ubl report

By: M.Noman Iqbal

1011111

BBA-II-A

Acknowledgement

Firstly I would like to thank Sir Darryl Pereira for great support which helped me

to complete this report successfully. Would really thank you for providing us the

best knowledge during the lectures up till now and for answering all the queries

related to the report

Secondly I would like to thank the MACHS UBL branch manager Miss samina

saleem khan for giving out the useful information related to UBL which helped to

complete the report

2 | P a g e w h e r e y o u c o m e f i r s t

Introduction ………………………………………………………………………5History…………………………………………………………………………….5Key people………………………………………………………………………...7Organizational hierarchy or management flow chart……………………………..9Branch hierarchy…………………………………………………………………10Accounting flow chart……………………………………………………………11Services

UBL WIZ………………………………………………………………….12 UBL Netbanking…………………………………………………………..17 UBL e-statement…………………………………………………………..20 UBL Hamrah………………………………………………………………21 UBL wallet………………………………………………………………...22 Remittances………………………………………………………………..25

Types of deposit account

UBL Business Partner (Current Account)………………………………….26 Rupee Transactional Account (RTA)……………………………………....28 UBL Basic Banking Account (BBA)……………………………………....30 UBL UniFlex Account……………………………………………………..31 UBL UniSaver Account……………………………………………………33 Foreign Currency Savings………………………………………………….34

Accounting policies and standards………………………………………………..35

Departments

Account opening department………………………………………………40 Clearing department………………………………………………………..40 Accounts department……………………………………………………….41 Cash department……………………………………………………………45 Credit department…………………………………………………………..48 Home finance department………………………………………………….48 Car finance department…………………………………………………….48

Accounting procedures


fixed assets…………………………………………………………………49 current assets……………………………………………………………….51 contra assets………………………………………………………………...52 current liabilities……………………………………………………………54 long-term liabilities………………………………………………………...55 share capital………………………………………………………………...56 Reserves……………………………………………………………………56

Internal auditing…………………………………………………………………...57

Verification of accounts…………………………………………………………...60

Balance sheet

Income statement

Cash flow statement


Introduction:

United Bank Limited is the 2nd largest Commercial Bank of Pakistan. Its main

Industry is Finance. It has total assets of more than Rs. 550 bn. It has 1079

branches in Pakistan.

It has 700 online branches in 400 cities almost in every city of Pakistan. It has 383

ATM machines of its own. It is the member of 1 link due to which its cards (Debit

& Credit) are acceptable on more than ATM’s. Also it Has joined hands with Visa

Network due to which its cards are Acceptable at 900,000 ATM’s worldwide.

It has 17 branches overseas which are located in different countries Of the world.

I.e. United States of America, Canada, China, Iran and so On. Its representative

offices are in Tehran, Kazakhstan, and China. It Has joint venture with National

Bank of Pakistan in United States of America by the name of United National

Bank Limited.

History

The decision to establish UBL was taken in June 1959 and the company was

registered on July 24, 1959. United Bank Limited started the operations on

November 7, 1959. On 9th November 1959 the Gazette of Pakistan notified and

included UBL in its list of scheduled banks operating in Pakistan. The bank

continued its operations as private banking company until 31st December 1973


when it was nationalized by the government of Pakistan. (Regime of Bhutto) The

bank was working as nationalized bank when the government decided to privatize

some banks. So the privatization program started in 1991.

· 51% of the smaller Muslim Commercial Bank successfully sold.

· Thereafter, via an employee buyout, the smallest Allied Bank sold.

· Privatization of the larger but more problematic United Bank successfully

attempted 3 times between 1991 & 1996. Meanwhile its condition continued to

deteriorate and the market share fell from 27% to 7%. At the end of the year 1996

the bank had:

· Negative Equity

· Heavy and continuing operating losses due to:

Overstaffing, 21,500 employees

Over branching, 1,701 branches

NPLs (Non performing loans), 60% of total loans

· A lack of systems and controls across the board.

· Demoralized staff, declining deposits and market share. Now the management

decides to take some preventive steps to make the performance better and to put

united bank on a progressive track once again. So they made a strategy consisting

of three phases:

· Phase one: (Jul – Dec 97)

Stem the Bleeding

· Phase Two: (Jan – Jun 98)

Create Key Building Blocks

· Phase Three: (Jul 98 Onwards)

Consolidate and position for growth


So according to the strategy they first focus on key people. They made strong

board of directors by hiring people from Private sectors and also took CEO’s from

major local and foreign companies. They change 33 key positions and identify

internal seniors to retain and drive change. They downsize the staff from 21,500 to

8,525 in order to cut the costs. They reduce the number of branches from 1,701 to

1,112 and focus on rationalization of branches and zones. They arrest the NPL’s

and block 80,000 deposits in default. They start rebuilding overseas network. They

facilitate the recovery of bad debts by setting up specialized remedial management

units. They implement technology plan by making the zones or regions PC based.

They then build overseas franchises, develop strategies, staff up, clean out NPL’s

and improve the services. They deepen corporate banking efforts and implement

SME strategy to protect top consumer relationships. Due to all these steps the

market share quickly increased from 7% to 10% and the performance improved.

The overall purpose was to reposition it for privatization. In 2002 the government

of Pakistan sold it in an open auction, main sponsors include Abu Dhabi group and

Best Way group having 25.50% of its shares each. While the balance is held with

the government of Pakistan and the general pUBLic. In 2002 it merged its

operations in the UK with those belonging to National Bank of Pakistan to form

United National Bank Limited, of which it owns 55%, with National Bank of

Pakistan owning the remainder. Since its privatization the bank has been

successfully turned around and remains a robust and strong performer in all major

segments of its operations.

Key People:7 | P a g e w h e r e y o u c o m e f i r s t

Key People of United Bank Limited Bank includes:

· His Highness Sheikh Nahyan Mabarak Al Nahyan – Chairman

· Sir Muhammad Anwar Pervez – Deputy Chairman

· Agha Hasan Abidi – Founder

Board of Directors:

· His Highness Sheikh Nahyan Mabarak Al Nahyan – Chairman

· Sir Muhammad Anwar Parvez OBE – Deputy Chairman

· Atif R.Bukhari – President & CEO

· Mr. Omain Zaid Jafar Al Askari – Director

· Mr. Zameer Muhammad Chaudrey – Director

· Mr. Ahmed Waqar – Director

· Dr. Asfhaque Hasan Khan – Director

· Mr. Aqeel Ahmed Nasir – Company secertary & Chief Legal

· Mr. Abdul Rauf Malik – Director

· Mr. Ameer Karachiwala – SEVP/Group Chief Financial Officer

· Mr. Ejazuddin – Group Executive/Audit & Inspection Group

· Mr. Salahuddin Khan – AVP

Executive Committee:

·atif R.Bokhari– President & CEO

· Mr. M.A. Manan – Group Executive Consumer/Commercial

Banking

· Mr. Numan Hussain – Group Operations & Technology Head

· Miss. Risha Mohyeddin – Group Executive Treasury & Capital

Markets

· Mr. Ameer Karachiwala - Group CFO


Organizational hierarchy


Chairman

board of directors

cheif executive officer

executive commitee

executive incharges

Branch hierarchy


Cheif manager

manager operations

accounts department

cash department

account opening department

remittences department

clearing department

manager international

banking

imports department

exports department

foreign exchange department

manager credits

leasing department

home finance department

car finance department

credit card department

Internal audit department

marketing department

Accounting flow chart


General ledger

Accounts receivable

Accounts payable Order entry

Pay roll

Cost accounting

Inventory control Fixed assets accounting

Services:

UBL has taken progressive steps and has introduced innovative products and

services to provide you a variety of banking and financing services. As an

individual or a group you can get much through UBL Services. You can Utilize the

following services:

UBL WIZ

UBL Netbanking

UBL e-statement

UBL Hamrah

UBL wallet

Remittances

UBL Online (for corporate customers only

UBL Wiz:

UBL Wiz is Pakistan’s first ever Prepaid VISA Debit Card that provides the

convenience, security and benefits of an ATM and Debit Card, locally and

internationally. More than just an ATM card, you can use your UBL Wiz

everywhere VISA cards are accepted. Whether you are using it online, paying for

petrol, shopping or dining, you are accessing money directly from your prepaid

card, without having to visit the bank. It is available is three types. i.e UBL Wiz

Travelers, UBL Wiz Ladies, & UBL Wiz Teen.


