Accounting Standard in Bangladesh
A REPORT ON APPLICATION OF BANGLADESH ACCOUNTING STANDARDS IN BUSINESS [pic] DEPARTMENT OF FINANCE UNIVERSITY OF DHAKA REPORT ON APPLICATION OF BANGLADESH ACCOUNTING STANDARDS IN BUSINESS FINANCIAL ACCOUNTING –I F-103 Submitted To Dr. H. M. Mosarof Hossain Accessory Professor Department of Accounts Faculty of Business Administration University of Dhaka Submitted By Members of Group-3 Section-B 14th Batch Department of Accounts Names |Roll No | |Upoma Antara Husain |14-052 | |Zubairia Khan |14-050 | |Nazmul Ehsan Omiya |14-054 | |Monowar Hossain |14-008 | |Md. Rubel Ahmed |14-030 | DATE OF SUBMISSION 1 May 2008 TABLE OF CONTENTS CHAPTER I: ? INTRODUCTION ? OBJECTIVES OF APPLYING BAS IN BUSINESS ? IAS ADDOPTED AS BAS ? SHORT DESCRIPTION OF BASs CHAPTER II: ? ABOUT PRIME BANK LIMITED ? BAS USED IN PBL ? APPLICATION OF BASs IN PBL ? IMPORTANCE OF APPLYING BAS IN PBL ? CONCLUSION CHAPTER III: ? ANNEXURE ? BIBLIOGRAPHY CHAPTER I INTRODUCTION The rules and guidelines adopted and implimented accepted in accounting almanac befitting and anniversary alertness ror advancement accord are accepted as All-embracing Accounting Standared (IAS). IAS were issued amid 1973 and 2001 by the lath of the All-embracing Accounting Standards Committee (IASC).
Bangladesh Accounting Standards (BAS) are adopted From IAS by Institute of Chartered Accountants of Bangladesh (ICAB) for adopted accounting practices in all kinds of business in bangladesh. To assimilate the accounting arrangement with the akin of IAS, the ICAB (Institute of Chartered Accountants of Bangladesh) has been adopting BAS back 1984. The Institute of Chartered Accountants of Bangladesh is a able accountancy anatomy in the Bangladesh. It is the sole organisation in the Bangladesh with the adapted to accolade the Chartered Accountant designation.
The ICAB acclimatized and acclimatized abounding important and the time ambitious standards in several time BAS is a set of standards which controls the arrangement of accounting in Bangladesh. In our country Companies listed with Dhaka & Chittagong Stock barter are to adapt their accounts according to the Balance and Barter Rules 1987 and the All-embracing Accounting Standards (IAS) as adopted by the Institute of Chartered Accountants of Bangladesh accepted as Bangladesh Accounting Standards (BAS). At present the (TRC) Technical analysis Committee of ICAB screens and evaluates IFRSs and recommends accurate IFRS to the board of the ICAB for adoption.
Prime Coffer Bound is one of the able banks in our cyberbanking sector. It is listed with Dhaka and Chittagong Stock Exchange. The cyberbanking statements of the Coffer are able beneath the actual bulk assemblage except investments and in accordance with the Coffer Companies Act, 1991, Bangladesh Coffer Circulars, All-embracing Accounting Standards and All-embracing Cyberbanking Advertisement Standards adopted by the Institute of Chartered Accountants of Bangladesh as BAS, Companies act 1994, SEC Rules 1987 and alternative laws and rules applicative in Bangladesh.
IAS ADOPTED AS BAS BAS are developed by the ICAB and are based on earlier IASs – about those developed by the IASC rather than the bigger IASs and new IFRSs developed by the IASB. The Technical and Analysis Committee of the ICAB develops the standards. Acceptance requires approval of the ICAB Council. A anniversary of IASs Adopted as BASs is apparent below. IAS |Version of IAS |BAS Cardinal |Remarks | | |Adopted in Bangladesh| | | |IAS 1: Presentation of Cyberbanking |1987 |BAS 1 |2003 revisions not yet advised | |Statements | | |by ICAB | |IAS 2 : Inventories |1992 |BAS 2 |2003 revisions not yet advised | | | | |by ICAB | |IAS 7 : Banknote Breeze Statements |1992 |BAS 7 |— | |IAS 8 :Accounting Policies, Changes in |1993 |BAS 8 |2003 revisions not yet advised | |Accounting Estimates, and Errors | | |by ICAB | |IAS 10: Contest Afterwards the Antithesis Breadth |1999 |BAS 10 |— | |Date | | | | |IAS 11: Architecture Diplomacy |1993 |BAS 11 |— | |IAS 12: Assets Taxes |2000 |BAS 12 |— | |IAS 14: Segment Advertisement |1997 |BAS 14 |— | |IAS 16: Property, Bulb and Accessories |1997 |BAS 16 |2003 revisions not yet advised | | | | |by ICAB |IAS 17: Leases |1998 |BAS 17 |2003 revisions not yet advised | | | | |by ICAB | |IAS 18: Acquirement |1993 |BAS 18 |— | |IAS 19; Abettor Allowances |2002 |BAS 19 |2003 and afterwards revisions not yet | | | | |considered by ICAB | |IAS 20; Accounting for Government Grants |1983 |BAS 20 |— | |and Acknowledgment of Government Abetment | | | | |IAS 21: The Furnishings of Changes in Adopted |1993 |BAS 21 |2003 and afterwards revisions not yet | |Exchange Ante | | |considered by ICAB | |IAS 22: Business Combinations |1998 |BAS 22 |IAS 22 has been abolished by IFRS | | | | |3, which has not yet been | | | | |considered by ICAB | |IAS 23: Borrowing Costs |1993 |BAS 23 |— | |IAS 24: Accompanying Affair Disclosures |1994 |BAS 24 |2003 revisions not yet advised | | | | |by ICAB | |IAS 25: Accounting for Investments |1987 |BAS 25 |IAS 25 has been abolished by IAS | | | | |39, which has not yet been | | | | |considered by ICAB | |IAS 26: Accounting and Advertisement by |1987 |BAS 26 |— | |Retirement Annual Diplomacy | | | | |IAS 27: Circumscribed and Abstracted |1998 |BAS 27 |2003 revisions not yet advised | |Financial Statements | | |by ICAB | |IAS 28:
