The bank system of Ukraine

The banking system of Ukraine has a two-leveled structure and is divided into Central Bank (NBU) and Commercial Banks of different types and forms of ownership.

The 1999 National Bank Law states that the primary function of the NBU is to ensure the stability of the national currency, the hryvnia (UAH). The NBU is also tasked with maintaining the stability in the banking system and price stability, within the scope of its power.

The NBU is a state currency issuing centre, which executes state politics with regard to monetary circulation, credit gold reserves and currency transactions. It organizes and coordinates activity of CB. In order to exercise its functions, the NBU within the limit of its competence issues normative acts, establishes for CB and other financial institutions volume and forms of accounting, rates of percentage, size of margin and other limitations, the rates of currency allocations and necessary reserves. The NBU is answerable to VRU.

The NBU issues permissions for the creation of CB, establishes a national register of banks.

The second level of banking sector – CB is the largest part of finsncial sector. There are more than 180 banks under the supervision of the NBU. Among the major banks in the country are: PrivatBank - the leading bank in country, Raiffeisen Bank Aval, UkrSibbank (subsidiary of BNP Paribas), UkrSotsBank,State Savings Bank of Ukraine (Oshchadbank) (State bank), UkrEximBank (State bank), PromInvestBank, Nadra Bank, OTP Bank, Finances and Credit, KreditPromBank etc.

CB are providing different types of banking services, they act as intermediaries between depositors and borrowers

12. Accounting. Financial statements

Accounting is the recording, classifying, summarizing and interpreting of the business activities that can be expressed in monetary terms. Accountancy is sometimes used as alternative expression expecially for the practice of accounting.

Accounting information can be classified into two categories financial accounting or public information and managerial accounting or private information.

Accounting in any country reflects the level of its economic development to some extent. A new phase of accounting development in Ukraine began on January 1, 2000, when the Law On Accounting and Financial Reporting in Ukraine and the Accountong Standards (provisions) of Ukraine came into force. The Verkhovna Rada of Ukraine adopted the Law on July 16. This day is now celebrated as a professional holiday, the Accountant’s Day.

The annual financial statements of enterprises comprise the following: Balance sheet, Income statement, Cash flow statement, Owner’s equity statement, Notes to the annual financial statements.

The balance sheet shows the financial position of a business on a certain date, usually the end of the month or year. The accounting equation of the Balance sheet is: Assets = owner’s equity+liabilities.

The income statement is a statement summarizing the firm’s revenues and expenses over an accounting period, generally a quarter or a year.

Cash Flows statement – a statement reporting the impact of a firm’s operating, investing and financial activities on cash flows over an accounting period.

Statement of owner's equity. The statement of owner's equity is prepared after the income statement. It shows the beginning and ending owner's equity balances and the items affecting owner's equity during the period. 

Notes to the financial statements report the details and additional information that are left out of the main reporting documents, such as the balance sheet and income statement. This is done mainly for the sake of clarity because these notes can be quite long, and if they were included, they would cloud the data reported in the financial statements.