Institute of Management Sciences

Spring Semester 2011

Accounting II

FINAL TERM REPORT

GROUP MEMBERS
TALHA MEHMOOD MUGHAL
SHAHZAIB BIN MUAZZAM

NAUMAN KHALID

AHSAAN ULLAH KHAN

BILAL AHMED
 TOPIC
WHAT ARE LIABILITIES?
CURRENT & LONG-TERM LIABILITIES
&
ITS TREATMENT
 INTRODUCTION

Soneri Bank Limited was formally incorporated on September 28,

1991. The first Branch commenced operations in Lahore on April
16, 1992, followed by the launch of Karachi's first Branch on May
09, 1992.

The bank currently operates 186 branches, spread all over

Pakistan including the Northern Areas of the country. The bank’s
expansion policy is based on the principle of maintaining a balance
between the urban and rural areas.
 
.
 
 MISSION STATEMENT

 To develop Soneri Bank Ltd into an aggressive and dynamic

financial institution having the capabilities to provide
personalized service to customers with cutting edge
technology and a wide range of products, and during the
process ensure maximum return on assets with the ultimate
goal of serving the economy and the society.
 CORPORATE INFO
CHAIRMAN
MOHD.ALTAF BUTT

  CEO
MR. ATIF BAJWA
 
DIRECTORS
NORRUDDIN FERRESTA
INAM ELAHI
S. ALI ZAFAR
ABDUL HAYYEE
SHAHID ANWER
 CONTINUE...

Campany Secretery
MOHD. ALTAF BUTT
AUDITORS
KPMG TASEER HADI & CO.
CHARTERED ACCOUNTANTS
 PRODUCT & SERVICE
FULL RANGE BANKING SERVICE
Soneri Bank’s mission is to serve all banking needs
and ensure our full satisfaction through
- Product innovation,
- Personalized banking,
- Top notch service.
Soneri bank offers a full range of corporate and retail
banking services with special emphasis on providing
qualitative and competitive services to small and
medium enterpenurers.  
Soneri bank offers...
Current & Saving Accounts
Term deposits
Online and electronic banking Services
SMS service
ATM Network & Online Banking
Soneri bank is a fast growing bank with 184 ATMs
operational. Soneri bank offers all chequing account holders online
banking services
Saving Schemes
Soneri bank offers a wide range of attractive saving and
deposit products to suit all segments off investors.
Corporate Banking
SBL’s have an innovative team of professionals having extensive
experience of Corporate Investment banking gives it the right platform
to success in today’s competitive and demanding environment.

Consumer Finance
Consumer Finance Division was established with a centralized
approach to provide Consumer Finance to account holders of Soneri
Bank who wishes to acquire personal use goods. They offer personalized
services for our customers and our portfolio is spread all over Pakistan. 
 
 Islamic Banking 
SBL’s strong Commitment to Islamic Banking with the objective
of operating Shariah Based Banking in the country. We provide a variety
of services including Current A/C, Saving Accounts and Team Deposits
and Term Deposits strictly based on Shariah principles.
 Financial Position
Year Ended 31 December
2010 2009
(Rupees in 000)
Investment- net 34,985,663 29,537,179
Advances - net 54,675,721 48,727,103
Deposits and other accounts 82,061,811 73,548,226
Profit before taxation 140,447 190,413
Profit after taxation 125,440 145,355
Net asset 8,917,673 7,803,202
Earning per share
- Basic Dilluted (Rs.) 0.21 0.28
 Liabilities

 In financial accounting, a liability is defined as

an obligation of an entity arising from past transactions or
events, the settlement of which may result in the transfer or
use of assets, provision of services or other yielding of
economic benefits in the future. For example, if John hits
Jane's car, John is liable for the damages to Jane's vehicle
because John is responsible for the damages. In the case of
a company, a liability is recorded on the balance sheet and
can include accounts payable, taxes, wages,
 Types of Liabilities

Current Liabilities 
Long Term Liabilities
 
 Current Liabilities

Current liabilities are those ones which are to be paid

by the organization in one accounting period. Usually
an accounting period is defined as that period in which
a company has to complete its operating cycle
 Examples of current liablities
They are:
Account Payable
- Dividend Payable
Account Payable refinanced
- Income tax Payable
Tax Payable
Interest payable
Wages Payable
Notes Payable
Current Maturities of Long term debt
 Long Term Liabilities
Long term liabilities are those liabilities which a
company has to pay back after one accounting period
i.e., one year. Long term liabilities can also be of many
types. Mainly long term liabilities are interest bearing.
Example
Debentures, 
Mortgage loans
Other bank loans
 Bills payable
 Similar to accounts payable, bills payable is the money a
bank borrows, mainly on a short-term basis, and owes to
other banks.    

BILLS PAYABLE 2010 2009

(Rupees in 000)

In Pakistan 1,857,810 1,763,401

Outside Pakistan - -
 Interest payable
This current liability account reports the amount
of interest the company owes as of the date of the
balance sheet.
Interest Payable 2010 2009

(Rupees in Thousands)

In local Currency 1, 189,392 1,328,892

In Foreign currency 170,817 7,514

 Tax payable
 
 A type of account in the current liabilities section of a company's
balance sheet. This account is comprised of taxes that must be paid to
the government within one year. Income tax payable is calculated
according to the prevailing tax law in the company's home country

Tax Payable 2010 2009

(Rupees in 000)

Tax payable 525,634 812,634

 Unearned revenue
When an individual or company receives money for a
service or product that has yet to be fulfilled.

Unearned Revenue 2010 2009

(Rupees in 000)

Unearned revenue 110,769 22,426

 Accrued Expense payable
 The account that records the short-term, noninterest-bearing liabilities
of a business that accumulate over time, such as vacation pay owed to
employees. This liability is different than
accounts payable, which is the liability account for bills that have been
received by a business from purchases on credit

Accrued Expense 2010 2009

Payable
(Rupees in 000)
Accrued Expense 110,769 22,426
Payable
 Borrowing/ Accounts Payable

Recieving something of Value in Exchange for

an obligation to payback something of usually greater
value at a particular time in the future.
Borrowing 2010 2009
(Rupees in 000)
In Pakistan 12,245,443 9,226,869
Out side Pakistan 125,085 158,653

Borrowing Total 12,370,528 9,385,522

 Sub-ordinate loans

Sub-ordinate loans are one of the types of long term

liabilities, they are issued by the bank for more than a
year.

Sub ordinate
2010  2009
Loans
(Rupees in 000)
Sub ordinate 1,197,360
Loans  1,197,840
 Deferred tax Liability

 The company postpones its tax liability from the present period to a
future period. Taxable differences give rise to deferred tax liabilities.
Deferred tax liabilities consist of the tax effect of only one item:
Taxable temporary differences

Deferred tax 2010 2009

Liability
(Rupees in 000)

Deferred tax 384,655 108,429

liability
 Deposits and other accounts
Deposits and other 2010 2009
accounts
(Rupees in 000)
Customers
Remunerative
- Fixed deposits 31,837,893 31,566,518
- Saving Deposits 32,158,780 27,870,081

Non-Renumerative
- Current Account 16,375,714 12,729,790
- Call Deposits 93,333 159,388
- Margin deposits 1,065,336 657,183
- Others 136,568 126,760

Total 81,667,623 73,099,720

 CONCLUSION
In the end we will conclude on this
Soneri Bank should