386 - Profits; how and when to be computed.

§ 386. Profits; how and when to be computed. 1. Every savings and loan  association  shall  close  its  books,  for the purpose of computing its  profits, at the end of any period for which a dividend is to be paid and  in no event less frequently than quarterly. To determine the  amount  of  gross  income  for any such accounting period the following items may be  included:    (a) All income received or properly accrued, provided that no interest  shall be accrued upon any interest-bearing asset upon which a default of  principal or interest has existed for a period which shall be determined  by the superintendent, except for  interest-bearing  assets  secured  by  collateral  the  ascertained  value  of  which  is at least equal to the  amount at which such asset plus all interest accrued thereon is  carried  on its books.    (b)  Amounts  added to cost for the purpose of amortizing discounts on  securities purchased for less than par, provided that no discount  shall  be amortized on securities upon which a default exists.    (c)  Any  profits actually realized from the sale or other disposition  of securities, real estate or other property.    (d) Amounts recovered on  assets  previously  charged  off,  including  amounts  allowed  by  the superintendent on account of assets previously  disallowed by him; and other amounts allowed by the board  of  directors  on account of assets previously disallowed by it.    (e)  Provided  the superintendent shall have approved, and only to the  extent of such approval, any increase in the  book  value  of  the  real  estate  and  building  or  buildings  thereon used by it as its place or  places of business.    (f) Such other items as the superintendent,  in  his  discretion,  may  permit to be included.    2.  To  determine the amount of net profits for such accounting period  the following items shall be deducted from gross income:    (a)  All  expenses  paid  or  properly  accrued,  both  ordinary   and  extraordinary, in the transaction of its business, the collection of its  debts and the management of its affairs.    (b) Interest paid or properly accrued upon time deposits held pursuant  to  section three hundred seventy-eight-a of this article, interest paid  or properly accruing upon deposits referred to in section three  hundred  seventy-eight-b of this article and debts owing by it.    (c)  Amounts deducted from cost for the purpose of amortizing premiums  on securities purchased for more than par.    (d) Any losses sustained by it except to the extent that  such  losses  have  been charged against the surplus account or valuation reserves. In  the computation of such losses there shall be  included  all  deductions  from  the  book  value  of  assets made pursuant to the direction of the  board of directors or by reason of the disallowance  of  assets  by  the  superintendent.  The  balance  thus  obtained  shall  constitute the net  profits of such savings and loan association for such period.