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General Banking
A/C Opening:
What are the papers requirement/ common documentations /formalities for opening an account?
 Daily filled UP signed account opening form
 Introduction of the account
 Copy of national ID /valid passport /Commissioner certificate
 Tin/VAT certificate
 Nomination where signature and photo of Nominee are attested by the Applicant a/c holder
 Photos of the account holder attested by the introducer
 Duly signed FATCA and KYC form
 Duly signed declaration form and deposit slip.
 Opening the account with cash deposit
What are the process/ general aspects/ procedures for opening an A/c?
 Scrutinize a/c opening form and specimen signature card
 Scrutinize all required documents as per account category
 Introduction of the account
 Admittance of signature of a/c holder
 Declaration of source of money
 KYC/ TP/ FATCA
 Approval of account
 Account indexing
 Deposit of cash
 issuance of letter of thanks
 issuance of cheque book
 Entry of cheque books series
What are the types of account? Describe SND account:
 Current deposit account (CD)
 Savings Bank deposit account (SB)
 Term fixed deposit account (FDR)
 Short term deposit account (STD)
 Special notice term deposit account (STD)
 Special notice deposit account (SND)
 Special deposit scheme account
Special notice deposit account (SND):
 Generally opened by corporate body local authority autonomous body institutions etc.
 cheque book is issued for transactions
 Interest is allowed based on daily product
 Prior notice minimum 7 days is required for withdrawal
What are the risk to open account without introduction?
 Banker cannot avail the statutory protection
 Risk in case of overdraft
 Risk in case of bogus cheques

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Who can open an account?
 Every person who is competent to contract
 Who is of sound mind
 Who is not disqualified from contracting by any law
Who cannot open an account?
 Lunatic
 Insolvent person /Bankrupt
 Drunker
 Liquidator
 Alien enemy
 Any other individual or organization restricted by law
What are the documents required for opening for Partnership Firm A/C?
 Valid trade license account opening
 Attested copy of partnership deed
 Letter of partnership
 Attested copy of TIN/VAT certificate
 Resolution signed by all partners to open an account
 Copy of registration certificate
 TP customer
 Rubber stamp seal of firm
 Account agreement form
What are the Documents required for opening private limited company A/C & Public Limited A/C?
 Memorandum of association and article of association attested by company secretary
 Board resolution duly signed by all directors
 Certificate of Incorporation
 valid trade license
 Form xii attested by company secretary
 TIN certificate
 List of directors
 Corporate agreement form
 Balance sheet
For Public limited company (required documents)
 same as private limited company extra paper only certificate of commencement of business.
What are the required documents for Club society (required documents)/Charity/ School/
Institution?
 Copy of bylaws/ constitution
 Copy of registration certificate certified by Chairman /secretary
 Board regulation regarding opening and operation of the account
 List of all executive members
 Board resolution regarding opening and operation of the account
 National ID/ passport copy of all members
 Photos of all members
 Profile of the firm

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What are the Documents required for Trust Account?
 Original trust deed along with the certified copy
 In case of more trustee’s clear instruction as to who shall operate the account must be
obtained and Duly signed by all trustees
 Resolution for opening account
 List of trustees and signal mandate
 AOF, SS cheque requisition properly filled
What are the legal procedures/Precautions for opening for Minor accounts?
 Savings account may be open in the name of minor
 Join name of minor and his/ her legal guardian
 Following manner: X natural guardian of y legal guardian
 Record date of birth of minor
 After minor’s death Guardian should not allowed to operate
 After guardian’s death money should be paid to the minor on attaining majority
 If the minor dies credit balance is to be paid to Nominee on the basis of succession
letter.
***But it will be not advisable to open current account of a minor since in case of overdraft the minor
does not have any liability.
What are the required documents for Mobile banking account?
 Photos
 Copy of NID /Driving license/ passport
 01 copy photo of Nominee
 Duly filled up TBMM account opening form.
What are closing process and procedures of Account opening?
 Application submission by the customer regarding account closing
 Verify the signature of the customer
 Surrender and check by the customer
 Cancellation unused chcque/destroy
 In case of join account closing application should signed by all
 Obtain board resolution for public or private limited company
 Closing charge realized
 Balance paid by pay order.
 Closing status
 Account opening form and SS card preserved
What are the steps/process and process Changing signatories of company account A/C?
 Application
 Board resolution minutes
 Operational institution
 Include new account holder specimen signature card
 Photo of new signatories
 upload new signature in core banking system
What is Nominee? Importance/ objectives of Nominee?

