80% IFRS Conformity in BMI Balance Sheets

Bank Melli Iran, the nation’s biggest bank, has made significant headways in conforming to International Financial Reporting Standards, its chief executive said.

“Bank Melli’s disclosure of information conforms to 80% of IFRS, the implementation of which is ongoing in the Iranian banking system under the supervision of the Central Bank of Iran,” Mohammad Reza Hosseinzadeh was also quoted as saying by the official website of BMI.

The CEO noted that the conformity of financial statements to international standards has been in line with the templates released and approved by the central bank, which entail better disclosure of data and higher transparency.

As Iranian lenders were cut off from the international banking system and lag in terms of conforming to global standards as a result of years of western sanctions imposed on Iran over its nuclear program, the central bank has been pursuing IFRS adherence vigorously for the past few years.

The IFRS-based balance sheet templates were first released by CBI in February to improve financial transparency and international operations of Iranian banks.

BMI has made notable progress and its CEO promises better prospects and 100% conformity in the foreseeable future.

“This trend of increasing transparency and IFRS conformity was launched in BMI last year and considering the pace with which it has advanced, we hope that in the next fiscal year (2018-19) the balance sheets of the bank will completely conform to these standards,” he added.

Hosseinzadeh noted that BMI devised two sets of financial statements last year and this year, with the former based on national standards and the latter revolving around new IFRS-based CBI templates.

The official added that even two years ago, Bank Melli strived to draft its balance sheets as best as it could so that they could be ready and sent to CBI before the annual general meeting of the bank was held. That was a time when other Iranian lenders had not begun to base their statements on agreeable standards.

Less than two weeks ago, the central bank set a number of conditions vis-à-vis banks’ financial statements, the fulfillment of which is necessary for shareholders’ annual meetings to become viable.

The CBI obligated banks and credit institutions to present their financial statements to their board members, independent auditors and registered inspectors, as well as depositors and shareholders for the fiscal 2016-17 based on IFRS and in line with the updated sample.

Since then, the CBI has confirmed that at least eight lenders have heeded its call satisfactorily and their general meetings were held.