World Gold Council Releases Proposed Guidance on Accounting for Gold

By:
Chris Gaetano
Published Date:
Apr 21, 2017
By Andrzej Barabasz (Chepry) - Own work, CC BY-SA 4.0


The World Gold Council, an international market development organization for the gold industry, has released proposed guidance on accounting for gold, according to Accounting Today. The council felt this was necessary because, according to the proposed guidance, there's no uniform framework on how monetary authorities, which generally hold gold as part of their reserves, account for the precious metal. 

"In the absence of a suitable framework, monetary authorities have adopted a variety of different treatments. In June 2016, the World Gold Council published a discussion paper (“Working towards a common accounting framework for gold”) reviewing the different approaches to gold accounting demonstrated by monetary authorities. This report ultimately served as the foundation for the guidance recommended in this consultation paper. It is important to note that such a variety of treatments limits the comparability of financial statements and risks a reduction in their credibility, a key element in monetary
authorities’ independence and accountability. There has, accordingly, been interest for some form of standardization in this area," said the proposal. 

The proposed guidance goes over initial classification and derecognition, initial and subsequent measurement, reclassification, unrealized and realized gains and losses, gold swaps, gold deposits, gold commodity swaps, disclosures and reconciliation with IMF reporting. 

The World Gold Council is accepting feedback on its proposed guidance until July 21, 2017. 

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