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Nominee is nomination of a person nominated by the account holder who can take care of the
account in the event of the account holders death.
Importance of Nominee:
 Nominee help the Bankers to disburse the amount of disease account to the certain person
without any succession certificate
 Nominee confirms the compliance of provision
 Any fraud can be avoided
Deceased account: On death of the customer the account as deceased a/c and contract create as
invalid. While information of death of a customer is received either in writing or verbally account
should be marked as deceased account. Operation of the account ceases. Amount standing in the
account will be paid to the nominee.
What are the required Documents for Settlement of Deceased Account?
1. The Death Certificate, issued by the Hospital Authority / Police Station / Chairman of Union
Council/Ward Commissioner or any other Competent Authority.
2. Graveyard Certificate.
3. Succession Certificate, issued by the Court (authenticity of the same shall be established).
4. In case of absence of Nomination in the AOF, selection of the Payee; out of present heirs, by
the Court.
5. Passport of the successors or any other proof for their respective identity.
6. Duly Notarized Affidavit, submitted by the heirs/ successors.
7. Marriage certificate, issued by Marriage Registrar (in case of spouse).
8. Indemnity Bond from the successors or Guarantee from third party
Who are eligible to open a CD/AWCD account?
 Business house/firms
 Corporate bodies
 Joint stock companies
 Public institutes
 Other organizations
Who are eligible to open a SD/MSD account?
 Single person
 Joint person
 A guardian on behalf of minor
 Officials of non-trading concern i.e schools, clubs, etc
 In the name of trading concern i.e firm, joint stock company, etc
Write down reasons for which can account can be closed?
 Customer request
 Death of customer
 Insanity of customer insolvency of customer
 Unclaimed deposit account undesirable customer
 Attachment order issued by the Income tax authority or on receipt of garnishee order.
What are steps of Balance confirmation certificate issue?

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Separate Balance Confirmation certificate as per prescribed format in addition to the usual statement
of accounts should be sent to all the deposit deposits and loan account holder on half yearly basis
POD must be preserved with the branch.
What are procedures of Cheque Book Requisition and Delivery?
 the customer will place a cheque book requisition through prescribed cheque book
requisition slip indicating the number of pages
 The concerned bank official will verify the signature and procure the cheque book requisition
 Deliver the cheque book to the account holder or his designated persons
PEPs: PEPs stands for politically exposed persons. Individuals who are delegated with prominent
public functions. A PEPs generally present a higher risk potential involvement by virtue of their
position they holds. The financial action task force (FATF) has categorized PEPs into 3 criteria:
I. Foreign PEPs ii. domestic PEPs iii. chief or similar high ranking positions in international
organizations.
LIPs: LIPs stands for local influential persons
 Domestically
 Example: head of government Senior politicians judicial or military officials senior
executive etc.
Why introduction/Importance of Introduction?
 For authentication of customer’s basic information and to avoid fraud and forgery
 Protection against inadvertently overdraft
 To get protection under section 131 of of NIA act 1881
 To prove that banker has opened the account in good faith and without negligence
 To get legal coverage under Contract Act 1872 and money laundering prevention Act
amendment 2015.
Who gives introduction:
 existing account holder
 responsible person
 bank employees
 any person acceptable to the bank
Describe Thanks letter process?
 identify customers address verification is very important
 as the account is open letter of thanks to the account holder and the introducer are sent
to their respective address. If returns for wrong address call customer, dormant marked
unless rectified.
 Otherwise exit relationship and close account -it is important in term of MLP.
What are the Account opening procedure of illiterate person?
1. Thumb Impression taken by the concerned official both on the Account opening form (AOF) and
on the Specimen Signature Card (SS card).
2. Photograph of the account holder must be enclosed with both the account opening form and ss
card.
KYC: Know your customer, which gives more identification of the client banker must know customer
more closely and accurately. Screening process of customer total risk profile. Different types of KYC:
i) KYC: Know your Customer.
ii) KYE: Know your Employee.

