Duration : 3 days - bird-cpec.inbird-cpec.in/wp-content/uploads/2015/04/CAS-MIS.pdf · Duration : 3 days Target Group: ... norms and observations made by auditors. ... Prudential

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Training and Capacity Building of STCCS - Programme on CAS & MIS

Duration : 3 days Target Group: Cooperative Auditors, Supervisors and Inspectors

Objectives : At the end of the programme, the participants will

be able to

�� Explain the need & urgency for adopting CAS in PACS.

�� Narrate the salient features of Common Accounting System.

�� List out the various books of account, registers and ledgers

and their inter connectivity.

�� State the various General Ledger heads, their sources,

significance and use in the preparation of financial statements.

�� Explain the flow of accounting under the CAS from preparation

of vouchers to generation of final accounts.

�� Demonstrate the writing of books under CAS.

�� List out the various MIS that could be generated from CAS and

their utility.

Programme Schedule

Session No.

Session Timing

Topic Resource

Person

1 2 3 4

Day I

Registration of participants, Inauguration, etc.

Tea Break

1 An Introduction to Common Accounting System

2 Heads of Account and Work Flow under CAS

Lunch Break

3 Books of Accounts and Registers under CAS

Tea Break

2

Session No.

Session Timing

Topic Resource

Person

1 2 3 4

4 Maintenance of Books of Accounts

Day II

Recap of previous day learning points by participants

5 Preparation of Financial Statements

Tea Break

6 Preparation of Financial Statements (continued)

Lunch Break

7

Conversion of the present Profit & Loss A/c & Balance Sheet as per CAS pattern

Tea Break

8 An Introduction to MIS under CAS

Day III

Recap of previous day learning points by participants

9 Asset Classification, Provisioning Norms & Preparation of Annexure VIII

Tea Break

10 Ratio Analysis and Interpretation of Ratios for Internal Control

Lunch Break

11 Ratio Analysis and Interpretation of Ratios for Internal Control (continued)

Tea Break

12 Concise Structure of Balance Sheet & Cash Flow Statement

Action Planning, Assessment of Impact of the Programme, Valediction,

3

Session1

Session Title: An Introduction to Common Accounting System I Session Objectives: At the end of the session the participants will:

� Describe the concept of Common Accounting System

� Explain the need, advantages, salient features and components of CAS

� Explain the Rules of Double Entry System of Book Keeping

� Explain the Similarities and the Differences between CAS and the existing

system in their states

II Duration of the session: 90 minutes III Key topics to be covered:

Key topics Time

allocation Methodology to

be adopted Slides to be used

Introduction, Objectives of the Session

5 minutes Two Slides

What is CAS?, Purpose of CAS & Major Components of CAS

5 minutes Interactive

Lecture & Guided Discussion

Three Slides

Accounting System, Classification of Accounts, Accounting Rules

20 minutes

Interactive Lecture & Guided

Discussion

Eight Slides

Accounting Concepts, Accounting Principles

15 minutes


Discussion

Four Slides

Similarities & Differences with the Existing System in the State

5 Minutes Interactive


Four Slides

Deficiencies in the Existing System

5 Minutes Interactive


Two Slides

Work Book exercise 20 minutes Questionnaire at

the end of chapter in RM

Caselets on Accounting Rules & Recap

10 minutes Case Exercise

Summarising key points of discussion

5 minutes Recapitulation

4

IV Performance aids required : 1. Black or white board, chalk pieces or

white board marker pens, 2. duster, 3. OHP with transparencies or PC with LCD

projector, or Laminated Flip chart containing the slides and copies of handout.

V Compulsory Reading by Trainees: Handout No.1 of the “Handout-

cum-Work Book” provided to them.

VI Session guide

1) Introduce yourself and explain the objectives of the session – Flash Slide Nos. 1 & 2

2) Ask the participants whether they have heard the word “CAS” in their

earlier Training Programme. Most of the participants would say “yes”.

Then ask them to expand “CAS”. Write their reply on the Board.

3) Then ask the participants – Why CAS? List out the responses of the

participants on the Board. Explain the need for introducing CAS, purpose

and the purpose of CAS – Flash Slide Nos. 3, 4 & 5.

4) Ask the participants – What is an Accounting System? Write the

responses on the Board or Flip Chart. Explain Accounting System and its

features – Flash Slide Nos. 6 & 7.

5) Ask the participants – What is Accounting? Explain the meaning of

Accounting – Flash Slide No. 8

6) Ask the participants – How an entrepreneur starts a business and runs the

same? Some would say that he identifies the activity to be started, brings

the capital, buys land, construct factory, installs machinery, hires workers,

borrows money from friends / banks, buys raw material (on credit as well

as on cash basis), converts them into finished products, sells them (credit

sales and cash sales) and so on. List out all these points in the board.

5

7) Then group these activities into three – activities relating to properties

(purchase of land, machinery, equipments, furniture etc.), activities

relating to persons (lenders, creditors & debtors) and activities relating to

expenses & income (salary, wages, electricity charges, commission.

discount etc.). Flash Slide No.9.

8) Explain the three classes of accounts – Real Accounts, Personal Accounts

and Nominal Accounts – Flash Slide Nos.10 & 11. Give Examples for

each account.

9) Explain the Rules of Accounting – Flash Slide Nos.12 & 13.

10) Explain Accounting Concepts, Accounting Principles in detail – Flash Slide

Nos. 14, 15, 16 & 17.

11) Ask the participants about the features of the existing accounting system

in their society or in their state. List them on the board. Then compare the

features of the present accounting system with the features of Common

Accounting System. Explain what the participants have to do when they

switch over to CAS – Flash Slide Nos. 18, 19, 20 & 21.

12) Then ask the participants – How they are valuing the closing stock,

investments etc.? Whether they are making adequate provision for Non

Performing Assets (overdues)? Are they adjusting entries to account

accrued income or outstanding expenses? Are they accounting

depreciation on fixed assets and dead stock? List out their responses.

Flash Slide Nos. 22 & 23 and explain the deficiencies in the existing

system.

13) Administer the Common Exercise on CAS and ask the participants to list

out the accounts involved in each transaction.

14) Discuss the answers and clarify the doubts.

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15) On completion of Case Exercise is complete ask the participants to

attempt the Work Book Exercise.

16) On completion of the Work Book Exercise, discuss the answers to the

questions. If anybody is getting a wrong answer, discuss where exactly,

the participant has gone wrong.

17) Once the Work Book Exercise is over, sum up the learnings.

VII Learnings from the session:

a. The purpose of CAS is to ensure uniformity in accounts maintenance.

b. CAS adopts standard accounting concepts and principles to ensure

quality and transparency in maintenance of accounts.

c. It follows Double Entry System of Book Keeping.

d. The formats for vouchers, various books of accounts, registers and

financial statements are standardized under CAS.

e. The ultimate aim of CAS is to present a true and fair picture of the

financial position of the PACS to its members and other stake holders.

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8

9

10

11

12

13

14

15

16

17

18

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Work Book Answers

1.8.1 Answer the following briefly.

1. What is accounting system?

Accounting System means a set of instructions, guidelines, rules, regulations and

procedures based on which record of transactions carried out by an organization

are maintained. Transaction, for this purpose, means financial transactions, i.e.

only those transactions which can be measured in terms of money.

2. Explain the need for an Accounting system.

a) To keep a systematic record

b) To ascertain the results of the operations

c) To ascertain the financial position of the business

d) To facilitate rational decision making

e) To satisfy the requirements of law

3 What is Common Accounting System? Explain its advantages?

Standard Accounting System developed under Revival Package for adoption by

the PACS in the country. Advantages: Uniform Accounting System for the

societies, Standardised Books & Registers, Standardised formats for Financial

Statements – easy to consolidate at district level, state level and country level,

preparation of MIS statements, Analysis of MIS Statements for meaningful

review, internal control etc.

4. Explain the major components of CAS.

Under the CAS, PACS are required to maintain the following:

⇒ A common set of vouchers in the prescribed form for different types of

transactions.

⇒ Uniform and standardized set of Books of Accounts.

⇒ Uniform / standard formats for financial statements, viz., Trading A/c, Profit &

Loss A/c and Balance Sheet

⇒ Uniform set of Registers relating to accounting transactions

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5. What is Double Entry System of Book Keeping?

Every business transaction involves two parties viz., giver of the benefit and

receiver of the benefit. The transaction affects both in opposite direction and the

same needs to be recorded. Recording this dual effect of money transfer is called

Doubt Entry System of Book Keeping.

6. Explain the various rules of Double Entry System of Book Keeping.

Personal Account: Debit the Receiver and Credit the Giver

Real Account: Debit What Comes In and Credit What Goes Out

Nominal Account: Debit all Expenses and Losses and Credit all Incomes Gains

7. Indicate the features of CAS adopted for PACS.

a) Adoption of Double Entry System of Booking

b) Introduction of Voucher System for booking transactions

c) A common set of vouchers in the prescribed form for different types of

transactions.

d) Uniform and standardized set of Books of Accounts / standardized formats

for vouchers / financial statements / Registers

8. Explain the basic concepts followed in accounting.

i. Going Concern Concept

ii. Business Entity Concept

iii. Consistency Concept

iv. Accounting Period Concept

v. Money Measurement Concept

vi. Dual Aspect Concept

vii. Matching Cost and Revenue Concept

9. Explain the concept of accrual system.

Income and Expenses are recorded as and when they become due and not as

and when they are actually received and paid.

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10. Name the Financial Statements of PACS.

� Trial Balance

� Trading Account

� Profit and Loss Account and Statement of Appropriation of profits

� Balance Sheet

11. Explain the important accounting principles.

� Double entry system of book keeping is to be followed i.e. for every debit,

there will be a corresponding credit.

� Distinction is to be made between capital expenditure and revenue

expenditure

� Transactions are recorded on historical cost basis i.e. they are recorded at

the price at which they were carried out and are not to be revalued with

the passage of time.

� Investments / stock of goods must be valued at cost price or market price

whichever is lower.

� Sundry debtors are to be valued only at the realizable amounts.

� Expenses and Incomes are to be treated on accrual basis.

� Provision is to be made for bad and doubtful debts in accordance with the

norms and observations made by auditors.

� Depreciation is to be provided following either straight line or diminishing

balance method consistently.

� Provisions for PF, Gratuity etc are to be made on actuarial basis.

� Distinction is to be made between provision and creation of reserves.

� Prudential (IRAC) norms are to be adopted.

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1.8.2 Say True or False (by using tick mark �� on the appropriate answer)

Sl. No Statement / Observation Answer

1 Every transaction will have a debit and a credit for the same

amount. True

2 Standardisation of formats of financial statements is not

envisaged under CAS. False

3 CAS envisages adoption of a common set of account heads

in consonance with financial statements. True

4 Income receivable and expenses payable are to be

recognized irrespective of actual receipt or payment of cash. True

5 Accounting transactions are to be recorded on timely basis

in a chronological order. True

6 An accounting transaction does not always have two

sides/elements. False

7 Financial statements are not prepared on historical cost

basis. False

8 Investments are not to be valued at cost price or market

price whichever is lower. False

9 The rule for Personal Account is Debit what comes in and

Credit what goes out. False

1.8.3 Fill up the blanks in the following statements :

Sl. No Statement / Observation

1 Under double entry system, each debit will have a Credit

2 Financial statements are prepared on Historical

cost basis.

3 Accounting transactions are to be recorded on timely basis and entries are

to be made in Chronological order.

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1.8.4 Indicate the class of account (Personal, Real & Nominal)

No. Particulars Class of Account

1 Sheela Personal

2 District Central Cooperative Bank Personal

3 Salary to Salesman Nominal

4 Paid up Capital Personal

5 Land & Building Real

6 Interest Received Nominal

7 Interest Paid Nominal

8 Purchase of goods Real

9 Sale of goods Real

9 Depreciation Nominal

10 Furniture & Fixtures Real

11 Interest Receivable on Loans Personal

12 Interest Accrued on Borrowings Personal

13 Reserve Fund Personal

14 Stock of fertilizers Real

15 Stationery purchased Nominal

16 Rent paid Nominal

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Session 2

Session title: Accounts Heads under Common Accounting System (CAS)

I Session Objectives:

At the end of the session, the participants will be able to:

� State the various Heads of Account and their purposes

� List out the different types of vouchers

� Explain how to prepare the vouchers for different types of transactions

� Explain the various items of work involved in accounting process

II Duration of the session : 90 minutes

III Key Topics to be covered

Key topics Time in minutes

Methodology Material to

be used

Introduction and objective 5 Slide No. 1

Various account heads under CAS and their purposes

20

Guided discussion and participatory lecture

Slides

Nos. 2 to 6

Logical flow of work - Preparation of Vouchers

10 Guided Discussion Slides

Nos. 7 to10

Work Book Exercise 20 Guided Discussion on the answers

Hands on practice for Preparation of Vouchers

30 Guided Interaction on the Preparation of Vouchers

Summarising and closing 5 Recapitulation

IV Performance aids required:

Black or White Board with Chalk piece or white Board Marker Pens & dusters

OHP with transparencies OR Computer (PC) supported by LCD Projector (or)

laminated Flip chart containing the slides and copies of hand-out to be used.

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V Compulsory Reading by Trainees: Handout No.2 of the “Handout-cum-

Work Book” provided to them.

VI Session Guide

i. Introduce yourself and start the session by explaining the objectives of the

session. (Flash slide No. 1)

ii. Ask the participants the question “What are the broad groups of accounts

prescribed under CAS?” List the responses of participants, summarise

them and flash slide No. 2.

iii. Ask next question “what are the general ledger head of accounts under

liabilities items “. List the responses, summarise them and flash slide No.

3.

iv. Ask next question “what are the general ledger head of accounts under

assets items “. List the responses, summarise them and flash slide No. 4.

v. Ask next question “what are the items under income and expenditure of P

& L Account”. List the responses, summarise them under income and

expenditure heads and flash slide No. 5.

vi. Ask next question “what is a trading account and what items generally

appear on both sides of trading account “. List the responses from the

participants, summarise them and flash slide No. 6

vii. Ask next question “what is a voucher and various types of vouchers being

used in PACs. List the responses from the participants, summarise them

and flash slide No. 7

viii. Ask next question “Narrate various processes involved in accounting –

where it starts and where it ends “. List the responses of the participants

and summarise them and flash slide No. 8 & 9.

ix. Ask the participants to complete the workbook exercise given at the end of

Chapter - 2. After completion of the workbook exercise, handover a copy

of the answer sheet to the participants & ascertain whether the answers of

26

the participants tally with the answers given in the answer sheet & clarify

any difference of any participant. ( 20 minutes)

x. Ask the participants to prepare the vouchers on the blank vouchers

proformae given in the practice book. Time allocation – 25 minutes and 5

minutes for matching with the solved voucher slides.

xi. Lastly summarise the discussions step by step and thank the participants

to close the session.

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29

30

31

Work Book – Answers.

2.6.1 Fill up the blanks

i. In CAS, the account heads fall under the following five main groups viz.,

Assets, Liabilities, Income, Expenditure & Trading A/C .

ii. Reserve Fund is created to tide over a difficult financial period.

iii. Agriculture Credit Stabilisation Fund (ACSF) is created to provide

conversion facilities for crop loans to Medium Term Conversion Loan in

case of failure of crops due to natural calamities

iv. Building Fund is created for construction / expansion / alteration /

renovation of society’s own Building.

v. Common Good Fund is maintained for providing facilities of common

nature for the members of the society.

