On November 5, 2013, the National Bank of Ukraine Board approved Resolution No. 437, whereby amendments shall be introduced to the Instruction on Accounting of Foreign Exchange and Banking Metals Transactions in Ukrainian Banks.

The amended Instruction is consistent with the International Financial Reporting Standards and intended to improve the accounting treatment of foreign exchange and banking metals transactions.

The amended Instruction, inter alia, envisages the following:

• imposition of requirements applied to the accounting treatment of spot transactions on sale-purchase of foreign currency and banking metals and arbitrage transactions under the terms of margin trading; 
• recording of transactions on purchase/sale of foreign currency and currency exchange transactions that under terms of the contract are carried out on a net basis without physical delivery of foreign currency.

This approach will enhance the efficiency of banking supervision, thus providing better protection for depositors and other creditors of banks.

The Resolution comes into effect from January 1, 2014.