1.

1 Introduction:
Bank is financial organization that deals with money. But it is the precise most definition about
bank. In modern age it is impossible to think a country without bank. Bank plays diversified role
in an economy. The most important task that is done by a bank is building capital. That is the key
factor of the development of a economy. An industrialized Nation’s build their industrial sector
with the help of banking sector. The growth of the economy also depends on the performance of
the banking sector. Banks secure money of the society. Govt. takes various monetary policies. It
is very important to have a practical application of the knowledge acquired from any academic
course of the study. Because a theoretical knowledge will become fruitless if it is not applied in
the practical life. So we need proper application of our knowledge to get some benefit from our
theoretical knowledge to make it fruitful. Such an application can be possible through internship.
EXIM Bank Bangladesh Limited is the place where I have gathered experience about the
operations of the financial institutions. This report is the outcome of two month internship
program. The study will be conducted as a partial requirement of the internship program of
Faculty of Business Studies of International Islamic University Chittagong.
ACCOUNTING & REPORTING PRACTICES – A study on EXIM Bank Bangladesh Limited,
is the topic of my internship report. That is to know about Accounting & reporting Practices of
EXIM Bank Bangladesh Limited. This study makes me able to get practical knowledge of
Accounting & Reporting practices of a private bank, like EXIM Bank Bangladesh Limited.
1.2 Objectives of the Study:
The main objective of the study is to identify the Accounting & Reporting Practices of the EXIM
Bank Bangladesh Limited, Sonapur Branch, Noakhali.
The study has taken following specific objectives:
 To highlights on the legal framework of Accounting & Reporting practices of the EXIM
Bank Limited.
 To find out the related findings & give some recommendations of the problem.

1.3. Methodology of the Study:

Data Source:
Primary Sources:
• Observing practical work.
• Informal Conversation with the clients.
• Personal experience gained by visiting different desks.
• Face to face communication with employees of the EXIM Bank Ltd.

1
Secondary Sources:
• Annual Report of EXIM Bank Ltd.
• Data collected from internal report.
• Bank records.
• Journals of the bank.
• Official website of the bank.

Technique:
Data has analysis through the Microsoft word ,exel, graph, chart etc. by computer software.

1.4 Scope of the Study:

This report has been prepared through extensive discussion with bank employees and with the
clients. Prospectus provided by the bank also helps to prepare the report. At the time of preparing
the report, I had a great opportunity to have an in depth knowledge of all the banking activities
practiced by the Exim Bank Limited.

1.5 Limitations of the Study:

The officers are very co-operative but they are too busy to give me time to get knowledge about
practical activities. Moreover they have to deal in a very competitive environment based on
money related activities. Bank is a sophisticate business sector. So bank do not interested to
provide me confidential data. I have to prepare this report alone. Every task has some limitations.
I faced some usual constraints during the course of my internship. These are as follows:
Short of time:
I had to complete this report writing within a shorter period of time. So the time constraint of the
study hindering the course of vast area and time for preparing a report within the mentioned
period is really difficult.
Busy working environment:
The officials had some times been unable to provide information because of their huge routine
work.

2
2.1 Background of the Bank:

Export Import Bank of Bangladesh Limited was incorporated in Bangladesh on June 2 1999 as a
banking company under the companies Act 1994. The Bank converted its banking operation into
Islamic Shariah from traditional banking operation on 1st July 2004 after obtaining approval
from Bangladesh bank. Exim bank went for public for issuing shares in the year 2004. Though
this bank started its business in 1999 but its growth rate was 40.68 % in 2004 and till 2007 it has
grown over 200 % from 2004. The bank has increased its branches to 40 at present and a huge
number of customers are getting services from them each day. That indicated that Shariah
banking has an effect on the growth of the bank. Within an operative period as short as six years,
the bank has arrived at a strong financial and business position by expanding its market share
compared to its contemporaries and to some extent to the 2nd even 1st generation banks of
private sector. In addition, the Bank has also made a significant contribution to the national
economy under the prudent leadership and untiring support of the member of the Board of
Directors, who are leading business personalities and reputed industrialists of the country.

2.2 Vision:
The gist of our vision is ‘Together towards Tomorrow’. Export Import Bank of Bangladesh
Limited, as the name implies, is not a type of Bank in some countries on the globe.

But is the first of its kind in Bangladesh.

It believes in togetherness with its customers, in its march on the road to growth and progress
with services. To achieve the desired goal, there will be pursuit of excellence at all stages wok a
climate of continuous improvement, because, in Exim Bank, we believe, the time of excellence is
never ending. Bank’s strategic plans and networking will strengthen its competitive edge over
others in rapidly changing competitive environments. Its personalized quality services to the
customers with the trend if constant improvement will be cornerstone to achieve our Operational
success.

3
2.3Mission of the Bank:

The bank chalked out the following corporate objectives in order to ensure
smooth achievement of its goals:

 To be the most caring and customer friendly oriented bank.

 To create a technology based most efficient banking environment for its Customers.
To ensure ethics and transparency in all level.

 To ensure sustainable growth and establish full value of the honorable shareholders.
Above all to add effective contribution to the national economy.