Features & Benefits:

UBL Wiz is the 1st Prepaid VISA Debit Card in Pakistan. It is instantly available

at selected UBL branches with the facility of re-load, allows you to spend online

and at shopping outlets and withdraw cash at ATMs. It is also accepted at all VISA

locations internationally. It offers the following amazing features:

Available to All CNIC Holders:

All valid CNIC holders in Pakistan can own a UBL Wiz Prepaid VISA Debit Card.

There is no need of an account mean that no matter if you do not have account in

UBL, still you can have UBL Wiz. An individual can purchase up to three cards at

a time on his/her CNIC - one of each category, i.e. a person can have a single UBL

Wiz Ladies, UBL Wiz Teen and UBL Wiz Travelers card at any given point in

time.

24x7 Toll Free Contact Centre:

If you have any queries or need assistance with your UBL Wiz card, you can talk

to an agent at our 24 hour Contact Centre at 0800-11-825. You can also use the

telephone next to all UBL ATMs and be instantly connected to our customer

service representative via a hotline facility.

UBL Wiz - Your ATM Card:

UBL has its own network of 336 ATMs in 85 cities, which continues to expand by

the day. Moreover, UBL is also part of the 1 Link, MNET and VISA networks.

These allow you to use your UBL Wiz across Pakistan at more than 3,000 ATMs

displaying the 1 Link and MNET logo and at more than 2 million ATMs in 150


countries. The UBL Wiz card is also accepted on all VISA certified machines

displaying the VISA Plus sign.

Online Shopping:

UBL Wiz provides you convenience and security to shop online. In order to

activate your card for online transactions, you will need to sign up for the facility

and enable your card.

UBL e-statement Facility:

UBL e-statement give you the flexibility to choose how frequently you want to

receive your e-statements i.e. daily, weekly, monthly, quarterly or semi-annually.

This facility is available absolutely free of cost for Wiz card holders!

Balance Enquiry:

You can check the available balance in your account at any UBL, 1 Link or MNET

ATM and get a slip of your account balance.

Card Limit:

UBL gives certain limit in three types of UBL Wiz cards that best fits you financial

needs. The catagerization is as follows

UBL Wiz Travelers VISA:

· Max balance per card Rs.200,000/-


· Loading / Reloading per instance Rs.100,000/-

· ATM withdrawal per day Rs.40,000/-

· POS usage per day Rs. 100,000/-

· Internet usage per day Rs. 100,000/-

UBL Wiz Ladies VISA:


· Loading / Reloading per instance Rs.25,000/-

· ATM withdrawal per day Rs.20,000/-



UBL Wiz Teen VISA:



· Loading/Reloading per instance Rs.10,000/-

· ATM withdrawal per day Rs. 20,000/-



Fee Structure:

·Card Issuance Rs. 100/-

+ 10% FED

·Re-load fee 0.1%, Min Rs.

50/- + 10% FED

· Switch Transaction Fee

Withdrawals on 1 Link ATM other than UBL Rs.15/-

Withdrawals on other switches Rs. 15/-

·International VISA Usage Charges

ATM Withdrawals 2%, Min

Rs.200/-

POS Purchase 2%, Min

Rs.200/-

·Internet Usage

Activation Charges 0 (zero)

Per session Charges Rs. 100/-

·Cancellation Charges Rs. 100/-

+ 10% FED

UBL Net banking:


UBL net banking is an Internet Banking portal offering a simple, convenient and

secure method of accessing bank accounts on the Internet. It's never been so easy

to access and manage your finances in a secure, real-time, online environment;

Anywhere, Anytime. Using UBL netbanking , the customers have access to their

bank accounts 24 hours a day, 7 days a week and can keep a close eye on their

account balances, print account statements, pay bills, transfer funds, track

purchases and schedule

their recurring payments at the touch of a button and much more.

Features & Benefits:

Using UBL Netbanking, you can avail different facilities and can benefit yourself

in many ways. Some of the features are discussed as follows:

Manage your Account:

Simple and intuitive 24/7 access to your accounts. You can keep an eye on cash

flows, transactions and check real-time account balances.

Send Money to Anyone using the new PC-to-Person facility:

UBL Netbanking is the first netbanking service in Pakistan to give you the power

to send money to anyone in Pakistan; even if they do not have a bank account at

UBL. You can either send money to another UBL customer through Account-To-

Account transfer, or get a TezRaftaar cheque delivered at payee’s doorstep just

within 48 hours anywhere in Pakistan.

Real-Time Account Balance & Summary:

UBL Netbanking offers easy, 24-hour access to the account information. The

customers can see an overview of the listed accounts in a summarize form with the

available account balance. Using netbanking, the customer can also keep an eye on


their cash flows, transactions and check their balances before paying their bills or

scheduling a transfer.

Manage Multiple Accounts:

Using netbanking, the customers can manage more than one account. All accounts

are linked, which enables them to perform fund transfers and set auto transfers

between these accounts.

vPay your Bills online:

Pay Bills online to a growing list of billers. netbanking offer the convenience to

pay PTCL, Mobilink Indigo, Paktel & Instaphone Bills online. Customers can

make instant payments or schedule their recurring payments on monthly or weekly

basis. The payment can be made from any of the listed

Customer account.

Transfer Funds between your accounts:

Customers can make instant transfers within their portfolio accounts. Having

details of Debit & Credit accounts with amount to be transferred, the customer can

instruct payments as per his own convenience. All transactions that are either

rejected or are still in processing are displayed in the Pending/Rejected

transactions.

Schedule your Recurring or one-off Payments:

Customers can schedule monthly, weekly, annual and time-factor based payments

through netbanking . The customer is only required to select the debit and credit

accounts, specify funds and define the fund transfer frequency. The Auto Transfer

Instructions can be deleted and modified by the customer as per his convenience.


View Account Statements:

Customers have the option of specifying a date range to view the account

statements. The Customers can also print, email and analyze the statement in a

graphical chart.

Receive Customized Alerts:

Customers can set alerts to track movements in the listed accounts. The customer

can assign a target for alerts.

Alerts can be of the following types.

· Balance Alert

· Statement Alert

· Transaction Alert

· Cheque Tracking Alert

· Low/High Balance Alert

Customers can perform all the above transactions and more, from the comfort and

convenience of your home or office internet connected computer, at any time of

the day or night.

Advanced Security Features:

· End-to-end encryption: Verisign-Certified 128-bit SSL Encryption

· Partial Token Authentication: Never reveal your entire password

· Choose your transaction limits: Fund-transfer limits are set to ‘zero’ by default.

You can request a change in your limit online (choose from Rs. 0.0 to a max of Rs.

100,000 per transaction.

