# Regulatory Summary for Micro Banking Accounting Standards
**SEOJK No. 21/SEOJK.03/2024 – Banking Accounting Guidelines for Rural Banks (BPR)**

## 1. Regulatory Scope
- Provides **technical accounting guidance** for:
  - Rural Banks (BPR)
- Acts as an implementation guideline of:
  - POJK regulations related to BPR financial reporting
- Focuses on:
  - Consistency
  - Comparability
  - Reliability of financial statements

> This regulation translates high-level OJK rules into **operational accounting standards**.

## 2. Accounting Basis & Principles
- Financial reporting must be prepared using:
  - **Accrual basis**
  - Going concern assumption
- Core principles applied:
  - Prudence
  - Substance over form
  - Consistency
  - Materiality

## 3. Financial Statement Components
BPR must prepare the following reports:
- Statement of Financial Position (Balance Sheet)
- Income Statement
- Statement of Changes in Equity
- Cash Flow Statement
- Notes to Financial Statements

> These reports must be generated periodically and be audit-ready.

## 4. Recognition & Measurement of Financial Instruments
- Covers accounting treatment for:
  - Loans
  - Interest income
  - Fees and commissions
- Interest income:
  - Recognized using the **effective interest method**
- Non-performing loans:
  - Must be classified based on collectability
  - Require allowance for impairment losses (CKPN)

## 5. Asset Quality & Impairment
- Loans must be categorized by quality:
  - Current
  - Special mention
  - Substandard
  - Doubtful
  - Loss
- Impairment provisions must:
  - Reflect credit risk exposure
  - Be reviewed periodically

> This requires accurate loan monitoring and aging mechanisms.

## 6. Equity, Income, and Expense Accounting
- Equity includes:
  - Paid-in capital
  - Retained earnings
- Income and expenses must:
  - Be matched to the correct accounting period
  - Be supported by valid documentation

## 7. Reporting Accuracy & Documentation
- Financial records must be:
  - Complete
  - Verifiable
  - Traceable
- Banks must maintain:
  - Transaction evidence
  - Reconciliation records
  - Supporting schedules

## 8. Alignment with IT & Core Banking Systems
- Accounting policies must be:
  - Embedded into core banking systems
  - Consistently applied across all transactions
- Systems must support:
  - Automated journal entries
  - Loan impairment calculations
  - Periodic financial reporting

## 9. Relevance to Digital & Micro Banking Systems
This regulation serves as the foundation for:
- Accounting logic in micro core banking systems
- Automated financial statement generation
- Credit risk and impairment engines
- Audit and compliance reporting modules

> SEOJK No. 21/2024 defines **how accounting must actually work inside BPR systems**, not just how it is reported.