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iii) KYCC: Know your customers of Customer.
iv) KYCB: Know your Business customer.
What are the Important/ objectives/functions of KYC?
 To ensure appropriate customer identification
 To monitor transactions of suspicious nature
 Screening of the risk profile of A/c holder
 Managing risk
 Helps to maintain the integrity of financial system
 Promotes good business governance
 It helps to protect money laundering and terrorist financing
What are the steps and procedures of Cheque issue?
 step to write a cheque
 write the date and write the name of the payee in the pay column
 proceed to write the amount in words and add only in the end
 And then right it in numbers followed by the symbol 1
 Lastly sign the cheque as per SS card.
What are process/ procedures and steps of Stop Payment System?
 application along with stop payment marked with GD copy
 verify the signature
 verify the cheque leaf weather paid or not
 Unused cheque series mark as stop payment at core banking software
 marked in appropriate register
 realized the stock payment charges.
What is FATCA: Foreign account tax compliance act enacted in March 2010 by the US government
and implemented on 1st January 2013. The ultimate purpose of FATCA is to obtain information about
us persons and entities who may be investing and earning income through non us institution.
What is Sanction screening: Sanction screening is a procedure to avoid establishing or maintaining
relationship with banned individual’s entities. To comply instruction of BFIU as FATF Bank must follow
the sanction screening mechanism system.
What are steps and procedures of issuing of Solvency/Balance confirmation certificate:
 Solvency certificate issue: solvency certificate is a document which provides information
about the financial stability of an individual/ entity. To get the certificate the customer
will submit an application
 Bank official will verify the signature
 input in register
 Realize the solvency certificate issue fee
 Lastly solvency certificate will be issue by bank official to the customer.
What are the Time Limits of Inoperative and dormant account?
Inoperative Account: Dormant Account:
SB, SND & CD A/C: 6 months from last SB Account: 6 months from Inoperative
transection or request. SND Account: 6 Months from Inoperative
CD Account: 18 Months from Inoperative

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Unclaimed Deposit Account:
In case an account remaining non-operative for a very long period (10 years), the banker may
request the customer to withdraw the money. If the customer could not be traced after
reasonable efforts, the banker usually transfers the balance to Bangladesh Bank as “Unclaimed
Deposit Accounts,” and the account is closed. The balance is paid to the customer as and when
he comes to claim it or to the legal successors under an order of the court (Sec. 35 of Bank
Companies Act, 1991).
Who will get the deposited amount in case of death of Joint account holder? How distribution of balance
amount after death of Joint A/C Holder?
If there is a mandate mentioning “Either or Survivor”, the joint account holder is entitled to further
operate the account. Otherwise, the account to be closed immediately and the heir(s) (উত্তরাধিকারী) of
deceased (মৃ ত) person will get the deposited amount on his part.
Write the payment procedure of joint account after death of one signatory Or What procedure to be
observed for payment of balance amount after death of any of the joint account holder?
If survivors declared on AOF
 Formal request of survivors & declaration cum indemnity bond (Tk. 300)
 Death certificate by competent authority
 Unused cheque returned
 Payment Order (PO) issued
If survivors not declared on AOF
 Formal request of survivors & legal heir(s) of deceased account & declaration cum indemnity
bond (Tk. 300)
 Death certificate by competent authority
 Succession certificate by court/commissioner if amount more than 1 lac
 Account statement, AOF require if balance more than Tk. 25000
 Unused cheque returned Payment Order (PO) issued.
Pordanshil Woman:
Clearing Section:
Clearing: Clearing is a process by which an individual cheque instrument is exchanged between
collecting and paying bank within the same region through Central Bank mechanism.
BACH: Bangladesh automated clearing house. overall system and facility that supports the exchange
and settlement of payment items between participating Bank in Bangladesh Bank.
Outward clearing: Outward instrument are those clearing items which are drawn on the bank but
received by our branches.
Inward Clearing: Inward instruments are those clearing items which are drawn on our bank but
payment received by other banks.
BEFTN: Bangladesh electronic fund transfer network operates as a processing of electronic credit and
debit transaction among all participating Bank.
The participants involved are:
(a) Originator.
(b) Originating Bank (OB)
(c) Bangladesh Electronic Funds Transfer Network (BEFT Operator)
(d) Receiving Bank (RB)

