financial year. The Institutions publish once they obtain consent from the Central Bank.
Once all institutions have submitted their financial statements, the Central Bank consolidates them to obtain a Global financial position, performance and strength of the banking sector. This quarterly consolidated financial statements are as below:
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