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vi. Recapitalisation Assistance received from Govt. of India for the revival of

the society is to be credited to “Recapitalisation Assistance Fund –

Contribution from GOI”.

vii. Types of Deposit Schemes are Savings Deposit, Recurring Deposit,

Fixed Deposit, Reinvestment Deposit , Other Deposit , etc.

viii. Borrowings from the District Central Cooperative Bank / SCB constitute

the main source for lending funds by PACS

ix. Societies avail Fertilizer Cash Credit Limit from DCCB for purchase of

fertilizer.

x. Provision for Standard Assets has to be made at @ 0.25% of the total

standard loans.

xi. Provision for Loss Assets has to be made @ 100 % of the total loss assets

xii. Purchase of fixed assets like tables, chairs, almirahs, fans etc., are to be

classified under the head of a/c ’Furniture & Fixture’.

xiii. Voltage stabiliser purchased for computer should be debited to

‘Computers & Electrical Installations A/C’.

xiv. Interest paid / payable for the broken period on Fixed Deposits, Savings

Bank Deposits Recurring Deposits, Daily Savings Deposits, Special

Deposits etc., are debited to ‘Interest on Deposit A/C’.

xv. Bonus paid to staff of the society is debited to ‘Salary & Allowance A/C’.

xvi. The account used for debiting expenses relating to xeroxing of agenda

papers is ‘Management Expenses A/C’.

xvii. The amount of electricity charges paid to the Electricity Board is debited to

‘Rent, Taxes, Electricity A/C’.

xviii. The cost of printing of books, forms, pamphlets & purchase of stationery

items are debited to ‘Printing & Stationery A/C’.

xix. If an asset has become unusable, it should be written off.

xx. ‘Depreciation Chart’ is prepared for calculation of depreciation on fixed

assets.

33

xxi. ‘Fixed Assets’ are physically verified to ensure that there is no shortage

of assets vis-à-vis assets as per dead stock register.

xxii. Locker Rent, Fee-based Income, Custom hiring etc., are credited to

‘Other Miscellaneous Income’.

xxiii. ‘Bank Reconciliation’ statements are prepared to reconcile the balances

with DCCB/SCB in deposit accounts.

xxiv. Steps for preparing Voucher are: i. Voucher Preparation, ii. Voucher

Authorisation, iii. Disbursement/collections and iv. Voucher Posting.

xxv. ‘Contra voucher’ ( CV ) is used to record all cash deposits and

withdrawals from the current account or savings bank account maintained

with the DCCB / SCB / Other Banks.

xxvi. Cash Withdrawal Forms ( CWF ) are used by customers for withdrawing

money from Savings Bank Account.

xxvii. ‘Pay – In – Slips’ (PIS) are used by customer for depositing money into

Savings Bank Account etc.

xxviii. ‘Pay – In – Slips’ (PIS) are used by customer for repaying the loan

amount and for paying interest on the loan amount.

xxix. ‘Receipt Vouchers’ (RV) are used for receipt of share capital from

members, admission fees, membership fees etc., from new members.

xxx. ‘Receipt Vouchers’ (RV) are used for receipt of cash on account of sale

of inputs like seed, fertilisers, pesticides, sale of PDS items and service

charges from customers for the services rendered to them

xxxi. ‘Payment Voucher’ (PV) is used for disbursement of loans and advances

in cash.

2.6.2 Choose the correct answer

i. Purchases Voucher is prepared to book - (d) Credit Purchases

ii. Sales Voucher is prepared to book - (c) Credit Sales

iii. (b) Journal Voucher is prepared to book transactions not involving cash

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iv. Journal Voucher is used to record those transactions that cannot be

passed through any other voucher type

v. Debit Note is used for recording - (d) Purchases Returns

vi. Credit Note is used for recording - (a) Sales returns

2.6.3 Say True or False

i. The Account “Travelling & Conveyance expenses” is meant for debiting all

expenses incurred on traveling by the Board of Directors. (False)

ii. The account “Depreciation in value of investments” is meant for making

provision for decrease/ diminution in value of land and building. (False)

iii. Profit on sale of Capital assets is credited to Capital Reserve (True)

Solution to Case Exercise on Common Accounting System

Voucher Preparation

36

The Alalpur Service Cooperative Society Limited, Alalpur

RECEIPT VOUCHER

No. 1 Dated : 31 March 2007

S. No. Head of Account Cash Book /

Ledger Flio No.

Debit (Rs.)

Credit (Rs.)

1 Cash A/c 110

2 Admission Fees A/c 10

3 Paid up Capital A/c – Individual 100

Being the amount of Admission Fees and Share Capital received from Shri

Mohanlal who was admitted as a member vide Board Resolution No. XXX

dated dd-MM-YYYY

_____________________________________________________________

Received Rupees One Hundred and Ten only. _______________________

Place : ________________ ______________________

Signature of the Receiver

Authorised Signatory ______________________________________________

37


RECEIPT VOUCHER


S. No.

Head of Account

Cash Book / Ledger Flio No.

Debit (Rs.)

Credit (Rs.)

1 Cash A/c 5,000

2 Paid up Capital A/c – Individual 5,000

Being the amount of additional share capital received from Shri Sohanlal (M No.

) who was allotted 50 shares of Rs. 100/- each vide Board Resolution No. XXX

dated dd-mm-yyyy

_______________________________________________________________

Received Rupees Five Thousand only._________________________________

Place : ________________ _______________________


Authorised Signatory ___________________________

38


PAY-IN-SLIP Credit SB A/c No. New Account Date : 31 March 2007

0010350 Of Shri Moneylal

________________________________________________________________

Rupess Two Thousand only _________________________________________

As per details furnished overleaf. ______________________ Signature of Remitter

Amount Rs. 2,000/-

Accountant ____________________________

Entered By ____________________________

__________________________

Authorised Signatory L F No.

39

No. : 4 Pass Book must accompany this withdrawal slip


WITHDRAWAL SLIP

Date : 31 March 2007 Branch

Name : Lal Bahadhur A/c No. 0005678

PAY Self_________________________________

Rupees Five Thousand

only___________________________

____________________________________________ only.

Place:: _____________________

Date: : 31 March 2007

Folio: _____________________

Authorised Signatory ____________________________________________

Rs. 5,000/-

40

The Alalpur Service Cooperative Society Limited, Alalpur No.5

PAY-IN-SLIP Credit SB / FD / RD / RID A/c No. Date 31 March 2007

Of Smt Sonia Mishra________________________________________________

Rupess Ten Thousand only__________________________________________

____________________________________________________________ only

As per details furnished overleaf. ________________________ Signature of Remitter

Rs. Ps. 1 0 0 0 0 0 0

Accountant ____________________________

Entered By ____________________________

______________________________

Authorised Signatory L F No.

41


JOURNAL VOUCHER


S. No.

Head of Account Ledger Flio No.

Debit (Rs.)

Credit (Rs.)

1 Loans & Advances - KCC Loans

50,000

2 Borrowings from DCCBs A/c - KCC Credit Limit

50,000

Being the amount of KCC loan issued to the following members.

P K Yadav M No. 1435 KCC 156/08 Rs. 10,000

N D Das 1223 157/08 Rs. 11,000

R L Yadav 897 158/08 Rs. 8,000

S N Sinha 1021 159/08 Rs. 7,000

Smt Lakshmi Yadav 817 160/08 Rs. 14,000

________________________________________________________________

Rupees Fifty Thousand only

_____________________________________________________________

Place : ________________

Authorised /signatory ________________________________

42


PAYMENT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Furniture & Fixtures A/c 6,000

2 Cash a/c 6,000

Being the amount paid for purchase of a Wooden Table costing Rs.5,000/- and

Wooden Chair costing Rs. 1,000/- for office use vide President’s / Board of

Directors’ approval dated dd-mm-yyyy.

________________________________________________________________

Paid Rupees Six Thousand only

________________________________________________________________

Place : ________________ _____________________

Signature of Payee

Authorised Signatory ___________________________

43


PAYMENT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Sundry Debtors A/c – Others 1,000

2 Cash A/c 1,000

Being the amount of Tour Advance paid to the Secretary for attending Training

Programme on Business Development at ACSTI, Bhubaneswar.

________________________________________________________________

Paid Rupees One thousand only______________________________________

________________________________________________________________

Place : ________________ _____________________

Signature of Payee

Authorised Signatory __________________________

44


PURCHASES VOUCHER

No.9 Dated : 31 March 2007

S. No.

Head of Account

Purchase Register /

Sundry Creditors

L F No

Debit (Rs.)

Credit (Rs.)

1 Purchase of Fertilisers A/c 15,000

2 Sundry Creditors A/c 15,000

Being the amount of fertilisers purchased from the District Cooperative Marketing

Society on credit basis vide Bill No. Xxx dated dd-mm-yyyy

________________________________________________________________

Rupees Fifteen Thousand only

________________________________________________________________

Place : ________________

Authorised Signatory _____________________________________

45


PAYMENT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Insurance A/c 2,000

2 Savings Bank A/c with DCCB 2,000

Being the amount of insurance charges for the Master Policy for the period from

01 April to 31 March 2008 paid by means of a cheque drawn on the S B a/c with

DCCB

________________________________________________________________

Paid Rupees Two Thousand only

________________________________________________________________

Place : ________________ _____________________

Signature of Payee

Authorised Signatory ____________________________

46


RECEIPT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Cash A/c 2,000

2 Sale of Fertiliser A/c 2,000

Being the amount received by way of cash sale of fertilisers. ________________________________________________________________

Received Rupees Two Thousand only

________________________________________________________________

Place : ________________ _____________________


Authorised Signatory _______________________________

47


RECEIPT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Cash A/c 30,000

2 Interest on Loans and Advances A/c 6,000

3 Loans & Advances A/c – KCC Loans 24,000

Being the amount of KCC loan and interest recovered from the following members Name M No. Account No. Principal Interest Ram Avatar Mishra 456 KCC 15/07 10,000 1,000

Ajay Narayan 564 881/07 1,000 1,000

N M Shukla 765 763/07 1,000 1,000

Naresh Yadav 387 1256/07 0 2,000

Rajendra Kumar 982 467/07 12,000 1,000

________________________________________________________________

Received Rupees Thirty Thousand only

________________________________________________________________

Place : ________________ _____________________



48


PAYMENT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Borrowings from DCCB - KCC Credit Limit

30,000

2 Cash A/c 30,000

Being the amount remitted into the loan account No. 1507 with DCCB

________________________________________________________________

Paid Rupees Thirty Thousand only

________________________________________________________________

Place : ________________ _____________________

Signature of Payee

Authorised Signatory _____________________________

49


CONTRA VOUCHER


S. No.

Head of Account Flio No. Debit (Rs.)

Credit (Rs.)

1 Cash A/c 22,000

2 Savings Bank A/c with DCCB 22,000

Being the amount withdrawn from the Savings Bank A/c with DCCB

________________________________________________________________

Rupees Twenty Two Thousand only

________________________________________________________________

Place : ________________


50


PAYMENT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Salary and Allowances A/c 26,000

2 Cash A/c 26,000

Being the amount of salary for the month of March 2007 paid to the staff ________________________________________________________________

Paid Rupees Twenty Six thousand only

________________________________________________________________

Place : ________________ _________________________

Signature of Payee

Authorised Signatory _________________________

51


RECEIPT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Savings Bank a/c with DCCB 700,000

2 Recapitalisation Assistance A/c - Contribution from GoI

700,000

Being the amount of recapitalisation assistance received from the Government of

India under Revival Package credited to Savings Bank Account

________________________________________________________________

Received Rupees Seven Lakh only

________________________________________________________________

Place : ________________ _____________________



52


RECEIPT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)


2 Recapitalisation Assistance A/c - Contribution from State Government

50,000

Being the amount of recapitalisation assistance received from the State

Government under Revival Package credited to Savings Bank Account

________________________________________________________________

Received Rupees Fifty Thousand only

________________________________________________________________

Place : ________________ _____________________

Signature of the

Receiver

53


PAYMENT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Term Deposit with DCCB A/c - Other than Reserve Fund

750,000


Being the amount of assistance received from the State government and the

Government of India earlier credited to Savings Bank A/c now withdrawn and

invested in Term Deposit

________________________________________________________________

Paid Rupees Seven Lakh and Fifty Thousand only

________________________________________________________________

Place : ________________ _____________________

Signature of Payee


54


PAYMENT VOUCHER


S. No.

Head of Account


Debit (Rs.)

Credit (Rs.)

1 Term Deposit with DCCB – Other than Reserve fund

3,000,000

2 Savings Bank A/c with DCCB 3,000,000

Being the amount withdrawn from the Savings Bank A/c with DCCB and invested

in Term Deposits with DCCB.

________________________________________________________________

Paid Rupees Thirty Lakh only

________________________________________________________________

Place : ________________ _________________________

Signature of Payee

Authorised Signatory __________________________

55

Session No. 3 Session Title: Books of accounts and Registers under CAS I Session Objectives : At the end of the session the participants will:

� Explain the rules of Double Entry System of Book Keeping

� Explain the utility and purpose of various books of accounts and registers

prescribed for PACS under CAS.

� Write the books of accounts prescribed under CAS


Key topics Time


be adopted Slides to be

used

Introduction and objectives

5 minutes

One slide

Meaning of accounting &Double entry system of book keeping

10 minutes

Guided & participatory interaction

Three slides

Utility and purpose of various books of accounts and registers

15 minutes


Five slides

Difference between ledgers and registers, step by step guidance to familiarize with writing of books/registers

10 minutes


Three slides

Work Book exercise 20

minutes

Questionnaire at the end of chapter

in RM

Hands on practice on writing books/registers

25 minutes

Case Exercise


5 minutes

Recapitulation




56


Work Book” provided to them

VI Session guide 1. Introduce yourself and highlight the objectives of the session. To recapitulate

the learnings from the first phase training programme on book keeping and

accounting ask the participants – What is the meaning of accounting? List the

answers and summarise the same as under by flashing slide No. 2

“Accounting is the science and art of recording and classifying business

transactions in a systematic manner for preparing financial statements to

determine profit or loss financial position of the concern.”

2. Ask the next question “How many accounting systems are there? Write

down the responses and ask the next question - “what are the basic

differences between double entry system and single entry system”. List the

responses under two columns and summarise the responses (flash slide No. 3)

Ask next question “how many types of accounts are there in accounting

system”. List the answers, summarise the responses by telling that there are 3

types of accounts viz., Personal Account, Real Account and Nominal

Account. Ask next question “what are the rules followed for passing entry for

each type of account”. List the answers and summarise the same –

• debit the receiver and credit the giver in case of Personal Account

• debit what comes in and credit what goes out in case of Real Accounts

• debit all expenses or losses and credit all incomes or gains in case of

Nominal Accounts (flash slide No. 4)

3. Ask questions “where the business transactions etc. are recorded “what

are the sources for preparation of financial statements and MIS returns”?

and what documents are accepted by court of law in case of dispute? . The

57

answer would be Books of accounts. Then flash the slide No. 5 to make the

participants understand the utility/ purpose of books of accounts.

4. Put the next question “What type of books are prescribed for PACS under

CAS” – The answer would be two types of books i.e. Related to Financial

statements (Books of primary entry and books of secondary entry) and Not

related to financial statements (control and other registers). Ask the participants

to indicate the names of subsidiary ledgers relating to Liability items and

asset items. List the responses and Flash slide Nos. 6, 7, 8 & 9.

5. Put next question “what are the difference between ledgers and registers

and subsidiary ledger and General Ledger” List the answers, summarise them

and tell the participants that:

• Ledgers are linked to financial statements and registers are not

• Ledgers contain details of financial transactions whereas registers contain non-financial information

• All registers are not ledgers.

