Kaupthing says govt to rule soon on euro accounting

STOCKHOLM, Jan 16 (Reuters) - Icelandic bank Kaupthing KAUP.IC said it had appealed a ruling against it adopting the euro for accounting purposes this year and expected a final decision from the country's finance minster within a few weeks.

Kaupthing wants to switch to the single currency to make its accounts easier to compare with other banks.

The bank, Iceland's biggest, said it had applied to the Register of Annual Accounts to report in euros as of Jan. 1 2008.

The authority approved the application, but with the proviso that Kaupthing's acquisition of Dutch bank NIBC was completed before the end of 2007.

"As the acquisition could not be finalised before that date, Kaupthing sent an appeal to the Minister of Finance, asking him to change the decision ... so that the authorisation is made unconditional," Kauphing said in a statement.

"It is expected that the Minister of Finance will give his final verdict within a few weeks."

Kaupthing also said that the central bank, which is required to give an opinion in such cases, was against the move.

The central bank said in a statement on its website that it objects to domestic financial companies fully adopting foreign currencies in their accounts.

"If financial companies are, as well, heading towards listing their equities in a foreign currency and reducing their business in the domestic currency, then the central bank believes there is ample reason to pause and consider the consequences for Iceland's monetary system," it said.

Kaupthing said in the third quarter it would propose to shareholders that its shares be redenominated in euros. (Reporting by Kristin Arna Bragadottir; Editing by David Cowell)