Investments in Assembly |1998 |BAS 28 |2003 revisions not yet advised | | | | |by ICAB | |IAS 29:Financial Advertisement in |Not yet Adopted |— |— | |Hyperinflationary Economies | | | | |IAS 30 :Disclosures in the Cyberbanking |1990 |BAS 30 |IAS 30 has been abolished by IFRS | |Statements of Banks and Agnate Cyberbanking | | |7 (effective 2007), which has not | |Institutions | | |yet been advised by ICAB | |IAS 31: Interests In Collective Ventures |1999 |BAS 31 |2003 revisions not yet advised | | | | |by ICAB | |IAS 32 :Financial Instruments: Acknowledgment |Not yet adopted |— |— | |and Presentation | | | | |IAS 33: Antithesis Per Allotment |1999; |BAS 33 |2003 revisions not yet advised | | | | |by ICAB | |IAS 34: Acting Cyberbanking Advertisement |1998 |BAS 34 |— | |IAS 35: Alternate Operations |1998 |BAS 35 |IAS 35 has been abolished by IFRS | | | | |5, which has not yet been | | | | |considered by ICAB | |IAS 36: Crime of Assets |1998 |BAS 36 |2004 revisions not yet advised | | | | |by ICAB | |IAS 37: Provisions, Accidental Liabilities|1998 |BAS 37 |1998 | |and Accidental Assets | | | | |IAS 38: Abstract Assets |1998 |BAS 38 |2004 revisions not yet advised | | | |by ICAB | |IAS 39: Cyberbanking Instruments: Recognition|Not yet adopted |— |— | |and Altitude | | | | |IAS 40: Beforehand Acreage |2000 |BAS 40 |2003 revisions not yet advised | | | | |by ICAB | |IAS 41: Agriculture |Not yet adopted |— |— | SHORT DESCRIPTION ON BAS • BAS 1: Presentation of Cyberbanking Statements
This Accepted prescribes the base for presentation of accepted purpose cyberbanking statements to ensure allegory both with the entity’s cyberbanking statements of antecedent periods and with the cyberbanking statements of alternative entities. It sets out all-embracing requirements for the presentation of cyberbanking statements, guidelines for their anatomy and minimum requirements for their content. A complete set of cyberbanking statements comprises: (a) a anniversary of cyberbanking position as at the end of the period; (b) a anniversary of absolute assets for the period; (c) a anniversary of changes in disinterestedness for the period; (d) a anniversary of banknote flows for the period; e) notes, absolute a arbitrary of cogent accounting behavior and alternative allegorical information; and (f) a anniversary of cyberbanking position as at the alpha of the ancient allusive aeon back an article applies an accounting activity retrospectively or makes a attendant digest of items in its cyberbanking statements, or back it reclassifies items in its cyberbanking statements. • BAS 2: Inventories The cold of this Accepted is to appoint the accounting analysis for inventories. A primary affair in accounting for inventories is the bulk of bulk to be accustomed as an asset and agitated advanced until the accompanying revenues are recognized. This Accepted provides advice on the assurance of bulk and its consecutive acceptance as an expense, including any write-down to net realisable value. It additionally provides advice on the bulk formulas that are acclimated to accredit costs to inventories. Inventories shall be abstinent at the lower of bulk and net realisable value. • BAS 7: Banknote Breeze Statements
The cold of this Accepted is to crave the accouterment of advice about the actual changes in banknote and banknote equivalents of an article by agency of a anniversary of banknote flows which classifies banknote flows during the aeon from operating, beforehand and costs activities. • BAS 8: Accounting Policies, Changes in Accounting Estimates, and Errors The cold of this Accepted is to appoint the belief for selecting and alteration accounting policies, calm with the accounting analysis and acknowledgment of changes in accounting policies, changes in accounting estimates and corrections of errors. The Accepted is advised to enhance the appliance and believability of an entity’s cyberbanking statements and the allegory of those cyberbanking statements over time and with the cyberbanking statements of alternative entities. • BAS 10: Contest Afterwards the Antithesis Breadth Date The cold of this Accepted is to prescribe: a) Back an article should acclimatize its cyberbanking statements for contest afterwards the advertisement period; and (b) The disclosures that an article should accord about the date back the cyberbanking statements were accustomed for affair and about contest afterwards the advertisement period. The Accepted additionally requires that an article should not adapt its cyberbanking statements on a activity affair base if contest afterwards the advertisement aeon announce that the activity affair acceptance is not appropriate. • BAS 11: Architecture Diplomacy The cold of this Accepted is to appoint the accounting analysis of acquirement and costs associated with architecture contracts. Because of the attributes of the activity undertaken in architecture contracts, the date at which the arrangement activity is entered into and the date back the activity is completed usually abatement into altered accounting periods.
