JAIIB AFb Unit 16 - Final Accounts of Banking Companies

JAIIB AFb Unit 16 - Final Accounts of Banking Companies (Year: 2019)

Requirements –Accounts & audit

  1. Third Schedule annexed to BRA
  2. Form A- Balance sheet
  3. Form B- Profit & Loss Account
  4. Audit
  5. Submission of accounts- RBI- within 3 months
  6. Publication of accounts- within 6 months
  7. Auditor-prior approval of RBI for appt/removal

Balance sheet-Form A

Capital & Liabilities

Assets

1.Capital

6.Cash & Bank Bal. RBI

2. Reserves & surplus

7.Balances with Banks & Money at call and SN

3.Deposits

8.Investments

4.Borrowings

9Advances

5 Other Liabilities & Provisions

10.Fixed Assets

 

11.Other Assets

Demand deposits

  1. Credit balances in OD and CC
  2. Deposits payable at call
  3. Overdue deposits
  4. In-operative current accounts
  5. Matured time deposits
  6. Matured cash certificates
  7. Matured certificate of deposits

Contingent liabilities
Schedule-12

  1. Claims against bank not acknowledged as debts
  2. Liability for partly paid shares
  3. Liability on account of outstanding forward exchange contracts
  4. Acceptances ,endorsement & other obligations
  5. 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

  1. Profit on exchange transactions
  2. Profit on sale of investments
  3. Profit on revaluation of investments
  4. Profit on sale of fixed assets
  5. Letting of locker (income from locker charges )
  6. Misc. income -Godown rent

Just go through these points

  1. Govt. securities shown at book value and diff. between MV and BV is given in the notes
  2. 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
  3. Other fixed assets includes vehicles, furniture and fixtures. Lockers and safe deposit vaults are included in furniture
  4. 20% to reserve fund before declaring dividend
  5. Gold is treated as investment
  6. Silver is treated as other assets
  7. Income from performing assets is recognized on accrual basis while in r/o non-performing assets it is on cash basis
  8. In r/o NPA, if income is already recognized, then make provision

ASSET CLASSIFICATION ETC

  1. Asset Classification
        1. Performing and
        2. non performing ( remain out of order)
  2. Income Recognition
        1. Performing-accrual basis
        2. Non performing-cash basis
  3. Asset Classification
          1. Std-0.40% (revised from 0.25%)
          2. Sub-Std.-Unsecured – 25%, Secured - 15%
          3. Doubtful – Unsecured - 100%, Secured - upto 1year-25%, 1 to 3yrs-40%, more than 3 years - 100%
          4. 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

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