As the name says ‘computerised accounting’ is the use of computers, software, and hardware to process financial transactions and events and produce accounting reports: A computerized accounting system (CAS) automates financial records and reporting processes of financial transactions and events and produce reports based on user requirements. The process of financial transactions done through…
The Bank’s financial statements are prepared under the historical cost convention, on the accrual basis of accounting on a going concern basis, unless otherwise stated, and conform in all material aspects to Generally Accepted Accounting Principles (GAAP) in India, which comprise applicable statutory provisions, regulatory norms/guidelines prescribed by the Reserve Bank of India (RBI), Banking…
The term “accounting treatment” represents the prescribed manner or method in which an accountant records and presents a specific business transaction or event in the establishment’s financial statements. The accounting policies of Banks require banks to disclose the key areas of operations in one place (under Schedule 17) along with notes to accounts in their…
Many methods and techniques are used in the analysis of financial statements including profit and loss accounts. They include (i).Trend analysis (Historical standard): A comparison is done of current performance with past figures of the firm. (ii). External Standards: Comparison is done between the two business concerns of the same size, which can also be…
Financial statement disclosures are non-financial information that appears at the end of a financial statement. This information helps investors, lenders, and others make decisions. The Basel Framework’s Pillar 3 outlines a set of public disclosure requirements for internationally active banks. These requirements provide market participants with information to assess a bank’s capital adequacy and material…
Correct and accurate compilation of financial information and its disclosure, in a manner that is standardized and understood by stakeholders, is central to the credibility of the corporates including banks. The preparation of financial information and its audit is regulated by the banking regulator in India (RBI) with stringent penalties for non-observance. Accounting Standards serve…
Books of Accounts include documents and books used in the preparation of financial statements. It includes journals, ledgers, cash book,s and subsidiary books. The principal book of accounts in a bank is the General Ledger (GL), which is also known as the book of final entry. Banks maintain a general ledger that summarizes all financial…
A company’s cash flow and fund flow statements reflect two different variables during a specific period. The funds flow statement takes both cash and non-cash items for accounting. A funds flow statement is useful to study the funds exactly available for working capital from long-term sources. It also enables the assessment of an entity’s ability…
In accounting there are generally four different kinds of financial statements namely the balance sheet, the income statement, the cash flow statement, and the fund flow statement. Here, we delve into the last two. The Cash flow statement represents the actual inflow, and outflow of cash, and the increased or decreased position of cash and…
The Indian Accounting Standards (Ind AS), as notified under section 133 of the Companies Act 2013, were first implemented voluntarily in India on April 1, 2015. They became mandatory for certain companies on April 1, 2016, and were later extended to other companies and sectors. The main objective of Indian accounting standards (Ind-AS) is to…