· Human –assisted verification: When you request an increase in your transaction-

limit for the first time, we call you at your “registered” phone/mobile number and

confirm your request.

UBL e-statement


Are you fed up of filing your Statement of Accounts? Do you want fast

delivery of your Account Statements? Do you want to be in constant touch

with your account?

UBL brings a simple solution to all your problems by introducing the UBL e-

statements facility. UBL is pleased to announce the launch of the UBL e-statement

facility which makes it easier for you to get your statement of accounts and

automated transactional debit/ credit alerts right into your inbox. Available for all

Rupee and Foreign Currency Account holders, you now do not have to wait for six

months to receive a paper based statement of your account any more. All you need

to do is tell UBL the frequency of statements you require and UBL will ensure that

it reaches your inbox.

Absolutely free of cost:

You don’t need to pay any additional cost in order to get benefit from this facility.

UBL believes in providing value added service to customers and all you need to

get started is your email address!

Accessible when you need it:

UBL e-statement provides you a highly convenient facility to receive your

statement anytime and anywhere in the world!

Security:

As an alternative to printed statements, UBL e-statements eradicate the hassle of

paperwork, box filling and the chance of having your unattended documentation

read by others.!

Receive bill statements according to your needs:

Your UBL e-statement can be delivered to you in the following frequencies

· Daily

· Weekly


· Monthly

· Quarterly

· Semi – annually

Automated transactional debit/ credit alerts:

Whenever there is an activity in your account, an email shall be sent to you with

the complete transaction details.

Easy to read format:

You UBL e-statement shall be sent to you in an easy to read Adobe Acrobat

format.

Note: Once you subscribe for the facility, you will receive your statements as per

your selected frequency.

UBL Hamrah:

UBL has always been at the forefront in identifying and meeting the financial

needs of its valued customers. UBL was the pioneer in introducing Rupee

Travelers Cheque facility in Pakistan, as early as 1971. In continuation of the same

tradition, UBL in the shape of "Hamrah" Rupee Travelers Cheque enhances this

facility for the convenience of its valued customers by offering denominations up

to Rs. 10,000.

UBL "Hamrah" has been designed keeping in mind, both convenience and

security - be it business, property, trade or personal needs. "Hamrah" Rupee

Traveller Cheques are the ideal and safest way of carrying cash when travelling

anywhere in Pakistan.

Hamrah RTC's are now accepted at more than 2000 places such as hotels, shops,

real estate agents, jewelers, car dealers, etc and of course at all our UBL branches.

UBL has a 24-Hours customer helpline, providing its customers with round the

clock tele-verification of "HAMRAH" traveler’s cheques.


Salient Features:

· Absolutely FREE - No Bank Commission, No Excise Duty:

Whatever the value of "Hamrah" purchased, no Bank Commission or Excise Duty

will be charged.

· Denominations:

Avai lable in denominations of Rs. 10,000 and Rs. 5,000.

· Available to all:

Holding an account with UBL not mandatory for availing this facility.

· Easily transferable and encashable:

Indicate choice of designated UBL Branch for refund which will be within days

only. Most convenient while in transit anywhere in Pakistan.

· Valid until encashed:

Use them for a week, month or even years depending on when there's a need for

encashment

· Exclusive security:

Secured with specially "Coded" printing and "RAIN BOW Effect" for added

security.

UBL Wallet:


Introducing the new UBL Wallet Card, now with the International power of VISA.

UBL Wallet, now with the power and international acceptance of VISA! Your

Wallet VISA ATM & Debit Card has all the convenience and security you desire

and the quality you deserve. This Wallet holds all the cash in your bank account.

Available to All UBL Account Holders:

UBL offers ATM and Debit Card facility to all account holders at all UBL

branches anywhere in Pakistan, regardless of whether their branch is online or

offline.

Nine Supplementary Cards:

UBL Wallet VISA also gives you the facility of having up to 9 supplementary

cards issued against one primary card. All supplementary cardholders will be able

to conduct

ATM/Debit transactions within the limits of the primary card account.

24 x 7 Toll-Free Contact Center:

UBL's dedicated staff is at your service 24 hours a day, 7 days a week. You can

call at UBL’s contact center at 0800-11-825 (Toll Free), or you can simply pick up

the telephone placed next to all UBL ATMs and be instantly connected to our

customer service representative via a hotline facility.

UBL Wallet Your ATM Card:

UBL already has its own network of 336 ATMs in 83 cities, which continues to

expand by the day. Moreover, UBL Wallet is now part of the 1 Link and VISA

networks. These allow you to use your UBL Wallet VISA across Pakistan at more

than 925

ATMs displaying the 1 Link logo and at more than 1 Million ATMs in 150

countries. It is also acceptable on the MNET network of ATMs in Pakistan.Your


Wallet VISA Card will also be acceptable on all local VISA certified machines

displaying the VISA Plus sign.

UBL Wallet Your Debit Card:

With UBL Wallet VISA as your debit card, you can shop all you want, eat all you

can or fill up your car tank without carrying any cash. Simply use your UBL

Wallet VISA for

direct debit from your bank account, along with the convenience of using signature

based verification instead of a PIN (Personal Identification Number). The debit

card facility is being offered in association with the Orix andVISA networks,

which means that you can use your UBL Wallet VISA to conduct a debit

transaction at any

outlet in Pakistan that displays the ORIX or VISA logos. The Orix network offers

connectivity at more than 5,000 outlets across the country, whereas your UBL

Wallet VISA card is also acceptable at 22 million VISA merchant locations, local

and international.

Funds Transfer:

UBL Wallet VISA allows three kinds of instant funds transfer through UBL ATMs

from your UBL account:

1. Into any of your UBL account.

2. Into any other UBL account.

3. Into any other participating 1 Link bank (through the new UBL Inter Bank

Funds Transfer facility). On confirmation, the amount from the cardholder account

is instantly transferred to the beneficiary account.

Balance Enquiry:

Enquire about the availability of funds or simply get a printout of your account

balance.


Mini Statement:

Get a printed statement of your account that shows all recent transactions.

Fast Cash:

Swiftly withdraw your desired amount by selecting from one of the options of

listed denominations.

Annual Fee (Rs.):

Card type primary Supplementary

Gold 500 250

Silver 300 150

Remittances (UBL Tez Raftaar):

Free Doorstep Remittances With-in the country or from abroad, UBL offers the

most efficient and price competitive service. With our large network of branches,

we are

poised to offer you service almost at your door step. UBL's new remittance service,

TezRaftaar offers all overseas Pakistanis the fastest and the most convenient

delivery of their money to their beneficiaries in Pakistan. Best of all, TezRaftaar is

completely cost free and is available at all UBL branches along the Bank's

Network in

the Middle East, UK and US.

Check out it's great benefits:

Free of charge transfer service.


Open to all including those who are not UBL account holders.

Types of accounts maintained in UBL:

UBL Business Partner (Current Account)

Rupee Transactional Account (RTA)

UBL Basic Banking Account (BBA)

UBL UniFlex Account

UBL UniSaver Account

Foreign Currency Savings

UBL Business Partner (Current Account):

It’s a current Account offered by UBL. UBL has 700 online branches in 400 cities,

so your account moves with you wherever you go. Access your account from over

700 online branches in over 400 cities all across Pakistan for unlimited online

transactions. Enjoy total convenience at any online branch with:

· Instant Cash Deposits & Withdrawals.

· Country Wide Instant Funds Transfer.

· Issuance of Pay Order, Demand Draft & Telegraphic Transfer.

· Instant Cheque Clearance for all UBL Cheques.

· Speedy clearing and collection of any non UBL cheque in any Online UBL

branch.

