MUHAMMAD Hanif

PAKISTAN

### GPURIN YAR HUSSAIN

Hawala broker Main Business
Activities 503601685

- To Transfer Money through station

- To Exchange Currecny

Walk in Customer
- keep deposits
- Transfer Money via
station/TPS Credit customer
- Currency Exchange Customer

Hawala broker

- Cash is paid in hand OR TT/DD is sent

to transfere money in adv to O.S & to
Customer own A/C
via whole seller

owned station

whole Seller

-These are orders of huge amounts which is transferred via W.S to

customers own A/C.
-cash is recorded as liability untill instruction is sent to W.S to transfer
Money to Customer A/c, Rate is negotiated and than SVC and RM income
is recognised.

Cash Transferred
into customer a/c

Note:- TPS (Third Party Station) are Money exchangers, Money is transferred via TPS
Money to Owned Station(O.S) is transferred via Whole Seller(W.S)

Whole seller (W.S) is the main source which transfer money to owned station a
customers own account, Exchange Rate is negotiated with W.S to us which is
the difference remains as Remittance income.
 Remittance Income (RM)

Owned Stations

Money Flow Broker House

MNG JOH MND BTK PSH MTA CHK

 YAR HUSSAIN PIYAR HUSSAIN S/.O YAR15000
HUSSAIN

- To transfer money through

TPS (other M.Exchanger)
- To transfer money through w.s

Walk in Customer

Hawala broker

-List of Remittances
sent to be paid by
S,

Rate is determined by negotiation

with Party
owned station Third Party
Station

is transferred via W.S to -Customer Pay cash in PRS at station which is to be

paid at Office in Dhm, there is a need to account for
on is sent to W.S to transfer any arising remittance income or Loss and increase
d and than SVC and RM income in cash at station

customer

s, Money is transferred via TPS and cash is paid to them at office

Whole Seller(W.S)

nsfer money to owned station as well as huge amount to

otiated with W.S to us which is the purchase Rate
CHK
 0

414

000./.
]
 Debit Credit

1- Journal Entries for walk in Customer TM via third party Station (TPS)
Cash 510 -Income from SVC is increased wi
To TPS (M.Exc) 505 amount received from Customer H
SVC 5 to TPS
OR
Credit Customer if Credit customer TM via TPS
To TPS (M.Exc)
SVC
OR
Customer (Receivable) Customer a/c is debited as amount
To TPS (M.Exc) sometime later
SVC

TPS 505 - Income from Remittances is incre

To Cash 500 the difference when cash is paid to
negotiated with TPS at end of the
RM income 5

2- Journal Entries for walk in customer TM via W.S

-Cash is first recorded as custome
Cash 510 - SVC and RM income is recognise
instruction to transfer money to res
customer account is sent to W.S, R
to walk in Customer 510 negotiated and W.S liability is crea

walk in Customer 510

to W.S 495
SVC 10
Rm income (exc.Rate Difference) 5

W.S 495
to Cash 495 -Amount is paid to W.S in hand an
-some time later it is sent via TT.
OR

W.S 495
TT/DD Charges 2
to Cash 497
 3- Journal Entries for Credit customer TM via W.S
- Pending Credit Customer TM ord
Credit Customer be created for later posting when
amount is paid to W.S, which wil
To W.S confirm the exchange Rate.
SVC

W.S
To Cash
RM income

3- Journal Entries for Customer TM via owned Station

Entries for Both Walk in customers
Cash Customers
To Cutomer A/c
SVC

Customer A/c
To Station
RM income

OR

Cash 450
To owned Station
SVC
RM income Updated Station Rate is used to wo
OR out RM income

Credit Customers
To owned Station
SVC
RM income

4- Journal Entries to Recognise Exchange Gain/Loss

Exchange Gain/Loss for currency
Cash at Owned Station station is immediately recognized
is ordered to transfer
To Exchange Gain money to owned Station at a Rate
when gain is recognised existing Rate… Or Current Availab

OR

Exchange Loss
 To Cash at Owned Station
when loss is recognised.

