Expense and Liquidity Coverage Ratio: Difference between pages

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1.  
''Bank regulation''.


A cost necessarily incurred in performing duties as an employee or independent professional.
The LCR is a requirement under Basel III for a bank to hold high-quality liquid assets (HQLAs) sufficient to cover 100% of its net cash requirements over 30 days.  


This requirement will be implemented during 2015 and will reduce the value to a bank of cash deposit of less than 30 days tenor because they are only worth the income on the HQLAs if a bank forecasts no short term cash revenue to cover repayment.


2.  
The purpose of this requirement is to ensure that banks can manage stressed market conditions, under which the bank is assumed to suffer substantial outflows of the cash previously deposited with it.


More generally, any cost necessarily incurred in order to do something.


== See also ==
* [[Basel III]]
* [[Net stable funding ratio]]
* [[Cash investing in a new world]]
* [[Leverage ratio]]
*[[Liquidity risk]]


3. ''Financial reporting - noun.''
[[Category:Compliance_and_audit]]
 
[[Category:Liquidity_management]]
An item treated as a cost in the current reporting period, when preparing an income statement.
 
 
4. ''Financial reporting - verb.''
 
To account for an item as an expense in the current reporting period, rather than capitalising it.
 
Capitalising an item of expenditure ''defers'' the accounting recognition of the expense into later reporting periods.
 
 
==See also==
*[[Accrual]]
*[[Accrued expense]]
*[[Administrative expenses]]
*[[Bad debt expense]]
*[[Capitalise]]
*[[Depreciation expense]]
*[[Expenditure]]
*[[Expense relief]]
*[[Expenses]]
*[[Financial reporting]]
*[[Income statement]]
*[[Management expenses]]
*[[Prepaid expense]]
*[[Recognition]]
*[[Research & development]]
 
[[Category:Accounting,_tax_and_regulation]]

Revision as of 12:56, 24 July 2015

Bank regulation.

The LCR is a requirement under Basel III for a bank to hold high-quality liquid assets (HQLAs) sufficient to cover 100% of its net cash requirements over 30 days.

This requirement will be implemented during 2015 and will reduce the value to a bank of cash deposit of less than 30 days tenor because they are only worth the income on the HQLAs if a bank forecasts no short term cash revenue to cover repayment.

The purpose of this requirement is to ensure that banks can manage stressed market conditions, under which the bank is assumed to suffer substantial outflows of the cash previously deposited with it.


See also

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