· Statement of Account Issuance / Balance Inquiry / Stop Payment of Cheques.

Convenience of 9-5 Non-Stop Full Service Banking:

Be it morning, afternoon or evening. UBL Business Partner is your banking

companion at all UBL branches across Pakistan. Walk-in anytime at any UBL

branch and have the


convenience of 9 to 5 non-stop banking:

· Rupee Deposits & Withdrawals (both cheque & cash)

· Issuance of Pay Order, Demand Draft & Telegraphic Transfer

· Locker Access

· Foreign Currency Cash Deposits & Withdrawals

· Utility Bills Payment

· Consumer Loans / Credit Card Payment

· Foreign Currency Traveler’s Cheque/Demand Draft

· Statement of Account Issuance & Balance Inquiry

· Issuance of Hamrah Rupee Traveler’s Cheques

The Current Account that offers FREEdom:

UBL Business Partner comes with unmatched free offers. We truly value your

partnership and believe in offering you the preference you deserve. Now

individuals and sole proprietorships can become our preferred Business Partner by

maintaining Rs. 250,000/- or above in their current account and get the following

services absolutely free!

· Unlimited Real Time Online Transactions

· Issuance of Pay Order, Demand Draft & Telegraphic Transfer

· UBL Wallet ATM/Debit Card

· Cheque Book

· Collection / Clearing of Cheques

· Lockers, small, medium and large (subject to availability)

· No Cheque Return Charges

· 50% discount on UBL Credit Card Annual Fee


If you have the amount and want to search a safe place for that to deposit, the UBL

is the best place for you. Be UBL business partner and enjoy all the benefits it is

offering.

Rupee Transactional Account (PLS Savings Account)

If you choose to keep a deposit in a secured savings account which also gives an

attractive rate of return, then UBL’s PLS Savings Account will serve all your

financial needs. By keeping your deposits in UBL’s PLS Savings Account you can

also avail the following services:

Special features are:

· No limitation on withdrawals

· Share of profit is credited on half-yearly basis

· Profit is calculated on monthly balance

· UBL offers free accidental and permanent disability insurance to individual and

joint account holders

683 branches 400 cities. Your Account in every one of them:

Access your account from more than 683 online branches in 400 cities and towns

across Pakistan. Our network is growing at an amazing pace and now you can avail

services like:

· Issuance of Pay Order, Demand Draft, Money Transfer & Telegraphic Transfer

· Country Wide Instant Funds Transfer

· Country Wide Instant Deposit / Withdrawal (both Cash & Cheque)

· Issuance of Statement of Account/ Balance Inquiry

· Stop Payment of Cheque

· Speedy OBC process for cheques of other banks within & inter city


Now customers can deposit all UBL and non UBL cheques in any online UBL

branch for clearing or collection.

9-5 Non-Stop Banking:

Banking at your own convenience has been made possible. UBL now offers 9-5

Non-Stop Full-Service Banking at all of branches (above 1000) across Pakistan.

You can avail the following

Services:

· Cheques / cash (FCY & PKR) deposit & withdrawals

· PO / DD / RTC issuance (all local currency remittance transaction) against cash

· Utility bill payment

· Statement of Account issuance

· Locker operation

· Foreign currency TC / DD issuance against cash

Note: No FC trade or TT transactions are allowed in the second half of the day.

Countrywide Instant Cheque Clearance:

Submit a cheque in Karachi and get it cleared in Peshawar within minutes. With

online banking services, you can get your cheque cleared instantly, without any

hassle.

Instant funds transfer:

Funds transfer was never this easy. Make payments or receive payments within

minutes using our online facility. With the introduction of Internet Banking now

funds transfer is even made easier and is just a click away.

Note: Zakat & WHT will be applicable as per Government rules.

UBL Basic Banking Account (BBA)


To accommodate the banking needs of low income groups, United Bank Limited is

pleased to launch the UBL Basic Banking Account Scheme (UBL BBA) from

February 25, 2006 across its branch network all over Pakistan. This is primarily

aimed toward helping the low income group to benefit from the banking services

without having the pressure to maintain specific balance amount with the banks.

Find below basic product features of the Product:

Special features are:

· The minimum initial deposit at the time of account opening is to be Rs. 1000/-

· There is no minimum balance penalty on UBL BBA accounts,

however all accounts having nil balance for a continuous six month period shall be

closed.

· Maximum of two deposit and two withdrawals (cash or clearing) per month are

allowed free of charge. However, any transaction (cash or clearing) after those

mentioned above will be charged a flat fee of Rs. 50/-, in addition to the regular

charges of services as per SOC. This charge will be system generated end of day,

once the customer exhausts his free transaction limits.

· BBA customers will be allowed unlimited free ATM withdrawals from UBL’s

own ATMs. However, withdrawals from other banks’ ATMs will be charged as

per the existing SOC (currently Rs. 15/- per transaction). Annual fees including

issuance and renewal of ATM card will be charged as per existing Schedule of

Charges (SOC).

· The statement of account will be issued once a year for UBL

BBA customers in June. Issuance of duplicate statement will entail a charge of

Rs.50/as per SOC.

· Like the regular Current accounts, UBL BBA will also be Zakat Exempt

accounts. Any existing customer wanting to convert his/her checking account into


Basic Banking Account can do so by giving a written application to the Branch

Manager upon which existing account will be closed and a new UBL BBA account

will be opened and a new account number will be provided to the customer after

due account opening procedures, including submission of CNIC, if not provided

earlier. The deposit in the previous account will be transferred to the newly opened

UBL BBA. Charges for closing any existing account shall be recovered as per

SOC.

UBL UniFlex Account

UBL has introduced a new checking account ideal for small investors, traders,

businessmen and customers from middle income group. They can now afford an

amazing rate of return plus value added benefits only available from the UBL

UniFlex PLS Savings Account. By having a UBL UniFlex Account, you can avail

the following:

· Amazing rate of return.

· Convenience of a cheque book.

· Power of Wallet VISA ATM / Debit Card.

· Online Banking Facility.

Terms & Conditions:

· All individual and joint account holders and sole proprietorships are eligible for

the UBL UniFlex Account (scheme); Corporations and partnerships are ineligible

for the scheme.

· Only one UBL UniFlex account per Computerized National Identity Card (CNIC)

shall be allowed to be opened in UBL, regardless of the branch; no doUBLing shall

be allowed even as joint account or sole proprietor.


· The Bank shall determine from time to time the rate of interest/return/profit

payable on the account/deposit in accordance with the prevailing profit and loss

sharing rules

and regulations of the State Bank of Pakistan and the policies of the Bank which

are subject to change from time to time and the account holder/depositor agrees to

accept such rate of interests/return/profit at the time such change was made.

· If the minimum balance touched during any calendar month exceeds

Rs.200,000/-, interest/return/profit shall only be paid on Rs.200,000/- and no

interest/return/profit will be paid on the amount exceeding this limit.

· Interest/return/profit shall be accrued monthly, based on minimum balance

touched during the month, and disbursed six monthly directly into the UniFlex

account.

· The UBL UniFlex account cannot be overdrawn.

· Accounts that are closed in the middle of a month will not be eligible for any

interest/return/profit for the broken period of that month.

· Wallet VISA card is optional; charges as per Schedule of Bank Charges (SOC).

· Regular checkbooks shall be provided as per Schedule of Bank Charges (SOC).