• Subsidiary ledgers are details version of General Ledger accounts whereas General ledger is the summarized version of Subsidiary ledger/s

• Vouchers are first posted in subsidiary ledgers, whereas postings in GL are made from day book.

(Flash slide No. 10)

6. Explain step by step procedure followed for writing books of accounts

and Flash slide No. 11 &12

7. Ask the participants to complete the workbook exercise given at the end of

Capter - 3. After completion of the workbook exercise, handover a copy of the

answer sheet to the participants. (20 minutes)

8. Ask the participants to write Cash Book, Bank Book and subsidiary

ledgers from the vouchers prepared in previous session. Time allocation – 20

minutes and 5 minutes for matching the books written with the solved ones to be

flashed on the screen from the slides.

58

9. At the end summarise the discussions step by step and thank the participants

for giving attention to close the session

59

60

61

62

63

64

65

66

WORKBOOK – ANSWER SHEET 3.6.1 Answer the following briefly.

i. What is the difference between Double entry and Single entry system ?

In double entry two aspects of transaction are recorded and in single entry

only one aspect of transaction is recorded. In other words, in double entry

system two accounts are affected in reverse direction whereas in single entry

system only one account is affected

ii. State the difference between a Subsidiary Ledger and a General ledger.

Subsidiary ledger is the detailed version of General Ledger Account whereas

General Ledger is the summarized version of Subsidiary ledger accounts

iii. Name the books / registers / ledgers involved in recording

transactions relating to borrowing from DCCB under KCC.

Bank book or cash book, ST(SAO) Borrowing ledger, Day Book and General

Ledger

iv. Why should the society charge depreciation on assets?

To spread the expenditure under revenue head by writing off a part of the

cost of the asset every year till the cost is reduced to its scrap value

v. Name the books / registers / ledgers involved in recording

transactions relating to investments.

Cash book or Bank Book, Investment Ledger, Investment Maturity Register,

Day Book and General Ledger

vi. Why is it necessary to obtain acknowledgement of debt from

borrowing members?

To make them aware about their outstanding dues to the society.

67

vii. List the items that are treated as Sundry Debtors.

Credit sales, dues recoverables from various parties

viii. List the items that are treated as Sundry Creditors

Credit purchases and dues payable to various parties

ix. Identify the items in your society which need to be insured.

Furniture, fixtures, land, building, stock, vehicles, cash etc. as may be

applicable to individual society

3.6.2 Indicate the purpose of books /registers

Sl.

No.

Name of the Book /

Ledger / Register Purpose

1 Cash Book For keeping record of only cash transactions

2 Day Book

For grouping all cash and transfer transactions

General Ledger Head of account-wise at one

place before posting to General Ledger

3 Sales Register For keeping record of daily sales of different

items

4 Investment Ledger For keeping record of investment transactions

5 Depreciation Chart For working out depreciation on various

depreciable assets

6 Membership Register To keep detailed profile of individual member/s

7 Sundry Creditors

Ledger

To keep record of credit purchases and dues

payable to various parties

8 Monthly Interest

Payment Register

To keep record of interest paid on monthly basis

on deposits

9 Due Date Register

To take timely action so as to prevent losses viz.,

payment of maturity value of term deposits,

repayment of instalments/dues to creditors in

case of borrowings, to renew insurance policy

68

before policy expiry date in case of insurance

policy etc.

10 Balancing Register To satisfy correct status or integrity or

authenticity of account/s

3.6.3 Say True or False. Please tick �� the correct answer.

i. The PACS is not considered as a business organization - False

ii. Different Accounting policies should be followed from one period to

another - False

iii. Revenues and costs are recognized on receipt basis - False

iv. General Ledger postings are made from voucher - False

v. When society pays salary to the staff, Salary and Allowance A/c is

credited in its books - False

vi. Share capital ledger is the detailed version of share capital account in

general ledger - True

vii. When sales take place, the stock of the item sold increases and when

purchase takes place the stock decreases - False

viii. Locker facility is a subsidiary activity of PACS which yields revenue. -

True

ix. The sum total of individual balances in SB ledger on any date should tally

with the balance shown by SB deposit account in General Ledger.- True

x. Insurance policy should be renewed before expiry of the current policy. -

True

xi. Due Date Register for Fixed Deposit indicates the date and amount to be

repaid on a particular date. –True


i. Arithmatical accuracy under double entry system is ensured by

preparation of Trial balance

69

ii. Shyam deposits money in his SB account. His account will be credited in

the books of society.

iii. Society deposits money with DCCB. In the books of the Society Cash

Account will be credited. .

iv. General Ledger is called the book of final entry.

v. Subsidiary ledger is the detailed version of General Ledger Account.

vi. SB Account ledger is the detailed version of Savings Deposit Account in

the G L

vii. Fixed Deposit Ledger is the detailed version of Fixed Deposit account in

the G L

viii. If member has seven fixed deposits maturing on different dates, the

number of folios to be opened in the Fixed Deposit Ledger is Seven.

ix. The Originating entry in Sundry Debtors Account is always a Debit entry

x. Sundry Debtors is an Asset account and appears on Assets side of

balance sheet.

xi. The Originating entry in Sundry Creditors Account is always a Credit entry

xii. The type of expenditure incurred for purchasing assets is called Capital

expenditure.

xiii. The resolutions passed in the Board Meeting are indicated in the Minutes

Book.

xiv. Opening and closing of accounts is a continuous process.

xv. Revival package brings PACS under the ambit of Income Recognition

and Assets Classification norms. (prudential norms)

70


Writing of Books of Accounts

71

72

73

74

75

76

77

78

79

80

81

82

83

84

Session No. 4 Session Title: Maintenance of Books of Final Entry I Session Objectives: At the end of the session the participants will:

� Explain the purpose of maintaining General Ledger

� List out the steps involved in posting

� Explain the need for preparing Trial Balance

� Demonstrate preparation of Trial Balance


Key topics Time




5 minutes Three Slides

Purpose of maintaining General Ledger



Three Slides

Posting in the General Ledger 10 minutes Interactive


Five Slides

Purpose of preparing Trial Balance



Six Slides

Preparation of Trial Balance 10 Minutes Interactive


Three Slides



Hands on practice on posting in the G L and preparation of Trial Balance

35 minutes Case Exercise



85




V Compulsory Reading by Trainees: Handout No.1 of the “Handout-

cum-Work Book” provided to them

VI Session guide

1. Introduce yourself and explain the objectives of the session

2. Ask the participants what they were practising during the earlier sessions.

3. Some would say that they had prepared vouchers while others would say

they were writing the transactions in certain books like Cash Book, Bank

Book, Day Book and Subsidiary Ledgers.

4. Write the answers on the Black or White Board (use these visual aids

wherever necessary)

5. Ask them about the purpose of maintaining Cash Book and Bank Book.

6. The answer may be “to know the Cash Receipts, Cash Payments, Closing

Cash Balance, Closing Balance in the Bank Accounts etc.”

7. Then ask the participants whether these books would provide concise

information about a particular account like Salary and Allowances Account

or Savings Bank Deposit.

8. Some may say “No” while others may say that one has to go through the

entire Cash Book or Bank Book or Day Book and cull out the information

9. To conclude, it is possible to obtain concise information from Cash Book,

Bank Book & Day Book, but that would involve a lot of labour and time.

10. To make this work easier, another book has been prescribed.

86

11. Explain General Ledger. Flash Slide No.2

12. Explain the term “Posting in G L”, balancing of account etc. Flash Slide

No. 3 to 6

13. Then administer the case exercise on posting. Start from the place where

the earlier session ended (i.e. Writing of Cash Book, Bank Book and Day

Book). The Day Book entries have to be posted in the respective ledger

accounts and balance has to be arrived at for each account.

14. Ask some of the participants to go through certain accounts which are

considered as Expenditure Accounts, some to go through Income

Accounts, Asset Accounts and Liabilities Accounts.

15. Ask them what they have observed from the closing balance shown by the

individual expenditure heads.

16. The answer may be all expenditures show “Debit” balance. Similarly,

those who have gone through Asset Accounts would give the same

answer.

17. Those who have gone through the Income Accounts and Liabilities

Accounts would say that the closing balance is a “Credit” Balance.

18. Then ask them why it so ?

19. If they were not able to answer, say that the first entry or the originating

entry in Asset Accounts and Expenditure Accounts is always a debit entry

and hence the closing balance of these accounts will always be a Debit

Balance.

20. Similarly, in the case of Liabilities Accounts and Income Accounts, the first

entry or the originating entry is always a credit entry and hence the closing

balance of these accounts will always be a Credit Balance.

87

21. Ask the participants if there is any error in balancing or posting in the

wrong side of the account what will happen?

22. They would say the concerned account would not show a correct picture.

It would not show a true and fair view of its position.

23. Then ask them how will you come to know that some arithmetical error

has taken place?

24. Those, who know some basics about accountancy, would say we have to

prepare Trial Balance.

25. Explain about Trial Balance and it preparation - Flash slides No.7 to 11

26. Explain the logic behind Trial Balance - Every Debit has a corresponding

and equal Credit(s) and vice versa. The sum total of net balances would

be “Zero”. In other words, the sum total of Debit Balances should be equal

to that of the Credit Balances.

27. Then continue with the exercise. Ask the participants to prepare the Trial

Balance from the balances extracted from the General Ledger and see

whether the Trial Balance is tallying.

28. Once the Case Exercise is complete ask the participants to attempt the

Work Book Exercise.

29. On completion of the Work Book Exercise, discuss the answers to the

questions. If anybody is getting a wrong answer, discuss where exactly,

the participant has gone wrong.

30. Once the Work Book Exercise is over, sum up the learnings.

88


i. General Ledger is maintained to obtain concise information about

each account head.

ii. Assets and Expenditure Accounts will always show a “DEBIT”

Balance.

iii. Liabilities and Income Account will always show a “CREDIT”

Balance.

iv. Trial Balance is prepared to find the arithmetical accuracy of

transactions recorded in the books of account.

89

90

91

92

93

94

95

Answers to Work Book Exercise

i. The Account where the net profit is apportioned to various Reserves /

Funds is called as Appropiration of Profits

ii. The book which keeps records of all cash transactions, i.e. Cash receipts

and cash payments is called Cash Book

iii. All cash receipts are recorded on the Receipts Side while all the cash

payments are recorded on the Payments Side of the Cash Book.

iv. Bank Book is used to record all the transactions involving Society’s

Current Account or Savings Bank Account with DCCB / SCB / Other

Banks.

v. General Ledger is the book of final entry

vi. The process of recording of transactions in the ledger is called posting.

vii. Fixed Deposit Ledger is a form Subsidary Ledger

viii. Trial Balance is prepared to test the arithmetical accuracy of Ledger

ix. Assets and Expenses Accounts would show Debit balances.

x. Incomes and Liabilities Accounts would show Credit balances

xi. Cash Book has two sides viz., Receipts Side & Payments Side.

xii. All deposits made in Bank account are entered in Debit column of bank

book.

xiii. When cash is deposited in bank account, entries are made in Payments

side of Cash Book.

xiv. Day book has two sides viz., Receipts Side and Payments Side.

96

xv. Investment account always shows a Debit balance

4.9.2 Choose the correct answer

i. All transactions - cash, credit, transfer (adjustment), trading, banking etc.,

took place in a day are recorded in - (a) Day Book

ii. Purchases Voucher is prepared to book - (d)Credit Purchases

iii. Sales Voucher is prepared to book - (c) Credit Sales iv. (b) Journal Voucher is prepared to book transactions not involving cash

v. Journal Voucher is used to record those transactions that cannot be

passed through any other voucher type

vi. Debit Note is used for recording - (d) Purchases Returns

vii. Credit Note is used for recording - (a) Sales returns

viii. Statements, which show the business results over a period of time and

business position as at a point of time, are called as - (b) Financial

Statements

ix. The periodicity of preparation of Trading Account and Profit & Loss

Account is - (a) yearly


i. Cash Book always shows a credit balance - False

ii. Entries in the credit column of bank book represent withdrawals or

payments from bank account. - True

iii. Transfer vouchers are posted in cash column of the day book. - False

iv. Only cash transactions are recorded in the day book. - False

v. Postings in General Ledger are made from vouchers. - False

97

vi. All asset accounts are debit balances and all liability accounts are credit

balances. - True

4.9.4 Name the two accounts involved in this transaction

i. Deposited Rs. 5,000/- into the Current Account with the DCCB

Current Account with DCCB & Cash

ii. Sold fertiliser worth of Rs.2,500/- on cash basis

Cash A/c & Sale of Fertilisers A/c

iii. Purchased rice, dal etc., worth of Rs.3,000/- for running the Mid-day Meal

Scheme by paying cash

Purchase of Food Grains and other items under Mid Day Meal

Scheme & Cash A/c

iv. Purchased seeds worth of Rs.25,000/- from M/s Cauvery Seeds on credit

basis

Purchase of Seeds A/c, Sundry Creditors A/c

v. Seeds worth of 1,500/- sent back to M/s Cauvery Seeds since they were

damaged Sundry Creditors A/c & Purchases Returns A/c

vi. One of the customer who is having savings bank with the society

deposited Rs.2,000/- into his account

Cash A/c and Savings Deposit A/c

vii. Paid electricity charges Rs. 200/-

Rent, Taxes, Electricity A/c & Cash A/c

viii. Purchased stationery worth of Rs.100/-

Printing & Stationery A/c & Cash A/c

98

4.9.5 Match the following

1 General Ledger 5 A book that contains all accounts

2 Trial Balance 7 A Statement of all accounts

3 Balance 2 Net difference of debit and credit total

4 Posting 6 A process of transferring transactions from Day Book to Ledger

5 Cash Book 3 A book that contains all cash transactions

6 Bank Book 1 A book to record the transactions involving Society’s Current A/c with DCCB

7 Investment Ledger 4 A book where the details of all investments are written

4.9.6 Answer the following questions briefly.

i. What is the relationship of closing balance as per cash book and physical

cash held in safe ?

Physical cash should tally with the closing cash balance as per Cash

Book.

ii. Why is it necessary to prepare bank reconciliation statement?

To find out the reasons for the difference between the balance as per

Bank Book and Pass Book

99

4.9.7 Problem on preparation of Bank Reconciliation Statement

On 31st October 2007 the Bank Book of Chandipur PACS showed a balance of

Rs. 50,000/- while the Pass Book of the Current Account with the DCCB showed

a balance of Rs.55,250/- on a scrutiny of both these books, it was observed that

the difference was on account of the following.

� Cheques issued by the PACS but not paid by bank Rs. 6,000/-

� Cheques deposited into the DCCB but not collected Rs. 4,000/-

� Direct payment by a customer into bank Rs. 3,000/-

� Interest on term deposit credited by bank Rs. 500/-

� Bank charges debited in the pass book Rs. 250/-.

