Guide to annual financial statements: IFRS 9 ...

1 PENSIONIFRSPROFIT ORLOSSCGUP RO F IT O R L O S SLIABILITIESCONSOLIDATIONFINANCIAL POSITION SHARE-BASED PAYMENTEPSJOINT ARRANGEMENTSDISCLOSURESHELD-FOR-SALEPENS IONCAPITALASSETSFINANCIAL RISK MANAGEMENTFAIRVALUEDERIVATIVESBUSINESS COMBINATIONSPRESENTATIONUPDATEACCOUNTING POLICIESOFFSETTINGESTIMATESDISCLOSURESBA NKSNCIPRESENTATIONGOODWILLESTIMATESOFFSE TTINGOCIDEBTFAIRVALUEDEPOSITSCASH FLOWSGOING CONCERNCONTINGENCYRELATED PARTYPROFIT OR LOSSSTRUCTURED ENTITYLOANS AND ADVANCESGOING CONCERNPERFORMANCEOFFSETTINGTRADING ASSETSCOMPARATIVEVALUATIONUPDATEMATE IALITYRFAIRVALUEACCOUNTING POLICIESOCINOTESIFRSPENSIONFINANCIAL POSITIONCASH FLOWSIFRS9 STATEMENTOPERATING SEGMENTSFINANCIAL RISK MANAGEMENTSUBSIDIARYOPERATING SEGMENTSBUSINESS COMBINATIONSPROVISIONSTRANSACTIONSEQUITY PERFORMANCESHARE-BASED PAYMENTJUDGEMENTFINANCIAL POSITIONCARRYING AMOUNTSIGNIFICANTPROPERTYACQUISITIONASSU MPTIONSCOMPARATIVEEQUITYNONCONTROLLING INTERESTS-FAIRVALUE MEASUREMENTACCOUNTING POLICIESLEASESDERIVATIVESGROUPINVENTORIE SASSETSSHARE-BASEDPAYMENTPERFORMANCEUNCO NSOLIDATED STRUCTURED ENTITIESFAIR PRESENTATIONPRESENTATIONCONSOLIDATIONCAS H EQUIVALENTSDEPOSITS FROMBANKSMATERIALITYFINANCIAL INSTRUMENTSFUNCTIONAL CURRENCYIMPAIRMENTLOANSBORROWINGSASSUMPT IONSDISPOSALIFRSIFRSG uide to annual

2 financial statements: ifrs 9 Illustrative disclosures for banksMarch this Guide 2 Independent auditors report 4 Consolidated financial statements 6 financial highlights 7 Consolidated statement of financial position 8 Consolidated statement of profit or loss and other comprehensive income 10 Consolidated statement of changes in equity 12 Consolidated statement of cash flows 14 Notes to the consolidated financial statements 16 Appendix I 185 Presentation of comprehensive income Two-statement approach 185 Acknowledgements 187 Keeping you informed 188 NotesBasis of preparation 161.

3 Reporting entity 162. Basis of accounting 163. Functional and presentation currency 164. Use of judgements and estimates 16 financial risk review and fair value 185. financial risk review 186. Fair values of financial instruments 60 Performance for the year 727. Operating segments 728. Net interest income 769. Net fee and commission income 7710. Net trading income 7811. Net income from other financial instruments at FVTPL 7912. Other revenue 8013. Losses arising from derecognition of financial assets measured at amortised cost 8114. Personnel expenses 8215. Other expenses 8916. Earnings per share 90 Income taxes 9117. Income taxes 91 Assets 9618.

4 financial assets and financial liabilities 9619. Cash and cash equivalents 10520. Trading assets and liabilities 10621. Derivatives held for risk management and hedge accounting 10822. Loans and advances to banks 11823. Loans and advances to customers 11924. Investment securities 12125. Property and equipment 12326. Intangible assets and goodwill 12427. Other assets 126 Liabilities and equity 12828. Deposits from banks 12829. Deposits from customers 12930. Debt securities issued 13031. Subordinated liabilities 13132. Provisions 13233. Other liabilities 13434. Capital and reserves 135 Group composition 13635. Group subsidiaries 136 Other information 13736.