· Customer can only conduct a maximum of two withdrawal transactions in a

calendar month (inclusive of all instruments). These withdrawals include but not

limited to Net banking, cash withdrawal by ATM, cash withdrawal over the

counter, Inter Bank Funds Transfer (IBFT), clearing, collection, Online banking,

Tez Raftaar, Tez Ibex, MT/DD/TT/PO/Online (UniRemote), RTC, etc. Any

withdrawals more than prescribed limit of two transactions shall attract 0%

interest/return/profit on the entire balance amount in the said month.


· All single debit incidents to an account will be considered as separate transactions

except deductions by the bank for charging service fee, Withholding Tax and Zakat

deductions.

· The UniFlex Account Holder shall be required to maintain the minimum balance

requirement of Rs. 10,000/- during each calendar month. Service charges where

the average balance during the month is less than Rs.10,000/- shall be applied as

per the Schedule of Bank Charges (SOC).

UBL UniSaver Account:

UBL UniSaver Account is an innovative way of serving your banking needs. Be it

trade, business or personal finance, the UBL UniSaver allows you maximum

flexibility, yet gives you optimum returns.

Special Features are:

· Innovative and flexible checking account.

· Attractive rates of return.

· Profit is calculated on monthly average balance.

· Profit payment is on six monthly basis.

· Higher returns on higher balances.

· Backed by the bank awarded AAA Credit Rating.

Please Note the Following:

· All rates are indicative and subject to change without any prior notice.

· The method of calculating return/profit under the profit/loss sharing scheme is

governed by the Bank Rules under prevailing regulations/directives of the State

Bank of Pakistan.

· Zakat & WHT will be applicable as per Government rules.


Foreign Currency Savings Account:

If you wish to maintain a secured foreign currency savings account then UBL is

the safest and most secure investment. By opening a UBL foreign currency savings

account you can have the following benefits:

Special Features are:

· Choose from different range of currencies i.e. US Dollars, British Pounds, and

Euros etc.

· There are no cash handling (Cash Deposit & Cash Withdrawals) charges from the

customers.

· Avail different attractive rates depending on the currency you choose.

· Get the pleasure of availing the best rates of return in the market.

· Unlimited withdrawals and deposits, making it easier for you to fulfill your

routine business needs.

· Avail the services and facility of 9 - 5 non stop full service banking in all foreign

currency handling branches such as foreign currency traveler cheque and demand

draft issuance against cash and foreign currency cash deposits and

withdrawals.

· You can withdraw funds in either foreign currency or in Pakistan Rupees,

whatever your requirement may be.

· You get to take your profit home every six months.

· Zakat exempted

UBL offers the widest reach across the country with an increasing number of more

than 228 foreign currency dealing branches. It also offers free accidental and

permanent disability insurance to individual and joint account holders. So do not


waste time any more be UBL customer and avail numerous benefits and financial

services.

Please Notice:

· All rates are indicative and subject to change without any prior notice.

· The method of calculating return/profit under the profit/loss sharing scheme is

governed by the Bank Rules under prevailing regulations/directives of the State

Bank of Pakistan.

· WHT will be applicable as per Government rules.

Accounting policies and standards maintained in UBL

Legal status and nature of business:

the group consists of:

holding company

united bank limited (the bank)

Subsidiary companies:

united national bank limited(UNBL), united kingdom

united bank AG(Zurich), Switzerland

united executers and trustees company limited(under liquidation)

UBL fund managers limited

The group is engaged in commercial banking, asset management, investment

advisory services and trustee services. The banks registered office and principal

office are situated at UBL building, Jinnah Avenue, Blue Area, Islamabad and at


state life building No. 1, 1. 1. Chundrigar road, Karachi respectively. The bank,

operates 1,121 (December 31,2009:1,120) branches inside Pakistan as at

September 30,2010. The domestic branch network includes 5(December

31,2009:5) Islamic banking branches.

The banks ordinary shares are listed on all three stock exchanges in Pakistan

whereas its global depository receipts (GDRs) are on the list of the uk listing

authority and the London stock exchange professional securities market. These

GDRs are also eligible for trading on the international order book system of the

London stock exchange. Further, the GDRs constitute an offering in the united

states only to qualified institutional buyers in reliance on rule 144A under the US

securities act of 1993 and an offering outside the united states In reliance on

regulation S.

The minority states represents state bank of pakistan’s 45% share in the net asset

value of UNBL.

Basis of representation:

In accordance with the directives of the federal government regarding the shifting

of the banking system to Islamic modes, the state bank of Pakistan has issued

various circulars from time to time. Permissible forms of trade-related modes of

financing include purchase of goods by bank from their customers and immediate

resale to them at appropriate mark-up in price in deferred payment basis. The

purchases and sales arising under these arrangements are not reflected in these

financial statements as such but are restricted to the amount of facility actually

utilized and the appropriate portion of mark-up thereon. However, the Islamic

banking branches of the bank have complied with the requirements set out under

the Islamic financial accounting standards issued by the institute of chartered


accountants of Pakistan and notified under the provisions of the companies

ordinance, 1984.

The financial results of the Islamic banking charges of the bank have been included

in these consolidated condensed interim financial statements for reporting

purposes, after eliminating intra branch transactions/balances. Key financial

figures of the Islamic banking branches are disclosed in note 20 to these

consolidated condensed interim financial statements

Statement of compliance:

These consolidated condensed interim financial statements of the groups for the

nine months ended September 30,2010 have been prepaid in accordance with the

requirements of the international accounting standard 34 – interim financial

reporting, provisions of the company’s ordinance, 1984, banking companies

ordinance, 1962 and directives issued by the securities and exchange commission

of Pakistan and the state bank of Pakistan. in case requirements differ, the

provisions of the companies ordinance, 1984, the banking companies ordinance,

1962 and the said directives have been followed .

The SBP wide BST circular No. 10, dated august 26, 2002 has deferred the

applicability of international accounting standards 39, financial instruments:

recognition and measurement (IAS 39) and international accounting standard 40,

investment property –(IAS 40) for banking companies for further instructions.

Further according to the notification of the SECP dated april 28,2008, IFRS – 7

“financial instruments: - disclosures” has not been made applicable to banks.

Accordingly, the requirements of the standards have not been considered in the

preparation of these financial statements. However, investments have been

classified and valued in accordance with the requirements of various circulars

issued by the SBP.


The disclosures made In these consolidated condensed interim financial statements

have, however, been limited based on a format prescribed by the state bank of

Pakistan wide BSD circular No. 2 dated may 12, 2004 and international accounting

standard 34, interim financial reporting. They do not include all the disclosures

required for annual financial statements and these consolidated condensed interim

financial statements should be read in conjunction with the annual consolidated

financial statements of the banks for the year ended December 31, 2009.

During the period following new/revised standards, amendments and interpretation

became effective:

IAS 37 – consolidated and separate financial statements(amendments)

IFRS 2 – share based payments: amendments related to group cash-settled

share-based payment transaction

IFRS 3 – business combinations(revised)

IFRIC 17 – distributions of non-cash assets to owners

Adoption of the above standards, amendments and interpretations did not affect the

accounting policies of the bank as disclosed in the consolidated annual financial

statements for the year ended December 31, 2009. The implications of the

amendments to IFRS – 2 relating to the government of Pakistan share option

scheme for employees of state owned enterprises are under consideration of the

institute of chartered accountants of Pakistan.

Basis of measurement

these consolidated condensed interim financial statements have been prepared

under the historical cost conventional except that certain fixed assets are stated at

revalued amounts and, certain investments, commitments in respect of certain


forward foreign exchange contracts and derivative financial instruments have been

mark to market and are carried at fair value.