2.4 List of Sponsors:

Md. Nazrul Islam Mazumder

Md. Nazrul Islam Swapan
Mohammad Andullah
Md. Altaf Hossain
Nasreen Islam
Md. Mazakat Harun
Md. Fahim Zaman
Pathan Asma Begum
Engr. Aminur Rahman Khan
Zubayer Kabir
Rizwana K. Riza
Md. Habibullah
Md. Nur Hossain
Akhter Anjan Kumar
Saha A.K. Nurul Fazal
Md. Abdul Mannan
Rabeya Khaton

2.5 Slogan:

“Together Towards Tomorrow”.

4
2.6Products & Services:

Finance/ Investment:

 Corporate Finance

 Industrial Finance » Lease Finance

 Hire Purchase Finance

 Commercial Investment

 Project Finance

 Syndicate Investment

 Retail Investment

 Mortgage Investment

Savings Scheme:

 Monthly Savings Scheme(Money Grower)

 Monthly Income Scheme(Steady Money)

 Double the deposit in 6 years (Super Savings)

 10 years deposit-more than triple (Multiples Savings)

 Education Savings Scheme

 Bai Murabaha

 Bai Muazzal

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  Izara Bil Baia

 Wazirat Bil Wakala

Bank emphasizes on non-fund business and fee based income. Bid bond/ bid security pew be
issued at customer’s request.

E-Cash/ ATM Service:

The bank is currently providing Credit Card Service (MasterCard) to the privileged of the bank
in collaboration of Prime Bank. Floating VISA card for both >it and Credit card service is under
process.

2.7Bank Operational Area:

Export and Import Trade Handling and Financing

As a commercial Bank, bank’s do all traditional Banking business including the wide no. of
savings and credit scheme products, retail banking and ancillary services with the support of
modern technology and professional Excellency .But our main focus is, for obvious reason, on
export and import trade handling and the development of entrepreneurship and patronization of
private sectors.

2.8Achievements:

It is a great pleasure that by the grace of Almighty Allah, we have migrated at a time and the
branches from its conventional banking operation into Shariah based Islamic poking operation
without any trouble. Lot of uncertainties and adversities were there this migration process. The
officers and executives of our bank motivated the customers by counseling and persuasion in
light with the spirit of Islam especially for the non-Muslim customers. Our IT division has done
the excellent job of converting and fitting the conventional business processes into the processes
based CD Shariah. It has been made possible by following a systematic procedure of migration
under the leadership of honorable Managing Director.

6
2.9 Exim bank at a Glance:

Particulars Descriptions
Legal Status Public Limited Company
Establish 1999
Incorporated 2nd June, 1999
Activity Status 3rd August, 1999
Islamic Banking 1st July, 2004
Listing with Dhaka Stock Exchange September, 2006
Listing with Chittagong Stock Exchange September, 2006
Inauguration of First Branch 3rd August, 1999
Authorized Capital Tk. 2000 Cr.
Profit 407 Cr.
Total Asset Tk. 123,385,904,440
Shares 922356286
Paid up Capital Tk. 922.36 Cr.
Reserve Fund Tk. 62775000
Number of Employees 3466 Persons
No. of Branches 121
Net Income 3,256,947,071 Taka

7
3.1 Analysis of Accounting System of Exim Bank Ltd.:

3.1.1 Accounting Policy:

Accounting policies are the specific principles, rules and procedures implemented by a
company's management team and are used to prepare its financial statements. These include any
methods, measurement systems and procedures for presenting disclosures. Accounting policies
differ from accounting principles in that the principles are the accounting rules and the policies
are a company's way of adhering to those rules.

3.1.2 GAAP (Generally Accepted Accounting Principles)

GAAP is a combination of authoritative standards (set by policy boards) and the commonly
accepted ways of recording and reporting accounting information. The primary purpose of
GAAP is to help accountants provide relevant and comparable information. In other words,
financial accounting practices should produce information that is relevant to the decision made
by financial statement users. GAAP identify uniform practices that make financial statements
more understandable and useful. Go through any annual report of a company and evaluate how
the companies are applying these GAAP principles (example:- Cost, Double Entry, Stable
Monetary, Cash or Accrual, Accounting Period, Conservatism, Business Entity Concept etc.) in
preparing their financial statement.
Accounting Standards for financial reporting by EXIM Bank Limited has to be developed
because in some cases Islamic financial institutions encounter accounting problems due to
existing accounting standards such as local GAAP being developed based on conventional
institutions, conventional product structures or practices, and may be perceived to be insufficient
to account for and report Islamic financial transactions.
Sharia'a compliant transactions that observe the prohibition on charging interest may not have
parallels in conventional financing and therefore, there may be significant accounting
implications. Likewise, the Islamic finance industry is under considerable pressure to enhance
practice and improve risk management systems and protect investors.

8
3.1.2 BAS Method of ICAB used by EXIM Bank Ltd:

The following table mainly focuses on the compliance of some relevant rules and regulations
under BAS (Bangladesh Accounting Standard) 1 in preparing the financial statement of EXIM
Bank of Bangladesh Limited.

a) Compliance with BAS-1

 BAS (Bangladesh Accounting Standard 1.9:

The objective of financial statements is to provide information about the financial position,
financial performance and cash flows of an entity that is useful to a wide range of users in
making economic decisions. To meet this objective, financial statements provide information
about an entity’s above particulars and EXIM Bank has fulfilled all the requirements.