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(e) Receiver
(f) Correspondent Bank
What are the features of BFTN?
 Involves the movement of money from one bank account to another digitally.
 As direct deposit, these transfers take place independently without any involvement of bank
employees.
 The digital transaction does not require heaps of documentation.
 Saves time and effort
 Payments occur electronically
 Payments occur over a secure mode.
Same day clearing /high value: taka 5lac m& above (Clearing) and settlement through high value
clearing session) previously known as same day clearing.
Regular value cheque: less than tk 5 lac (Clearing and settlement through regular value clearing
session)
High value and regular value session /timeline: high value: clearing presentment cut off 11.00
am return cutter 2.30 pm.
Regular value: Clearing presentment cut- off 11:30 am return cut- off 4.00pm (same day),
BACH component:
Two component of BACH
 Bangladesh automated cheque processing system (BACPS)
 Bangladesh Electronic fund transfer network (BEFTN)
What are difference between Traditional /Manual clearing House Vs. BACPS
Manual clearing house BACPS/BACH
Physical movement of instruments for both Image exchange instead of physical movement of
presentment and returns. instrument return only the data not the image.
Time consuming Less Time Consuming
Physical instruments will be stored by the Physical Instruments Will Be Stored By The
paying bank Presenting Bank
central archive not available Central Archive In Bangladesh Bank
Presenting banks responsibilities: (regarding clearing)
 Comply with the BACPS rules
 Certifies that presented item is a copy of the original instrument
 Prima face genuiness of the cheque be verified with-
 Due diligence and ordinary care
 Genuineness of the cheque leaf
 Material alteration of page name, amount or date
 Verification by UN detector
 Instruments image and data are preserve for 6 years
 Original cheque is available for inspection within 7 calendar days’
 Reconciliation
Paying banks responsibilities: (regarding clearing)
 Transmission of posting files
 Digital signature validation

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 Payment processing
 Returned cheques
 requests for paper
 Internal control
 Reconciliation of clearing differences.
What are the Core risks of bank?
 Anti-money laundering risk management
 Credit risk management
 Asset Liability risk management
 Foreign Exchange Risk Management
 IC&C risk management
 IT Risk management
 Environmental Risk.
What are the Cheque return procedure:
 delegate inward batches
 Scrutinize
 marks return with return reason (29 reasons)
 Batch authorization
 release batches to CCD
MICR Cheque: Magnetic Ink Character Recognition is a recognition Technology based on the
characters printed with the magnetic ink code line consist:
 cheque serial number (7 digit)
 banks and branch routing number (9 digit)
 account number (13 digit)
 transaction code number (2 digit)
What are the Functions of DMS software DMS: Documents management system?
 in ward clearing
 outward clearing
 Electro fund transfer
What is RTGS? Real time gross settlement to facilitate fast and Secured interbank payment system
introduced 29 October 2015. Taka 1 lac and above amount settlement between participating Banks
instantly. NPSB: National payment with Bangladesh. RTGS settlement Time 9.00am to 3.00pm.
What are Objective/significance/Features of RTGS?
 Establishment of the real time growth settlement systems for the country
 To settle the interbank local and Forex payments instantly
 Safe secure and real time call money market transactions
 Safe secure and online secondary Bond market transactions
 Minimum and Maximum fund transfer value
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 RTGS transactions are available both online and offline.
GUIDELINES OF FC CLEARING THROUGH BD-RTGS SYSTEM

 Bangladesh Bank has been providing clearing and settlement services for local currency
as well as approved foreign currencies within the country since long time. Forex Reserve