The preparation of consolidated condensed interim financial statements requires

managements to make judgments’, estimates and assumptions that affect the

application of accounting policies and the reported amount of assets and liabilities,

income and expenses. Actual results may differ from these estimates.

Estimates

The significant judgements made by the management in applying the accounting

policies and the key sources of estimation uncertainty were the same as those

applied to the annual financial statements for the year ended December 31, 2009.

Significant accounting policies and financial risk management

The accounting policies and the methods of computation adopted in the preparation

of these consolidated condensed interim financial statements are the same as those

applied in the preparation of the consolidated annual financial statements for the

year ended December 31,2009.

The financial risk management objectives and policies are consistent with those

disclosed in the consolidated annual financial statements of the bank for the year

ended December 31,2009.

Types of department in UBL:

Account opening department:


An account opening department in UBL consists of:

· Account Opening Procedure

· The persons who are eligible to open an account

· Kinds of Accounts offered by Bank Alfalah Limited

· Information about Royal Profit Account

· Documents required by different categories of persons

· Issuance of Cheque Book

· Preparation of Debit and Credit Vouchers

· Procedure of closing an account

· Information about Zakat Exemption

An account opening is an initial step of building contractual relationship with

customer. Customers wish to open their accounts with their different requirements.

Some people want an account in foreign currency. Some customers want Pak

rupees account but with different type of account.

CLEARING DEPARTMENT:

Clearing department consists of:

· Procedure of clearing a cheque

· Checking of cheques

· Inward and outward clearing

· Within bank transfer

· Different reason of returning a cheque

· Types of clearing stamps

The basic function of the clearing department is to facilitate the customer; it

provides them the services in collection of their cheque in other banks. Clearing

actually means the transfer of funds from one branch of bank to the other branch of


the same bank or the other bank on which the instrument is drawn, without

involving cash through State banks clearing house.

ACCOUNTS DEPARTMENT:

Accounting opening department consists of or these are the following activities

carried out in this department

Budgets

Income & expenditures

Reports

Budget review form

Reconciliation

Foreign Exchange; Forward Contracts

Activity checking

Funds management

Depreciation & Maintenance of fixed assets provision

Minutes of the branch review committee

Test Keys

BUDGETS:

Annual budgets are prepared three months earlier before the start of New Year.

One-year budget are further splits in semi-annually, and monthly basis. During

three

months, budgets are reviewed by head office. At times changes are

asked to make in accordance with changing rates, excess funds and due to other

reasons.

Budgets are revised after amendments.


Major heads include in budgets are:

Deposits

Advances

Car finance

Exports

Imports

Guarantees

Sales of rupee travelers cheque

Income/ expenditure

The revenue target is fixed keeping in view the past performance. The cost of

generating these revenues is also estimated. Then budget of each branch is

submitted to head office for modifications and for approval. After the modification

and approval the budget for a specific branch is being set by the head office.

Monthly budget meeting is held to analyze the monthly performance by all the

branch managers with head office. The actual performance is compared with the

estimated and variance is calculated. Variance can be negative as well as positive.

If there is a negative variance, this shows management’s inefficiency in controlling

its expenses or incompetence in achieving the desired revenue target. Proper

Adjustments are made in the next month’s target according to the previous month’s

performance because sometimes the goals that are set by the head office are

unrealistic and unachievable.

Income & expenditures of bank:

Income

Mark up on advances


Mark up on h/o balances/ demand a/c

Mark up on placements

Mark up on investments

Expenditures:

Total interest expenditures

Total administrative expenditures

Personal cost

Training & subscription

Rent, taxes, instrument

Reports:

Each and every activity with their particular are reported daily by MIS. Besides

daily reports, these are weekly, monthly, semiannual, and annual reports. These are

generated from the main frame and are used or proper analysis. MIS compiles

every activity of each department. Account and Audit departments further

authenticate these activities on daily basis.

Statement of Affairs

It includes information about assets, liabilities and their balance. Daily position of

deposit and advances are also calculated in this report.

Subsidiary Statement:

This is a detailed report that includes all the information regarding the statement of

affairs.

Income & Expenditure Report:

It includes all the details regarding to both the heads of income and expenditure in

detail.

Royal Profit Report:


It includes the details of the deposit of royal profit account.

Currency Wise Report:

It provides the details of all the deposits currency wise.

New FCY Report:

This report includes the information regarding only the new foreign currency

accounts. The old foreign currency accounts are those that were at the time of

nuclear explosion in Pakistan and were being freezed by Nawaz Sharif

Government.

Sub 66 Report:

It contains income, expenditure, general ledger accounts and their balances.

Daily Position of Advances & Deposits:

This report is being sent to the Head Office daily in which the detail is given

regarding the new accounts of deposits and advances.

RECONCILIATION

United bank limited prepares its reconciliation statements with

Head Office

State Bank of Pakistan

Head Office Reconciliation:

All the debit and credit entries of the main office account are recorded in the

statement. Then it is checked with physical vouchers and if there is any problem,

they reconcile it. Head Office check the outstanding entries, if there is any entry

posted by branch but not by head office they will send their query to the branch

and then branch will respond to that query by sending the required document. Head


office reconciliation is carried out in the head office; accounts department handles

inquiries.

State Bank of Pakistan Reconciliation:

State Bank of Pakistan maintains the account of every scheduled bank including

United bank limited. The statement of account reconciliation shows the entries that

are passed during the month in both banks. United bank limited compares the

statement with the ledger card of State Bank of Pakistan in which all entries are

recorded done with SBP. If any amount debited by SBP and united bank limited

doesn’t credit that amount, it is added in the balance of the reconcile statement

provided by the State Bank of Pakistan to united Bank limited.

BUDGET REVIEW FORMS:

These forms are designed to review the actual budgets and performances with

expected performances at the end of every month.

ACTIVITY CHECKING

Activity checking is the process of the entire banking, which is taken place on

daily basis. The report specifies every vouchering, which has taken place. Sorting

is made according to the mainframe-generated report. All the Vouchers are

checked that whether they are properly posted or is there any transaction is left to

be posted. This checking makes the working of the bank more efficient and avoids

any loopholes.

Cash department

The department is responsible for the handling of cash deposits and encashment of

cheques issued by the depositors.


Receipt of Cash:

In receipt section deposits are received in form of cash. The depositor use pay-

inslip for depositing the amount. There are two different types of slips for both

saving and current account. The client gives all the detail regarding date, account

number, title of account, amounts in words and figure. The pay-in-slip is stamped,

cash is received and counter foil is given to the depositor. The adjacent credit

voucher is used for recording and posting purposes. In case the client is depositing

money in his/her account through a cheque of another bank, and then the cheque is

lodged in clearing.

Cheque Encashment Section:

The process of cheque encashment is done with the help of the following

procedure.

Receiving Cheques

Verification of signatures

Computer terminal process

Payment of cash

1.Receiving of Cheques:

The cash is paid against the cheque of the client. The following things have to be

checked by the cashier before the encashment of the cheque.

The cheque that is presented should be drawn on united bank Limited.

Cheque is not post dated or the date should exist, for example it can’t be of 30th

February etc.

It should be a bearer cheque

Amount in words and figures should be same.

Alterations in date / figures / words require drawers’ full signature


The receiver of cash should make one signature on the back of cheque.

2.Verification of Signatures:

After receiving the cheque, the officer verifies signatures of the account holder and

the signature on the cheque. The signatures are feeded in the computer so they are

checked from the computer. The CD personnel scan the Signature Specimen Card

and add the mentioned account number with the SS Card. It is then load in the

main Server. In this way the officers can use the SS Card for the verification of the

signatures. If signature is not same than it is returned back, otherwise forwarded to

the computer terminal.