 BAS (Bangladesh Accounting Standard) 1.10:

9
A complete set of financial statements comprises all the above particulars but EXIM Bank is not
following the similar components.

 BAS (Bangladesh Accounting Standard) 1.25:

The company reported a loss during the year as it was within the initial years of trading and the
customer base has not yet been fully established. Overheads were higher as expected in relation
to the launch of a new venture in relation to expected income. The results are the directors
consider that the company will be able to rely upon sufficient additional support from the parent
undertaking for at least the next 12 months, to be able to meet all its commitments as they fall
due.

 BAS (Bangladesh Accounting Standard) 1.29:

10
An audit involves obtaining evidence about the amounts and disclosures in the financial
statements is sufficient to give reasonable assurance that the financial statements are free from
material misstatement, whether caused by fraud or error.

b) Compliance with BAS (Bangladesh Accounting Standard) - 30

 BAS (Bangladesh Accounting Standard) 30.9:

11
3.1.3 Accounting System:
 How EXIM Bank Ltd. Follows Double Entry System:

12
There are two different ways to memorize the effects of debits and credits on accounts in the
double entry system of bookkeeping. They are the Traditional Approach and the Accounting
Equation Approach. Irrespective of the approach used, the effect on the books of accounts
remains the same, with two aspects (debit and credit) in each of the transactions.

How EXIM Bank Ltd. Follows Cash Entry Accounting System:

There are five main method of cash entry system followed by EXIM Bank Ltd. The critical
functions consist of:

1. Reporting all financial transactions for each student activity account within the
overall fund. An accounting of all cash receipts and cash disbursements must be
maintained.
2. Categorizing financial transactions into the correct student activity account of the
fund.
3. Summarizing transactions on a periodic basis and reporting on the summary  both
individually to each activity sponsor and on the consolidated school-wide basis to
the Accounting Services Department;
4. Ensuring the establishment of an audit trail for all transactions;
Reconciling the transactions of the student activity fund to an independent source (typically a
monthly bank statement) to ensure that the amounts were accounted for correctly.

How EXIM Bank Ltd. Follow Accrual Accounting System:

BREAKING DOWN 'Modified Accrual Accounting:
The modified accrual method of accounting costs less to maintain than full accrual accounting. 
Modified Accrual Accounting Method in Government:
The Government Accounting Standards Board (GASB), which is recognized as the official
source of generally accepted accounting principles (GAAP) for state and local governments,
establishes modified accrual accounting standards. 

BREAKING DOWN 'Modified Cash Basis:

Because both accounting methods have limitations, a business may use a modified cash method
to develop what it feels is a more accurate picture of its finances. 

4.1 Account System Maintenance:

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EXIM Bank Limited normally maintains its accounting system in four different
departments these are given below:

1. Accounts departments

2. Customer Service Department

3. Credit Department

4. Foreign Exchange Department

4.1.1 Accounts Department:

General expenses: General expenses are daily expenses like office stationary, printing
stationary, entertainment expense, traveling expense etc. A ledger for each type of
expense has to be maintained.

4.1.2 Direct payment of general expense:

When any general expense is paid directly then the journal entry is made in that fashion:
Payment of general expense (particular head) Dr
Cash/Pay order/Customer account Cr

4.1.3 Advance of direct payment:

When any general expense is paid before its actual period which means in advance then
the bank will pass this journal entry:

Advance payment of general expense (particular head) Dr

Cash/Pay order/Customer account Cr

4.1.4 Expire of certain period:

If a certain period of advance payment expires then the bank will pass this journal entry:
Particular expense Dr
Advance payment Cr

4.1.5After expiring the full period:

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When the period of advance payment becomes fully expired then the bank will write this
journal entry:
Adjusted account/expense head Dr
Cash/Pay order/Customer account Cr

4.1.6Payment of provision/ particular period:

When the bank pays the amount of provision of a particular period then it will pass this
journal entry:
Adjusting account Dr
General expense/particular head Cr

4.1.7After expiring of full provision period:

When the bank pays the whole amount of provision which means after expiring of full provision
period the bank passes this journal entry:

General expense Dr
Cash/Pay order/customer account Cr
4.2 Journals:

In accounting and bookkeeping, a journal is a record of financial transactions in order by date. A

journal is often defined as the book of original entry.
EXIM Bank Ltd. keeps the following journal:
Journal Entry (Contra Voucher) of L/C
When L/C is opened, the journal entry would be as follows.
Date Particulars Dr. Cr.
- Customer’s Liability XXX
- Banker’s Liability XXX

When documents come to L/C issuing bank, the journal entry would be as follows.
Date Particulars Dr. Cr.
- Paid Account XXX
- Exim Bank Ltd. General Account XXX
- Exchange Gain Account XXX
(As the documents are received)

4.3 Lodgment of the Documents:

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After receiving the documents from the exporters, at first EXIM Bank Ltd. write it in the PAD
Registrar. PAD Register contains date, PAD number, L/C number, and flame of the drawer,
name of the drawer, amount, and number of copies of various documents, name of the imported
items. This written procedure is called Lodgment.
 IFDBC (Inward Foreign Documentary Bill for Collection) Creation,
 Journal for interest on document
Date Particulars Dr. Cr.
- PAD Account XXX
- Interest on PAD Account XXX
(The interest is calculated on documents)
- Exchange Gain Account XXX
(As the documents are received)

a) Process of Calculating Interest on Document in EXIM Bank Ltd.

