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Accounting in central banks

Author

Listed:
  • Bholat, David

    (Bank of England)

  • Darbyshire, Robin

Abstract

This paper examines the important but not often discussed issue of accounting in central banks. It highlights the distinguishing factors that make the financial statements of central banks unique relative to those produced by other bodies. We begin by explaining why central banks produce financial statements. We then discuss a variety of specific topics in central bank accounting. In terms of balance sheet items, we discuss banknotes, shareholders’ equity, gold, foreign exchange and financial instruments. Our discussion of the income statement then centres on profit recognition and distribution.

Suggested Citation

  • Bholat, David & Darbyshire, Robin, 2016. "Accounting in central banks," Bank of England working papers 604, Bank of England.
    • Handle: RePEc:boe:boeewp:0604
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    File URL: https://www.bankofengland.co.uk/-/media/boe/files/working-paper/2016/accounting-in-central-banks.pdf?la=en&hash=F302BAF73C1B578A9E1872B6A4FF14A575688B8F
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    References listed on IDEAS

    as
    1. Mr. Alain Ize, 2005. "Capitalizing Central Banks: A Net Worth Approach," IMF Working Papers 2005/015, International Monetary Fund.
    2. Desan, Christine, 2015. "Making Money: Coin, Currency, and the Coming of Capitalism," OUP Catalogue, Oxford University Press, number 9780198709589, Decembrie.
    3. Mr. Peter Stella & Mr. Ulrich H Klueh, 2008. "Central Bank Financial Strength and Policy Performance: An Econometric Evaluation," IMF Working Papers 2008/176, International Monetary Fund.
    4. Perera, Anil & Ralston, Deborah & Wickramanayake, Jayasinghe, 2013. "Central bank financial strength and inflation: Is there a robust link?," Journal of Financial Stability, Elsevier, vol. 9(3), pages 399-414.
    5. Bindseil, Ulrich & Manzanares, Andrés & Weller, Benedict, 2004. "The role of central bank capital revisited," Working Paper Series 392, European Central Bank.
    6. David Archer & Paul Moser-Boehm, 2013. "Central bank finances," BIS Papers, Bank for International Settlements, number 71.
    7. Gustavo Adler & Pedro Castro & Camilo Tovar, 2016. "Does Central Bank Capital Matter for Monetary Policy?," Open Economies Review, Springer, vol. 27(1), pages 183-205, February.
    8. Mr. Alain Ize, 2006. "Spending Seigniorage: Do Central Banks Have a Governance Problem?," IMF Working Papers 2006/058, International Monetary Fund.
    9. Maxwell J. Fry, 1993. "The Fiscal Abuse of Central Banks," IMF Working Papers 1993/058, International Monetary Fund.
    10. Garreth Rule, 2015. "Understanding the central bank balance sheet," Handbooks, Centre for Central Banking Studies, Bank of England, number 32, April.
    11. Mr. Peter Stella, 2009. "The Federal Reserve System Balance Sheet: What Happened and Why it Matters," IMF Working Papers 2009/120, International Monetary Fund.
    12. Buiter, Willem, 2008. "Can Central Banks Go Broke?," CEPR Discussion Papers 6827, C.E.P.R. Discussion Papers.
    13. Alain Ize, 2005. "Capitalizing Central Banks: A Net Worth Approach," IMF Staff Papers, Palgrave Macmillan, vol. 52(2), pages 289-310, September.
    14. Bholat, David & Lastra, Rosa & Markose, Sheri & Miglionico, Andrea & Sen, Kallol, 2016. "Non-performing loans: regulatory and accounting treatments of assets," Bank of England working papers 594, Bank of England.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Joerg Bibow, 2018. "Unconventional Monetary Policies and Central Bank Profits: Seigniorage as Fiscal Revenue in the Aftermath of the Global Financial Crisis," Economics Working Paper Archive wp_916, Levy Economics Institute.
    2. Jörg Bibow, 2018. "Unconventional monetary policies and central bank profits," IMK Studies 62-2018, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.

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    More about this item

    Keywords

    Central bank accounting; central bank balance sheet; seigniorage; central bank capital;
    All these keywords.

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation

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