LONDON, Jan 13 (Reuters) - The Bank of England said on Wednesday it would do more to quantify potential losses from its 895 billion-pound ($1.22 trillion) bond purchase programme, so the government and public are clear how much money is at stake. Britain’s government has so far received more than 110 billion pounds in profits booked by the BoE’s Asset Purchase Facility (APF) - partly representing interest payments that one arm of the state is paying another. But the government is obliged to compensate the BoE if the central bank makes losses on its quantitative easing (QE) programme, which is likely if the BoE decides to sell bonds back to the market at a time of higher interest rates. These cash payments to the BoE could amount to tens of billions of pounds in a single year. “Given the potential for fading institutional and public memories, it is important that arrangements to manage a reversal of cash flows remain well understood by relevant stakeholders, ahead of time,” the BoE said in a new report. The report was ordered by the BoE’s Court of Directors, which monitors BoE Governor Andrew Bailey and other executives. The BoE has bought government bonds since the 2009 financial crisis as part of efforts to keep inflation at its 2% target. Bailey has said that although these purchases had lowered government borrowing costs, their aim was to stabilise inflation and markets, not to underwrite extra public spending. The BoE said on Wednesday it would publish new estimates this year of potential payments that the government might need to make due to future QE losses. An estimate in 2017 showed a scenario where the government would need to pay the BoE more than 20 billion pounds in 2060 and again in 2065. Since then the BoE has doubled its target for asset purchases and a fall in gilt yields to record lows mean it has paid close to record high prices for the government bonds that make up the overwhelming majority of the programme. Actual profits and losses from the APF will depend heavily on both BoE interest rates and market rates, as well as the timing and scale of future gilt sales. BoE officials have said they do not expect to ever sell back all the government debt they have purchased, due to changes in the structure of banks and financial markets since the 2008-09 financial crisis. ($1 = 0.7331 pounds) (Reporting by David Milliken; Editing by Jon Boyle)