Calculation of Interest on Document
(Document value – Margin)* interest rate*days paid for interest = amount of
interest

Journal entries for receiving payment

Date Particulars Dr. Cr.
- Party Account XXX
- Margin Account XXX
- PAD Account XXX
(When the bank receive money from the
importer)

When L/C issuing bank Pay to the seller, the journal entry would be as follows:
Date Particulars Dr. Cr.
- FDBP Account XXX
- Postage Account XXX
- Source Tax XXX
- Customer Account XXX
( When the bank purchases bill through
negotiation before realization)

4.4 Negotiation of export documents:

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Negotiation stands for payment of value to the exporter against the documents fixed in the L/C.
If documents are in order, EXIM Bank Ltd. purchases (negotiates) the same on the basis of
banker- customer relationship. This is known as Foreign Documentary Bill Purchase (FDBP).
c) Payment of Bill

Date Particulars Dr. Cr.

- Exim Bank General Account XXX
- FDBP Account XXX
- Income Account XXX
( When the bank pay for the bill )

d) Journal Entries for Purchase of Local Bills

Purchasing the local bill which is known as Inland Documentary Bills for Purchase (IDBP). The
bank has to purchase the local bills through some process. The Inland documentary bills for
purchase (IDBP) is done in the following ways,-
a. EXIM Bank Ltd. gets L/C from other Bank.
b. Then EXIM Bank Ltd. officer advising the L/C to the party/Beneficiary.
c. Customers then present the documents for negotiation to EXIM Bank Ltd.
d. EXIM Bank Ltd. officials examine the documents to confirm the terms and conditions
of L/C.
Journal entries when the bank purchase local bill before realization
Date Particulars Dr. Cr.
- IDBP XXX
- Party XXX
- Commission XXX
- Charge Account XXX
( When the bank negotiate the local bill. )

Journal entries when the bank pay the amount of local bill
Date Particulars Dr. Cr.
- Sundry Deposit XXX
- IDBP XXX
- Party Account (If Surplus) XXX
( When the bank pay for the local bill )

4.5 Basis of preparation of the Financial Information Statement:

Conventional Banking:
17
The bank prepares its financial statements on a going concern basis under historical cost
convention and in accordance with first schedule (sec-38) of bank companies Act, 1991 as
amended by Bangladesh Bank circulars, International Financial Reporting Standards adopted as
Bangladesh Accounting Standard (BAS), the company Act, 1994, the Listing Rules of the Stock
Exchange, the Securities and Exchange Rule 1987 and other laws and regulations applicable in
Bangladesh Islamic Banking.

Bank’s Statement:

The bank operates Islamic Banking in 2 (two) branches designated for the purpose fin complying
with the rules of Islamic Shariah. The financial statements of the branches have also been
prepared as per Bank Companies Act, 1991, Bangladesh Accounting Standard (BAS), Financial
Accounting Standard issued by the Accountancy &amp. Auditing organization for Islamic
Financial Institutions for which a separate set of books and records are being maintained.
Separate statement of accounts of consolidated accounts of 2 (two) Islamic Banking branches are
enclosed herewith.

EXIM also reports another two statement with those five statement mentioned above.

These statements are called value added statement & amp, EVA statement.

Value added statement: This statement represents the value that the bank adds by its banking
service and none banking services and how it distributes its added value.

EVA statement: This statement represents the amount of economic value that the bank is added
for the particular year.

4.6 Different Reporting Practices of EXIM Bank Limited:

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Financial statements, auditors’ report, board of directors’ report and notes to the financial
statements are the important parts of published reports of the organizations. In some cases users
do not understand the information reported in these statements. Therefore, for better
understanding, EXIM Bank Limited uses different types of reporting practice techniques which
are given below:
a. Funds flow statements
Funds Flow Statement is a statement prepared to analyze the reasons for changes in the
Financial Position of a Company between 2 Balance Sheets. It shows the inflow and outflow
of funds i.e. Sources and Applications of funds for a particular period.
b. Highlight statement
A page at the start of the annual report setting out key measures of performance during the
reporting period.
c. Narrative statement
A credit account narrative is a record of transactions (IATs) made between client’s accounts.
They're what they see on their credit account statement so client knows that it's from their
debit account.
d. Summarized Balance sheet and Income statement
The balance sheet summarizes a business's assets, liabilities, and shareholders ' equity.
A balance sheet is like a photograph; it captures the financial position of a company at a
particular point in time. The balance sheet is sometimes called the statement of
financial position.
e. Statistical records
A vital statistical record is a document or form, containing the items of information
concerning an individual vital event or a number of vital events of the same type, filled in at
the time of registration, to meet the needs of vital statistics compilation.
f. Policies and procedures of accounts
Accounting policies are the specific principles and procedures implemented by a company's
management team that are used to prepare its financial statements. These include
any accounting methods, measurement systems, and procedures for presenting disclosures.