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and Treasury Management Department of Bangladesh Bank executes clearing and
settlement through maintaining FC accounts in approved currencies of scheduled banks
to facilitate safe, secure and efficient interbank payment system, Bangladesh Bank
launched Real Time Gross Settlement (BD-RTGS) system on 29h October 2015 as part of
its inclusive digitization initiative. BD-RTGS opened a new horizon in the payment
ecosystem, accommodating instant settlement of large value and time critical payments
in the country.
 RTGS system is capable of operating both in local currency and foreign currency. Now
Bangladesh Bank is introducing clearing and settlement in 5(Five) foreign currency [US
Dollar (USD), Great Britain Pound(GBP), Euro (EUR), Canadian Dollar (CAD), Japanese Yen
(JPY)] transactions inside the country. Mentionable that, the Clearing & Settlement of
Chinese Yuan (CNY) will be incorporated in the RTGS system soon.
What are the features/functions/Activities/ prerequisites/Significance for inland FC clearing
through the RTGS system?

 BD-RTGS is a stand-alone system; no other payment platform is connected to this system.

 Banks have to maintain FC Accounts with Bangladesh Bank to originate and receive FC
transactions in RTGS system.
 RTGS system allows only currency-wise transaction; cross-currency transaction is not
allowed.
 Any amount of FC transaction can be settled through RTGS system.
 AD branches and Head office clearing unit of banks can originate and receive FC
transactions in RTGS system.
 SOD (Start of Day) Fund transfer, Top-Up and EOD (End of Day) reconciliation will be
executed by Forex Reserve & Treasury Management Department of Bangladesh Bank.
 To execute customer transaction, Originating Bank has to mention the originator account
type as well as beneficiary account type (such as ERQ, SFCAMS, RFCD, NFCD, PFCD, NRB
FCY, Airlines, Shipping FCY, Intra-EPZ, Inter-EPZ etc) in the account information field of
the instruction.
 Originating Bank has to mention the purpose of the transaction properly; this field will be
treated as mandatory in case of FC settlement. Bank can also provide additional
information in other fields of the message.
 Bank can charge maximum BDT100 (Including VAT) or equivalent FC for each transaction
from the originator.
 Intraday Liquidity Facility (ILF) will not be available for FC transactions in RTGS system.
 Each Bank will prepare their BCP, operation procedure & guidelines and maintain
separate reconciliation team for FC settlement.
 Banks shall follow the Guidelines of Foreign Exchange Transactions (GFET) while
originating and posting a transaction as and when applicable.
 For FC transaction through RTGS system, section 4.2 of BD-RTGS System Rules will be
relaxed but transaction shall be posted to the beneficiary account within 2 (Two) hours of
the settlement instruction from BD-RTGS, otherwise to be returned.

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 All other rules and procedures of local currency settlement as well as BD-RTGS system
Rules will be applicable to FC settlement through the RTGS system.
What are Positive pay instruction & procedures of PPI? Positive instruction (PPI) is a preventive
measure of cheque forgery and it is mandatory during cheque clearing without PPI cheque could be
return showing the reason advice not received.
 corporate and proprietorship account taka 100,000 and above
 individual account Taka 5 lakh and above
What is ISS reporting process: Integrated supervision system. It is a web based Monitoring tools.
 BB introduced to supervise the banks and NBFIs head office as well as their branches financial
health.
 Enable us to ensure continuous and risk focusing
 reduce supervision gap of traditional supervision model.
 Log in to Web portal of Bangladesh Website.
 Download the ISS Forms and dropdown the list.
 Fill up the Forms and convert the CSV format (ISS form 5& 6).
 Upload the CSV Format of BBK Web portal.
What are Objectives/Goals/ purpose of ISS Reporting System:
 To integrate the supervision information
 To ensure effective supervision
 To minimize the supervision frequency
Why ISS is important:
 To comply obligatory self-examination
 Ensure the effectiveness of MIS
 To improve remote communication
 To minimize the oversight gap
 Enhance the effectiveness of internal control
LIMITATIONS of ISS
 Shortage of Manpower.
 Branch officials are not well equipped for ISS Reporting in BB.
 Not supervised properly by Branch Management.
 Absence of ‘Reporting Solution Tools’ in Flora Banking Software System.
 Continuous changes & modifications are made in ISS Forms by ISM Cell, BB.