4.9.7 Bank Reconciliation Statement as on 31 October 2007 Amount(Rs.) Amount (Rs.) Balance as per Bank Book = 50,000 Add: Cheques issued but not paid = 6,000 2. Direct Payment by Customer = 3,000 3. Interest on Term Deposit Credited by the Bankd = 500 ------------------- 9,500 ======= 59,500 Less: 1. Cheques Deposited but not Credited by the bank = 4,000 2. Bank Charges debited by the Bank but not accounted = 250 ------------------ 4,250 ======= Balance as per Pass Book = 55,250 =======

100


Posting in General Ledger & Preparation of Trial Balance

101

GENERAL LEDGER

Head of Account Cash on Hand Account

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

3,000 3,000

31 March 2007

To 71,110 74,110

By 68,000 6,110

GENERAL LEDGER

Head of Account Savings Bank Account with DCCB

Date Particulars

Day Book

Folio No

Debit (Rs.) Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

3,327,000 3,327,000

31 March 2007

To 750,000 4,077,000

By 3,774,000 303,000

GENERAL LEDGER

Head of Account Admission Fees Account

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

1,000 1,000

31 March 2007

By 10 1,010

102

GENERAL LEDGER

Head of Account Paid up Capital A/c - Individual

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

1,085,000 1,085,000

31 March 2007

By 5,100 1,090,100

GENERAL LEDGER

Head of Account Savings Deposits Account

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

6,263,000 6,263,000

31 March 2007

By 2,000 6,265,000

To 5,000 6,260,000

GENERAL LEDGER

Head of Account Fixed Deposits Account

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

6,653,000 6,653,000

31 March 2007

By 10,000 6,663,000

103

GENERAL LEDGER

Head of Account : Borrowings from DCCB Account - KCC Credit Limit

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.) Balance

(Rs.) Initials

Opening Balance

11,655,000 11,655,000

31 March 2007

By 50,000 11,705,000

To 30,000 11,675,000

GENERAL LEDGER

Head of Account Loans and Advances Account - KCC Loans

Date Particulars

Day Book

Folio No


Balance (Rs.)

Initials

Opening Balance

12,176,000 12,176,000

31 March 2007

To 50,000 12,226,000

By 24,000 12,202,000

GENERAL LEDGER

Head of Account Sundry Creditors A/c

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

87,000 87,000

31 March 2007

By 15,000 102,000

104

GENERAL LEDGER

Head of Account Sale of Fertiliser A/c

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

317,000 317,000

31 March 2007

By 2,000 319,000

GENERAL LEDGER

Head of Account Interest on Loan and Advances A/c

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

1,833,000 1,833,000

31 March 2007

By 6,000 1,839,000

GENERAL LEDGER

Head of Account Recapitalisation Fund A/c - Contribution from GoI

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

0 0

31 March 2007

By 700,000 700,000

105

GENERAL LEDGER

Head of Account Recapitalisation Fund A/c - Contribution from State Govt

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

0 0

31 March 2007

By 50,000 50,000

GENERAL LEDGER

Head of Account Furniture & Fixtures A/c

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

46,000 46,000

31 March 2007

To 6,000 52,000

GENERAL LEDGER

Head of Account Sundry Debtors A/c- Others

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

180,000 180,000

31 March 2007

To 1,000 181,000

106

GENERAL LEDGER

Head of Account Purchase of Fertilisers A/c

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

316,000 316,000

31 March 2007

To 15,000 331,000

GENERAL LEDGER

Head of Account Insurance Account

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

0 0

31 March 2007

To 2,000 2,000

GENERAL LEDGER

Head of Account Salary & Allowances Account

Date Particulars

Day Book

Folio No

Debit (Rs.)

Credit (Rs.)

Balance (Rs.)

Initials

Opening Balance

295,000 295,000

31 March 2007

To 26,000 321,000

107

GENERAL LEDGER

Head of Account Investment A/c Term Deposits with DCCB (Other than Reserve Fund)

Date Particulars

Day Book

Folio No


Balance (Rs.)

Initials

Opening Balance

10,707,000 10,707,000

31 March 2007

To 3,750,000 14,457,000

108


Preparation of Trial Balance

109

Trial balance as on 31 March 2007 Month ______ Year _______

LIABILITIES & INCOME (Amount in Rs.)

Head of Account in G L

Folio No.

Opening Balance at

the beginning of

the month

Total of Debit

during the month

Total of Credit during

the month

Closing Balance

Paid up Capital - Individuals 1,090,100

Paid up Capital - Government 225,000

Reserve fund 37,000

Savings Deposits 6,260,000

Fixed Deposits 6,663,000

Recurring Deposits 1,540,000

Borrowings from DCCB - KCC Credit Limit

11,675,000

Interest Accrued on Deposits 2,076,000

Interest Accrued on Borrowings

306,000

Provision for Sundry Debtors (Others)

169,000

Provision for NPAs 602,000

Overdue Interest Reserve 841,000

Sundry Creditors 102,000

110

Subsidy meant for society 34,000

Other Liabilities 406,000

Purchases Returns 14,000

Sale of Fertilisers 319,000

Interest on Loans and Advances

1,839,000

Admission Fees 1,010

Interest on Deposits with Banks / Institutions

1,394,000

Recapitalisation Assistance Fund - Contribution from GoI

700,000

Recapitalisation Assistance Fund - Contribution from State Government

50,000

Total 36,343,110

111

ASSETS & EXPENDITURE (Amount in Rs.)

Head of Account in G L

Folio

No.

Opening Balance at

the beginning

of the month

Total of Debit

during the

month

Total of Credit

during the month

Closing Balance

Cash In Hand 6,110

Savings Bank Account with DCCB

303,000

Term Deposit with DCCB (Representing Reserve fund)

81,000

Term Deposits with DCCB (Other than Reserve Fund)

14,457,000

Shares in Other Cooperative Institutions

762,000

Loans and Advances - KCC Loan

12,202,000

Loans & Advances - Loans against Deposits

610,000

Land & Buildings 212,000

Furniture & Fixtures 52,000

Interest Accrued but not due on Loans

414,000

Interest Receivable on Investments

2,740,000

Overdue Interest Receivable 841,000

Sundry Debtors for Others 181,000

Stock of Agricultural inputs - Fertilisers

49,000

112

Purchase of Fertilisers 331,000

Transport and other Expenses on Purchase of Fertilisers

5,000

Interest on Deposits 1,078,000

Interest on Borrowings from DCCB

1,487,000

Salary and Allowances 321,000

Rent, Taxes, Electricity 9,000

Postage and Telephone Charges

1,000

Printing and Stationery 8,000

Audit Fees 2,000

Other Expenses 2,000

Management Expenses 5,000

Vehicle Expenses 2,000

Repair Cost on Premises 1,000

Insurance 2,000

Profit & Loss Account 179,000

Total 36,343,110

113

Recap Session Time Allotted for Recap: 15 minutes Ask a participant to come to the dais and give an account of what he has learnt during the previous day.

Session No.5 Session Title: Preparation of Financial Statements I. Session Objectives: At the end of the session the participants will:

� List out the various Financial Statements

� Describe the preparatory work.

� Demonstrate preparation of Financial Statements

II. Duration of the session: 180 minutes III. Key topics to be covered:

Key topics Time




5 minutes Three Slides

Components, Preparatory Steps



Three Slides

Preparation of Trading Account

10 minutes


Discussion Five Slides

Preparation of Profit & Loss Account and Appropriation of Net Profit

10 minutes


Discussion Six Slides

Preparation of Balance Sheet 10 Minutes Interactive


Three Slides

114



Hands on practice on writing books/registers

110 minutes

Case Exercise







Work Book” provided to them

VI Session guide

1. Introduce yourself in case it is necessary 2. Explain the Objectives of the session - flash Slide No.2 3. Ask the participants what were doing in the last session of the

previous day 4. The answer would be - posting in the General Ledger and

preparation of Trial balance 5. Write the answers on the Black or White Board (use these visual

aids wherever necessary) 6. Ask them the purpose of General Ledger & Trial balance. 7. The participants would give the answer as - to know the concise

information about each account head and to know the arithmetical accuracy of posting.

8. Then ask the participants whether the General Ledger or Trial

Balance would give a picture about the business result of an institution.

115

9. The answer would be “No”. 10. Then ask them what should be done to know the business result. 11. The accounts have to grouped or rearranged. 12. Then tell them about the purpose of preparing Financial Statements

- flash Slide No.3 13. List out the Financial Statements - Flash Slide No.4 14. In order to arrive at a true and fair position of the business results,

certain steps have to be initiated before preparation o financial statements - flash Slide No. 5 & 6.

15. Ask the participants - in case the salary for the month of March was

paid in April. Whether it will have an effect on the result of the society for the year ended 31 March?

16. The answer may be - “No”. Unless voucher is passed for the salary

it will not have any effect. 17. Put some more questions like - Whether the same has to be taken

into account or not? 18. What is to be done to bring this amount into the current year’s

books? 19. The answer may be - we have to pass an adjusting entry. 20. Explain about Adjusting Entries - Flash Slide No. 7 & 8. 21. Explain about Trading A/c and ask the participants to list out the

account heads related to non-trading activities. 22. Explain the items of Trading Account, Balancing of Trading Account

and preparation of Monthly Trading Account - Flash slide No. 9 to 14.

23. Explain about Profit & Loss Account 24. Ask the participants to list out the various expenditure and income

accounts 25. Explain how to prepare & balance the Profit & Loss A/c, how to

appropriate the net profit etc. - Slide No. 15 to 19.

116

26. Explain about Balance Sheet and its preparation - Flash slide No.

20 to 23. 27. Administer the Case Exercise. 28. Start from the place where the earlier Faculty has stopped -

Preparation of Trial Balance. 29. See whether the Gross Profit and Net Profit tallies with those

arrived by the participants. 30. Ask any of the participant to write the Trading Account, Profit and

Loss Account and Balance Sheet on the Black Board or White Board.

31. Ask the other participants to compare their answers with the

answer written on the Board. 32. In case of difference, clarify where the participant has committed

mistake. 33. Once the Case Exercise is complete ask the participants to attempt

the Work Book Exercise. 34. On completion of the Work Book Exercise, discuss the answers to

the questions. If anybody is getting a wrong answer, discuss where exactly, the participant has gone wrong.

35. Once the Work Book Exercise is over, sum up the learnings.


a. Financial Statements are prepared to find out the business results over a period of time and the business position as at a point of time.

b. Trial Balance, Trading A/c, Profit & Loss A/c and Balance Sheet

form the Financial statements c. Adjusting entries are passed to arrive at the true and fair view of the

financial position d. Trading A/c is prepared to know the trading results i.e. Gross Profit

or Gross Loss

117

e. Profit & Loss A/c is prepared to know the net results i.e. Net Profit or Net Loss

f. Net Profit is appropriated to various Funds and Reserves and for

declaring Dividend g. Balance Sheet is a Statement of Assets and Liabilities as on a

particular date.

118

119

120

121

122

123

124

125

126

127

128

129

Work Book Answers

5.11 Work Book

5.11.1 Say True (T) or False (F)

1. Revenues and costs are recognized as they are earned or incurred and

not as money is received or paid. - True

2. Since the double entry system of book keeping follows the rule that every

debit must have a corresponding credit and vice versa once the trial

balance statement has tallied we can safely presume that the accounts

are correctly prepared. - False

3. While preparing final accounts Investments must be always be valued at

the market value. False

4. While preparing final accounts expenditure and income should be treated

on actual basis and not on accrual basis – False

5. A clear demarcation be made in regard to provisions and contingencies on

the one side and reserves on the other. While provisions and

contingencies are to be made from P&L Account, statutory and other

reserves be made out of appropriation of profits. - True

6. Since the overdue interest is booked on accrual basis in CAS, this will

inflate the profit of the PACS. - False

7. In the books, entries for accounting closing stock of all the items should be

passed with reference to actual stock after physically verifying the stock

and not stock as per stock register - True

8. In case assets are purchased out of grant assistance from State

Govt./NABARD, no depreciation should be shown on those assets - False

9. Profit is shown as a liability and loss is shown as an asset in the Balance

sheet of PACS. - True

10. Inter Branch account will always appear on the Asset side of the Balance

Sheet - False

130

11. The un-appropriated balance of Profit should be carried to “Asset” side of

the Balance sheet.- False

12. Expenses shown in Profit and Loss account include paid and payable

figures. Similarly, income shown consists of both income received and

income receivable - True

13. Under Loans and advances only net figure after deducting “Provision for

NPAs” should be shown in the outer column of the Balance Sheet. - True

14. The Balance Sheet is a statement of assets and liabilities of a society

created during a year - False

15. Provisions for NPAs which includes provision for Sub-standard Assets,

Doubtful Assets and Loss Assets should be shown on the liability side of

the Balance sheet - False

16. Overdue Interest Reserve or Provision for Overdue Interest should be

subtracted from the total of Interest Accrued and Receivable and only the

net interest accrued should be shown on the Assets Side under Other

Assets - True

17. In case the society charges sales tax on items sold, the amount of sales

tax has to be deducted from the Gross Sales figure and only the net

amount is shown in the Trading Account - True

18. Sales Tax liability is shown as other assets in the Balance Sheet. - False

5.11.2 B. Fill in the Blanks

i. In reporting all business transactions of the PACS, the intention is to exhibit a

true and fair picture of the Operational Results and Financial Position of the

business.

ii. Depreciation should be provided for on depreciable assets on Straight Line

Method or Diminishing Value Method on a consistent basis.

iii. The net profit arrived at should be carried forward for Appropriation of

Profits. In case of loss, the same should be carried to Balance Sheet.

131

iv. Insurance of stock should be charged to Trading Account for respective

activity.

v. We should ensure the total of member-wise share capital in the Share Capital

Ledger agrees with the share capital as per the General Ledger balance.

vi. The Trading Account is prepared to ascertain the results of the Trading

Activity of the PACS

vii. The amounts of the Authorsed and Subscribed Capital should be furnished

in the Balance Sheet. But they should not be included in the total.

5.11.3 Give short answers

1. List out the various Financial statements a PACS should prepare under

the CAS

i. Trial Balance

ii. Trading Account

iii. Profit & Loss A/c

iv. Profit & Loss Appropriation A/c

v. Balance Sheet

vi. Annexures to Profit & Loss A/c & Balance Sheet.

2. Give a short account of the Annexure to P&L Account and Balance

Sheet

• Details of Miscellaneous Income should be furnished in Annexure to Profit &

Loss A/c.

• Details of Borrowings from Other Institutions, Shares in Other Cooperative

Institutions, Term Deposits with DCCB / SCB / Other Banks, Other Investments,

Closing Stock of any other stock other than those mentioned etc., sundry debtors

and sundry creditors should be given separately as Annexures and should be

attached to the Balance Sheet

132

3. What do you understand by Capital Reserves? Give few examples

Capital Reserve is a reserve created on account of the following.

a. Profit on sale of capital assets like land, building, furniture etc.

b. Amount received against the forfeiture of shares

c. Government grant received in the form of promoters’ contribution

d. Excess of assets taken over than the amount of liability on acquisition of

business

The above mentioned amounts cannot be treated as normal income and hence

not to be included in the net profit of the society.

4. Contra Items in the Balance Sheet of the PACS

Liabilities Side : Bills for Collection (being Bills Receivable as per contra)

Assets Side: Bills Receivable (as per Contra)

5. Contents of the Annual Report of the PACS

Annual Report should contain important developments in the society covering

total members, enrollment of new members, borrowing members, members

retired during the year, changes in the Management Committee and holding of

MC meetings as per bye-law, growth of deposits, advances and profit, issue of

Kisan Credit Cards and ST-SAO loans disbursed through KCC, loans issued to

SC/ST/ women beneficiaries/ SHGs and information about Farmers’ clubs and

other details as per the provisions of the Cooperative Societies Act along with

the financial statements of PACS.