5- Journal Entries for Customer Deposit money at station and

withdraw at office
There will be Income or Loss arisin
Cash at Station Remittances received at office, wh
recognised soon as Remittance ad
To Credit Customer
received from station.
RM income
OR
Cash at Station
RM Loss
To Credit Customer

Credit Customer
To Cash

6- Journal Enties for Sale of Tickets

Cash/Credit Customer
To Account Payable
Income from Tickets
 ncome from SVC is increased with Half of the
mount received from Customer Half to be paid
o TPS
Credit customer TM via TPS
ustomer a/c is debited as amount is received
ometime later
Income from Remittances is increased with
he difference when cash is paid to TPS(Rate is
egotiated with TPS at end of the day)
Cash is first recorded as customer liability
SVC and RM income is recognised when
nstruction to transfer money to respective
ustomer account is sent to W.S, Rate is
egotiated and W.S liability is created.
-Amount is paid to W.S in hand and
-some time later it is sent via TT.
Suggestion:-
Two Different Ex.Rates (1. For Trasactions with TPS 2. for Trasaction
shall be used to ascertaine the Purchase Price.
1- walk in /Credit customers transactions are posted to Different TPS
so there is a need that when TPS are paid at later time
the system should allow a negotiated Ex.Rate to be applied
against selected Transaction to arrive at Remittance income.
For this to happen a Repot for trasaction posted to TPS a/c
The same should be repeated for Customers who send money via W.S
2- When new Rate is available from W.S or Money is transferred to
Station via W.S, the Balance at station is to be re-stated according
to this available new rate.
3- And the Difference should be adjusted to Exchange Gain/Loss A/C.
Dhm Ex.Rate
1 station 500 20
 Pending Credit Customer TM order need to
be created for later posting when the
amount is paid to W.S, which will also
confirm the exchange Rate.

2 526.32 19
Entries for Both Walk in customers and Credit
Customers

500 20
pdated Station Rate is used to work
ut RM income 476.19 21

Exchange Gain/Loss for currency held at

station is immediately recognized when TT/DD
s ordered to transfer
money to owned Station at a Rate Different to
existing Rate… Or Current Available Rate.
There will be Income or Loss arising from
Remittances received at office, which will be
ecognised soon as Remittance advice is
eceived from station.
asactions with TPS 2. for Trasaction with W.S)
rchase Price.

ctions are posted to Different TPS

are paid at later time
ated Ex.Rate to be applied
rive at Remittance income.
asaction posted to TPS a/c
Customers who send money via W.S

W.S or Money is transferred to

ation is to be re-stated according

usted to Exchange Gain/Loss A/C.

PRs
10000
10000

10000

10000
 Chart Of Accounts

Head Account control Accounts

1- Fixed Assets
Furniture

Cars

Computers & Equip

Contract & Agreements

License
Long-term Deposits
2- Current Assets
Cash in Hand (Dhm)
Cash in Hand (PRS)
Cash Held at Station

Bank

Advances

Short-term Deposits
Other Receivable
3- Expenses
Delivery Charges

Salaries
 Utilities

CAR Expenses

Stationery
Food, Water, Tea
insurance
Rent
4- Liabilities
Customers Deposits

Loan from Other Branches

Account Payable

5- Income
Customer Remittances
Exchange Gain/Loss
Service Charges
Income from Cur Exng

Income form Tickets

6- Equity
Capital
Retained Earnings
Drawings

Types of Reports

1- Daily Transaction Reports with sub total

i.e Customer Remittance Report with Dhm & PRS.
 * for each TPS
* for station
* for W.S
* also for daily total cash Transaction

2- Aged Debtor Analysis

3- Aged Creditor Analysis
4- Statement of Financial performance
5- Statement of Financial Position
6- Cash Flow statement
Transaction Accounts

