1. Accounts of Banking Companies

2. Form ‘B’ Form of Profit & Loss Account for the year ended 31st March (Year)
Schedule no.
Year ended
(current year)
Year ended
(previous year) I.
II.
Income:
Interest earned
Other Income
Total
Expenditure:
Interest expended
Operating expenses
Provisions & contingencies 13 14 15 16

3. Schedule no.
Year ended
(current year)
Year ended
(previous year)
III.
IV.
Profit/Loss:
Net profit/Loss(-) for the year
Profit/Loss(-)brought forward
Total
Appropriations
Transfer to Statutory reserve
Transfer to other reserves
Transfer to Govt/Proposed dividend
Balance carried over to B/S

4. Schedule 13-Interest earned
Year ended on
(current year)
Year ended on (previous year) I.
II.
III.
IV.
Interest/ discount on advance/ bills
Income on investments
Interest on balances with RBI and other inter bank funds
Others
Total

5. Schedule 14- Other Income
Year ended on
(current year)
Year ended on (previous year) I.
II.
III.
IV. V.
VI.
VII.
Commission, exchange & brokerage
Profit on sale of investments
Less: Loss on sale of investment
Profit on revaluation of investments
Less: Loss on revaluation of investments
Profit on sale of land, buildings and other assets
Less: Loss on sale of land, buildings and other assets
Profit on exchange transactions
Less: Loss on exchange transactions
Income earned by way of dividends etc. from subsidiaries/ companies and/or joint ventures abroad /in India
Miscellaneous Income
Total

6. Schedule 15- Interest Expended
Year ended on (current year
Year ended on (previous year) I.
II.
III.
Interest on deposits
Interest on RBI/ inter-bank borrowings
Others
Total

7. Schedule 16- Operating expenses
Year ended on (current year
Year ended on (previous year) I.
II.
III.
IV. V.
VI.
VII.
VIII
IX. X.
XI.
XII.
Payment to and provisions for employees
Rent, taxes and lighting
Printing & stationery
Advertisement & publicity
Depreciation on banks property
Directors fees, allowances and expenses
Auditors fees, allowances and expenses (including branch auditors)
Law charges
Postages, telegrams, telephones etc.
Repairs & maintenance
Insurance
Other expenditure
Total

8. Form of Balance Sheet Balance Sheet of… as on 31st March (year)
Capital & Liabilities
Schedule
As on (current year)
As on (previous year)
Capital
Reserve & Surplus
Deposits
Borrowings
Other liabilities and provisions
Total 1 2 3 4 5

9. As on 31-3-01 (previous year)
Schedule
As on (current year)
As on (previous year)
Assets
Cash & balances with RBI
Balances with banks and money at call and short notice
Investments
Advances
Fixed Assets
Other Assets
Total
Contingent liabilities
Bills for collection 6 7 8 9 10 11 12

10. Schedule 1- Capital As on 31-3-00 As on 31-3-01 I. II.
For nationalised banks
Capital (Fully owned by Central Govt.)
For Banks incorporated outside India Capital:
(i) The amount brought in by banks by way of start up capital as prescribed by RBI should be shown under this head)
(ii) Amount of deposit kept with RBI under section 11(2) of the Banking Regulation Act, 1949.
Total

11. As on
As on
III.
For other banks
Authorised Capital
(….shares of Rs…each)
Issued Capital
(….shares of Rs… each)
Subscribed Capital
(…shares of Rs… each)
Called up Capital
(…shares of Rs…each)
Less: Calls unpaid
Add: Forfeited shares

12. As on (current year)
As on (previous year) I.
II.
III.
Statutory Reserve
Opening Balance
Additions during the year
Deductions during the year
Capital Reserves
Securities Premium

13. As on (current year)
As on (previous year)
IV. V.
Revenue & Other Reserves
Opening Balance
Additions during the year
Deductions during the year
Balance in P&L A/c
Total

14. Schedule 3- Deposits As on 31-3-00 As on 31-3-01 A. B. Demand Deposits
From Banks
From Others
Saving Bank Deposits
Term Deposits
Total
Deposits of branches in India
Deposits of branches outside India

15. Schedule 4-Borrowings As on 31-3-00 (current year)
As on (previous year) I.
II.
Borrowing in India
Reserve Bank of India
Other Banks
Other institutions and agencies
Borrowings outside India
Total

16. Schedule 5- Other Liabilities & Provisions
As on (current year)
As on (previous year) I.
II.
III.
IV.
Bills Payable
Inter-office adjustments (net)
Interest accrued
Others (including provisions)
Total

17. Schedule 6- Cash & Balance with RBI
As on (current year)
As on (previous year) I.
II.
Cash in hand (including foreign currency notes)
Balances with RBI
Current Account
In Other Accounts
Total

18. Schedule 7- Balance with banks & Money at call & Short notice
As on
As on I.
II.
In India
Balance with banks
In current accounts
In other deposit accounts
(ii) Money at call and short notice
With banks
With other institutions
Total
Outside India
(i) In current accounts
(ii) In other deposit accounts
(iii) Money at call and short notice
Grand Total

19. Schedule 8- Investment As on 31-3-00 As on 31-3-01 I. II.
Investments in India in
Government securities
Other approved securities
Shares
Debentures & Bonds
Subsidiaries and /or joint ventures
Others (to be specified)
Total
Investments outside India in
Government securities (including local authorities)
Others Investments (to be specified)

