General directions and notesGeneral directions and notes

General directions and notes

Reporting entity

The Debt Securities on Issue form is to be completed by all locally incorporated banks, Foreign ADIs and Special Service Providers on a Domestic Books basis.

The Domestic books of the locally incorporated banks, Foreign ADIs and Special Service Providers relates to the Australian books of the Australian ADI and has the following scope:

• Is an unconsolidated report of the Australian licensed ADI's operations/transactions that are booked inside Australia.
• Exclude offshore branches of the Australian licensed ADI from this reporting unit.
• Exclude offshore banking units based overseas from this reporting unit.
• Do not consolidate Australian and offshore controlled entities or associated entities that are not ADIs.
• Include Australian based offshore banking units of the licensed ADI.
• Include transactions with non-residents recorded on Australian books.

Reporting period

The form is to be completed as at the last day of the stated reporting quarter. Locally incorporated banks, Foreign ADIs and Special Service Providers should submit the completed form to APRA within 20 business days after the end of the relevant reporting quarter.

Unit of measurement

Banks are asked to complete the form in millions of Australian dollars rounded to one decimal place. Special Service Providers are asked to complete the form in whole Australian dollars (no decimal place).

Amounts denominated in foreign currency are to be converted to AUD in accordance with AASB 1012 ‘Foreign Currency Translation’.

The general requirements of AASB 1012 for translation are:

1. Foreign currency monetary items outstanding at the reporting date must be translated at the spot rate at the reporting date.
2. Other items outstanding at the reporting date must not be retranslated subsequent to initial recognition of the transaction.

Monetary items are defined to mean money held and assets and liabilities that are to be received or paid in fixed or determinable amounts of money.

Monetary items arising under foreign currency derivative contracts at the reporting date must be translated as follows:

• Where the exchange rate is fixed in the contract, at that fixed exchange rate; and
• Where the exchange rate varies, at the spot rate at the reporting date.

Timing

Report assets and liabilities as at the date of change of ownership.

Netting

Unless otherwise specifically stated, institutions are to comply with the prerequisite for netting outlined in Australian accounting standards AASB 1014 ‘Set-off and Extinguishment of Debt’ and AASB 1033 ‘Presentation and Disclosure of Financial Instruments’.

Term to maturity

References to term to maturity in this form are references to original term to maturity. Note that this approach differs from the treatment of debt securities (liabilities) on ARF 320.0 Statement of Financial Position (Domestic Books), which requires data on a residual maturity basis. This difference arises because the standards underlying this form are based on international statistical standards rather than accounting standards.

Valuation and currency conversion

Closing balances should be reported at market price effective at the reference date. Where denominated in foreign currency, market values in foreign currency should be converted to AUD at the spot rate effective as at the reference date.

For debt securities, the market price is the traded price quoted on the reference date. If the traded price does not take account of interest accrued up to the ex-coupon date but not yet payable, this interest accrued should be included. If the traded price is not available, other methods of approximation include (in order of preference):

• Using a market rate of interest (yield to maturity), the net present value of the expected stream of future payments associated with the securities;
• For unlisted securities, the price used to value securities for accounting or regulatory purposes;
• For discount, deep discount or zero coupon securities, the issue price plus amortisation of the discount; or
• Other mark to market method.

Basis of preparation

Unless otherwise specifically stated, institutions are to comply with Australian accounting standards regarding the measurement of asset, liability and equity items

Domicility

References to "issued in Australia" are references to the domicility of the debt instruments used to raise funds in the domestic market. These instruments can be denominated in either AUD or some foreign currency such as USD.

References to "issued overseas" or "offshore" are references to the domicility of the debt instruments used to raise funds in countries other than Australia. These instruments can be denominated in either AUD or some foreign currency such as USD. Euro issues should be included in "overseas".