Fitting & Fixtures

Car No.12345

Computers
Printers
Cash Machine

Mingora
Batkhela
Mardan

Bank Al-islami
Habib Bank

Advances to Customers
Advance Rent
Advance Insurance

Postage Expenses
TT/DD charges

Staff Names
 Electricity Bills
Telephone Bills
Internet Charges

Fuel & Maintenance

Stationery
Food, Water, Tea
insurance Expense
Rent Expense

Credit Customers
her Branches

whole seller
TPS
Travel Agent
Other Payables

PRS

ion Reports with sub total

emittance Report with Dhm & PRS.
r daily total cash Transaction

inancial performance
inancial Position
Muhammad Iqbal Shah Mian
Hawala Broker
Statement of Financial Performance
For the year Ended 31 March 2009
2009
Revenue
Income from Remittances
TT/DD charges Received

Cost of Services
License Fee
Service charges paid

Gross Profit From Hawala Operation

Revenue
Income from Ticketings

Cost of Ticketings

Total Gross Profit

Other Expenses
Administration Expenses
Salaries
Electricity Bills
Mobile Cards
Telephone Bills
Internet Charges
Stationary
Traveling Expenses
Customer Entertainment exp
Food & Water
Rent Expense
License Fee Charge
Staff Visa Fee charge
insurance Expense
Fittings & Fixtures
Computers & Equipments

Net Profit From Operation

2008
Muhammad Iqbal Shah Mian
Hawala Broker
Statement of Financial Position
as at 31 March 2009
2009 2008

Non-Current Assets
Fixed Assets
Furniture -
Fitting & Fixtures -
Computers -
Printers -
Cash Machine -
-

Current Assets
Cash In Hand 155,110
Cash in Hand (PRS)
Petty Cash
Banks UAE National Bank
Sundry Customers
Special Debit Customer 266,202
Advances
Head Office (Abu-Dhabi) 5,782,542
Sundary Customers 2,112,157
Staff
Rent
Insurance
License Fee
Staff Visa Fee

8,316,011

Total Assets 8,316,011

Equities & Liabilities

Capital 596,013
Retain Earnings
Drawings -
596,013

Current Liabilities
Sundary Customers 7,545,218
Special Credit Customer 174,780
Account Payable
Whole sellers
Travel Agent
7,719,998
Total Equities & Liabilities 8,316,011
-
 Fixed Assets Register

W/D Value Non-Current Assets

1-Apr-10 Description Opening Bal Addition Deletion
Furniture
Fitting & Fixtures
Computers
Printers
Cash Machine
Intangible Assets

Staff Visa Fee

Amortisation Schedule

Advance Expenses
Monthe
License Fee Rent Insurance
Fee paid in adv

April
May
June
July
August
September
October
November
December
January
February
March

TOTAL
ixed Assets Register

Depreciation & Amortisation W/D value

Closing Balance Opening deletion For the Year Closing 31-Mar-11
Whole seller
Abud-Dhabi Head Office

BKA- Batkhela
DAG-Dagar
JOH-Johar
KHW-Khwaza Khela
MAR-Mardan
MNG-Mingora
MYN-Madyan
PBA-Pir Baba
SNI- Sarsani
SWB-sawabi

Fazal & Brothers

MIN-Mingora
PWR-Peshawar
ABT-Abot Abad
BTM-Batagram
Dak- Darra Adam khel
KOT-Kohat
MZA-Muzafar Abad
RWP-Rawalpindi
LHR-Lahore
GWL-Gujranwala
GRT- Gujrat
BKT- Balakot
MNR-Mansehra
FSB-Faisal Abad
TAL- TAL
MLT-Multan
SLK-Sialkot
SRG-Sargoda
BSM-Besham
HRP-Haripor
KRC-Karachi
HZR-Hazro
RWK-RawlaKot
MTA-Mata
BRT-Bareekot
SND-Sundry A/C