Therefore, the primary affair in accounting for architecture diplomacy is the allocation of arrangement acquirement and arrangement costs to the accounting periods in which architecture assignment is performed. This Accepted shall be activated in accounting for architecture diplomacy in the cyberbanking statements of contractors. • BAS 12: Assets Taxes The cold of this Accepted is to appoint the accounting analysis for assets taxes. For the purposes of this Standard, assets taxes accommodate all calm and adopted taxes which are based on taxable profits. Assets taxes additionally accommodate taxes, such as denial taxes, which are payable by a subsidiary, accessory or collective adventure on distributions to the advertisement entity.
The arch affair in accounting for assets taxes is how to anniversary for the accepted and approaching tax after-effects of: (a) the approaching accretion (settlement) of the accustomed bulk of assets (liabilities) that are accustomed in an entity’s antithesis sheet; and (b) Diplomacy and alternative contest of the accepted aeon that are accustomed in an entity’s cyberbanking statements. • BAS 16: Property, Bulb and Accessories The cold of this Accepted is to appoint the accounting analysis for property, bulb and accessories so that users of the cyberbanking statements can anticipate advice about an entity’s beforehand in its property, bulb and accessories and the changes in such investment. The arch issues in accounting for property, bulb and accessories are the acceptance of the assets, the assurance of their accustomed amounts and the abrasion accuse and crime losses to be accustomed in affiliation to them. • BAS 17: Leases
The cold of this Accepted is to prescribe, for lessees and lessors, the adapted accounting behavior and acknowledgment to administer in affiliation to leases. The allocation of leases adopted in this Accepted is based on the admeasurement to which risks and rewards accidental to affairs of a busy asset lie with the freeholder or the lessee. A charter is classified as a accounts charter if it transfers essentially all the risks and rewards accidental to ownership. A charter is classified as an operating charter if it does not alteration essentially all the risks and rewards accidental to ownership. • BAS 18: Acquirement The primary affair in accounting for acquirement is free back to admit revenue.
Revenue is accustomed back it is apparent that approaching bread-and-butter allowances will breeze to the article and these allowances can be abstinent reliably. This Accepted identifies the diplomacy in which these belief will be met and, therefore, acquirement will be recognized. It additionally provides activated advice on the appliance of these criteria. Acquirement is the gross arrival of bread-and-butter allowances during the aeon arising in the beforehand of the accustomed activities of an article back those inflows aftereffect in increases in equity, alternative than increases apropos to contributions from disinterestedness participants. This Accepted shall be activated in accounting for acquirement arising from the afterward diplomacy and events: (a) the auction of goods; (b) the apprehension of services; and c) the use by others of article assets acquiescent interest, royalties and dividends. • BAS 19: Abettor Allowances Abettor allowances are all forms of appliance accustomed by an article in barter for annual rendered by employees. The cold of this Accepted is to appoint the accounting and acknowledgment for abettor benefits. The Accepted requires an article to recognize: (a) a accountability back an abettor has provided annual in barter for abettor allowances to be paid in the future; and (b) An bulk back the article consumes the bread-and-butter annual arising from annual provided by an abettor in barter for abettor benefits. • BAS 20: Accounting for Government Grants and Acknowledgment of Government Assistance
This Accepted shall be activated in accounting for, and in the acknowledgment of, government grants and in the acknowledgment of alternative forms of government assistance. Government grants are abetment by government in the anatomy of transfers of assets to an article in acknowledgment for accomplished or approaching acquiescence with assertive altitude apropos to the operating activities of the entity. They exclude those forms of government abetment which cannot analytic accept a bulk placed aloft them and diplomacy with government which cannot be acclaimed from the accustomed trading diplomacy of the entity. Government abetment is activity by government advised to accommodate an bread-and-butter annual specific to an article or ambit of entities condoning beneath assertive criteria.
Government abetment for the purpose of this Accepted does not accommodate allowances provided alone alongside through activity affecting accepted trading conditions, such as the accouterment of basement in development areas or the artifice of trading constraints on competitors. • BAS 21: The Furnishings of Changes in Adopted Barter Ante An article may backpack on adopted activities in two ways. It may accept diplomacy in adopted currencies or it may accept adopted operations. In addition, an article may present its cyberbanking statements in a adopted currency. The cold of this Accepted is to appoint how to accommodate adopted bill diplomacy and adopted operations in the cyberbanking tatements of an article and how to construe cyberbanking statements into a presentation currency. The arch issues are which barter rate(s) to use and how to address the furnishings of changes in barter ante in the cyberbanking statements. • BAS 22: Business Combinations The cold of this accepted is to appoint the accounting analysis for business combinations (both acquisitions and, in aberrant instances in which the acquirer cannot be articular chain of interests). It provides advice on the allocation of a business combination, which includes whether an acquirer can be identified, and whether shareholders of the accumulation entities allotment mutually in the risks and allowances of the accumulated entity. BAS 23: Borrowing Costs Borrowing Costs Borrowing costs that are anon attributable to the acquisition, architecture or assembly of a condoning asset anatomy allotment of the bulk of that asset. Alternative borrowing costs are accustomed as an bulk • BAS 24: Accompanying Affair Disclosures The cold of this Accepted is to ensure that an entity’s cyberbanking statements accommodate the disclosures all-important to draw absorption to the achievability that its cyberbanking position and accumulation or accident may accept been afflicted by the actuality of accompanying parties and by diplomacy and outstanding balances with such parties. • BAS 26: Accounting and Advertisement by Retirement Annual Plans
This Accepted shall be activated in the cyberbanking statements of retirement annual diplomacy breadth such cyberbanking statements are prepared. Retirement annual diplomacy are arrange whereby an article provides allowances for advisers on or afterwards abortion of annual (either in the anatomy of an anniversary assets or as a agglomeration sum) back such benefits, or the contributions appear them, can be bent or estimated in beforehand of retirement from the accoutrement of a affidavit or from the entity's practices. The cyberbanking statements of a authentic addition plan shall accommodate a anniversary of net assets accessible for allowances and a description of the allotment policy. • BAS 27: Circumscribed and Abstracted Cyberbanking Statements
The cold of BAS 27 is to enhance the relevance, believability and allegory of the advice that a ancestor article provides in its abstracted cyberbanking statements and in its circumscribed cyberbanking statements for a accumulation of entities beneath its control. The Accepted specifies: (a) the diplomacy in which an article charge consolidate the cyberbanking statements of addition article (being a subsidiary); (b) the accounting for changes in the akin of affairs absorption in a subsidiary; (c) the accounting for the accident of ascendancy of a subsidiary; and (d) the advice that an article charge acknowledge to accredit users of the cyberbanking statements to appraise the attributes of the accord amid the article and its subsidiaries. • BAS 28: Investments in Assembly This Accepted shall be activated in accounting for investments in associates.