5.11.4 Complete the following

i. Capital Rs. 40,000/- + Liabilities Rs. 15,000/- = Assets Rs. 55,000/-

ii. Capital Rs. 65,000/- + Liabilities Rs.24,000/- = Assets Rs.89,000/-

iii. Assets Rs.1,00,000/- - Liabilities Rs.30,000/- = Capital Rs. 70,000/- iv. Assets Rs. 35,000/- - Liabilities Rs.10,000/- = Capital Rs. 25,000/-

133

5.11.5 Match the following - Table 1

Sl. No Particulars Sr No Particulars

1 Bank Reconciliation Statement

4 Balance confirmation

certificates

2 Trial Balance 6 Arithmetical Accuracy of

Accounts

3 Damaged or degraded stock 1 Realizable value

4 Unusable Assets 10 Write off

5 Trading Account 7 Non-Credit Business

6 WDV Method 5 Depreciation

7 Reserves and Funds 3 Created out of profit

8 Balance confirmation certificates

2 Borrowing

9 Overdue Interest Reserve 8 Provision for Overdue Interest

10 Bills Receivable 9 Contra Item

5.11.6 Match the following - Table 2

Sr No Particulars Sr No Particulars

1 Trading Account 3 Non-Credit Business of PACS

2 Balance Sheet 10 Assets and Liabilities

3 Statement of Sources and Uses of Funds

9 Balance Sheet

4 Income and Expenditure 1 Profit and Loss account

5 CAS 2 Common Accounting System

134

6 Liabilities 4 Sources of Funds

7 Annual Report 8 Important Developments of the

PACS

8 Capital Reserve 6 Profit on sale of Capital Asset

9 Depreciation on Assets 7 Straight Line Method

10 Capital Reserve 5 Forfeited Shares


i. Closing stock of goods should be valued on the basis of Cost Price or

Market Price whichever is higher - False

ii. Depreciation Chart is prepared to work out the depreciation in closing

stock of goods - False

iii. Trading Account is prepared to ascertain the trading results of the

business - True

iv. Sale of gunny bags, kerosene barrels, etc., is an Item of Trading Account -

True

v. Only cash sales should be shown in the Trading Account - False vi. Gross Profit or Gross Loss is transferred to Balance Sheet - False

vii. In Profit & Loss Account, The left hand side of the Profit & Loss Account is

called as the “Liability” side - False viii. The right hand side of the Profit & Loss Account is called as the

“Expenditure” side - False

ix. Profit on sale of Capital assets is credited to Reserve Capital - False

x. Grants received are shown on the Assets Side of the Balance Sheet -

False

135

xi. In the Balance Sheet “Provision for Standard Assets” is reported on the

Liabilities Side - True xii. Provisions for NPAs is subtracted from the total of Loans and Advances

and only the net figure is shown on the Assets Side of the Balance Sheet.

- True

xiii. “Provision for Overdue Interest” is subtracted from the total of Loans and

Advances and only the net figure is shown on the Assets Side of the

Balance Sheet.- False

xiv. Provision for Sundry Debtors on Credit Sales and Provision for Bad and

Doubtful Debts (others) are shown separately in the Balance Sheet on the

Liabilities Side - False

xv. Appropriation of net profit to various reserves & funds is done in Balance

Sheet - False

xvi. Term Deposits with SCB / DCCB is shown under Cash & Bank Balances

on the Assets side of the Balance Sheet - False

136


Preparation of Financial Statements

137

Alalpur Service Cooperative Society Limited, Alalpur

JOURNAL VOUCHER


S. No.

Head of Account Ledger Folio No.

Debit (Rs.)

Credit (Rs.)

1 Depreciation on Properties a/c 12,700

2 Land & Building A/c 7,500

3 Furniture & Fixtures A/c 5,200

Being the amount of depreciation provided for building and furniture & fixtures for

the year 2006-07

________________________________________________________________

Rupees Twelve Thousand Seven Hundred only

________________________________________________________________

________________________________________________________________

Place : ________________

Authorised Signatory _____________________________

138


JOURNAL VOUCHER


S. No.


Debit (Rs.)

Credit (Rs.)

1 Transport and Other Expenses on Purchase of Fertilisers A/c

2,000

2 Provision for Outstanding Expenses A/c

2,000

Being the amount of provision made for outstanding Transportation Charges

incurred but not paid before 31 March 2007

________________________________________________________________

Rupees Two Thousand only

________________________________________________________________

________________________________________________________________

Place: _________________ Authorised Signatory _____________________________

139


JOURNAL VOUCHER


S. No.


Debit (Rs.)

Credit (Rs.)

1 Prepaid Expenses a/c 2,000

2 Insurance a/c 2,000

Being the amount of insurance paid in advance now adjusted.

________________________________________________________________


________________________________________________________________

________________________________________________________________

Place : ________________

Authorised Signatory ____________________________________________

140


JOURNAL VOUCHER


S. No.


Debit (Rs.)

Credit (Rs.)

1 Profit and Loss Account 2,000

2 Provision for Depreciation in Value of Investments

2,000

Being the amount of Provision made in respect of the shares of Cooperative

Printing Press since the Press is under liquidation.

________________________________________________________________


________________________________________________________________

________________________________________________________________

Place : ________________

Authorised Signatory _______________________________

141


JOURNAL VOUCHER


S. No.


Debit (Rs.)

Credit (Rs.)

1 Profit & Loss A/c 400,000

2 Provision for Standard Assets 100,000

3 Provision for Sub-Standard Assets 300,000

Being the amount of provision for Standard Assets and Sub-Standard Assets

made for the year 2006-07.

________________________________________________________________

Rupees Four Lakh only

________________________________________________________________

________________________________________________________________

Place : ________________


142


JOURNAL VOUCHER


S. No.


Debit (Rs.)

Credit (Rs.)

1 Closing Stock of fertiliser 47,000

2 Trading A/c 47,000

Being the value of closing stock of fertilisers as on 31 March 2007 brought into

the books of account.

________________________________________________________________

Rupees Forty Seven Thousand only

________________________________________________________________

________________________________________________________________

Place ______________________ Authorised Signatory ______________________________

143

Trading Account for the year ended 31 March 2007

Particulars

Amount (Rs.)

Particulars

Amount (Rs.)

Inner Col.

Current Year

Inner Col. Current Year

1. Opening Stock 1 Sales A/c.

1 (a) Fertilizers 49,000 1 (a) Fertilizers 319,000

2. Purchases A/c

1(b) Less Sales Returns

0

2((i) Fertilizers 331,000 1(c) Net Sales [1(a)-1(b)]

319,000

2(b) Less Purchase Returns

14,000 2. Commission

0

2 (c) Net Purchases [2(a)-2(b)]

317,000 3. Compensation

0

3. Transport and other expenses on purchases.

7,000 4. Gunny Bags Sales

0

4.Salary for Salesman/ Manufacturing wages

0

5. Other Trading Income

0

5. Factory expenses

0 6. Closing Stock

6.Insurance for Stocks, Godown

0

6.a. Gross Stock [(i) to (viii)]

7. Godown rent

0 (i) Fertilisers 47,000

8. Electricity charges

0

6.b. Less: Value of stock in deficit and reduction in value of damaged / rejected stocks.

0

9. Licence Fee

0 6.c. Net Closing Stock [6(a)-6(b)]

47,000

10.Interest on borrowings for the non-credit activities

0

12. Trading Gross Profit carried to main Profit & Loss A/c

7. Trading Loss carried to the main Profit & Loss A/c

7,000

Total

373,000 Total

373,000

144

PROFIT AND LOSS ACCOUNT OF XYZ PACS Ltd.,

for the year ended 31 March 2007

Particulars Amount (Rs.)

Particulars Amount (Rs.)

Current Year

Current Year

1. Gross loss transferred from Trading a/c

7,000 1. Gross profit transferred from Trading a/c

2. Interest (paid and payable) on

2. Interest on Loans and Advances (Received and Receivable)

i. Deposits 10,78,000 18,39,000

ii. Borrowings from DCCB / SCB*

14,87,000

iii. Loans availed from State Government

iv. Borrowings from others

3.Establishment and other Expenses

3. Income on Investments

3.i. Salary and Allowances including Contribution to PF, Bonus, Gratuity or Pension Fund

3,21,000

3(i) Interest on Deposits with Banks / institutions

13,94,000

3.ii. Management expenses (expenditure relating to board meetings etc)

5,000 3(ii) Dividend on other investments

4. Rent, Taxes, Electricity and Repair Costs on Premises

10,000 4. Rental Income

5. Insurance 0 5. Admission Fees

1,010

6. Law charges 0

6. Miscellaneous Income (specify details in annexure)

7. Postage and telephone charges

1,000

145

8. Printing and Stationery 8,000

9. Audit Fees 2,000

10. Vehicle expenses 2,000

11. Traveling & Conveyance expenses

0

12. Donations and Subscriptions

0

13. Depreciation on properties

12,700

14. Other expenses 2,000

15. Provisions for

i. Standard assets 1,00,000

ii. NPA

ii(a) Sub standard assets 3,00,000

ii(b) Doubtful debts

ii(c) Loss Asset

iii. Bad and doubtful debts (credit sales)

iv. Bad and doubtful debts (others)

v. Depreciation in value of investments

2,000

vi. Overdue Interest on loans

vii. Overdue interest on investments

viii. Others (to be specified)

16. Profit for the year 7. Loss for the Year

1,03,690

Total 33,37,700 Total 33,37,700

*

146

BALANCE SHEET of XYZ PACS Ltd as on 31 March 2007

(Amount Rs.)

S. No.

Liabilities Break

up

31 Mar 2007' 31 Mar

200'

(Current Year)

(Previous Year)

1 Capital

i. Authorised

ii. Subscribed

iii. Paid-up

a) Individuals 10,90,100

b) Government 2,25,000

c) Others

2 Reserves and Funds (created out of surplus of PACS)

i. Reserve Fund 37,000

ii. Capital Reserve

iii. Agricultural Credit Stabilisation Fund

iv. Dividend Equalization Fund

v. Common Good Fund

vi. Building Fund (created out of surplus by PACS)

vii. Others (to be specified)

3 Profit and Loss Account (if closing balance is profit)

4 Grants and other Funds

i. Provident Fund

ii. Building Fund (received from State Government)

iii. Recapitalisation Assistance Fund 7,50,000

iv. Subsidies meant for Society 34,000

v. Subsidy meant for members

vi. Others (to be specified)

5 Deposits

i. Savings Deposits 62,60,000

ii. Recurring Deposits 15,40,000

iii. Fixed Deposits 66,63,000

iv. Reinvestment Deposits

v. Others (to be specified)

147

S. No.

Liabilities Break

up

31 Mar 2007 31 Mar 2006

(Current Year)

(Previous Year)

6 Borrowings

(a) Borrowings from DCCB / SCB*

i. ST (SAO) / KCC Credit Limit 116,75,000

ii. MT/LT Agri Loans

iii. MT Conversion

iv. MT/LT Reschedulement

v. SHG Loans

vi. Non farm sector Loans

vii. Cash Credit Limit for procurement of Agricultural Produce

viii. Cash Credit Limit for Gold Loans

ix. Loans against deposits with DCCB / SCB

x. Fertilizer Cash Credit Limit

xi. Seeds Cash Credit Limit

xii. Public Distribution Scheme CC Limit

xiii. Consumer Commodities CC Limit

xiv. Other non credit activities

xv. Other borrowings from DCCB / SCB (to be specified)

(b) Borrowings from State Government

(c) Borrowings from Other Institutions (details in annexure)

7 Other Liabilities

i. Interest Accrued on Deposits 20,76,000

ii. Interest Accrued on Borrowings 3,06,000

iii. Unclaimed Dividend

iv. Sundry Creditors (details in Annexure) 1,02,000

v. Others (to be specified) 4,06,000

8 Bills for Collection (being Bills Receivable as per Contra)

9 Branch Adjustment Account

10 Provisions

i. Provision for PF / Gratuity / Bonus / Pension

ii. Provision for Standard Assets 1,00,000

iii. Provision for Expenses 2,000

iv. Others (to be specified)

Total 312,66,100

148

Sr. No

Assets Breakup 31 Mar 2007 31 Mar 2006

(Current

Year) (Previous

Year)

1 Cash on Hand 6,110

2 Balances with DCC Bank / SCB * i. Current Account ii. Savings Account 3,03,000

3 Balances with Other Banks / Institutions

i. Current Account

ii. Savings Account 4 Investments

i. Government and Trustee Securities

ii. Shares in Other Cooperative Institutions (specify details in annexure )

7,62,000

iii. Term Deposits with DCCB/ SCB * representing Reserve Funds (Annexure)

81,000

iv. Term Deposits with DCCB / SCB* (other than Reserve Funds)

144,57,000

v. Term Deposits with other banks

vi. NSC / KVP

vii. Staff PF balance with PF Trust / with Banks

viii. Others (Details in Annexure)

(a) Gross Investments 153,00,000

(b) Less: Provision for depreciation in the value of investment

2,000

(c) Investment net of provisions (a – b) 152,98,000

5 Loans and Advances

i. ST (SAO) Loans / KCC Loans 122,02,000

ii. Medium Term / L T Agricultural Loans

iii. MT Conversion Loans

iv. MT /LT Reschedulement

v. Loans against deposits 610,000

(a) Total 128,12,000

(b) Less: Provision for NPA 9,02,000

(c)Loans and Advances net of provisions (a – b) 119,10,000

6 Closing Stocks

i. Agricultural Inputs (fertilisers, seeds etc.) 47,000

(a) Total ( i to vi) 47000

(b) Less: Reduction for value of shortage / damaged/degraded stock

0

(c) Net closing stock (a) – (b) 47,000

149

Sr. No

Assets

Breakup 31 Mar 200x (Current

Year)

31 Mar 200x (Previous

Year) 7 Fixed Assets (net of depreciation as per

Depreciation Chart)

i. Land and Buildings / Godowns 2,04,500

ii. Furniture and Fixtures 46,800

iii. Computers and Electrical Installations

iv. Vehicles

v. Others (to be specified)

8 Other Assets

1(a) Interest Accrued and Receivable (i to iii)

i. Interest Accrued but not due on Standard Loans

4,14,000

ii. Interest accrued but not due on NPA Loans

iii. Overdue interest receivable 8,41,000

1(b) Less: Provision for overdue interest 8,41,000

1(c) Net interest Accrued & Receivable (a) – (b) 4,14,000

2(a) Interest receivable on Investments 27,40,000

2(b) Less : Provision for overdue interest on investments. 0

2(c) Net Interest receivable on investments (a) – (b)

27,40,000

3 Miscellaneous Income Receivable

4(a) Sundry debtors (for credit sales)

4(b) Less: Provision for bad and doubtful Sundry Debtors (for credit sales)

4(c) Net Sundry debtors for credit sales {net of provision i.e. (a)-(b)}

5(a) Sundry debtors (others) - details in annexure

1,81,000

5(b) Less : Provision for bad and doubtful sundry debtors (others)

1,69,000

5(c) Net Sundry Debtors (others) (a – b) 12,000

6 Prepaid expenses 2,000

7 Tax Deducted at source

8 Others

9 Bills Receivable (as per contra)

10. Branch Adjustments accounts

11 Profit and Loss Account (if balance is loss) 282,690

Total 312,66,100

150

Session No.7 (Day 2 – III Session)

Session Title: Conversion of the present Profit & Loss Account, Balance Sheet as per the CAS pattern

I. Session Objectives: At the end of the session, the participant will be able to:

• Demonstrate how the present / existing Trading Account, Profit & Loss

Account & Balance Sheet can be converted as per the requirements of

CAS

II. Duration of the session: 90 minutes

III. Performance aids required:

Black or White Board with Chalk piece or white Board Marker Pens & dusters

IV. Session Guide

a. Distribute the present Trading Account, Profit & Loss Account and

Balance Sheet of any society to the participants.

b. Discuss each and every particulars in these statements and how they

should be written in the Financial Statements prescribed under CAS.

c. Ask the participants to rewrite the Financial Statements as per CAS

pattern.

d. On completion of the same, discuss the answers and clarify the doubts.