g. Ratio analysis

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 Ratio analysis is the comparison of line items in the financial statements of a business. Ratio
analysis is used to evaluate a number of issues with an entity, such as its liquidity, efficiency
of operations, and profitability.
h. Financial statements in vertical forms
Vertical analysis of financial statements is a technique in which the relationship between
items in the same financial statement is identified by expressing all amounts as a percentage
a total amount. This method compares different items to a single item in the
same accounting period.
i. Statement of cost analysis
Cost Projection Statement and Analysis. Stating cost projection is an activity carried out
during the project initiation phase to identify costs for development, implementation and
maintenance of the project. The analysis intends to identify, estimate and describe total
expenses of project management initiative.
j. Consolidated financial statements
Consolidated financial statements - are the "Financial statements of a group in which
the assets, liabilities, equity, income, expenses and cash flows of the parent company and
its subsidiaries are presented as those of a single economic entity"
k. Elucidation of directors’ report
A directors' report is a financial document that larger limited companies are required to file at
end of the financial year.

20
4.7 EXIM Bank Limited Overall 5 Years Performance:
4.7.1 Profit & Loss Account

21
4.7.2 Cash Flow Statement

22
4.7.3 Statement of Changes in Equity

4.7.4 Balance Sheet

23
4.7.5 Notes of the Financial Statements
a) Depreciation: Depreciation is charged at the following rates on strait-line method on
cost/revalued amount of assests from the date of purchase/revaluation:

Assets Category Rate of Depreciation p.a. (%)

Land 0.00
Building and Construction 2.50
Leasehold property – building 2.50
Furniture and Fixture 10.00
Office Equipment 20.00
Interior Decoration 10.00
Vehicles 20.00
Books 20.00

b) LEASE: Leases are classified as finance lease whenever the terms of the lease transfer
sustainability all the risks and rewards of ownership to the lessee. All other leases are classified
as operating leases as per BAS 17 "leases"

c) Earnings per share: Earnings per share (EPS) have been computed by dividing the basic
earnings by the number of ordinary shares being calculated as per BAS-33. Previous year's
figures have been adjusted as per guidelines of BAS-33.

d) Taxation: Tax is the recognized in the income statement, expect that a change attributable to
an item of income of expense recognized as other comprehensive income or to an
item recognized directly in equity is also recognized in other comprehensive income or directly
in equity respectively. The current income tax charge is calculated on the basis of tax of rates and
laws that have been enacted or substantively enacted by the reporting date on the countries where
the company operates and generates income.

24
4.8 EXIM Bank Five Years Performance

Sl. Particulars 2014 2015 2016 2017 2018

No.

1 Authorized Capital 3500.00 3500.00 3500.00 10000.00 10000.00

2 Paid-up Capital 1713.76 2142.2 2677.75 3373.96 6832.27

3 Shareholder’s Equity 3111.69 4042.53 4989.2 6717.21 12474.85

4 Total Capital (Tier I + Tier 3467.37 4569.56 5763.89 7718.89 13928.40*

II)

5 Statutory Reserve 810.88 1134.64 1532.55 2092.97 3154.76

6 Total Assets 41793.54 51503.03 68446.46 86213.37 113070.98

7 Total Liabilities 38681.86 47460.5 63457.26 79496.16 100596.13

8 Deposits 35023.02 41546.57 57586.99 73835.46 94949.40

9 Investment (General) 32641.27 40195.24 53637.68 68609.91 9329.65

10 Investment (Shares& 2233.25 2457.72 2894.02 2189.54 6012.86

Securities)