Remittance and FCAD:

What are the process/procedures and steps of issuance of PO?
 Fill up prescribed form /application duly sign by applicant
 Ensure cash or cheque deposit with commission and VAT
 Entry into register and software
 Write printed serial number on application
 Write amount with protectograph
 Handover after acknowledgement
 Issue cost memo (if)
 Cheque & sign by to authorized officials

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What are the process/procedures and steps of issuance of Duplicate PO?
 Application from the purchaser stating reasons
 Verification signature
 Taking confirmation regarding nonpayment of the PO and caution mark
 Obtain indemnity bond from the purchaser
 Note in po issue register and application form
 Duplicate issue in live of original number….. and dated…..
What are the Cancellation process of pay order?
 Application with the instrument
 Signature verified
 Confirmation about duplicate issue
 Debit pay order account and credit party voucher with transfer seal
 Notes in issue register and application form
 Obtain cancellation charge
 Mark, cancellation Instrument and application form
 Cancelled instrument attached with debit voucher
What are the process Premature encashment of FDR/ MTDR /ECO /GPS/ TDS?
Interest of fixed deposit shall be paid on maturity it is extended father for same period automatically.
FDR may be en-cashed before maturity. In such case, interest may be paid at prevailing savings rate
or is advised by HO upon receipt of customer’s request. No interest is allowed before elapse of 1
month.
What are the Function/Activities of FCAD?
 Preparation of early budget
 Controlling stock of stationery
 Receipt of stationary
 Payment of Bill
 Depreciation of fixed asset
 Filing of vouchers
 Balance with others Bank
 Fixed asset record and Depreciation
 Purchase of fixed asset
 Transfer disposal of fixed asset
 Bangladesh Bank reporting
 vendor payment.
What is Depreciation? What are different methods and rates of depreciations?
Depreciation is a non-cash monthly basis expenditure which is charge on fixed assets of an organization.
Depreciation shall be charged on Fixed assets from the date of acquisition.
Particulars Rate of Depreciation Method of Depreciation Building 2.50% Reducing Balance Method
Furniture & Fixtures- Office 10.00% Reducing Balance Method Furniture & Fixtures- Residence 20.00%
Straight Line Method Equipment 20.00% Straight Line Method Decoration & Renovation 12.00% Reducing
Balance Method Motor Vehicles 20.00% Straight Line Method.
[

Please note that for proper fixed Assets Management, accumulated depreciation will have to be carried
forward until the related assets will have not been written off from the affairs.

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What is Inventory Management? What are the ways of Inventory management?
Inventory Management is the asset categorization/control system of an organization. Inventory
management refers to the process of ordering, storing, and using a company's inventory. These include
the management of raw materials, components, and finished products, as well as warehousing and
processing such items
Methods of Inventory Management: a) First in First out b) Last in First out c) Periodic Inventory
Disbursement Method d) Perceptual Method e) Just-in-Time Management f) Materials Requirement
Planning g) Economic Order Quantity h) Days Sales of Inventory
Important of Inventory Management/Why is it important to maintain an inventory management
system?
i) Categorization of assets ii) Tracking and Transparency iii) Improved Vendor Relationships iv) Better
Inventory Planning and Ordering v) Accurate Order Fulfillment vi) Increased Consumer Satisfaction vii)
Increased Efficiency and Productivity viii) Save Time and Money
What is Voucher? what are procedures of preparations of Voucher?
Voucher allows authorized staff to check the accuracy of business transactions. Voucher is a very primary
accounting record which shows the authenticity of the transactions
Preparation of voucher: Name of the party to whom the payment is being made
 Date on which the payment is made
 Amount in figure as well as in worlds
 Purpose on which the payment is being made
 Signature of the recipient
 Signature of the of the persons making the payment
 Minimum Two authorized signatures.
What are the keeping the provision of expenditure? How to pass an expense provision Entry?
A provision represents funds set aside for future expenses or other losses as reduction in asset value.
To pass/ Process of expense provision:
i) To create a ledger
ii) Go to general ledger
iii) Pass journal entries.
iv) To identify Actually dues.
v) Pass reversed entries.
vi) Obtained documentary Invoice.
Amortization means: To the process of writing down the value of a loan or an intangible asset.
Amortization methods include the straight line, declining balance, annuity, bullet and balloon.
What is Budget? A budget is an estimation of revenue, expenditure, assets and liabilities over a
specified future period of time and is usually compiled and re-evaluation on a periodic basis.
What are the purpose/ objectives/ significance/ Goals/features/benefits of budget?
i) A budget helps create financial stability.
ii) By Tracking the expenses
iii) Plan for revenue and expenses
iv) Plan foe asset and liabilities.
v) Build an emergency fund.
vi) Save time and cost.