V. A model exercise is given below:

151

Case Exercise on Rewriting of Financial Statements as per CAS Formats

Trading Account of Dhaulimuhan S C S Limited

Particulars Debit (Rs.)

Credit (Rs.)

Opening Stock - Fertiliser 6,591

Sale of Fertiliser 4,780

Shortage of Fertiliser 988

Closing Stock of Fertiliser 2,983

Gross Profit 2,160

Total 8,751 8,751

Profit & Loss Account

Particulars Debit (Rs.)

Credit (Rs.)

Establishment Cost 125,678

Interest paid on Loans 838,572

Interest paid on Deposit 744,687

House Rent Received 1,200

Other Cost Received 860

Entrance Fee Collected 780

Miscellaneous Income 630

Process Fee Collected 1,865

Interest Received on Investment 606,085

Interest Received on Loans 1,226,689

L/Yr Interest Payable on Loans 197,084

L/Yr Interest Payable on Godown Loans 3,071

L/Yr Interest Payable on Deposits 143,725

L/Yr Interest Receivable on Loans 349,367

L/Yr Interest Receivable on Agri Loans 530

L/Yr Interest Receivable on Deposits 9,092

152

L/Yr Difference in Balance Sheet 1,790

Sale Proceeds of Pump Set 164 1,143

By Gross Profit Brought Forward 3,505

Depreciation A/c 2,160

Land & Building @ 2.5% 4,473

Bank Counter @ 5% 1,197

Bank Counter @ 5% 500

Sign Board 24

Bicycle 70

Electrification @ 10% 512

Provision for Overdue Interest 202,684 188,277

Provision for Salary of Staff 2,250

OTS Rebate Allowed 1,884

Provision for OTS Rebate Receivable 2,826

Net Profit 94,354

Total 2,378,864 2,378,864

Details of Establishment Expenditure

Particulars Amount

(Rs.) Particulars

Amount (Rs.)

Salary to Staff 31,996 B/F 106,649

Salary to Secretary 54,556 Tom Tom Expenses 300

Contingent Expenditure 994 General Body Expenses 910

Collection Drive 2,677 Electricity 1,339

Bonus to Secretary 2,500 Audit Fees 1,200

T A to Secretary 2,100 Entertainment Expenses 4,199

Printing & Stationery 3,871 Xerox Expenses 200

153

Election Expenditure 3,521 Typing Expenses 200

Hire Charges & Fuel 3,301 Repair & Maintenance 2,200

Electrification Expenses 560 Liveries 300

Insurance Fees 51 Board Meeting 3,100

Commission & postage 22 Carpus Fund 5,081

Coop. Education Fund 500 Total 125,678

C/o 106,649

Balance Sheet of Dhaulimuhan S C S Ltd

Liabilities Balance

(Rs.) Assets

Balance (Rs.)

Paid up Share Capital Cash &Bank Balance

Member Share 389,377 Cash in hand 7,272

Nominal Share 192,850 Current Deposit with KCCB

1,995

Govt Share 173,000 S B D I with KCCB 37,944

Reserve fund & Other Reerves

S B D II with KCCB 376

Reserve Fund 3,535 S B D III with KCCB 75,127

Cooperative Education fund

500 Fixed Deposit with KCCB

1,219,000

Deposits K d A/c with KCCB 5,552,991

Member Deposits 8,460 Sundry Creditors A/c with KCCB

0

Security Deposits of staff 10,580 Interest Receivable on Deposit

0

H R Deposit 2,000 Investment of Share

Election Security 3,920 Share with KCCB, H O 320,500

154

S B D Individual 1,728,680 Nominal Snare with KCCB

170,700

D S B D Individual 207,712 Share wtih OSCMF Ltd 1,000

Mani Manika Individual 1,830 Share with District Cooperative Union

100

R D Individual 231,140 Statutory Funds

F D Individual 2,460,208 RFD with KCCB 6,264

K D Individual 2,950,934 Risk Fund with KCCB 31,065

Loans & Borrowings Other Investments

Agri Loan from KCC Bank

3,786,504 Cadre Development Fund with KCCB

3,400

S C Loan - KCCB 40 Advance with W C C Store, Khurda

8,000

S R T O Loan _ KCCB 961,885 Stocks

Term Loan - KCCB 21,303 Stock of Fertiliser 2,983

Godown Loan - KCCB 74,000 Shortage of Fertiliser 988

Godown Loan _ OSCB 62,156 Loans & Advances

Cadre fund to KCCB 61,663 Agri Loan with Members 3,228,220

Sundry Debtor - KCCB 9,832 Term Loan with Members

265,943

Interest Payable to KCCB

372,081 Manika Loan with Members

0

Interest Payable on Deposits

157,388 LAD Loan with Member 743,790

Interest Payable to Godown Loan

14,846 SRTO Loan with Members

1,469,340

L A D to KCCB 305 C D Loan with Members 78,872

Provisions & Reserves Interest Receivable on Agricultural Loan

577,223

Provision for Bad Debts 104,896 Interest Receivable on Non-agricultural Loan

0

155

Provision for Bad Assets 8,000 Fixed Assets

Provision for pay of Watcher

30 Land & Building with compound wall

174,439

Provision for Shortage 109 Dead Stock & furniture 22,739

Provision for Election Expenses

35 Diesel Pump set 0

Provision for Overdue Interest

202,684 Mini Bank Counter 9,499

Grants & Subsidies Sign Board 445

Subsidies B F 10,760 Bicycle 700

Managerial Subsidy 8,000 Electrical Equipment 4,603

Input Subsidy 4,394 Books & Library 330

Consumer Subsidy 900 Other Assets

Dug Well Subsidy 9,543 Advance with Sound Culture Centre

0

Crop Insurance Subsidy 4,995 Litigation cost with Members

17,988

Building Grant 12,000 Crop Insurance Provision with Member

12,714

Risk Fund with DRDA 10,345 Sundry Advance with Staff

1,750

Other Liabilities OTS allowed Receivable from Bank

2,826

Fertiliser Dues to OSCMF

108 Sundry Recoveries from Staff

12,872

Payable to WCC Store 2,758 Profit & Loss A/c - Last Year

334,520

Payable to Ex Secretary 14

Payable to S B Singh 35

Cooperative Education Fund

1,400

Advance to OSCSC Ltd 3,503

156

House Rent Advance from sound culture

50

Suspense Collection 240

Audit Fees payable 1,440

CDF from NABARD - Mini bank

25,775

Provision for OTS Rebate recoverable

2,826

Provision for salary of staff

2,250

Crop Insurance payable to members

345

Profit & Loss A/c - Current Year

94,354

Total 14,398,518 Total 14,398,518

TASK : Regroup the accounts as per CAS Grouping and Prepare the Trading Account,

Profit & Loss Account and Balance Sheet as per CAS Formats

Answer: Trading Account

For the year 2006-07

Particulars Amount (Rs.) Particulars Amount (Rs.)

Current Year

Previous Year

Current Year

Previous Year

Opening Stock Sales A/c

I. Fertilisers 5,603 i. Fertilisers 4,780

Closing Stock

Fertilisers 2,983

Trading Gross Profit carried to main Profit & Loss Account

2,160

Total 7,763 Total 7,763

157

Profit and Loss Account of Dhaulimuhan SCS Ltd., for the year ended 31 March 2007

Expenditure

Amount (Rs.) Income

Amount (Rs.)

Current Year

Previous Year

Current Year

Previous Year

1. Interest paid on

1. Gross Profit transferred from Trading A/c

2,160

i.Deposits 600,962 2. Interest on Loans and Advances

874,908

ii.Borrowings 638,417 3. Income on Investments

596,993

2. Establishment & Other Expenses

4. Rental Income 0

i.Salary & Allowances 88,286 5. Admission Fees 780

ii.Management Expenses

4,010 6. Miscellaneous Income

3. Rent, Taxes, Electricty and Repair Costs

3,539 i.Process Fee 1,865

4. Insurance 51 ii.Misc. Income 630

5. Law Charges 0 iii.Last year diff. in Balance sheet

1,790

6. Postage & Telephone Charges

22

7. Printing & Stationery

3,871

8. Audit Fees 1,200

9. Vehicle Expenses 0

10. Traveling & Conveyance Exp

5,401

11. Donations & Subscriptions

0

12. Depreciation on properties

6,776

13. Other Expenses 13,733

14. Provisions for

i.Overdue Interest 14,407

ii.OTS Rebate 2,826

iii.Salary to Staff 2,250

Profit for the year 93,375

Total 1,479,126 Total 1,479,126

158

Appropriation of Profits

Expenditure Amount (Rs.)

Income Amount (Rs.)

Current Year

Previous Year

Current Year

Previous Year

Accumulated Losses (Previous Year)

334,520 Profit for the Current Year

93,375

Balance of losses carried to Balance Sheet

241,145

Total 334,520 Total 334,520

Interest (Paid & Payable) on Deposits

Interest paid on Deposit = 744,687 Dr

Less: L/Yr interest payable on Deposits = 143,725 Cr

Interest on Deposits shown in the P & L A/c = 600,962 Dr

Interest (Paid & Payable) on Borrowings

Interest paid on Borrowings = 838,572 Dr

Less: L/Yr interest payable on Godown Loans = 3,071 Cr

Less: L/Yr interest payable on Borrowings = 197,084 Cr

Interest on Borrowings shown in the P & L A/c = 638,417 Dr

Establishment and Other Expenses

Salary to Staff = 31,996

Salary to Secretary = 54,556

Contingent Expenditure = 994

Bonus to Secretary = 2,500

Liveries = 300

---------------------

Total = 90,346 Dr

Less: Other Cost Recovered = 860 Cr

Less: House Rent Received = 1,200 Cr

Amount reported in the P & L A/c = 88,286

159

Management Expenses

General Body Expenses = 910

Board Meeting = 3,100

Total = 4,010

Other Expenses

Collection Drive = 2,677

Election Expenditure = 3,521

Tom Tom Expenses = 300

Electrification Expenses = 560

Contribution to Cooperative Education Fund = 500

Entertainment Expenses = 4,199

Xerox Expenses = 200

Typing Expenses = 200

Corpus Fund = 5,081

Total = 17,238 Dr

Less: L/Yr Double Corpus Fund = 3,505 Cr

Total = 13,733 Dr

Travelling & conveyance Expenses

T A to Secretary = 2,100

Hire Charges & Fuel = 3,301

Total = 5,401

Rent, Taxes, Electricity & Repairs to Premises

Electricity Charges = 1,339

Reparis & Maintenance = 2,200

Total = 3,539

Sale Proceeds of Pumpset (net) = 979 (1,143 - 164) - Shown

as Capital Reserve in Balance sheet

160

Depreciation on Properties

Depreciation on Land & Building = 4,473

Depreciation on Dead Stock = 1,197

Depreciation on Bank Counter = 500

Depreciation on Sigh Board = 24

Depreciation on Cycle = 70

Depreciation on Electrical Installations = 512

Total = 6,776

Provision for Overdue Interest

Total Provision for Overdue Interest to be made = 202,684 Dr

Less: Provision made till last year = 188,277 Cr

Provision of Overdue Interest to be made during = 14,407

Current year

Interest (Received & Receivable) on Loans and Advances

Interest Received on Loans = 12,26,689 Cr

Less: L/Yr Interest Receivable on Loans = 3,49,367 Dr

Less: L/Yr Interest Receivable on Agri Loans = 530 Dr

Less: OTS Rebate Allowed = 1,884 Dr

Amount Reported in the Profit & Loss A/c = 8,74,908

Income on Investments

Interest received on Investments = 606,085 Cr

Less: L/Yr Interest Receivable on Deposits = 9,092 Dr

Amount Reported in the P & l A/c = 596,993

Paid-up Capital - Individuals

Member Share = 389,377

Nominal Share = 192,850

Total = 582,227

161

Subsidies Meant for Society

1Subsidies B F = 10,760 Managerial Subsidy = 8,000

Input Subsidy = 4,394

Consumer Subsidy = 900

Total = 24,054

Subsidies meant for Members

Dug Well Subsidy = 9,543

Crop Insurance Subsidy = 4,995

Total = 14,538

Savings Bank Deposits

S B D Individual = 17,28,680

Member Deposits = 8,460

Total = 17,37,140

Fixed Deposits

F D Individual = 24,60,208

Mani Manika - Individual = 1,830

Total = 24,62,038


Interest Payable to KCCB = 372,081

Interest payable on Godown Loans = 14,846

Total = 386,927

Provisions for Expenses

Provision for Pay of Watcher = 30

Provision for election expenses = 35

Provision for salary of staff = 2,250

Total = 2,315

162

Sundry Creditors

Amount Payable to KCCB = 9,832

L A D to KCCB = 305

Fertiliser Dues to OSCMF = 108

Amount payable to WCC Store = 2,758

Amount payable to ex Secretary = 14

Amount payable to S B Singh = 35

Advance from OSCSC Ltd = 3,503

House Rent Advance from sound Culture = 50

Suspense Collection = 240

Crop Insurance payable to Members = 345

Total = 17,190

Assets

Balances with DCCB/SCB - Savings Bank A/c

S B D I with KCCB = 37,944

S B D II with KCCB = 376

S B D III With KCCB = 75,127

Total = 113,447

Investments - Shares in other Cooperative Institutions

Shares with KCCB - HO = 320,500

Nominal Share with KCCB = 170,700

Shares with OSCMF = 1,000

Share with District Cooperative Union = 100

Total = 492,300

Term Deposits with DCCB (other than Reserve Funds)

Fixed Deposit with KCCB = 1,219,000

K D A/c with KCCB = 5,552,991

Risk Fund with KCCB = 31,065

Cadre Development Fund with KCCD = 3,400

Total = 6,806,456

163

Fixed Assets - Furniture & Fixtures

Dead Stock & Furniture = 22,739

Mini Bank Counter = 9,499

Sign Board = 445

Total = 32,683

Sundry Debtors - Others

Advance with WCC Store, Khurda = 8,000

Shortage of Fertiliser to be recovered = 988

Litigation Cost with Members = 17,988

Crop Insurance Provision with Member = 12,714

Sundry Advance with Staff = 1,750

OTS Rebate allowed receivable from bank = 2,826

Sundry Recoveries from staff = 12,872

Total = 57,138

Less: Provision for Shortage = 109

Less: Provision for OTS Rebate = 2,826

Net amount reported in the Balance Sheet = 54,203

Balance Sheet of Dhaulimuhan SCS Ltd as on 31 March 2007

S

No Liabilities

Break Up

31 March 2007

31 March 2006

1 Capital

i) Authorised

ii) Subscribed

iii) Paid-up

a) Individuals 582,227

b) Government 173,000

c) Others 0

2 Reserves and Funds

i) Reserve Fund 3,535

ii Capital Reserve 979

3 Profit and Loss Account 0

164

4 Grants and other Funds

i) Building Fund 12,000

ii) Cooperative Education Fund 1,900

iii) Subsidies meant for Society 24,054

iv) Subsidy meant for Members 14,538

v) Others

Risk Fund with DRDA 10,345

CDF from NABARD 25,775

5 Deposits

i) Savings Deposits 1,737,140

ii) Recurring Deposits 231,140

iii) Fixed Deposits 2,462,038

iv) Reinvestment Deposits 2,950,934

v) Daily Savings Deposits 207,712

6 Borrowings

a) Borrowings from DCCB

i)ST(SAO) / KCC Credit Limit 3,786,504

ii)MT / LT Agri Loans 21,303

iii)S C Loan 40

iv)Non Farm Sector Loans 961,885

v)Godown Loan 74,000

Vi)Loan Against Deposit 305

b) Borrowings from State Govt. 0

c) Borrowings from SCB

I) Godown Loan 62,156

7 Other Liabilities

i) Interest Accrued on Deposits 157,388

ii) Interest Accrued on Borrowings 386,927

iii)Sundry Creditors 16,885

iv) Cadre Fund to KCCB 61,663

v) Audit Fees Payable 1,440

vi) H R Deposit 2,000

vii) Security Deposit of Staff 10,580

viii) Election Security 3,920

165

8 Provisions

Provision for PF / Gratuity / Pension 0

Provision for Standard Assets 0

Provision for Expenses 2,315

Total 13,986,628

S No.