11 Total Contingent liabilities 18994.09 22632.65 26070.57 30109.11 55098.36

12 Total Risk Weighted 32401.36 40706.47 53428.99 69058.87 142057.50

Assets

13 Total Fixed Assets 178.43 200.7 293.53 381.98 463.75

14 Total Income 4067.57 6407.96 8356.82 10383.62 13723.96

15 Total Expenditure 3588.89 4499.76 5838.43 7201.87 7830.16

16 Profit before Provision and 1378.67 1908.2 2518.39 3181.78 5793.79

tax

17 Profit before tax 1199.49 1618.8 1989.55 2802.12 5308.96

18 Net profit after provision 650.29 930.84 1096.63 1694.1 3476.01

and tax

25
19 Foreign Exchange 96175.1 117900.14 156434.57 162604.61 227966.60
Business

a) Import Business 49596.7 61399.4 78540.49 83911.51 129570.73

b) Export Business 46234.6 55790.42 76465.62 76240.77 95395.45

c) Remittance 343.8 710.32 1428.46 2452.33 3036.42

20 No. of Foreign 246 256 278 333 354

Correspondent

21 Profit earning assets 35161.48 42357.65 56192.52 69006.57 97501.97

22 Non-profit earning assets 6632.07 9145.38 12253.94 17206.81 15569.01

23 Investment as a % of total 93.18% 96.75% 93.14% 92.92% 98.26%

Deposit

24 Capital Adequacy Ratio 10.70% 11.23% 10.79% 11.18% 9.80%**

25 Dividend 25 32 26 35 35

Cash (%) 0 7 0 0 0

25 25 26 35 35
Bonus (%)
Rights Share 1R:2       1R:2
26 Cost of fund 9.17% 9.07% 9.52% 9.09% 7.10%
27 Net Asset Value Per Share 181.57 188.71 186.32 199.09 18.26
28 Earnings per share ( EPS) 43.48 34.76 40.95 50.21 5.35
29 Price earnings ratio (times) 7.74 9.02 7.85 7.52 11.34
30 Return on Assets (ROA) 1.73% 2.0% 1.83% 2.19% 3.54%
after tax
31 No. of Shareholders 18771 23284 24387 29302 99882
32 Number of Employees 1120 1344 1575 1735 1909
33 Number of Braches 39 50 72 90 105

Source: Annual Report of EXIM Bank 2014-2018

5.1 Accounts Divisions of EXIM Bank Limited Sonapur Branch:

26
EXIM Bank Limited operates in a variety of different ways and serve a variety of different
market sectors. As a large banking firm, it has several divisions or groups, making up the totality
of bank corporate divisions. While different banks may have different divisions, these are often
the main divisions offered:

 Retail Banking
 Corporate/Commercial Banking
 Global Banking
 Private Banking
 Investment Banking

Under each of these divisions, there may be further subdivisions that support each group.

a) Bank Corporate Divisions – Retail Banking:

The retail banking division takes care of the regular day-to-day banking most people know banks
for. This includes providing checking and saving services, and issuing credit cards. Retail
banking divisions may also be in charge of providing loans, mortgages, and other financing.

The following are some other products and services that may be offered under retail banking
divisions:

 Lines of credit
 Investment management and accounts
 Insurance
 Retirement and education accounts

b) Bank Corporate Divisions – Commercial Banking:

Commercial banking does the same things that retail banking does, but for a larger audience.
Where retail banking is tailored for the individual, commercial banking caters to small
businesses or larger firms. (There are, however, cases were banks will cater to small businesses
under their retail banking division). Additionally, commercial banking divisions may also
provide advisory services for their clients.

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c) Bank Corporate Divisions – Global Banking:

With increasing globalization, EXIM Bank Ltd. has a specialized global banking division that
specializes in cross-border transactions. In addition to the services offered by a commercial
banking division, a global banking group may provide:

 Multi-currency management services and products

 Foreign currency accounts
 Foreign currency credit cards
 Trans-border advisory services
 Liquidity management

d) Bank Corporate Divisions – Private Banking:

Private banking divisions specialize in wealth management for high net-worth individuals
(HNWI) or families. Services offered may include investment, insurance, and loan products.

5.2Transaction of EXIM Bank Limited

5.2.1 Transactions Types:
There are many transaction occurred in bank which are listed below:

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A. Primary Functions of Banks:
The primary functions of a bank are also known as banking functions. They are the main
functions of a bank.
These primary functions of banks are explained below.
1. Accepting Deposits:
The bank collects deposits from the public. These deposits can be of different types, such as :-
a. Saving Deposits
b. Fixed Deposits
c. Current Deposits
d. Recurring Deposits
a. Saving Deposits
This type of deposits encourages saving habit among the public. The rate of interest is low. At
present it is about 4% p.a. Withdrawals of deposits are allowed subject to certain restrictions.
This account is suitable to salary and wage earners. This account can be opened in single name
or in joint names.
b. Fixed Deposits
Lump sum amount is deposited at one time for a specific period. Higher rate of interest is paid,
which varies with the period of deposit. Withdrawals are not allowed before the expiry of the
period. Those who have surplus funds go for fixed deposit.
c. Current Deposits
This type of account is operated by businessmen. Withdrawals are freely allowed. No interest is
paid. In fact, there are service charges. The account holders can get the benefit of overdraft
facility.
d. Recurring Deposits
This type of account is operated by salaried persons and petty traders. A certain sum of money is
periodically deposited into the bank. Withdrawals are permitted only after the expiry of certain
period. A higher rate of interest is paid.
2. Granting of Loans and Advances
The bank advances loans to the business community and other members of the public. The rate
charged is higher than what it pays on deposits. The difference in the interest rates (lending rate
and the deposit rate) is its profit.

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The types of bank loans and advances are:
a. Overdraft
b. Cash Credits
c. Loans
d. Discounting of Bill of Exchange
a. Overdraft
This type of advances are given to current account holders. No separate account is maintained.
All entries are made in the current account. A certain amount is sanctioned as overdraft which
can be withdrawn within a certain period of time say three months or so. Interest is charged on
actual amount withdrawn. An overdraft facility is granted against a collateral security. It is
sanctioned to businessman and firms.
b. Cash Credits
The client is allowed cash credit up to a specific limit fixed in advance. It can be given to current
account holders as well as to others who do not have an account with bank. Separate cash credit
account is maintained. Interest is charged on the amount withdrawn in excess of limit. The cash
credit is given against the security of tangible assets and / or guarantees. The advance is given for
a longer period and a larger amount of loan is sanctioned than that of overdraft.
c. Loans
It is normally for short term say a period of one year or medium term say a period of five years.
Now-a-days, banks do lend money for long term. Repayment of money can be in the form of
installments spread over a period of time or in a lump sum amount. Interest is charged on the
actual amount sanctioned, whether withdrawn or not. The rate of interest may be slightly lower
than what is charged on overdrafts and cash credits. Loans are normally secured against tangible
assets of the company.

d. Discounting of bill of exchange

The bank can advance money by discounting or by purchasing bills of exchange both domestic
and foreign bills. The bank pays the bill amount to the drawer or the beneficiary of the bill by
deducting usual discount charges. On maturity, the bill is presented to the drawee or acceptor of
the bill and the amount is collected.