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vii) To create stronger financial footing.
viii) Budgeting is prepared in advance.
ix) Budget requires Cooperation.
x) Budget is measurable.
xi) Budgeting are motivating.
xii) Budgeting helps review performance.
What are the steps/process/activities/phases/ functions of budgeting?
i) Assess your financial resources.
ii) Determine your expenses.
iii) Set goals.
iv) Create a plan
v) Tracking the progress
vi) Forecasting for future financial activities
vii) Preparation and approval
viii) Execution and evaluation.
ix) Accumulation and authorization of data
x) Presenting the budget and live the plan.
Internal control:
Internal control: Internal control are the mechanism rules and procedures implemented by a
company to ensure the integrity of financial and accounting information promote accountability and
prevent fraud
What are the Function/ Activities/purpose/Goals/process/procedures of IC&CD?
 Audit function: the audit team of IC&C performs periodic and special audit
 Complaint function: the compliance department will be responsible to ensure that Bank
complies with all regulatory requirements while conducting its business
 Monitoring function: Modern department will be responsible to monitor the operation
performance of various branches.
 Efficiency and effectiveness of operations of bank.
 Reliability and completeness of financial and management information
 Compliance with applicable laws and regulations.
 To make strong liaison with the Central bank.
 Monitoring or off-site Supervision on the activities of the branches.
 To establish Control over the operations of the bank.
 All the circulars issued by different Divisions/departments of the bank are circulated
through IC&C Division.
What are the Tools/ Mechanism of IC&CD?
 Departmental control function checklist (DCFCL).
 Loan Documentation checklist (LDCL).
 Quarterly operations report (QOR)
 Dual control system
 Segregation of duty
 Implementation of specific job responsibilities
 Reporting system

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 Complaint system
 Risk grading of the branch
 Monitoring activities.
What are steps of internal control system:
 Most internal control can be classified as preventive and detective
 preventive internal control includes internal check and
 Detective internal control includes internal audit
What are the Objectives of internal control system?
 Operational/ performance objective: efficiency and effective ness of operations
 information objectives: Reliability and completeness of financial and management
information
 Complaint objectives: Compliance with applicable laws and regulations.
What are the Internal control environment?
The internal control environment in the Framework under which internal controls are developed
implemented and monitor. The key factors of the internal control environment are:
 Board of directors
 The management
 Organizations and procedural control with effective management information system
 An independent IC&CD
What are the Elements internal control systems?
 Management Oversight and control culture:
 Risk assessment
 control activities:
 Information and Communication:
 Monitoring activities:
What are the Reasons for control breakdowns?
 Lack of adequate mgt. oversight and accountability.
 Failure to develop a strong control culture within the organization
 Inadequate assessment of risk of certain banking activities
 Absence of key control activities such segregation of duties approval process verification etc.
 Inadequate communication of information between the levels of mgt.
 Inadequate or ineffective Audit and other monitoring activities
Various types of common irregularities:
a. Account opening Desk:
 Accounts are open without manager's approval
 Accounts are opened without introduction
 KYC is not done
 Accounts are opened without initial deposit
 TP is not obtained
 Accounts are open without photographs of a/c holder
 Accounts open with expired passport
 Letter of thanks are not issued to the account holder
 account holders photo not attend by introducer

