JAIIB-AFB-MOD-C- Final Accounts of Banking Companies Unit - 16 : Final Accounts of Banking Companies Requirements – Accounts & audit Third Schedule annexed to BRA Form A- Balance sheet Form B- Profit & Loss Account Audit Submission of accounts- RBI- within 3 months Publication of accounts- within 6 months Auditor-prior approval of RBI for appt/removal Balance sheet-Form A Capital & Liabilities Assets 1.Capital 2.Cash & Bank Bal. RBI 3. Reserves & surplus 4.Balances with Banks & Money at call and SN 5.Deposits 6.Investments 7.Borrowings 8.Advances 9. Other Liabilities & Provisions 10.Fixed Assets 11.Other Assets
Demand deposits Credit balances in OD and CC Deposits payable at call Overdue deposits In-operative current accounts Matured time deposits Matured cash certificates Matured certificate of deposits
Contingent liabilities Schedule-12 Claims against bank not acknowledged as debts Liability for partly paid shares Liability on account of outstanding forward exchange contracts Acceptances ,endorsement & other obligations Other items for which bank is contingently liable.
PROFIT & LOSS ACCOUNT-FORM B Income Interest Earned Other Income Schedule.13 Schedule.14 Expenditure Interest Expended Operating Expenses Provision for contingencies Schedule.15 Schedule.16 Profit /Loss Appropriations Transfer to Reserves Proposed dividend Balance carried to Balance sheet Significant Accounting Policies Schedule.17 Notes forming part of Accounts Schedule.18 Other Income Profit on exchange transactions Profit on sale of investments Profit on revaluation of investments Profit on sale of fixed assets Letting of locker (income from locker charges ) Misc. income -Godown rent
Just go through these points Govt. securities shown at book value and diff. between MV and BV is given in the notes If some fixed assets are w/o on revaluation of assets/reduction of capital every B/S after wards should. show the revised figure for next 5 yrs. With the date & amt. revised Other fixed assets includes vehicles, furniture and fixtures. Lockers and safe deposit vaults are included in furniture 20% to reserve fund before declaring dividend Gold is treated as investment Silver is treated as other assets Income from performing assets is recognized on accrual basis while in r/o non-performing assets it is on cash basis In r/o NPA, if income is already recognized, then make provision
ASSET CLASSIFICATION ETC Asset Classification Performing and non performing ( remain out of order) Income Recognition Performing-accrual basis Non performing-cash basis Asset Classification Std-0.40% (revised from 0.25%) Sub-Std.-Unsecured – 25%, Secured - 15% Doubtful – Unsecured - 100%, Secured - upto 1 year-25%, 1 to 3yrs-40%, more than 3 years - 100% Loss assets-100%
SLR & NON SLR DEPOSITS Held to maturity Available for sale Held for trading Investment should not exceed 25% of total investment Freedom available Freedom available -no marked to market. Profit on sale treated as cap. Reserve -Marked to market -profit on sale of investment.taken to P&L a/c Marked to market To be sold within 90 days