20. Schedule 9- Advances As on 31-3-00 As on 31-3-01 A B. II.
Bills Purchased and Discounted
Cash credits, overdrafts and loans repayable on demand
Term loans
Total
Secured by tangible assets
Covered by bank/ government guarantees
Unsecured

21. As on 31-3-00 As on 31-3-01 C. Advances in India Priority Sectors
Public Sector
Banks
Others
Total
II. Advances outside India
Due from Banks
Due from Others
Bills purchased and discounted
Syndicate Loans

22. Schedule 10- Fixed Assets
As on (current year)
As on (previous year) I.
II.
Premises
At cost as on 31st March of the proceeding year
Addition during the year
Deduction during the year
Depreciation to date
Other fixed assets (including furniture and fixtures)
At cost as on 31st March of preceding year
Total

23. Schedule 11- Other Assets
As on (current year)
As on (previous year) I.
II.
III.
IV. V.
VI.
Inter-office adjustments (net)
Interest accrued
Tax paid in advance/ tax deducted at source
Stationary and stamps
Non- banking assets acquired in satisfaction of claims
Others
Total

24. Schedule 12- Contingent Liabilities
As on (current year)
As on (previous year) I.
II.
III.
IV. V.
VI.
Claims against the bank not acknowledged as debts
Liability for partly paid investments
Liability on account of outstanding forward exchange contracts
Guarantees given on behalf of constituents
In India (b) Outside India
Acceptances, endorsements & other obligations
Other items for which the bank is contingently liable
Total

25. Statutory Reserve
Under section 17, every banking company incorporated in India is required to transfer at least 25% of its current profits to its reserve fund. It is known as statutory reserve. Only those banks get exemption from this legal condition, whose reserve along with share premium if any become equal to paid up capital.
Accounting treatment:
It is shown in the P&L A/c under the heading ‘Appropriations’.
In the B/S it is disclosed as a separate item under the heading ‘ R&S’ under Schedule 2.

26. Non- Banking Asset
Any asset which does not come in the ordinary course of business of a bank is called non-banking asset. The bank is not allowed to deal in such assets. But a bank can always lend against the security of the assets. The bank may have to take possession of the asset given as security, if the loanee fails to repay the loans. Such asset is a non-banking asset. It appears on the asset side of the B/S under the head ‘Other Asset’. Such assets have to be disposed off within a period of seven years from the date of acquiring these assets.
Accounting treatment:
Any profit or loss on sale of such asset must be shown in the P&L A/c under Schedule 14.
Non- Banking assets acquired in satisfaction of claims must be disclosed as separate item in B/S under Schedule -11 under the head ‘Other Assets’.

27. Classification of Advances
Banks are required to classify their advances into following four broad groups:
Standard assets
Sub-standard assets
Doubtful assets
Loss assets

28. Standard Assets
Standard asset is one which does not disclose any problem and which does not carry more than normal risk attached to the business. Such an asset is not non-performing. However , govt. guaranteed advances, although categorised as NPA for the purpose of income recognition are to be treated as standard assets. Further the advances against term deposits, NSC,s eligible for surrender, Indira Vikas Patar, Kisan Vikas Patar and LIC Policies are to be classified as standard Assets.

29. Sub-standard Assets
With effect from 31st March 2001, a sub standard asset is one which has remained NPA for a period not exceeding 18 months. Proper security is not available to the bank for these assets and there are chances that bank may suffer some loss on account of holding such assets.
of the total outstanding amount of these assets is to be made.

30. Doubtful Assets
With effect from 31st March 2001 an asset to be classified as doubtful has to remain NPA for a period exceeding 18 months.
A proper distinction is made between secured and unsecured portion of the asset. The unsecured portion has to be fully provided i.e. 100% amount for provision be made against unsecured doubtful assets.
Also proper provision be made against the secured portion on the following basis:
Period for which the advance has been considered doubtful
% of the provision for the secured portion
Upto 1 year
1 year to 3 years
More than 3 years
20%
30%
40%

31. Loss Asset
A loss asset is one where loss has been identified by the bank or internal or external auditors or RBI inspectors, but the amount has not been written off wholly or partly. It is considered non- collected and is of such little value that its continuance as a bankable asset is not warranted although there may be some salvage recoverable value. There is no security available for such advances.
These assets should be written off entirely or 100% provision should be made for the amount outstanding.

32. Rebate on Bills Discounted
It represents unearned discount for those bills which will mature after the closing of financial accounts. It is possible that the maturity dates of some bills may fall after the date of preparation of final accounts, the total discount credited in respect of such bills cannot be treated as earned during the current year. So discount for the unexpired period is debited to discount account to cancel the credit given previously and credited to Rebate on Bills Discounted Account or Unexpired Discount Account.
Accounting treatment:
At the end of the year-
Discount A/c Dr.
To Rebate on Bills Discounted A/c
(ii) At the beginning of the year-
Rebate on bills discounted A/c Dr.
To Discount A/c

33. e.g. A person gets a bills of exchange discounted on 1st February 2003 during the financial year ending 31st March the amount of the bill is say Rs and it is for 3 months, the date of the maturity being 4th May,2003. The rate of discount 6% p.a. The total discount charged by the bank is Rs A part of this discount belongs to the nest accounting year i.e. the amount of discount for the period from 1st April to 4th May. This part of discount i.e. Rs is called Rebate on bills Discounted.
31st March:
Discount A/c Dr
Rebate on Bills Discounted
(being the amount of unexpired discount)
1st April
Rebate on Bills discounted A/c Dr. 5.75
To Discount A/c
(being the amount of rebate brought in the next accounting year)

34. Thank You