Assets Break-up 31 March

2007

31 March 2006

1 Cash on Hand 7,272

2 Balances with DCCB / SCB

I) Current Account 1,995

Ii) Savings Account 113,447

3 Balances with Other Banks/Institutions

0

4 Investments

I. Government & Trustee Securities

0

Ii) Shares in Other Cooperative Instutions

492,300

Iii) Term Deposits with DCCB / SCB representing Reserve Funds

6,264

Iv) Term Deposits with DCCB / SCB other than Reserve Funds

6,806,456

5 Loans and Advances

iI)ST (SAO) / KCC Loans 3,228,220

ii)MT / L T Loans 265,943

iii) Non Farm Sector Loans 1,469,340

iv) Loan Against Deposits 743,790

v) Loans for consumer durables 78,872

Total 5,786,165

Less: Provision for NPA 112,896

Loans and Advances net of provision

5,673,269 5,673,269

6 Closing Stock 2,983

7 Fixed Assets (net of depreciation)

I) Land & Buildings 174,439

Ii) Furniture & Fixtures 32,683

Iii)Computer and Electrical Installations

4,603

166

iv)Vehicles 700

V) Others - Library Books 330

8 Other Assets

Interest Accrued on Loans 577,223

Less: Provision for Overdue Interest

202,684 374,539

Sundry Debtors - Others 57,138

Less Provision for Bad & Doubtful Debts

2,935

Net Sundry Debtors - Others 54,203 54,203

9 Profit & Loss Account 241,145

Total 13,986,628

Session No. 8 (Day 2 – IV Session)

Session title An Introduction to Management Information System under Common Accounting System (CAS)

I. Session Objectives: At the end of the session, the participant will be able to:

• Explain the importance of MIS to be developed in consonance with CAS

• Describe the various returns / statements prescribed under MIS for

effective internal control and monitoring by external authorities


III. Key Topics to be covered



be used

Introduction and objective 5

Need for revision / refinement of MIS

5 Guided and participatory Interaction,

Slide Nos. 1 & 2

Characteristics of a Sound MIS


Slide Nos. 3 to 5

MIS Statements prescribed under CAS


Slide Nos. 6 to 21

167

Work Book Exercise 10 Guided Interaction on the answers


IV. Performance aids required:

Black or White Board with Chalk piece or white Board Marker Pens & dusters (or)

OHP with transparencies OR Computer (PC) supported with LCD Projector (or)

Laminated Flip chart containing the slides and copies of hand-out to be used.

V. Compulsory Reading by Trainees: Handout No.6 of the Handout-cum-Work

Book” provided to them

VI. Session Guide

e. Introduce yourself and start the session by explaining the objectives of the

session.

f. Ask the participants the question “What they understand by MIS?” List out

the responses of participants, summarise them and flash slide No. 1.

g. Ask the next question “what is the need for revision / refinement of MIS “.

List out the responses, summarise them and flash slide No. 2.

h. Ask the next question “what are the characteristics of sound MIS“. List out

the responses, summarise them and flash slide Nos. 3, 4 & 5

i. Ask the next question “Explain one by one the 14 statements out of the 19

(Nineteen) types of Statements / Returns prescribed under CAS” to be

used in PACs as regards to their utility, contents, source of information for

preparation & the formats as given in the Handbook on MIS prepared by

NABARD. Flash slide Nos. 6 to 21.

j. Ask the participants to complete the workbook exercise given at the end of

Chapter. After completion of the workbook exercise, handover a copy of

the answer sheet to the participants & ascertain whether the answers of

168


any difference of any participant.

k. Lastly summarise the discussions, thank the participants and close the

session.

VII. Learnings from the session:

� Any organization comprises of Management sub-system, Operations sub-

system and Information sub-system

� Information sub-system is concerned with the work of collection and

processing of data.

� An effective MIS provides required information to the management at the

right time, in the right form for decision making.

� Under MIS, PACS have to prepare/compile nineteen statements/ Returns.

169

170

171

172

173

174

175

176

177

178

179

180

Work Book Exercises

6.8.1 Questions and Answers – Objective type :

i. Why a sound and standardized MIS is need at PACS level?

Post reforms, PACS are expected to function as full fledged and self controlled

financial intermediaries that establish their own business policies to meet the

challenges of a dynamic economic environment and business models. To help

decision making at PACS and at other levels including those of higher financing

agencies, regulators and other agencies, there is an urgent need to have a

sound and standardized MIS at PACS.

ii. Explain the need of MIS for effective internal control?

The MIS in PACS would enable purpose - wise / activity-wise analysis to draw

inferences on the performance of PACS and initiation of corrective / timely action.

Credit activities of PACS include crop loans, MT loans etc and the non-credit

business consists of PDS operations, fertiliser/pesticides business, grocery shop

etc. The MIS generated should fully reflect the performance of the PACS under

all these activities for review & effective control

iii. Explain the Characteristics of a sound MIS.

• MIS should be comprehensive and should cover all operations of PACS.

• It should be selective and should not be over burdened with less important

or incidental information.

• It should be transparent and should establish relationship between input

and output.

• It should speak about success as well as failures so that corrective action

can be initiated.

• It should also bring out the causes of success and failure.

• The statements/returns should be in fixed periodicity so that there is

systematic analysis and sustained monitoring over a period of time.

181

iv Explain the Functions of MIS

The Management Information System (MIS) evaluates the performance of PACS

on an on-going basis and enable the Management to take timely, corrective

remedial action. Information system has to be purposeful and focused to enable

decision making process. It is essential for planning, developmental initiatives

and internal & external control.

v Name the users of MIS.

The users of MIS are the managing committee of PACs, the DCCB they are

affiliated to, Cooperation Department / RCS of the State as well as other State

and National agencies. National Federation of State Cooperative Bank

(NAFSCOB) and NABARD also use data on PACS, collected from the SCBs and

DCCBs.

vi Name the MIS returns developed for monitoring recovery and NPA position.

Demand, Collection and Balance Statement as given in Annexure-VI, Period-

wise Classification of Overdues as given in Annexure-VII & Asset Classification

and Provisioning Requirements as given in Annexure-VIII

vii Name the MIS returns prepared for monitoring lending performance.

The Kisan Credit Card (KCC) Scheme as given in Annexure-II, Crop-wise Loan

Disbursement as given in Annexure-III, & Medium and Long Term Loans Issued

during the year as given in Annexure-V.

6.8.2 Indicate True or False: (by appropriate tick mark)

Sr. No. Statement / Observation Answer

1 An effective MIS enables proper internal control True

2 There is no need to base MIS on CAS False

3 A sound MIS does not always help in purpose False

182

oriented analysis

4 Some MIS returns facilitate monitoring by external

authorities. True

5 Computerisation makes MIS vibrant. True

6 NPA statement must give break up under sub-

standard, doubtful and loss making categories. False

7 Percentage of recovery to demand can not be

ascertained from DCB statement True

8 Purpose-wise DCB helps in focused recovery drive. True

9

Separate trading account for PDS and fertilizer

business will be desirable to ascertain the

profitability of these non-credit activities.

True

Day 3 Recap Session Time Allotted for Recap: 15 minutes Ask a participant to come to the dais and give an account of what he has learnt

during the previous day

Session No. 9 (Day 3 – I Session)

Session title: Asset Classification & Provisioning Norms & preparation of Annexure VIII

I. Session Objectives:

At the end of the session, the participant will be able to:

• Explain the concept of NPA & how the assets are classified as per period

of NPAs

• Describe the provisioning norms various categories of assets classified as

per period of NPAs

• Explain the preparation of Annexure VIII

183


III. Key Topics to be covered



be used

Introduction and objective 5 Slide No.1

Prudential Norms - Reason for introduction, NPA Norms

15 Guided and participatory Interaction

Slide Nos.

2 to 11

Income Recognition Norms, Asset Classification Norms


Slide Nos.

12 to 16

Provisioning norms 5 Guided and participatory Interaction

Slide Nos.

17 & 18

Preparation of Annexure VIII


Case Exercise on NPA classification & provisioning norms

30 Case Exercise

Work Book Exercise 10 Guided Interaction on the answers


IV. Performance aids required:

Black or White Board with Chalk piece or white Board Marker Pens & dusters (or)

OHP with transparencies OR Computer (PC) supported with LCD Projector (or)

Laminated Flip chart containing the slides and copies of hand-out to be used.

V. Compulsory Reading by Trainees: Handout No. 7 of the “Handout-cum-


VI. Session Guide

a. Introduce yourself and start the session by explaining the objectives of the

session and flash Slide No.1.

184

b. Ask the participants – Whether they have heard the term Prudential

Norms - List out the responses of participants, summarise them and flash

slide No. 2 & 3

c. Then explain the concept of NPA and the NPA norms by flashing Slide

Nos. 4 to 11.

d. Ask the participants about the basis for treating interest on loans and

advance as income. Further ask them about the treatment of Overdue

Interest. Some will say that they treat the overdue interest as income and

make necessary provision. Ask them about the reason for making

provision for overdue interest. List out the responses and explain the

Income Recognition Norms by flashing Slide No. 12.

e. Ask the participants about Good Loans and Bad Loans and difference

between them. Why do they make provision when the loan becomes bad?

List out the responses and explain the Asset Classification Norms and the

Provisioning Norms. Flash slide Nos. 13 to 18.

f. Ask the participants to complete the workbook exercise given at the end of

Chapter. After completion of the workbook exercise, handover a copy of

the answer sheet to the participants & ascertain whether the answers of


any difference of any participant.

g. Administer the Case Exercise on Prudential Norms and initiate the

discussion on the outcome of the Case Exercise

h. Lastly summarise the discussions, thank the participants and close the

session.

VII Learning from the Session:

• Balance sheet should reflect society’s actual financial position

• An asset becomes NPA when it ceases to generate income

• Income recognition should be based on record of recovery

185

• Overdue interest not to be treated as income. If taken as income,

matching provision has to be made

• If a borrower has more than one loan account, if one account becomes

NPA, all the other loans will also become NPA.

• Advances against term loans, NSCs, IVPs, KVPs and life insurance

policies are not covered by NPA norms

• Adequate provision has to be made for each category of assets

186

187

188

189

190

191

192

193

194

195

7.8 Work Book


a. Prudential Norms comprise of Income Recognition, Asset

Classification, Provisioning and Capital Adequacy Norms.

b. If an account ceases to generate income, it is called as NPA.

c. Crops with crop season longer than one year are called as long duration

crops.

d. The crop season for each crop is decided by State Level Bankers’

Committee.

e. A cash credit account will be treated as Out of Order if there are no

credits continuously for a period of six months.

f. Fee, commission etc., is treated as income only when the account is

classified as Standard Assets.

g. The provisioning norm for standard assets is 0.25 %.

h. Societies have to make provision at 10 % for sub-standard assets.

i. For loss asset and unsecured portion of doubtful assets, the provision

requirement is 100 %.

------------------------------------------------------------------------------------------------------- 3 rd Day

Session No. 10 & 11 (Session II & III of Day 3) Session title: Ratio Analysis and Interpretation of Ratios for Internal

Control I. Session Objectives: At the end of the session, the participants will be

able to explain:

• The meaning of Ratio Analysis & its objectives

196

• The definition of Working Funds, Equity, Income, Costs, Yield,

Margin etc.

• Calculation of different types of Financial Ratios like Efficiency

Ratios and Ratios indicating the performance and their interpretation

• Preparation of MIS XV to XVIII

II. Duration of the session: 180 minutes III. Key Topics to be covered:

Key topics Time

allocation Methodology to be

adopted Slides to be used

Introduction, Objective of the session

5 minutes One slide

Definition of Financial Statements, Components, Parties interested in Financial statements

10 minutes

Interactive lecture and guided discussion

Four slides

Meaning of Ratio Analysis, Objectives, how to use ratios

15 minutes


Four slides

Terminologies – Working Funds, Net Worth, Income, Yield, Costs, Margins and their interpretation

30 minutes


Nine slides

Calculation of Efficiency Ratios, Performance Indicators and their interpretation

20 minutes


Six slides

Capital Adequacy Ratio and its calculation with case exercise

30 minutes


Three slides

Case Exercise on Calculation of different ratios and their interpretation

40 minutes

Hands on Practice Three slides

Preparation of MIS XV, XVI & XVIII

20 minutes


Eleven slides


10 minutes

Clarification & Recapitulation

IV. Performance aids required : 1. Black or white board, chalk pieces or



197



VI. Session guide

a. Introduce yourself and highlight the objectives of the session. To

recapitulate the learnings from the sessions on CAS, ask the participants

– What do you mean by Financial Statements? Who are the parties

interested in Financial Statements? – Write down the responses,

summarise them and flash slides Nos. 1, 2, 3 and 4.

b. Then ask the participants whether they have heard about the term

“Analysis of Financial Statements” & What are the objectives? Summarise

the responses and flash slides Nos. 5, 6 & 7.

c. Then list out certain terminologies like Working Funds, Net Worth, Income,

Yield, Cost, Margin etc., and ask them whether they have come across

such terminologies. Some participants may give some vague explanation.

Some may say that they have not heard about certain terms. Explain them

one by one slowly and ensure that the participants have fully understood

the concepts. While explaining flash the slides Nos. 8 to 16. While

explaining the concepts indicate the purpose of calculating the concerned

ratio.

d. Explain the Efficiency Ratios and Performance Indicators one by one and

indicate the purposes of working out those ratios. Ensure that all the

participants have understood the calculation of these ratios. Flash slides

Nos.17 to 22.

e. Ask the participants as to whether they have heard of the term “Capital

Adequacy”. Most of the participants may respond. List the responses and

explain the concept by flashing slide Nos. 23, 24 & 25. Show them the

198

calculation sheet and explain how to work out the Risk Weighted Assets.

Give them a small exercise on calculation of Capital Adequacy Ratio.

f. Indicate the statements to be prepared using the ratios. Explain each

statement one by one and the purpose for which they are prepared. Flash

slide Nos. 26 to 33 & 36.

VII. Learnings from the session:

� Ratio Analysis of Financial Statements is a mathematical tool to assess

the financial condition and performance of PACS.

� Ratios are relationships expressed in mathematical terms between

interconnected figures.

� Ratios are classified into Profit & Loss A/c Ratios, Balance Sheet Ratios

and Inter Statement Ratios

� Financial Ratios help the management to compare the cost with the yield,

decide the strategy for mobilizing resources, their deployment and profit

planning

-------------------------------------------------------------------------------------------------------

Session No. 12 (Session IV of Day 3) Session title: Concise Structure of Balance Sheet & Cash Flow

Statement I. Session Objectives: At the end of the session, the participants will be

able to explain:

• The concept of Working Funds and Equity

• Broad grouping of Accounts into Equity, Borrowings, Deposits,

Loans & Advances, Investments.