5 Involvement with unconsolidated structured entities 13737. Transfers of financial assets 13838. Contingencies 14239. Related parties 14340. Operating leases 14441. Subsequent events 14542. financial risk management 146 Accounting policies 15243. Basis of measurement 15244. Changes in accounting policies 15345. Significant accounting policies 15546. Standards issued but not yet adopted 184 2016 KPMG IFRG Limited, a UK company, limited by guarantee. All rights | Guide to annual financial statements: ifrs 9 Illustrative disclosures for banksAUDITORS REPORTPRIMARY STATEMENTSNOTESAPPENDICESINTRODUCTIONA bout this guideThis Guide has been produced by the KPMG International Standards Group (part of KPMG IFRG Limited) and the views expressed herein are those of the KPMG International Standards helps you to prepare financial statements in accordance with ifrs , illustrating one possible format for financial statements based on a fictitious banking group involved in a range of general banking activities.

6 Our hypothetical corporation (the Group) has been applying ifrs for some time it is not a first-time adopter of ifrs . For more information on adopting ifrs for the first time, see Chapter in the 12th edition 2015/16 of our publication Insights into ifrs . Standards coveredThis Guide illustrates example disclosures for the early adoption of ifrs 9 financial Instruments and of consequential amendments to other standards, which are required to be adopted at the same time. It assumes that the Group has not adopted the hedge accounting requirements of ifrs 9 but continued to apply hedge accounting requirements of IAS 39. With the exception of ifrs 9, other standards or amendments that are effective for annual periods beginning after 1 January 2015 ( forthcoming requirements ) are not illustrated in this Guide .

7 Our ifrs : New standards Are you ready? provides a summary of newly effective and forthcoming standards (in addition to ifrs 9).Accordingly, except for the early adoption of ifrs 9, this Guide reflects IFRSs in issue at 31 December 2015 that are required to be applied by an entity with an annual period beginning on 1 January 2015 ( currently effective requirements ). ifrs 9 is a new and complex standard, and the interpretation of its requirements is subject to ongoing discussions between preparers, auditors, regulators and other stakeholders. This Guide does not intend to pre-empt this process and provide a view on how the requirements of the standard should be interpreted.

8 Instead, it gives an indication of possible disclosure requirements that would apply if a bank interpreted the requirements in a particular way. It is intended to help banks implement ifrs 9, by guiding them through the decision-making process needed to prepare the required Guide is not intended to be seen as a complete and exhaustive summary of all disclosure requirements under ifrs . Instead, it focuses on disclosure requirements that are particularly relevant to banks. For examples of other disclosures, see our Guide to annual financial statements Illustrative disclosures (September 2015).In addition, ifrs and its interpretation change over time.

9 Accordingly, this Guide should not be used as a substitute for referring to the standards and interpretations entity should also have regard to applicable legal and regulatory requirements. This Guide does not consider the requirements of any particular jurisdiction. For example, ifrs does not require the presentation of separate financial statements for the parent entity, and this Guide includes only consolidated financial guidanceIn preparing this Guide , we had regard to the recommendations made by the Enhanced Disclosure Task Force (EDTF) in its report Enhancing the Risk Disclosures of Banks, issued on 29 October 2012, and its revision issued on 7 December 2015, Impact of Expected Credit Loss Approaches on Bank Risk Disclosures.

10 The purpose of this report is to help banks improve their communication with their stakeholders in the area of risk disclosures, with the ultimate aim of improving investor confidence. The recommendations scope is wider than the financial statements, because they apply to all financial reports, including public disclosures required by regulators and other communications with stakeholders. In some cases, recommendations in the report may impact the manner of presentation of information that is already required to be disclosed under ifrs . In other cases, it recommends disclosure of new information. Many regulators continue to focus on disclosures in financial statements.