3.Computer Terminal Process:

The cheque is received in computer terminal, where the computer operator checks

the balance of the account holder that whether there is enough balance in the

account or not. After considering these points the computer operator posts the

cheque in account holder ledger and after cancellation of the cheque returned it

back to the cashier.

4.Payment of Cash:

After the cancellation of the cheque the cashier enters the cheque in the “Cash Paid

Register” and pay against the second signature of the receiver on the back of the

cheque.

CREDITS DEPARTMENT:

Consists of:

· Credit facilities for customers


· Long term & short term loans

· Employees loan

· Securities for credit etc

Home finance department

· Home finance is term loan facility repayable in monthly installments and secured

by equitable or registered mortgage over real estate property

· Purpose of facility is to finance purchase, construction, improvements, extension

and restoration of private residential or commercial real estate property

· It shall be extended for all types of real estate properties i.e. houses, apartments,

bungalows, town houses, office premises etc

Car finance department

Car finance department in UBL is responsible for providing cars to both

individuals and corporates and hence there are two types of products in this

department

· Car Finance

· Auto Lease

The procedure for loan disbursement for leasing, home finance and car finance is

same as discussed above.


There are other departments as well in UBL such as foreign trade department,

exports and imports department

Accounting Procedures to record:

Fixed assets

Contra assets

Current assets

Current liabilities

Long term liabilities

Shared capital

reserves

Fixed assets:

These are stated at cost less accumulated depreciation, except for freehold land and

capital work-in-progress, which are stated at cost

In respect of additions depreciation is charged from the month in which asset is put

to use and on disposal up to the month the asset is in use. Additional depreciation


at the rate of fifty percent of the normal rate is charged on such machinery which is

operated on double shift during the year.

The assets residual values, useful lives and methods are reviewed and adjusted if

appropriate, at each financial year endnb

Tagging and recording of fixed assets

An interface extract program ran by Fixed Asset staff identifies potential

capitalized assets that enter Banner Finance through purchasing and accounts

payable, and create corresponding pending asset records. This extract program

gathers cost and other asset data from purchase orders, invoice, voucher and other

records. Extract processing is controlled by UBL defined capitalization rules,

based on the purchase cost and the account codes charged for the purchase.

Acquisitions (office desk, land, buildings, lockers) not recorded in purchasing or

accounts payable may be entered into Fixed Assets on-line or in batch.

Disposal of fixed assets

UBL equipment cannot be thrown away. To dispose of an asset, the responsible

department must complete Form FA-13, Equipment Disposal Form. This form

must be completed whenever the custody of the fixed asset changes due to the item

being surplused, returned to vendor, junked or traded. The department fills in their

department name and number, telephone number, contact person, date, tag

number(s), description of item being disposed, and location of item being disposed.

Current assets:

Cash and cash equivalents:


Cash and cash equivalents are carried in the balance sheet at cost. For the purpose

of cash flow statement, cash and cash equivalents comprise cash in hand, balances

with banks on current and deposit account and outstanding balance of running

finance facilities availed by the company.

Cash transactions

Cash transactions can be the most difficult to account for and record, and the most

necessary. Maintaining control and accountability of cash transactions is a huge

responsibility for companies like UBL, and the company’s accounting department.

Of all the transactions that take place, cash transactions are the hardest to record

and track, simply because the paper trail generated by a purely cash transaction is

virtually non-existent. A voucher system is most often used in UBL to record cash

payments. This is a set of procedures for authorizing and recording liabilities and

cash payments. The voucher system covers all types of payments that must be

made, and provides for the accurate recording of transactions, as well as accurate

recording keeping for reference back to those transactions. The voucher system

usually includes vouchers, matching receipts that verify the amount of the voucher,

and a filing system for paid and unpaid vouchers.

UBL also have in place preventive and defective control procedures that are

designed to protect cash from misuse and theft. Cash payments can be controlled

internally, and for the most part, are successfully monitored and accurately

recorded

Advances:

Advances are monitored to accurately record costs or capitalize other assets as

work is completed or services are received. Based on the work completed or


services received, the advance account is credited, and the appropriate expense or

asset account is debited. If adequate information is not available, UBL estimates

the work completed. Based on the estimate, the appropriate expense or asset

account is debited and accounts payable is credited. When the cost information is

received, accounts payable for the estimated amount previously recorded is debited

and the advance account for actual work completed is credited. Any differences

between the estimate and the actual work completed are adjusted to the appropriate

expense or asset account. Each advance is limited to the minimum amount

necessary for immediate disbursement needs and is timed to be in accordance with

the actual immediate cash requirements of the recipient in carrying out an

approved program or project. The timing and amount of cash advances are as close

as is administratively feasible to the actual disbursements by the recipient for direct

program costs and the proportionate share of any allowable indirect

costs.

Contra assets

Accumulated depreciation

Overview

Posting depreciation means to account for depreciation using the proper journal

entries. UBL depreciates its assets annually. Depreciating assets will match the

cost to purchase the asset and only record the expense as the company uses the

asset. The two main accounts involved are "Accumulated Depreciation," which is a

contra-account to the asset and "Depreciation Expense." "Accumulated

Deprecation" will decrease the value of an asset on the balance sheet, this is why it


is a contra-account. "Depreciation Expense" will record the expense from using the

asset on the income statement.

Step 1

Determine the amount of depreciation to account for. For example, Firm A uses

straight-line depreciation. The firm wants to depreciate an asset that costs $15,000

with an estimated $3,000 residual value. The asset has an estimated three-year

useful life. So $15,000 minus $3,000 equals $12,000. Then $12,000 divided by 3

years equals $4,000 of depreciation a year.

o Step 2

Debit "Depreciation Expense" by the yearly depreciation and credit "Accumulated

Depreciation" by the yearly depreciation. Do this each year of the assets useful life.

In the example, debit "Depreciation Expense" by $4,000 and credit "Accumulated

Depreciation" by $4,000.

o Step 3


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Account for any changes in the depreciation estimates prospectively. This means

do not adjust previously accounted for sums. For example, after year 2, Firm A

decides the asset still has two more years of useful life with $1,000 of residual

value. Re-calculate the depreciation using the current. Since two years passed,

$8,000 of depreciation is accounted for already, so the asset is worth $7,000. Then

$7,000 minus $1,000 equals $6,000. Finally, $6,000 divided by two years equals

$3,000.

o Step 4

Record the depreciation in the same manner as in Step 2, but use the new

depreciation value. In the example, debit "Depreciation Expense" by $3,000 and

credit "Accumulated Depreciation" by $3,000.

Current liabilities

Policies

There shall be no carried forward of sick time past of the current year a

common management problem is for employees to build up massive reserves of

unused sick time, for which they must be paid when they eventually leave the

company the policy is designed to eliminate all unused sick time at the end of each

calendar year, thereby keeping accrued sick time expense to a minimum.

Procedures

Include a standard review of customer advances in the closing procedure. If a

company regularly deal with the large number of customer deposits, there is a

significant risk that the deposits will not be recognized as revenue in conjunction

with completion of any related services or product sales. This problem can be


avoided by requiring a periodic review of the status of each deposit as part of the

period-end closing procedures.

Include an accrual review in the closing procedure for income tax payable. A

common practice is to only accrue for income taxes on a quarterly basis, when

estimated taxes are due. The trouble is that this is a substantial expense being

excluded from all monthly financial statements not falling at the end of each

reporting quarter, so it tends to skew the reported results of those months. By

including in the closing procedures a line item requiring the accrual of an income

tax liability, the accounting staff is forced to address this issue every time financial

statements are issued.

