Post on 13-Jan-2016
transcript
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Guidance Note on
Bank
Gaurav Dhamija
2
Index
S. No. Contents Page
No.
1. Objective 4
- 5
2. Authorized Signatories 6
- 8
3. Vouching 9 -
10
4. Control over Cheque Books 11 -
12
5. Bank Reconciliation Statement 13 -
15
6. Bank Interest & Fund Utilization 16 -
18
Gaurav Dhamija
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Index
S. No. Contents Page
No.
7. Bank Guarantee & Letter of Credit 19 -
20
8. Packing Credit / Bill Discounted /
Margin Money
21 - 23
9. Control over Fixed Deposits 24 -
26 Gaurav Dhamija
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1. Objective
Ensure
• All systems & procedures for making the
transactions with the bank are being
adhered to.
• Optimum Utilization & control of funds lying
in bank
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Objective Summary
• How much value addition we can
contribute to assure the management
that the system is full proof with remote
possibility of leakages and frauds.
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2. Authorized Signatories
• Obtain the list of authorized signatories
along with financial limits.
• Ensure list is approved by higher authority
and same has been updated at periodic
intervals.
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• Take the list of all bank accounts with their
- Nature and Limits
- Rate of interest
• In case any new bank account has been
opened / any bank account has been closed,
check the board resolution authorizing the
same. And ensure that closed bank
accounts
cheque books have been surrendered.
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• Ensure, in case an Authorized
signatory has left the organization, that
his name has been deleted and proper
information has been given to Bank.
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3. Vouching
Ensure
• All payments are authorized and are
within the authorization limits.
• All payments are duly supported and
marked “PAID” along with cheque no.
and date.
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• Cancelled Cheques are marked
“CANCELLED” and retained along with
the voucher.
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4.Control over Cheque
Books
Ensure
• All the cheque books are kept in safe
custody.
• Proper control is maintained for all
receipt
and issue of cheque books. Gaurav Dhamija
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• On all cheques “A/c Payee” stamp has
been affixed.
• Blank cheques are not signed.
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5.Bank Reconciliation
Statement
Ensure
• Bank Reconciliation Statement is prepared for
all banks on monthly basis.
• Balance shown in Bank Reconciliation
Statement is tallied with the balance as per
books.
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• Original Bank Statement is available in
all cases.
• Entries from bank statement to bank
book [names] especially contra entries
and cash withdrawl and deposit entries.
• Cheques issued/ cheques issued but not
yet presented for payment against which
6 months has been passed has been
reversed/ transferred to Stale cheques
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account.
• No entries are outstanding in Bank
Reconciliation Statement for more than
2 months.
• Person, doing Bank Reconciliation should
not make Cheque. And signatures are
taken on Bank Reconciliation Statement.
• Bank certificate is taken for closing balance
at end of financial year for all bank
accounts.Gaurav Dhamija
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6.Bank Interest & Fund
Utilization
Obtain
• List of all bank accounts and ensure
whether there are any idle balances
lying in bank accounts.
• List of limits available in all banks and
ensure the utilization there of.
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• Ensure that procedure of quickest
crediting of realization / receipts into
company Cash Credit account where
interest is being borne on daily balances.
• The list of bank charges and Bill / Hundi.
And ensure that whether they were
properly charged in Bill Discounting,
Demand Drafts, Bank Guarantee,letter of
credit etc.
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• List of interest rate on
- Cash Credit,
- Working Capital Demand Loan,
- Term loan and other loan
And ensure that interest is being borne by the
company according to agreement / standard
norms.
[Obtain and file sanction letters of all banks
along with date of sanction]
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7. Bank Guarantee &
Letter of Credit
Ensure
• Obtain the detail of Bank guarantees given by
the company.
• All guarantees are within the validity period
and were given only against requirement.
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• Expired bank guarantees have been taken
back.
• Letter of Credit were opened only as per
requirement and ensure that all terms and
conditions were taken care of. The
utilization of Letter of Credit along with the
amount for which it was taken should be
analyzed. And Scrutinize the Letter of
Credit amendment charges paid by the
company.
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8. Packing Credit / Bill
Discounting / Margin
Money
Ensure
• No Pendency.
• Periodicity of realization of Bill by the bank
with due dates.
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• Analyze the Overdue Interest charged by
bank on late realization of Bills and
reason
for non-charging of same from the
customers.
• Promptness in discounting of Bills.
• Analysis can be made from date of Bill of
Lading.
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• System of crediting and control over Post
dated Cheques issued by the division. Same
should be credited on date of payment only.
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9. Control over Fixed
Deposits
Ensure
• All Fixed Deposits are valid and in
possession of the division and is in name of
the company except where same is given as
security.
• Calculation of Interest is correct
• Provision has been taken on quarterly basis.
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• Control register of Fixed Deposits is being
maintained & updated on regular basis.
• Fixed Deposits are made to utilize the
excess funds and analyze the cost paid in
Interest in Cash Credit account and Bill
discounting Account in comparison to
interest received on Fixed Deposit.
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• System of collection of Outstation
Cheques along with charges charged by
Bank.
• Fast Collection scheme offered by various
banks have been availed by the division.
• Transfer of Funds into bank account are
within time.
Gaurav Dhamija