1. Accounting Principles
Estonian Central Depository for Securities Accounting Principles The financial statements of the Estonian Central Depository for Securities have been prepared in conformity with the Estonian Accounting Law and good accounting practice.
The Income Statement scheme no. 1 has been used for recording the profit in the financial statements during the accounting years 1996 and 1997.
The FIFO method has been used to value the short-term securities. The shares, holdings and bonds have been classified as current assets are valued at the balance date according to which is lower, either at historical costs or net realisable value.
Customer receivables have been valued in the balance sheet according to the probability of their collection. Doubtful receivables totalling EEK 26,852 are recorded as expenses. The Estonian Central Depository for Securities has independently started the collection of debts within the abovementioned amount.
Uncollectible receivables calculated in 1996 were recorded on the off-balance sheet account (EEK 33,734 Tallinna Lihatööstus - bankruptcy).
The assets with acquisition costs exceeding 4000 kroons are recorded as fixed assets. Small assets (with costs under 4000 kroons) are recorded as expenses during the acquisition. Depreciation is calculated using the straight-line method. The depreciation rates are changed according to the useful life of every fixed asset.
The “interest and issue amounts in the Bank of Estonia” recorded in the liabilities on the balance sheet consists of the financial means of the issues carried out through the Estonian Central Depository for Securities which are transferred in the subscription period by the investors to the account of the Estonian Central Depository for Securities and the interests and dividends paid to the investors by the companies through the Estonian Central Depository for Securities. The issue amount is transferred to the issuer’s account after the subscription results are announced and the issue ended. The interests and dividends are transferred to the accounts of investors according to the orders of the companies.
In 1997 the Estonian Central Depository for Securities had neither purchase nor sales transactions with the related parties.
No changes have been made in the accounting scheme and methods in 1997.