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B. Secondary Functions of Banks
The bank performs a number of secondary functions, also called as non-banking functions.
These important secondary functions of banks are explained below.
1. Agency Functions

The bank acts as an agent of its customers. The bank performs a number of agency functions
which includes:
a. Transfer of Funds
b. Collection of Cheques
c. Periodic Payments
d. Portfolio Management
e. Periodic Collections
f. Other Agency Functions
a. Transfer of Funds
The bank transfer funds from one branch to another or from one place to another.
b. Collection of Cheques
The bank collects the money of the cheques through clearing section of its customers. The bank
also collects money of the bills of exchange.
c. Periodic Payments
On standing instructions of the client, the bank makes periodic payments in respect of electricity
bills, rent, etc.
d. Portfolio Management
The banks also undertakes to purchase and sell the shares and debentures on behalf of the clients
and accordingly debits or credits the account. This facility is called portfolio management.
e. Periodic Collections
The bank collects salary, pension, dividend and such other periodic collections on behalf of the
client.
f. Other Agency Functions
They act as trustees, executors, advisers and administrators on behalf of its clients. They act as
representatives of clients to deal with other banks and institutions.

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2. General Utility Functions
The bank also performs general utility functions, such as:
a. Issue of Drafts, Letter of Credits, etc.
b. Locker Facility
c. Underwriting of Shares
d. Dealing in Foreign Exchange
e. Project Reports
f. Social Welfare Programmes
g. Other Utility Functions
a. Issue of Drafts and Letter of Credits
Banks issue drafts for transferring money from one place to another. It also issues letter of credit,
especially in case of, import trade. It also issues travelers’ cheques.
b. Locker Facility
The bank provides a locker facility for the safe custody of valuable documents, gold ornaments
and other valuables.
c. Underwriting of Shares
The bank underwrites shares and debentures through its merchant banking division.
d. Dealing in Foreign Exchange
The commercial banks are allowed by RBI to deal in foreign exchange.
e. Project Reports
The bank may also undertake to prepare project reports on behalf of its clients.
f. Social Welfare Programs
It undertakes social welfare programs, such as adult literacy programs, public welfare
campaigns, etc.
g. Other Utility Functions
It acts as a referee to financial standing of customers. It collects creditworthiness information
about clients of its customers. It provides market information to its customers, etc. It provides
travelers' cheque facility.

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5.2.2 Daily Transaction Statements of EXIM Bank Ltd., Sonapur Branch (20
Weeks)
Amount in Crore

No. of Weeks Accepting Granting Agency Utility

Deposits Advances Functions Functions
01 4.15 2.35 1.10 0.75
02 3.90 2.68 0.90 0.85
03 3.43 2.49 1.01 0.63
04 4.32 1.79 1.00 0.30
05 3.03 1.43 1.33 0.41
06 3.79 2.04 1.79 0.89
07 4.33 2.09 1.15 0.77
08 3.17 3.41 0.90 0.31
09 2.37 4.11 1.01 0.83
10 3.67 2.89 0.88 0.68
11 3.55 2.43 1.21 1.01
12 2.79 3.04 2.19 0.29
13 4.35 2.55 1.79 0.15
14 3.98 2.33 1.30 0.23
15 3.23 2.69 1.11 0.59
16 4.32 1.79 1.00 0.30
17 3.67 2.89 0.88 0.68
18 3.55 2.43 1.21 1.01
19 2.79 3.04 2.19 0.29
20 3.90 2.68 0.90 0.85
Table: Daily Transaction Statements

5.2.3 Monthly Transaction Statements of EXIM Bank Ltd., Sonapur Branch

(20 Months)
Amount in Crore Tk.

SL. No. Accepting Granting Agency Utility

Deposits Advances Functions Functions
1 16.80 9.20 4.35 3.55
2 12.90 9.10 3.28 3.31
3 11.71 8.31 4.13 3.12
4 12.23 6.31 4.00 2.31

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 5 12.41 5.11 5.20 2.60
6 11.34 8.16 4.10 3.12
7 12.90 9.10 3.28 3.01
8 13.80 8.44 4.75 2.95
9 10.90 9.23 3.98 3.39
10 14.80 9.09 4.15 3.05
11 12.58 7.11 4.93 2.91
12 12.81 6.81 5.81 3.60
13 11.90 8.31 4.13 3.12
14 12.23 6.31 4.00 3.31
15 12.18 4.11 4.89 3.60
16 11.88 8.31 4.13 3.09
17 12.23 6.31 4.00 3.25
18 12.90 8.75 3.28 3.41
19 16.80 9.79 4.35 2.95
20 12.41 5.51 5.31 3.60
Table: Monthly Transaction Statements

