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					                                                         Corporate Laws (Specialised Institutions Laws 1)


                           Banking Companies Ordinance, 1962
SYLLABUS
Banking Companies Ordinance, 1962 – Sections pertaining to audit and accounts, mainly sections
34 to 38 of the Banking Companies Ordinance, 1962
                                                                                             Page | 1
ACCOUNTS & BALANCE SHEET [34]
               Banking company incorporated in Banking        company       incorporated
Applies to:
               Pakistan.                        outside Pakistan.
  Scope        All business transacted by it.   All business transacted in Pakistan.
 Balance       On expiry of each calendar year. On expiry of each calendar year.
sheet date
 Format        2nd schedule or as near thereto.          2nd schedule or as near thereto.
   SBP         May amend 2nd schedule after at least     May amend 2nd schedule after at least 15
 powers        15 days notice in official gazette.       days notice in official gazette.
               Manager or principal officer & Atleast    Manager or agent of principal officer &
 Signing
               03 directors if more than 03 directors,   Officer next in seniority to the manager
   off
               otherwise all directors                   or agent.

AUDIT [35]
Qualification of     Qualified under CA Ordinance, 1961 for auditor of companies.
  auditors           Has name on SBP panel of auditors.
                     The SBP shall classify the panel of auditors, so maintained, in different
                     categories for different banking companies keeping in view the scope and
                     size of such banking companies.
                     If SBP is not satisfied with the performance of the auditor or the auditor has
    Panel of         not fulfilled any of the requirements the SBP after giving the auditor an
    Auditors         opportunity of being heard may:
                     (a) revoke the appointment of external auditors of the banking company;
                     (b) downgrade the category of the auditor in the panel of the auditors; and
                     (c) remove the auditor from the panel of the auditors for a maximum period
                         of five years.
                     03 years.
Term of auditors
                     Not to be removed without prior approval of SBP.
Audit guidelines     SBP may prescribe from time to time & Auditor shall be bound to follow.
Auditor’s Power      Auditor shall have all the powers and duties under CO 1984.
                     Whether or not:
                         (a) Information and explanation satisfactory.
  Additional
                         (b) Transactions within powers of banking company.
  contents of
                         (c) Branch return adequate for audit.
auditors’ report
                         (d) Profit and loss shows true balance of profit or loss.
                         (e) Any other matter for notice of shareholders.
                     The auditors shall report all the matters of material significance to State
 Report to SBP       Bank and reporting of such information and material shall not constitute
                     breach of confidentiality under any law for the time being in force.

                                                  financedoctors@gmail.com (www.financedoctors.net)
           ICAP Module E

           SUBMISSION OF RETURNS [36]
             Statements to be filed      Financial statements & auditor’s report approved by AGM
                 Submitted to            SBP
                                         03 months of financial year close.
                   Time frame
                                         SBP may extend upto 03 months in special circumstances.
Page | 2
           FILING OF FINANCIAL STATEMENTS TO REGISTRAR [37]
           Applies to:                   Private company      COMPULSORY
                                         Other                OPTIONAL
           Number of copies              03 (three)
           Time of filing                Same time when returns u/s 36 are filed to SBP
           Relevance with CO1984         Submission of copies under this section is considered fulfilling
                                         the requirements of CO 1984.

           DISPLAY OF LATEST AUDITED FINANCIAL STATEMENTS [38]
           Applies to:                   Banking companies incorporated outside Pakistan
           Place of display              Principal office and every branch in Pakistan at conspicuous
                                         place
           From when                     Not later than 1st Monday in August
           Until                         Replaced by subsequent financial statements

           ACCOUNTING PROVISIONS OF THIS ORDINANCE [39]
           These are NOT applied retrospectively.

           INSPECTION OF ACCOUNTS [40]
           Who inspects                  Officer appointed by SBP
           Time of inspection            At any time
                                         Or when directed by FG
           Scope of inspection           Books of accounts of any banking company
           Report                        It is submitted to FG

           MISCELLANEOUS
           2ND SCHEDULE TO ORDINANCE
           20% of profit after tax must be transferred to statutory reserve.

           MANNER OF PUBLICATION OF FINANCIAL STATEMENTS
           Within 03 months of financial year close.
           In newspapers having circulation in place of its principal office
           MERGER
           In case of merger, SBP shall have all powers which the Court has under CO1984.


                                                            I
           Kashif Adeel

				
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