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Key considerations for financial reporting

After the transition away from certain familiar Interbank Offered Rates in foreign jurisdictions, the reforms to South Africa’s reference interest rate are now accelerating rapidly. The Johannesburg Interbank Average Rate (JIBAR) will be replaced by the new South African Overnight Index Average(ZARONIA).

The transition from JIBAR to ZARONIA will present a major challenge, requiring significant time commitment from all stakeholders in executing a carefully structured plan. From an accounting perspective, it is important to gain an understanding of the consequences of transition as this will support in the decisions made in executing the transition plan. Failure to do so may bring about unforeseen accounting consequences reflected in reported financial results.

This article was originally published by the Association of Corporate Treasurers of Southern Africa (ACTSA) on in partnership with Treasury Management International (TMI). It is reproduced here with their permission.

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