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• <br />Separate disclosure of investment securities and trading account securities is <br />not required in Canada as it is in the United States. <br />Under U.S. bank accounting principles, there is no deferral of gains and losses <br />on disposal of fixed maturity debt securities. Profits and losses on the <br />disposition of all securities are reflected in the incase statement. U.S. banks <br />are required to value investment securities at amortized cost and disclose the <br />market value. The other prirciples mentioned above are consistent with U.S. <br />principles in all material respects. <br />Pension Costs <br />The basic approach to aomconnting for pension costs under the accounting <br />prirciples in effect at the Bank's last fiscal year and was similar in the <br />United Stages and Canada. However, pension fund actuarial gains and losses <br />under United Statues generally accepted accounting principles were amortized over <br />a period that reflected the long-term nature of a pension fund (usually <br />minimum of ten years); in Canada the rmxinum period was three years. <br />the required disclosure of pension information is more extensive in the United <br />States where financial statements must include details on the actuarial present <br />value of vested and nan-vested accunulated plan benefits, the plans' net assets <br />available for benefits, assumed rages of return used in determining actuarial <br />present values and the date as of ohich the benefit information was determined. <br />Bogs Canada and the United States have introduced, under similar timetables, new <br />standards of accounting for pension costs. Sane United States banks have <br />already implemented the new United States standards; the Bank must implement the <br />Canadian standards no later than November 1, 1987. <br />Other <br />All other accounting principles used in the preparation of the financial <br />statements of the Bank are consistent with Generally Accepted Aeccuntimq <br />Principles applicable to U.S. banks in all material respects. <br />For a more ccmplete surnary of significant accounting policies of the Bank, see <br />"Summary of Significant Account lbhcies" curler "Notes to Financial Stateren.ts" <br />on page A-15. <br />A-5 <br />