5.3 Depreciation System

a) Recognition and Measurement
Fixed assets accept land & building are started at cost less accumulated depreciation. Lab and
buildings are stated at revaluated amount less accumulated depreciation, where applicable.
Revaluation has been done by engaging a professional valuer as per IAS-16 “Property, Plant and
Equipment”. Bangladesh Bank Circulars and Circulars/Notifications issued by regulators.
ii) Depreciation
Depreciation is charged at the following rated on straight line method on cost/revalued amount of
assets from the date of purchase/revaluation:
Assets Category Rate of Depreciation p.a (%)
Land 0.00
Building and Construction 2.50
Leasehold Property – Building 2.50
Furniture and fixtures 10.00
Office equipment 20.00
Interior decoration 10.00
Vehicles 20.00
Books 20.00

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5.4 GAAP Rules & Regulations Followed by EXIM Bank Ltd.
EXIM Bank Limited followed some GAAP rules & regulations which are stated below:
 Principle of regularity: GAAP-compliant accountants strictly adhere to established rules
and regulations.
 Principle of consistency: Consistent standards are applied throughout the financial
reporting process.
 Principle of sincerity: GAAP-compliant accountants are committed to accuracy and
impartiality.
 Principle of permanence of methods: Consistent procedures are used in the preparation of
all financial reports.
 Principle of non-compensation: All aspects of an organization's performance, whether
positive or negative, are fully reported with no prospect of debt compensation.
 Principle of prudence: Speculation does not influence the reporting of financial data.
 Principle of continuity: Asset valuations assume the organization's operations will
continue.
 Principle of periodicity: Reporting of revenues is divided by standard accounting time
periods, such as fiscal quarters or fiscal years.
 Principle of materiality: Financial reports fully disclose the organization's monetary
situation.

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  Principle of utmost good faith: All involved parties are assumed to be acting honestly.

6.1 Summary of the Findings:

1. Accounting Standards for financial reporting by EXIM Bank Limited is not developed
fully.
2. EXIM Bank Ltd. mainly focuses on the compliance of some relevant rules and
regulations under BAS (Bangladesh Accounting Standard) 1 in preparing the financial
statement.
3. EXIM Bank Ltd. Follows Cash Entry Accounting System & Accrual Accounting System.
4. EXIM Bank Limited normally maintains its accounting system in four different
departments like accounts departments, customer service department, credit department,
foreign exchange department.
5. EXIM Bank Limited reports its Financial Statement according to Bangladesh Accounting
Standard (BAS) 1 “Presentation of Financial Statements”.
6. Accounting system of EXIM Bank Limited is not traditional.
7. Accounting Standards by GAAP for financial reporting by EXIM Bank Limited is not
developed because in some cases Islamic financial institutions encounter accounting
problems due to existing accounting standards.
8. Fixed assets accept land & building are started at cost less accumulated depreciation.
Lab and buildings are stated at revaluated amount less accumulated depreciation,
where applicable.

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 9. Act 1991 properly not followed.
6.2 Recommendations:
Though EXIM Bank Limited tries to give the best customer support, they have some lake and
linkage compare to other bank of the same generation. The recommendations for this report are‐
1. Accounting Standards for financial reporting by EXIM Bank Limited should be
developed fully.
2. Accounting system should be developed.
3. Accounting policy should be maintained.
4. Accounting Standards by GAAP for financial reporting by EXIM Bank Limited should
be developed.
5. Act 1991 should be followed properly.

6.3 Conclusion
EXIM bank has converted all of their system and policy of traditional banking to Islamic
Banking and is now a Shariah Based Islami Bank. EXIM Bank Ltd has emerged itself as one of
the most disciplined and promising banks in the commercial banking sector in Bangladesh. In
this competitive market EXIM Bank Ltd. competes not only with the others commercial banks
but also with the public Bank sector banks and has been able to throw in more positive
contributing towards economic development of Bangladesh as compared to other banks.
EXIM Bank Ltd. invests comparatively more funds in export and import businesses. It has been
operating its foreign exchange operation with great success and been able to make positive
contribution to the economy of Bangladesh by virtue of its devoted and expert personnel. EXIM
Bank Ltd is considered to be specialized in Foreign Exchange Operation. That is exactly why
within a very short period of time, EXIM Bank Ltd. has positioned itself one of the leading
bank in Bangladesh.
To the gateway to practical professional life, an experience at EXIM Bank Limited as an intern
was a privilege for me. EXIM Bank Ltd. does offer a real practical orientation to the new
comers with typical corporate culture. This two months internship orientation with EXIM Bank
Ltd. undoubtedly will help me a lot to understand and cope with any future typical corporate
culture.

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References:

 EXIM Bank Corporate Intranet

 Annual Report of EXIM Bank.
 Statement of Affairs, Prepared by accounts section of EXIM Bank of Sonapur
Branch.
 Various information’s supplied by EXIM Bank, Sonapur Branch.
 Websites:
 www.eximbankbd.com.bd
 www.bangladesh-bank.org
 Websites of other banks

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