• Concept of Cash Flow and Utility of Cash Flow Statement

• Preparation of MIS – XVII & XIX

• Case Exercise on preparation of MIS XVII & XIX


199

III. Key Topics to be covered:

Key topics Time

allocation Methodology to be

adopted Slides to be

used Introduction, Objective of the session

5 minutes

Recap on the definition of Working Funds & Equity

5 minutes Interactive lecture and

guided discussion Two slides

Broad Grouping of Accounts into Equity, Borrowings, Deposits, Loans & Advances and Investments

10 minutes


One slide

Preparation of MIS – XVII and its utility

10 minutes


One slide

Case Exercise on preparation of MIS XVII

10 minutes

Hands on Experience

Concept of Cash Flow and its utility

10 minutes


One slide

Preparation of MIS XIX 15

minutes Hands on Practice Three slides

Case Exercise on preparation of MIS XIX

20 minutes

Hands on Experience


5 minutes Clarification & Recapitulation

IV. Performance aids required : 1. Black or white board, chalk pieces or





VI. Session guide

a. Introduce yourself and highlight the objectives of the session. To

recapitulate the learnings from the session on Ratio Analysis, ask the

participants – What do you mean by Working funds & Equity? – Most

of the participants would respond. List out their responses and clarify the

same in case the responses were not correct.

200

b. Then tell the purpose of MIS – XVII (concise structure of balance sheet)

and how to prepare them. Flash slide Nos. 34 & 35. Give them a balance

sheet of a society and ask them to prepare the statement. Ask any one the

participant to write the answer on the black board or white board and

discuss the same with the other participants.

c. Ask the participants as to whether they have heard the terminology

“Sources and Uses” of funds. Many may not respond. Ask them what are

the ways money comes into a society? List out the responses, summarise

them and explain the sources and uses of funds in a society. Also inform

them that the sources are called as Cash Inflow and uses are called as

Cash Outflow. Flash slide No.37.

d. Explain how to prepare the Cash Flow Statement or MIS – XIX and its

utility by flashing slides Nos. 38, 39 & 40. Administer a case exercise on

preparation of Cash Flow Statement. Compare the answers arrived at by

the participants with the answer given in the Trainer’s Guide. In case of

discrepancy, discuss the answer with the participants. Finally summarise

the learnings from the session.

VII. Learnings from the Session:

� Cash flow statement is a statement depicting the changes in cash

position from one period to another.

� It is useful for short term planning

� Cash Book and Bank Book are the sources for preparation of Cash

Flow Statement.

� It has to be prepared on a monthly basis and put up to the Board or

Managing Committee.

201

202

203

204

205

206

207

208

209

210

211

212

213

214

215

216

217

218

219

220

221

Answers to Work Book Exercises

8.12.1 Say True (T) or False (F)

a. Ratios are used as a yardstick for evaluating the financial condition and

performance of a society. (True)

b. Operating Cost means Interest Expenses plus provision for NPAs and

Standard Asset made. (False)

c. Net Income is defined as the excess of Gross Expenses over Gross

Income. (False)

d. Higher the NPA Ratio, poorer is the quality of assets. (True)

e. Capital Adequacy Ratio indicates the quality of capital. (False)

f. NPA is an asset which ceases to generate income to the society. (True)

g. Transaction Cost is also called as Financial Cost. (False)

h. Credit Deposit Ratio indicates the quality of credit and deposit. (False)

222

8.12.2 Fill in the Blanks

a. Business per Employee, Deposit per Employee and Loans & Advances

per Employee are called as Efficiency or Profitability Ratios.

b. NPA Ratio indicates the quality of loan portfolio.

c. Risk Cost indicates the quality of assets.

d. Capital Adequacy Ratio indicates the risk bearing capacity of the society.

e. If the Net Margin is positive, then the society earns net profit and if it is

negative, it incurs net loss.

f. For calculation of Average Working Funds monthly average figures of

balance sheet items have to be taken.

g. Cost incurred on raising resources is called Financial Cost.

h. A society is considered earning profit only when its Gross Income is more

than its Gross Expenses.

i. To increase the interest income, the society should increase the recovery

percentage of interest.

j. To reduce its interest expenses, the society should mobilize low cost

deposits

8.12.3 Complete the following

v. Operating Income = Interest Income plus Miscellaneous Income vi. Operating Cost = Interest Expense plus Cost of Management

vii. Net Interest Income = Total Interest Income minus Total Interest Expenses

viii. Operating Profit = Operating Income minus Operating Expenses (cost)

ix. Net Income = Gross Income minus Gross Expenses

x. Financial Margin = Average Yield on Asset minus Average Cost

xi. Net Margin = Net Financial Margin minus Transaction Cost

223

Case Exercise on calculation of ratios The Profit & Loss Account for the year 2006-07 and Balance Sheet of XYZ PACS

Limited as on 31 March 2007 are furnished below:

Profit and Loss Account for the Year 2006-07

Expenditure Amount

(Rs.) Income

Amount (Rs.)

Interest Paid & payable on Gross Profit 6,000

i) Deposits 1,078,000 Interest on Loans and Advances

1,933,000

ii) Borrowings 1,487,000 Income on Investments

Establishment & Other Expenses

Interest on Deposits with Banks

1,242,000

i) Salary & Allowances 295,000 Dividend on Other investments

152,000

ii) Management Expenses 5,000 Admission Fees 1,000

Rent, Rates, Electricity and Repair Cost on Premises

10,000

Insurance less prepaid insurance

0

Postage & Telephone Charges 1,000

Printing & Stationery 8,000

Audit Fees 2,000

Travelling & Conveyance Expenses

2,000

Depreciation on Properties 12,100

Other Expenses 2,000

Provision for NPAs 300,000

Provision for Standard Assets 100,000

Profit for the year 31,900

Total 3,334,000 Total 3,334,000

224

Appropriation of Profit

Expenditure Amount (Rs.) Income Amount (Rs.)

Accumulated Losses (previous year)

179,000 Profit for the current year

31,900

Balance of losses carried to Balance Sheet

147,100

Total 179,000 Total 179,000

Balance of XYZ PACS Limited as on 31 March 2007

Liabilities Amount

(Rs.) Assets

Amount (Rs.)

Capital Cash on Hand 3,000

Paid up – Individuals 1,085,000 Balances with DCCB

Paid up – Government 225,000 Savings Account 325,000

Reserves & Funds Investments

Reserve Fund 37,000 Term Deposits with DCCB

13,707,000

Grants and other Funds Term Deposits with DCCB – R F deposits

81,000

Subsidy meant for society 34,000 Shares in Cooperative institutions

762,000

Deposits Loans & Advances

Savings Deposits 6,263,000 KCC Loans - Rs. 12176000

Recurring Deposits 6,553,000 Loan against Deposits - Rs. 610,000

Term Deposits 1,540,000 Less: Provision for NPAs -Rs. 902,000

Borrowings Loans & Advances net of provisions

11,884,000

KCC Credit Limit 11,655,000 Closing Stock 47,000

Other Liabilities Fixed Assets net of Depreciation

Interest Accrued on Deposits 2,076,000 Land & Buildings 204,500

225


306,000 Furniture & Fixtures 41,400

Sundry Creditors 87,000 Other Assets

Other Liabilities 406,000 Interest Accrued but not due

414,000

Provisions Interest Receivable on Investments

2,740,000

Provision for Standard Assets

100,000 Sundry Debtors Rs.180,000/-

Provision for Outstanding Expenses

2,000

Less: Provision for Sundry Debtors Rs. 169000

Net Sundry Debtors 11,000

Prepaid Insurance 2,000

Profit & Loss A/c (Accumulated Loss)

147,100

Total 30,369,000 Total 30,369,000

From the above financial statements, workout the following:

1. Working Funds

2. Interest Income

3. Interest Expenses

4. Net Interest Income

5. Miscellaneous Income

6. Operating Income

7. Cost of Management

8. Operating Cost

9. Operating Profit

10. Gross Income

11. Total Expenses or Gross Expenses

12. Net Income (Net Profit)

13. Average Yield

14. Average Cost

15. Financial Margin

226

16. Transaction Cost

17. Net Margin

18. Risk Cost

19. Net Worth

20. Capital Adequacy Ratio

21. Credit Deposit Ratio

22. Ratio of Total Loans to Total Assets

23. Ratio of Total Deposits to Total Assets

24. Ratio of Operating Expenses to Average Total Assets

25. Ratio of Interest Earned to Interest Paid

26. Prepare Concise Structure of Balance Sheet

Answers to Case Exercise

1 Working Funds Working Funds = Balance Sheet total minus contra items, accumulated losses & fixed assets

Working Funds = 303,69,000 (-)147,100 (-) 204,500 (-) 41,400

= 299,76,000

2 Interest Income Interest Income = Interest Income received & receivable on Loans &

Advances and on Investments

= 19,33,000 + 12,42,000 + 1,52,000

= 33,27,000

3 Interest Expenses Interest Expenses = Interest paid & payable on Deposits and on Borrowings

= 10,78,000 + 14,87,000

= 25,65,000

4 Net Interest Income Net Interest Income = Interest Income (-) Interest Expenses

227

= 33,27,000 (-) 25,65,000

= 7,62,000

5 Miscellaneous Income Miscellaneous Income = Trading Profit + Admission Fees

= 6,000 + 1,000

= 7,000

7,000

Miscellaneous Income as a percentage to W Funds = -------------------X 100 299,76,000 = 0.02% 6 Operating Income Operating Income = Interest Income + Miscellaneous Income

= 33,27,000 + 7,000

= 33,34,000

7 Cost of Management Cost of Management = Salary & Allowances + Management Expenses + Rent,

Rates, Electricity & Repairs to Property + Insurance +

Postage & Telephone Charges + Printing & Stationery

+ Audit Fees + Travelling & Conveyance Expenses +

Vehicle Expense + Donations & Subscriptions + Other

Expenses + Depreciation on Properties

Cost of Management = 2,95,000 + 5,000 + 10,000 + 1,000 + 8,000 + 2,000 + 2,000 + 12,100 + 2,000

= 3,37,100 8 Operating Cost

Operating Cost = Interest Expense + Cost of Management

= 25,65,000 + 3,37,100

= 29,02,100

228

9 Operating Profit Operating Profit = Operating Income (-) Operating Cost

= 33,34,000 (-) 29,02,100

= 4,31,900

10 Gross Income

Gross Income = Interest Income + Miscellaneous Income + Capital Gains &

Other Income

= 33,27,000 + 7,000

= 33,34,000

11 Total Expenses or Gross Expenses Gross Expenses = Interest Expenses + Cost of Management + Risk Cost

(Provisions Made for NPAs)

= 25,65,000 + 3,37,100 + 4,00,000

= 33,02,100

12 Net Income (Net Profit) Net Income = Gross Income (-) Gross Expenses

= 33,34,000 (-) 33,02,100

= 31,900

13 Average Yield Interest Income Average Yield = ------------------------------------------- X 100 Average Working Funds 33,27,000 = --------------------------- X 100 299,76,000

= 11.1 %

229

14 Average Cost Interest Expenses Average Cost = ----------------------------------------- X 100 Average Working Funds 25,65,000 = --------------------------- X 100 299,76,000 = 8.56 % 15 Financial Margin Financial Margin = Average Yield on Asset (-) Average Cost of Funds

= 11.10% (-) 8.56%

= 2.54%

16 Transaction Cost

Total Cost of Management Transaction Cost = ---------------------------------------------- X 100

Average Working Funds 3,37,100 = ------------------------- X 100 299,76,000

= 1.12%

17 Risk Cost Provision required to be made against its NPAs for the year +

= Provision required to be made for standard assets for the year X 100 Average working funds

4,00,000 = --------------------------- X 100 299,76,000 = 1.33%

230

18 Net Margin

Net Margin is defined as Financial Margin plus Miscellaneous Income as a

percentage to Working Funds minus Risk Cost and Transaction Cost as a

percentage to Working Funds.

Net Margin = 2.54% + 0.02% (-) 1.33% (-) 1.12%

= 0.11%

19 Net Worth Net Worth = Paid up Capital + Free Reserves + Credit Balance in the

Profit & Loss A/c + Provision for Standard Assets (-) Accumulated Losses

= 10,85,000 + 2,25,000 + 37,000 + 1,00,000 (-) 1,47,000

= 13,00,000

20 Capital Adequacy Ratio Net Worth Capital Adequacy Ratio = ------------------------------------------- X 100 Risk Weighted Assets 13,00,000 = ------------------------ X 100 193,00,375 = 6.74%

Work Sheet on Calculation of Risk Weighted Assets

Sl. No.

Assets Amount

(Rs.)

Risk Weight

(%)

Risk Weighted Assets

(3 X 4) / 100

(1) (2) (3) (4) (5)

1 Cash on Hand 3,000 0% 0

2 Balances with DCCB

A In Current Account 0 20% 0

B In Savings Bank Account 325,000 22.5% 73,125

231

3 Balances with Other Banks

A In Current Account 0 20% 0

B In Savings Bank Account 0 22.5% 0

C Others 0 22.5% 0

4 Investments

A Government Securities 0 2.5% 0

B Shares in other Cooperative Institutions

762,000 102.5% 781,050

C Fixed Deposits with DCCB / Other Banks �

13,788,000 22.5% 3,102,300

D NSC / KVP 0 2.5% 0

E Staff P F balance with P F Trust / as Deposits with Banks

0 22.5% 0

F Others - Deposit with Marketing Societies

0 102.5% 0

5 Loans & Advances

A ST / MT / LT Loans to Members 11,884,000 100% 11,884,000

B Loans to staff covered by mortgage / superannuation benefits

0 20% 0

C Other Loans (Specify) 0 100% 0

6 Closing Stock 47,000 100% 47,000

7 Fixed Assets

A Land & Buildings, Godown 204,500 100% 204,500

B Furniture, Fixtures, Banking Counter, Computers & Electrical Installations

41,400 100% 41,400

C Vehicles 0 100% 0

D Agriculture Machinery 0 100% 0

8 Other Assets

A Interest Accrued but not overdue 3,154,000 100% 3,154,000

B Overdue Interest 0 100% 0

C Interest Receivable on Investments 0 100% 0

D Sundry Debtors 11,000 100% 11,000

E Other Receivable 0 100% 0

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F Amount involved in Frauds 0 100% 0

G Prepaid Expenses 2,000 100% 2,000

9 Total Risk Weighted Assets 30,221,900 19,300,375

21 Credit Deposit Ratio Total Loan Outstanding Credit Deposit Ratio = ---------------------------------------------- X 100 Total outstanding Deposit 118,84,000 = -------------------------------- X 100 143,56,000 = 82.78% 22 Ratio of Total Loans to Total Assets Total Loans & Advance Outstanding

Ratio of Total Loans to Total Assets = ---------------------------------------------X 100 Total Assets 118,84,000 = ---------------------------- X 100 302,21,900

= 39.32%

23 Ratio of Total Deposits to Total Assets Total Deposits Outstanding Ratio of Total Deposits to Total Assets = -------------------------------------- X 100 Total Assets 143,56,000 = --------------------------- X 100 302,21,900

= 47.50%

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24 Ratio of Operating Expenses to Average Total Assets Operating Expenses Ratio of Operating Expenses to Average Total Assets = ------------------------------ X 100 Average Total Assets 29,02,100 = ---------------------------- X 100 302,21,900 = 9.60% 25 Ratio of Interest Earned to Interest Paid Interest Received on Loans

And Advances & Investments Ratio of Interest Earned to Interest Paid = --------------------------------------- X 100 Interest paid on Deposits & Borrowings 33,27,000 = -------------------------- X 100 25,65,000

= 129.71%

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Duration : 3 days - bird-cpec.inbird-cpec.in/wp-content/uploads/2015/04/CAS-MIS.pdf · Duration : 3 days Target Group: ... norms and observations made by auditors. ... Prudential