However, it does not administer to investments in assembly captivated by: (a) adventure basal organizations, or (b) Mutual funds, assemblage trusts and agnate entities including investment-linked allowance funds. • BAS 30: Disclosures in the Cyberbanking Statements of Banks and Agnate Cyberbanking Institutions The cold of BAS30 is to appoint adapted presentation and acknowledgment standards for banks and agnate cyberbanking institutions as a supplement of the requirements of alternative standards. It provides the Requirement for allocation of items in the assets anniversary and antithesis breadth by their nature, and for the antithesis breadth in adjustment of about liquidity. Identifies the assets anniversary and antithesis breadth band items acute disclosure. ? Additional acknowledgment requirements, including absorption of assets, liabilities and asymmetric items, losses on loans and advances, and accepted cyberbanking risks. • BAS 31: Interests in Collective Venture: This Accepted shall be activated in accounting for interests in collective ventures and the advertisement of collective adventure assets, liabilities, assets and costs in the cyberbanking statements of ventures and investors, behindhand of the structures or forms beneath which the collective adventure activities booty place. However, it does not administer to ventures’ interests in accordingly controlled entities captivated by: 1. (a) adventure basal organizations, or 2. b) Mutual funds, assemblage trusts and agnate entities including investment-linked allowance funds. • BAS 33: Antithesis Per Allotment The cold of this Accepted is to appoint attempt for the assurance and presentation of antithesis per share, so as to advance achievement comparisons amid altered entities in the aforementioned advertisement aeon and amid altered advertisement periods for the aforementioned entity. The focus of this Accepted is on the denominator of the antithesis per allotment calculation. This Accepted shall be activated by entities whose accustomed shares or abeyant accustomed shares are about traded and by entities that are in the action of arising accustomed shares or abeyant accustomed shares in accessible markets.
An article that discloses antithesis per allotment shall annual and acknowledge antithesis per allotment in accordance with this Standard. • Bas 34: Acting Cyberbanking Advertisement The cold of this Accepted is to appoint the minimum agreeable of an acting cyberbanking address and to appoint the attempt for acceptance and altitude in complete or abridged cyberbanking statements for an acting period. Timely and reliable acting cyberbanking advertisement improves the adeptness of investors, creditors, and others to accept an entity’s accommodation to accomplish antithesis and banknote flows and its cyberbanking action and liquidity. This Accepted applies if an article is adapted or elects to broadcast an acting cyberbanking address in accordance with All-embracing Cyberbanking Advertisement Standards.
Interim cyberbanking address agency a cyberbanking address absolute either a complete set of cyberbanking statements (as declared in IAS 1 Presentation of Cyberbanking Statements (as revised in 2007)) or a set of abridged cyberbanking statements (as declared in this Standard) for an acting period. Acting aeon is a cyberbanking advertisement aeon beneath than a abounding cyberbanking year. • BAS 35: Alternate Operations The cold of this accepted is to enhance the adeptness to accomplish cyberbanking projections by segregating advice about alternate operations from advice about continuing operations. BAS 35 does not authorize any acceptance or altitude attempt in affiliation to alternate operations-these are dealt with beneath alternative BAS.
In particular, BAS 35 provides advice on how to administer BAS 36, Crime of Assets, and BAS 37, Accoutrement Accidental Liabilities and Accidental Assets, to alternate operations. • BAS 36: Crime of Assets The cold of this Accepted is to appoint the procedures that an article applies to ensure that its assets are agitated at no added than their recoverable amount. An asset is agitated at added than its recoverable bulk if its accustomed bulk exceeds the bulk to be recovered through use or auction of the asset. If this is the case, the asset is declared as broken and the Accepted requires the article to admit an crime loss. The Accepted additionally specifies back an article should about-face an crime accident and prescribes disclosures. • BAS 37: Provisions, Accidental Liabilities and Accidental Assets
The cold of this Accepted is to ensure that adapted acceptance belief and altitude bases are activated to provisions, accidental liabilities and accidental assets and that acceptable advice is appear in the addendum to accredit users to accept their nature, timing and amount. IAS 37 prescribes the accounting and acknowledgment for all provisions, accidental liabilities and accidental assets, except: (a) Those consistent from executory contracts, except breadth the arrangement is onerous. Executory diplomacy are diplomacy beneath which neither affair has performed any of its obligations or both parties accept partially performed their obligations to an according extent; (b) Those covered by addition Standard. • BAS 38: Abstract Assets
The cold of this Accepted is to appoint the accounting analysis for abstract assets that are not dealt with accurately in addition Standard. This Accepted requires an article to admit an abstract asset if, and alone if, defined belief are met. The Accepted additionally specifies how to admeasurement the accustomed bulk of abstract assets and requires defined disclosures about abstract assets. An abstract asset is an identifiable non-monetary asset afterwards concrete substance. • BAS 40: Beforehand Acreage The cold of this Accepted is to appoint the accounting analysis for beforehand acreage and accompanying acknowledgment requirements.
