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BIFC

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BIFC 18-Jul-2019

(Continuation news of BIFC): (7) Deficit of Statutory Liquidity Requirement (SLR): As per FID circular No.-6, November-06, 2003 and FID Circular -2, Dated: November-10, 2004 every Financial Institutions of Bangladesh has to maintain 5% SLR on balance on average of total liability as prescribed by Bangladesh Bank circular from time to time, but in course of our audit for the year ended December 31, 2018, we observed that BIFC failed to maintain sufficient balance as per (cont. 12)

BIFC 18-Jul-2019

(Continuation news of BIFC): Name of the month: December 2018 (1st 2 weeks); Required amount of the weekly average (2.5%): Tk. 45,539,559; BIFC maintained on weekly average: Tk. 74,243; Shortfall on weekly average: Tk. 45,465,315. Name of the month: December 2018 (2nd 2 weeks); Required amount of the weekly average (2.5%): Tk. 45,539,559; BIFC maintained on weekly average: Tk. 106,774; Shortfall on weekly average: Tk. 45,432,784. (cont. 11)

BIFC 18-Jul-2019

(Continuation news of BIFC): Name of the month: July 2018 (1st 2 weeks); Required amount of the weekly average (2.5%): Tk. 47,379,192; BIFC maintained on weekly average: Tk. 57,184; Shortfall on weekly average: Tk. 47,322,008. Name of the month: November 2018 (2nd 2 weeks); Required amount of the weekly average (2.5%): Tk. 50,301,264; BIFC maintained on weekly average Tk. 47,130; Shortfall on weekly average: Tk. 50,254,133. (cont. 10)

BIFC 18-Jul-2019

(Continuation news of BIFC): on a daily basis of the same total term deposit. While we are conducting our audit for the year ended December 31, 2018. We found that there were several time shortfalls of maintaining CRR on the bi-weekly average basis in the following months as per the following details: Name of the month: June 2018 (2nd 2 weeks); Required amount of the weekly average (2.5%): Tk. 50,338,581; BIFC maintained on weekly average Tk. 67,654; Shortfall on weekly average: Tk. 50,270,926. (cont. 9)

BIFC 18-Jul-2019

(Continuation news of BIFC): All of these loans and leases are classified as Bad and Loss and there was only 1.30% recovery during this year. However, legal processes are ongoing to recover the amount. (6) Deficit Cash Reserve Requirement (CRR): As per FID circular No.-02, Dated: November 10, 2004 every Financial Institutions has to maintain Cash Reserve Requirement (CRR) of 2.5% on the bi-weekly average basis of their total term deposit with a provision of minimum 2% (cont. 8)

BIFC 18-Jul-2019

(Continuation news of BIFC): There was no recovery on account of said outstanding amount during this year. All of these loans/leases were classified as bad and loss. However, the management of BIFC has taken all possible steps to recover this amount. b) As at December 31, 2018 outstanding of Loan, Lease & Advance against various concern of Biswas Group was Tk. 201,155,268. These amount represent 2.39% of total outstanding. (cont. 7)

BIFC 18-Jul-2019

(Continuation news of BIFC): Income Tax Para-15 and 20, BIFC should compute deferred tax. As a result, liability and income tax being understated. (5) Loan, Lease & Advances: a) As at December 31, 2018 a total outstanding of Loans, Lease and Advances against various concerns of Sunman Group was TIC. 6,396,500,546 equivalents to 76.01% of total outstanding balance of Tk. 8,414,821,757. The amounts were carried forward from financial year 2014. (cont. 6)

BIFC 18-Jul-2019

(Continuation news of BIFC): We scrutinized that the company's total equity becomes negative Tk. (7,998,665,811) because of net loss made during last 3 years and investment in share as on 31 December 2018 Tk. 205,573,951 in quoted and un-Quoted shares clearly state that non-compliance investment of the Financial Institutions Act 1993. (4) Taxation: We found that BIFC did not compute the deferred tax on the asset revaluation reserve amount of Tk. 403,425,667. As per IAS-12, (cont. 5)

BIFC 18-Jul-2019

(Continuation news of BIFC): Capital Adequacy Ratio (CAR) was negative by 77.95% and Core Capital to RWA was stood negative by 80.1%. (3) Non-compliance of Financial Institution Act 1993: As per Financial Institutions Act 1993, Section-16 "No Financial Institution shall expend or use more than 25% of its Paid-up Capital and reserves for the acquisition or holding of any kind of shares of financial, commercial, agricultural or industrial institution or of any similar institution". (cont. 4)

BIFC 18-Jul-2019

(Continuation news of BIFC): Provision made/charge: Tk. 359,972,546; Shortfall: Tk. 271,952,110. Year 2017; Required Provision: Tk. 641,325,687; Provision made/charge: Tk. 373,765,471; Shortfall: Tk. 267,560,216. Year 2018; Required Provision: Tk. 801,735,708; Provision made/charge: Tk. 578,443,479; Shortfall: Tk. 223,292,229. (2) Deficiency of Capital Adequacy: As per the statement of the Capital Adequacy and Market Discipline (CAMD)) of BIFC as on December 31, 2018 (cont. 3)

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