Long term liabilities:

Long term loans and deposits are stated at cost.

Long-term debt consists of probable future sacrifices. It has various covenants or

restrictions for the protection of both lenders and borrowers. The indenture

agreement incorporates the terms of the issue and restrictions.

Bond issues, parties to the contract

Share capital

The Meaning of Share Capital

A corporation must include its "paid-up capital stock" in PUC, in accordance with

clause 61(1)(a). Paid-up capital stock, which is termed "share capital" in this

bulletin, is the dollar amount of the issued share capital of the corporation, as


shown on its balance sheet prepared in accordance with generally accepted

accounting principles (GAAP).

Items Included in Share Capital

Share capital includes the value given to all types of issued shares,

including:

o common shares

o preferred shares, and

o special category shares.

The following amounts must be included:

o the value of shares issued for intangibles such as trademarks and

patents, and

o premiums received from shareholders on the issue of shares and

recorded as share capital.

Items Excluded from Share Capital

The following amounts are excluded from share capital:

o subscriptions receivable from shareholders on shares issued to them

but not fully paid for, and

o discounts allowed to shareholders on the issue of shares.

Internal auditing


Internal auditing is an independent, objective assurance and consulting activity

designed to add value and improve an organization's operations. It helps an

organization accomplish its objectives by bringing a systematic, disciplined

approach to evaluate and improve the effectiveness of risk management, control,

and governance processes. Internal auditing is a catalyst for improving an

organization’s effectiveness and efficiency by providing insight and

recommendations based on analyses and assessments of data and business

processes. With commitment to integrity and accountability, internal auditing

provides value to governing bodies and senior management as an objective source

of independent advice. Professionals called internal auditors are employed by

organizations to perform the internal auditing activity. UBL uses internal audit for

several benefits, such as : Review of the accounting and internal control system

(including computer-based controls and data security procedures) and the

monitoring of the operation of these systems and recommending improvements,

Ensuring proper safeguarding of assets to prevent or detect fraud, Examination of

financial and operating information, review of the means used to identify, measure,

classify and report such information and specific inquiry into individual items

including detailed testing of transactions, balances and procedures, Review of the

application and effectiveness of risk management procedures and risk assessment

methodologies.

International Standards on Auditing (ISA) requires that the regulatory status of the

internal department should ensure that does not affect its ability to be objective,

and their ability to Communicate freely with the external auditors and their ability

to fulfill their responsibilities.

Thus, based on the regulatory status of the bank, and Lev grief Executive Audit

and Inspection Division must report to the Audit Committee of the Council which


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is composed of 2-3 non-executive Management. Committee decides on the strength

of overall staff in the Division as well as on the strength of the General Staff of the

Division of the Audit Committee of the Council on the basis of Network and the

requirements of the business. It Identifies the structure of the Division. The

geographical spread of our network which may necessitate creation / placement

audit Staff in different locations. The various units have therefore developed a fiber

to the grief of the Executive Division who will be responsible for overall growth

and professional development.

Supervision

Audit & Inspection Division should provide assurance that the audit work is

properly supervised. The Executive Incharge of Audit & Inspection Division is

responsible for providing appropriate supervision, which is a continuous process,

beginning with the planning and ending with the proper supervision and conclusion

of the audit assignment. Appropriate evidence of supervision should be

documented and retained. The extent of supervision will depend upon the

proficiency of the internal auditors and the nature of the audit assignment.

Supervision includes:

i. Ensuring that the auditors chosen for a particular audit are independent of the

activity being audited; providing necessary instructions to the staff at the outset of

the audit work and approving the audit programs;

iii. ensuring that the approved audit programs are implemented unless deviations

are justified as well as authorized;

iv. determining that working papers adequately support the audit findings,

conclusions and reports;


v. ensuring that reports are accurate, clear, concise, constructive and timely; and

vi. determining that audit objectives are being achieved.

Verification of balance sheet accounts:

Cash:


All the cash on hand should be brought at one table and physically counted as on

the closing date and agreed with cash book and balance sheet. The last numbers of

the receipt books, cash memo books, cheque payment vouchers, cash payment

vouchers, cheque books and cheque receipts should be noted

See that the collections are segregated and kept separately from imprest. At the

time of counting the cash, examine the pay-in-slips for the last 7 days prior to cash

count and link up the lodgment dates with cash receipts. Scrutinize bank statements

subsequent to cash count for any dishonored cheque. Vouch all cheques drawn for

cash during 14 days prior to cash count.

Bank balances

Obtain direct bank confirmations in support of the bank balances. Obtain a bank

reconciliation and agree the balance of cash book as at the date of the balance sheet

with the balance shown in the bank statement. Scrutinize all outstanding items and

note their subsequent adjustments. See that the above bank certificate indicates the

name of the clients in whose account the money is lying in the books of the bank.

Examine the fixed deposit receipt for amounts lying the fixed depostis(apart from a

direct bank certificate). See that accrued interest to the date of the balance sheet

has been accounted for in the books, show the balances with the bankers on deposit

or on current account separately. Verify conversion rates in the case of foreign

exchange balances and disclose to exchange rate of conversion as a footnote on the

balance sheet. Any loss or gain arising due to devaluation must be reflected in the

accounts.

Prepaid accounts

Obtain a schedule and check it with demand notes, bills, vouchers etc, noting

carefully the period for which the prepayments are involved. Scrutinize their


subsequent adjustments. Examine necessary correspondence is this respect.

Compare amounts with the previous year and note any major fluctuations. Enquire

into usual financing by the clients.

Loans

Confirm the borrowing powers with reference to the memorandum and articles of

association. See board resolution for the approval of exercising the borrowing

powers. Study the contract for loan noting the maximum limit sanction, rate of

interest, plan of repayment, installment payable, the nature and extend of scrutiny

and type of charge. Scrutinize that account to find out instance where limits have

exceeded and report such instances to directors. All interest on outstanding balance

should either be paid or provided in the accounts. Check the value of the security

and see that the loan is fully secured. See confirmation for the loan. In case of

difference, obtain a reconciliation statement. Examine that the charge on assets has

been noted on the register of charges and confirm that it has also been registered by

the registrar. Prepare a movement account during the year and tie up the opening

and closing balances of the loan.

Bills payable

Obtain a schedule of bills payable. Check it with bills payable book. Check control

account. Check cast of the schedule. Examine the unpaid bills.

Share capital

The steps are taken for verifying the share capitals of the company covering

several phases are enumerated as under:

Check the authorized share capital with the relevant clause of the

memorandum of association. Scrutinize the minute book of the shareholders


to ensure that no alteration was made during the year. If it was so done, the

minutes should be seen and altered amount may be shown in the accounts.

Obtain a list of shareholders, check with the register of members, and verify

the control account

Obtain a schedule showing the movement during the year in the above

account. Verify entries in respect of the additions on account of issue of new

shares.

Reserves

Obtain a movement schedule of each type of reserve and agree the closing balance

of the schedule with the balance sheet

The opening balance of each of the reserves should be checked with the

audit working papers of the previous year or audited balance sheet

Scrutinize any addition to or deletion from the reserves carefully and ensure

that they are properly authorized by the articles of the company and the

directors or shareholders resolution

The auditor should study the case law and comply with the guidelines laid

down in the judicial pronouncements

Note undisclosed secret reserves


ubl report

Documents

ubl estatement

united bank limited

ubl netbanking

ubl hamrah21 ubl wallet

nationalized bank

national bank of pakistan

ubl uniflex account

problematic united bank