Investment acreage is acreage (land or a building—or allotment of a building—or both) captivated (by the buyer or by the aborigine beneath a accounts lease) to acquire rentals or for basal acknowledgment or both, rather than for: (a) use in the assembly or accumulation of appurtenances or casework or for authoritative purposes; or (b) Auction in the accustomed beforehand of business. OBECTIVES OF USING BAS IN BUSINESS • Standardized Accountings : The cold of applying BAS in business is to assimilate the accounting issues and alertness of cyberbanking statements. • All-embracing Recognition: To accumulate bendability with All-embracing Business the use of All-embracing Accounting Standards adopted as BAS is important. It helps the businesses to accretion all-embracing recognition. • Advancement Uniformity:
Accounting standards are maintained in adjustment to ensure accord in recording accounts and advancing cyberbanking statements aural the businesses both in country and abroad. • Ensuring Transparency: An important cold of applying BAS is to ensure able acknowledgment of all-important advice in the cyberbanking statements. It provides accuracy in the statements. • Accouterment Reliability: The appliance of BAS provides believability and bendability in the accounting almanac befitting and cyberbanking statements to the alfresco parties. CHAPTER II [pic] ABOUT PRIME BANK LIMITED The Prime Coffer Bound (“the Bank”) was congenital as the accessible bound aggregation in Bangladesh beneath companies Act, 1994.
It commenced its cyberbanking business with one annex from April17, 1995 beneath the authorization issued bi Bangladesh Bank. Presently the Coffer has 61 branches all over Bangladesh and a berth amid at Dhaka Club, Dhaka. The Coffer had no across branches as at 31 December 2007. The Coffer went for Initial Accessible Offerings in 1999 and its allotment is listed with Dhaka Stock Barter Bound and Chittagong Stock Barter Bound as a about traded aggregation for its accepted chic of shares. VISION The eyes of the Coffer is to be the best Private Commercial Coffer in Bangladesh in agreement of efficiency, basal adequacy, asset quality, complete administration and advantage accepting able liquidity. MISSION
The mission of the Coffer is to body Prime Coffer Bound into an efficient, bazaar driven, chump focused academy with acceptable accumulated babyminding structure. Continuous advance in the business policies, action and ability through affiliation of technology at all levels. STRATEGIC PRIORITY The cardinal antecedence of the Coffer is to accept abiding growth, augment and bigger ambit of articles and casework in all areas of cyberbanking activities with the aim to add added bulk to allotment holders’ investments and action accomplished accessible allowances to the customers. CORE VALUE • For barter It refers to become best caring Coffer by accouterment the best affable and able casework in every breadth of our business. For advisers It promotes abundance of the employees. • For shareholders It ensures book acknowledgment on the investments of the shareholders through breeding abiding profit. • For the association As a socially amenable accumulated article the Coffer maintains abutting adherence to civic behavior and objectives. [pic]BAS FOLLOWED IN PRIME BANK The Institute of Chartered Accountants of Bangladesh (ICAB) is the sole ascendancy for acceptance of All-embracing Accounting Standards (IAS) and All-embracing Cyberbanking Advertisement Standards (IFRS). While advancing the cyberbanking statements, Prime Coffer affiliated best of IAS and IFRS as adopted by ICAB. Details are accustomed below: Name of the BAS | BAS no | Status | |Presentation of Cyberbanking Statements | 1 | Activated | |Stationeries | 2 | Activated | |Cash Breeze Statements | 7 | Activated | |Accounting Policies, Changes in Accounting Estimates and Errors | 8 | Activated | |Events afterwards the Antithesis Breadth Date | 10 | Activated | |Construction Diplomacy | 11 |
N/A | |Income Taxes | 12 | Activated | |Segment Advertisement | 14 | Activated | |Property, Bulb and Accessories | 16 | Activated | |Leases | 17 | Activated | |Revenue | 18 | Activated | |Employee Allowances | 19 | Activated | |Accounting for Government Grants and Acknowledgment of Government Abetment | 20 | N/A | |The Furnishings of Changes in Adopted Barter Ante | 21 | Activated | |Borrowing Costs | 23 | Activated | |Related Affair Disclosures | 24 | Activated | |Accounting for Investments | 25 | Activated | |Accounting and Advertisement by Retirement Annual Diplomacy | 26 | Activated | |Consolidated and Abstracted Cyberbanking Statements | 27 | Activated | |Investments in Assembly | 28 | N/A | |Disclosures in the Cyberbanking Statements of Banks and agnate Cyberbanking Institutions | 30 | Activated | |Interests in Collective Ventures | 31 | N/A | |Earnings per allotment | 33 | Activated | |Interim Cyberbanking Advertisement | 34 | Activated | |Impairment of Assets | 36 | Activated | |Provisions, Accidental Liabilities and Accidental Assets | 7 | Activated | |Intangible Assets | 38 | N/A | |Investment Acreage | 40 | Activated | |Agriculture | 41 | N/A | | Name of the BFRS | BAS no | Status | |Share Based Payment | 2 | N/A | |Business Combinations | 3 | N/A | |Non-current Assets Captivated for Auction and Discontinued Operations | 5 | N/A | |Exploration for and Evaluation of Mineral Assets | 6 | N/A | *N/A=not applicative [pic] APPLICATION OF BAS IN PRIME BANK LIMITED For the accessibility of altercation we are assuming the aftereffect of some important BASs in almanac befitting and accounting of Prime Coffer Limited. • BAS No. 1: Alertness of Cyberbanking Statements: The cyberbanking statements of the coffer are able in accordance with BAS-1 to accord a fair appearance of the accompaniment of the Bank’s diplomacy and of the after-effects of the operations and banknote flows.
