The bank's balance sheet reflects the important economic information underlying the organization of banking and the improvement of bank management activities. With its help, state bodies control the development of the monetary sphere throughout the country. The bank management, in turn, on the basis of the balance sheet evaluates the final results obtained by the bank and the effectiveness of the activities carried out, outlines further steps for the development of banking operations.
They draw up the bank balance sheet in the form of a final table created on the principle of grouping operations according to economically homogeneous indicators that characterize the state of bank accounts at a certain date.
The balance sheet of a commercial bank is a balance sheet, which reflects the state of the bank's own, borrowed and attracted funds, and shows how they are placed in credit and other active operations. In practice, this is a source of information for monitoring the formation of monetary resources and their allocation, the status of credit, cash, settlement and other banking operations, including transactions with securities.
The accounts of the nomenclature of bank balances are divided into balance and off-balance.
The first of them are:
- passive - these are bank resources intended for lending and other banking operations, they are a reflection of bank funds, funds of individuals of enterprises and organizations, state budget revenues, deposits, funds in settlements, bank profits, payables, other liabilities and borrowed funds, including refinancing amounts received from other banks;
- active - the debt on them shows how and in what areas these resources were used, cash is kept at the bank's cash desks, long-term and short-term loans, state budget expenditures, receivables, and other active funds.
The second, off-balance sheet, is a reflection of the movement of documents and valuables that go to banking institutions for commission, custody or collection, including signs of payment of state fees, share forms, strict reporting and others.
The bank balance sheet is grouped by liquidity into articles for the following assets:
- cash, funds in accounts with other banks, that is, reflect the "primary reserves" for liquidity;
- investments in commercial bills, short and long-term securities and others, that is, some of them are “secondary reserves”, as they can be quickly converted into cash with little risk of loss;
- loans issued to individual borrowers, organizations, enterprises, other banks; since there is a likelihood of their untimely repayment, these balance sheet assets are classified as low liquid investments;
- investment - investment in real estate and movable property, the creation of joint ventures, branches, etc.
Accordingly, the economic nature of the operations the bank balance is grouped into articles by:
- operations with clients, including operations to raise resources and provide loans;
- interbank operations, including short and long-term ones; other operations, including investing in short-term liquid securities and other securities.
The bank balance sheet has a standard form approved by the Bank of Russia and is based on the following principles:
- business continuity
- efficiency, inviolability of the incoming balance,
- Content priority over form
- open accounting
- constancy of accounting rules,
- caution, reflection on a cash basis of income and expenses,
- Separate reflection of assets and liabilities.