Interrelation of the Reserve for Expected and Incurred Losses and Revaluation Reserve and Their Presentation in the Banks' Accounting

The purpose of the article is to determine differences in accounting for the reserves in respect of financial assets measured at fair value with revaluation being recognized comprehensive income of the bank in accordance with IFRS 30 and reserves for financial investments available for sale in the bank's portfolio recognized in accordance with Instruction No. 400. It clears up methodological principles of accounting for assets measured at fair value with revaluation results recognized in other comprehensive income. It contains comparative evaluation of key particulars of accounting for revaluation results in creation of the reserve for expected and incurred losses in accordance with the applicable IFRS accounting rules and principles. It defines differences in accounting for reserves in case of creation of separate control accounts for the revaluation reserve and the provision for utility diminishing in accordance with different accounting rules. It determines the preconditions for simultaneous recognition of two reserves for assets measured at fair value with revaluation results being recognized in other comprehensive income. It justifies expediency of use of the expected losses model in evaluation of assets for utility diminishing.