The cyberbanking belletrist for the year concluded in 31 December 2007 are accustomed as annexure for viewing. • BAS No. 7: Banknote Breeze Anniversary Banknote breeze anniversary has been able in accordance with the BAS-7 “Cash Breeze Statement” beneath absolute adjustment as recommended in BRPD Circular No. 14, anachronous June 25 2003 issued by the Cyberbanking Regulation and Activity Department of Bangladesh Bank. • BAS No. 12: Assets Taxes Accouterment for accepted assets tax has been fabricated @ 45% as assigned in the Accounts Act, 2007 on the accounting accumulation fabricated by the Coffer afterwards because some of the add backs to the assets and disallowances as bulk as per assets tax laws in acquiescence with BAS-12 “Income Taxes”. • BAS No. 16: Property, Bulb and Equipment
All anchored assets are declared at bulk beneath accumulated abrasion as per BAS-16 “Property, Bulb and Equipment”. The bulk of accretion of an asset comprises its acquirement bulk and any anon attributable bulk of bringing the asset to its alive action for its advised use across-the-board of entering freight, duties and non-refundable taxes. • BAS No. 17: Leases Leases are classified as accounts leases whenever the ‘terms of the lease’ transfers essentially all the risks and rewards of affairs to the aborigine as per BAS-17 “Leases”. ? The Coffer as freeholder Bulk due from lessees beneath accounts leases are recorded as receivables at the bulk of the Bank’s net beforehand in the leases. The Coffer as aborigine Assets captivated beneath accounts charter s are accustomed as assets of the Coffer at the date of accretion or if lower, at the present bulk of the minimum charter payments. • BAS No. 18: Acquirement ? Absorption assets In agreement of the accoutrement of the BAS-18 “Revenue”, the absorption assets is accustomed on accretion basis. ? Beforehand assets Absorption assets on investments is accustomed on accretion basis. ? Fees and agency assets Fees and agency assets arises on casework provided by the Coffer are accustomed on a banknote cancellation basis. ? Dividend assets on allotment Dividend assets on allotment is accustomed during the aeon in which declared and ascertained. Absorption paid and alternative costs in Conventional Cyberbanking In agreement of the accouterment of the BAS-1 “Presentation of Cyberbanking Statements” absorption and alternative costs are accustomed on accretion basis. ? Accumulation paid on deposits in Islamic Cyberbanking Accumulation paid to mudaraba depositors is accustomed on accretion base as per conditional rate. • BAS No. 19: Abettor allowances The retirement allowances accrued for the advisers of the Coffer as on advertisement date accept been accounted for in accordance with the accoutrement of BAS-19, “Employee Benefit”. Bases of enumerating the retirement annual schemes operated by the Coffer are categorical below: ? Provident armamentarium Provident armamentarium allowances are accustomed to the abiding advisers f the Coffer in accordance with Bank’s annual rules. All accepted advisers of the Coffer are accidental 10% of their basal bacon as cable to the fund. The Coffer additionally contributes according bulk of the employees’ contribution. ? Alms armamentarium Actuarial appraisal of alms arrangement had been fabricated to appraise the capability of the liabilities accommodate for the arrangement as per BAS-19, “Employee Benefits”. ? Abundance armamentarium Prime Bank’s employees’ abundance armamentarium is subscribed by annual addition of the employees. The Coffer additionally contributes to the Armamentarium from time to time. Disbursement from the armamentarium is done as per rules for employees’ abundance fund. ? Allurement bonus
Prime Coffer started an allurement account arrangement for its employees. 10% of net accumulation afterwards tax is accustomed to the advisers in every year as allurement bonus. This account bulk is actuality broadcast amid the advisers based on their performance. • BAS No. 21: The Furnishings of Changes in Adopted Barter Ante Adopted bill diplomacy are adapted into agnate Taka appliance the cardinal barter ante on the dates of corresponding diplomacy as per BAS-21, “The Furnishings of Changes in Adopted Barter Rates”. Adopted bill balances captivated in US Dollar are adapted into Taka at abounding boilerplate bulk of inter-bank bazaar as bent by Bangladesh Coffer on the closing date of every month.
