Accounting for gold


Monetary authorities hold gold in the performance of their official functions, typically as part of the country’s official reserves. This functional purpose differs from the objectives of other entities who hold gold, and monetary authorities also commonly hold gold in much larger quantities than other entities. General purpose financial reporting frameworks lack appropriate guidance on accounting for gold, in particular for gold classified as monetary gold.

To match accounting for gold to its functional objectives, monetary authorities require an accounting framework that recognises the several reasons that the entity may hold gold and reflects the economic substance of these holdings. 

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, which reviewed the different approaches to accounting for gold, demonstrated by monetary authorities, and the findings ultimately served as the foundation for our consultation paper: Guidance for Monetary Authorities on the recommended practice in accounting for gold.

This guidance aims to

  • Standardise the accounting practices of monetary authorities with respect to gold, by establishing a suitable framework that is consistent with the conceptual framework of current financial reporting standards.
  • Ensure framework considers both the presentation in the statement of financial position and in the income statement (or comprehensive income statement where presented), and the treatment of unrealised revaluations.
  • Issue guidance as to what should be regarded as distributable, particularly to entities like central government.

The World Gold Council held a public consultation on the draft guidance earlier this year to garner comments and feedback on the proposed recommended practice.  That feedback is now being consolidated before a final version will be issued.

Industry roundtable events

Accounting for gold - Industry roundtable events

The World Gold Council will be holding a series of roundtable events in 2017, bringing together central banks and industry stakeholders to discuss a proposed global best practice accounting standard for gold. 

Any key stakeholders (including central banks, international accounting standard boards, advisory institutions, global auditors, and sovereign wealth funds) wishing to participate in and/or host one of these roundtable events, please contact us at: [email protected].