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12.04.2007 Business & Finance

BoG Sets Guidelines For Cedi Re-Denomination

The Bank of Ghana has released technical guidelines on its planned programme towards the re-denomination of the cedi, which begins from July 1, this year.

The guidelines covered five main sections, including pricing of goods and services, exchange rate quotation, banking and transactions, securities and references.

According to a statement issued by the Central Bank, under pricing of goods and services, beginning from next month all stakeholders should display and quote prices, charges, fines, fees, taxes and tariffs in both old and new currencies.

Again, during the same month of May, prices and commission fees charged by banks should be displayed at their head offices and branches in both cedis and Ghana Cedis and pesewas.

On exchange control, the Central Bank has directed that with effect from July 1, all exchange rate quotations should be made in four digits to reflect international practice.

It went on further to state that figures at the fifth decimal equal or higher than half a Ghana pesewa should be rounded upwards to one Ghana pesewa, while the figures at the fifth decimal lower than half a Ghana pesewa shall be disregarded.

On section three, which dealt with accounting system, the Bank of Ghana, among other things, stated that all approved budget estimates up to the June 30, 2007 should remain in cedis, however, from July 1, 2007, all unutilised budgetary allocations shall be converted into Ghana cedi and Ghana pesewa.

It said financial statements for the half year to June 30, 2007 should be prepared in cedis, however, from July 1, 2007, figures in June 30 financial statements should be converted into Ghana cedi and Ghana pesewa.

“Thereafter, all transactions should be recorded in Ghana cedi and Ghana pesewa”, the statement said.

The central bank further stated that goods and services should be invoiced in cedis until June 30, 2007, thereafter, from July 1, 2007, goods and services should be invoiced in Ghana cedi and Ghana pesewas.

Under section three, which deals with banking transactions, the Bank of Ghana has directed that all banks should make cash collection for both cedi and the new Ghana cedi, while payment shall be made only in the new Ghana cedi and pesewas.

It urged banks to adopt Auto Teller Machines (ATMs) and other cash processing equipment to use the new Ghana cedi notes by the end of the month of June.

On securities, the central bank stated that all securities printed and issued after the commencement date should be in the Ghana cedi and pesewa, whilst the face values of existing securities shall be converted accordingly.

It said all references made to the cedi in contracts and other business transactions, exchange instruments, payment arrangements, court decisions and any other document not expressly provided for the statue should be considered to have been made to the Ghana cedi and pesewas, the statement concluded.