Balances captivated in adopted currencies alternative than US Dollar are adapted into agnate US Dollar at affairs ante of New York closing of the priviou7s day and adapted into Taka equivalent. • BAS No. 33: Antithesis per Allotment Basal antithesis per allotment accept been affected in accordance with BAS-33, “Earnings per Share” which has been apparent on the face of the accumulation and accident account. This has been affected by adding the basal antithesis by the abounding boilerplate cardinal of accustomed shares are continuing during the year. The account shares issued during the year 2007 were advised as if they had been in affair in antecedent year additionally (declared for 2006 result). Hence, in accretion the basal earning per allotment of 2006, the absolute cardinal of shares including the said account shares has been advised as abounding boilerplate no. f shares outstanding during the year 2006 as per BAS-33, “Earning per Share”. • BAS No. 37: Provisions, Accidental Liabilities and Accidental Assets A accouterment is accustomed in the antithesis breadth back the Coffer has a acknowledged or effective obligation as a aftereffect of a accomplished accident and it is apparent that an address of bread-and-butter annual will be adapted to achieve the obligations, in accordance with the BAS 37, “Provisions accidental Liabilities and Accidental Assets”. [pic] IMPORTANCE OF APPLYING BAS IN PBL • Abiding By The Rules: Adopted BASs are acknowledged for listed companies by SEC rules. So able appliance of BAS in PBL is maintained to accept by the regulations of the nation. Guideline For Accounting Issues: BAS provides guidelines on altered accounting issues to accord to a accepted action and framework of advertence for accountancy development and ensures cellophane cyberbanking reporting, in accordance with complete accumulated governance. • Presenting Accordant & Reliable Information: Applying BAS in the almanac keepings and alertness of cyberbanking statements makes the accounting advice accordant and reliable to all complex parties. • Abetment in All-embracing Business: Appliance of BAS is important for befitting up to the All-embracing Standards which is important for All-embracing business. • Co-operation Amid Altered Parties:
The use of BAS helps advance co-operation amid governments, the accountancy and alternative professions, the all-embracing cyberbanking institutions, regulators, accepted setters, basal providers and issuers. CONCLUSION In the apple of globalization it is basic for businesses about the apple to assimilate the accounting almanac keepings and alertness of cyberbanking statements. The government of Bangladesh has fabricated the All-embracing Accounting Standards adopted by Institute of Chartered Accountants of Bangladesh as Bangladesh Accounting Standards acknowledged for all listed companies in adjustment to ensure accuracy and accepted in accounting issues. Like alternative listed companies of our country Prime Coffer Bound almanac their accounts and adapt their cyberbanking statements in acquiescence with these standards.
The furnishings of these standards accommodate advice and believability in the accounting information. CHAPTER III ANNEXURE [pic] Antithesis Breadth As at 31 December 2007 2007 2006 PROPERTY AND ASSETS Taka Taka Banknote In duke (including adopted currencies) 663,028,189 452,560,474 Antithesis with Bangladesh Coffer and its abettor bank(s) (including adopted currencies) 4,755,788,872 3,662,426,602 5,418,817,061 4,114,987,076 Antithesis with alternative banks and cyberbanking institutions
In Bangladesh 1,625,581,391 627,964,960 Alfresco Bangladesh 791,887,088 485,749,435 2,417,468,479 1,113,714,395 Money at alarm and abbreviate apprehension - 1,490,000,000 Investments Government 12,090,285,095 7,673,700,299 Others 607,735,533 170,682,648 12,698,020,628 7,844,382,947 Loans and advances/investments Loans, banknote credits, overdrafts, etc 53,814,967,656 41,307,504,065 Bills purchased and discounted ,868,053,856 3,702,713,983 57,683,021,512 45,010,218,048 Anchored assets including premises, appliance 660,490,066 412,107,309 Alternative assets 710,613,052 914,107,309 Non-banking assets - - Absolute assets 79,588,430,798 60,899,475,793 2007 2006 LIABILITIES AND CAPITAL Taka Taka Liabilities Borrowing from alternative banks, cyberbanking institutions 390,869,490 345,944,757 Deposits and alternative accounts
Current/ al-wadeeah accepted deposits 10,590,463,357 8,261,264,165 Bills payable 1,144,540,968 528,231,748 Savings coffer 6,027,260,878 4,125,622,204 Term deposits 52,750,109,722 41,808,962,467 Bearer affidavit of drop - - Alternative deposits - - 70,512,374,925 54,724,080,584 Alternative liabilities 3,411,909,021 1,969,561,728 Absolute liabilities 74,315,153,436 57,039,587,069 Capital/ Shareholders’ disinterestedness Paid-up basal 2,275,000,000 1,750,000,000 Statutory assets 1,873,543,597 1,404,170,652 Revaluation accretion 2,723,913 - Alternative assets - - Retained antithesis 1,112,009,852 705,718,072 Absolute Shareholders’ disinterestedness 5,273,277,362 3,859,888,724 Absolute liabilities and Shareholders’ disinterestedness 79,588,430,798 60,899,475,793 Antithesis Breadth as at 31 December 2007 [pic] 2007 2006 Taka Taka OFF-BALANCE SHEET ITEMS Accidental liabilities
Acceptances and endorsements - - Belletrist of agreement 10,480,381,241 9,476,314,713 Irrevocable belletrist of acclaim 21,193,628,862 17,392,748,116 Bills for accumulating 1,414,716,406 1,060,486,687 Alternative accidental liabilities - - 33,088,726,509 27,929,549,516 Alternative commitments Documentary credits - - Advanced assets purchased - - Undrawn ote arising - - Undrawn academic standby accessories - - Liabilities adjoin advanced acquirement and auction - - Others - - 33,088,726,509 27,929,549,516 Alternative announcement items Bulk of travellers’cheques in duke 141,383,952 14,284,764 Bulk of Bangladesh Patras in duke 1,348,897,500 346,193,975 1,490,281,452 360,478,739 Absolute 34,579,007,961 28,290,028,255 Accumulation and Accident Anniversary For the year concluded 31 December 2007 [pic] 2007 2006 Taka Taka
Interest assets 7,170,099,616 5,198,790,368 Absorption paid on deposits (5,226,592,564) (3,698,441,036) Net absorption 1,903,507,052 1,500,349,332 Beforehand assets 1,294,205,056 419,496,059 Commission, barter 1,198,942,404 998,117,247 Alternative operating assets 419,555,862 314,073,525
Total operating assets (A) 4,816,210,375 3,232,036,163 Salaries and allowances 725,285,435 561,930,122 Rent, taxes and insurances 159,529,399 113,987,335 Acknowledged costs 24,728,362 4,951,307 Postage, brand 60,999,650 47,690,052 Stationery 121,691,050 63,382,686 Managing Directors’ bacon 9,131,448 6,400,000 Directors’ fees 2,224,444 2,734,300 Auditors’ fees 791,725 570,990 Accuse on accommodation losses - - Abrasion and adjustment of Bank’s assets 102,185,026 71,657,509 Alternative costs 352,779,110 227,768,616 Absolute operating costs (B) 1,559,345,650 1,101,072,827
Profit/ (Loss) afore provision(c=A-B) 3,256,864,725 2,130,963,336 Accouterment for loans/investments Specific accouterment (350,000,000) (210,000,000 Accepted accouterment (350,000,000) (180,000,000) Accouterment for asymmetric breadth items (210,000,000) - (910,000,000) (390,000,000) Accouterment for abatement - - Alternative accouterment - -
Total accouterment (D) (910,000,000) (390,000,000) Absolute accumulation / (loss) afore taxes(C-D) 2,346,864,725 1,740,963,336 Accouterment for taxation Accepted tax (1,015,000,000) (592,362,815) Deferred tax 68,800,000 96,709,995 Net accumulation afterwards taxation 1,400,664,725 1,051,890,526 Retained antithesis (previous) 180,718,073 2,020,213 1,581,382,073 1,053,910,739 Appropriations
Statutory assets 469,372,945 348,192,667 Accepted assets - - 469,372,945 348,192,667 Retained surplus 1,112,009,852 705,718,072 Antithesis per allotment (EPS) 61. 57 46. 24 Banknote Breeze Anniversary For the year concluded 31 December 2007 [pic] 2007 2006 Taka Taka A) Banknote flows from operating activities
Interest receipts in banknote 7,076,601,586 5,616,509,362 Absorption payments (5,266,592,564) (3,698,441,036) Assets receipts 7,976,958 1,777,066 Fees and agency receipts in banknote 1,198,942,404 998,117,247 Recoveries of loans 415,867 - Banknote payments to advisers (729,416,883) (596,830,122) Banknote payments to suppliers (286,567,522) (175,315,699) Assets taxes paid (476,148,788) (590,139,079) Receipts from alternative operating activities 419,555,862 314,067,381 Payments for alternative operating activities (470,041,003) (296,680,802)
Cash generated from operating activities 1,474,725,917 1,573,064,318 Increase/ (decrease) in operating assets and liabilities Statutory deposits - - Acquirement of trading balance (1,197,259,262) (1,161,365,969) Loans and advances to alternative banks - - Loans and advances to barter (12,672,803,463) (13,094,105,540) Alternative assets (3,796,358,897) 2,494,489,750) Deposits from alternative banks /borrowings 62,890,500 (490,439,000) Deposits from barter 15,171,985,121 18,833,626,261 Others liabilities accounts of barter 616,309,220 (140,262,287) Trading liabilities - - Alternative liabilities 1,437,147,293 (177,440,778) (378,089,488) 1,275,522,937 Net banknote from operating activities 1,096,636,429 2,848,587,255 B) Banknote flows from operating activities
Debentures 4,932,282 5,000,000 Proceeds from auction of balance - - Payments for acquirement of balance (430,320,723) (58,856,689) Acquirement of acreage (333,719,898) (98,473,598) Payment adjoin charter obligation (2,785,500) (1,995,468) Proceeds from auction of acreage 277,045 325,900 Net banknote acclimated in beforehand activities (761,616,794) (153,999,855)
C) Banknote flows from costs activities Dividend paid - - Net banknote from costs activities - - D) Net increase/(decrease) in banknote and banknote equivalents 335,019,635 2,694,587,400 E) Furnishings of barter bulk - - F) Banknote and banknote equivalents at alpha of the year 7,468,239,215 4,773,651,851 G) Banknote and banknote equivalents at the end of the year 7,803,258,850 7,468,239,215 Banknote and banknote equivalents at the end of the year
Cash in duke 663,028,189 452,560,474 Antithesis with Bangladesh Coffer 4,755,788,872 3,662,426,602 Antithesis with alternative banks 2,382,784,489 1,061,064,639 Money at alarm and abbreviate apprehension - 1,490,000,000 About-face repo - 800,000,000 Prize bonds 1,657,300 2,187,500 7,803,258,850 7,468,293,215 Anniversary of Changes in Disinterestedness Particulars |Paid up basal |Statutory assets |Revaluation |Retained antithesis |Total | | |(Taka) |(Taka) |gain/loss |(Taka) |(Taka) | | | | |(Taka) | | | |Balance as at 1 January 2007 |1,750,000,000 |1,404,170,652 | - |705,718,072 |3,859,888,724 | | | | | | | | |Changes in accounting activity | | | | | | | | | | | | | | | | | | | | |- |- |- |- |- | |Restated Antithesis |1,750,000,000 |1,404,170,652 | - |705,718,072 |3,859,888,724 | | | | | | | | |Surplus on revaluation of |- |- |- |- |- | |properties | | | | | | | | | | | | | |Surplus of investments |- |- |12,723, |- |12,723,913 | | | | |913 | | | |Currency adaptation differences | | | | | | | |- |- |- |- |- | |Net assets and | | | | | | |losses(Unrecognized) |- |- |12,723, |- |- | | | | |913 | | | |Net accumulation for the year | | | | | | | |- |- | |1,400,664, |1,400,664,725 | |Dividends | | |- |725 | | | | | | | | | |Issue of allotment basal |525,000,000 - | |(525,000, |- | | | | |- |000) | | |Appropriation | | | | | | | |- |- | |- |- | | | | |- | | | | |- |469,372,945 | |(469,372, |- | | | | |- |945) | | |Balance as at 31 December 2007 | | | | | | | |2,275,000,000 |1,873,543,597 |12,723,
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