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 TP blank accounts open without mentioning the nominee
b. loans and advances:
 Loan disburse without head office approval
 CIB report not obtained
 Sanction advice is not issued by the branch
 Disbursement authority from head office is not obtained
 Acceptance of borrower is not obtained
 Original title deed Bia deed are not obtained
 personal guarantee is not obtained
 NEC is not obtained
 loan is disbursed without completion of mortgage formalities
 LDC is not done
[
 Charges documents are unstamped, blank and undated
c. Foreign exchange:
 Required LC margin is not realized at the time of opening of LC
 LC margin is realized after the date of opening
 LC opening commission is not realized at the time of opening of LC
 Commission is realized after the date of opening of LC
 VAT on Swift charges is not imposed
 LC is opened without obtaining suppliers credit report
 Shipment date is not mentioned in the export register
 Declaration of importer is not completed
 Letter of credit authorization from is found blank
 Exp. issue register is not maintained properly
 Original copy of bill of entry is not preserved in the branch
 PAD is not adjusted in due time.
d. Cash and Vault management:
 Excess cash in held in the vault
 Cash in transit limit exceeded the insurance coverage limit
 Signature of manager and cash in charge are not found in the cash reserve proof sheets
 Anti-dated postdated & stale cheque not identified
 Vault entry register is not updated
 CTR and HR not properly prepared
 cash on counter register is not updated
e. PO/ OBC register:
 Issuing date missing
 Issuing branch officials do not sign on the instrument properly
 PO is delivered without obtaining recipients signature
 Cutting erasing overwriting have been found in pay order register
 Long outstanding OBC are found in the branch
 Realization date is not mentioned in the OBC register
 Commission and VAT are not realized
 KYC is not done

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Cash Cheque Receipt and Payment:
key holding: A key register shall be maintained in which all important keys are recorded. In taking
over, sign in the register retained under manager /manager operation. once in a year duplicate would
exchange and recorded in the register.
Vault limit: Cash officer shall never exceed the counter limit and after a certain interval they will keep
the excess amount in the vault. But when the branch cash exceeds the vault limit the excess amount
must be remitted to principal branch.
Insurance: An insurance file shall be opened and maintained for cash counter, cash in vault and cash
in transit.
Safe in safe out register: Cash in charge shall maintain vault register for keeping record of cash
movement to & from iron safe. Denomination of cash in hand mentioned in cash balance book must
match with the vault register.
Steps in receipt and payment of cash:
Step in receipt and payment of cheque;
Receiving of outward clearing check:
Identification of bearer and Record Keeping:
What are the Process/ Procedures/ Significance of Opening/ closing cash position?
It shows the total debit balance, total credit balance and closing balance of the day. Closing
balance is shown according to the denomination of different types of notes. Beside it contains
the closing balance of the teller and initially receiving amount.
What are the Function and activities of Head tailor /cash in charge?
 Opening of vault before (at least 15/20 minutes) business hour starts
 Making arrangement of the Tellers and distribute the Reserve cash among them
 To lift the surplus cash from the Tellers
 To counter sign the deposit slip
 Cancellation of the cheques above Tk. 25000
 Maintenance of vault register foreign currency register prize Bond register
 Ensuring deposit or surplus cash to feeding branch /BB /Sonali Bank
 Withdrawal of cash from feeding branch/ BB/ Sonali bank when required
 Keeping vault keys joint custodian
What are the Function and Activities of Tellers?
 Maintenance of customer relationship
 Receiving of cash from customers
 Receiving of cheque for clearing and transfer
 Payment of cheques if other requirements are fellfield
 Receiving of various kind of bills
 Packing and Bunding of cash
 purchase and sell of prize Bonds
 Preparation of different statements
What are the Main security features of a 100 /500 /1000 Taka notes?
 Watermark
 intaglio print

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 Optically variable ink
 security thread
 Latent image and
 Micro Text
What is Watermark: Portrait of the Other of the nation Bangabandhu Sheikh Mujibur Rahman is
used as watermark. In addition to the 500 /100/1000 and logo of Bangladesh Bank are also in the
form of electrotype watermark which are brighter than that of the Portrait.
Preservation of teller cash proof sheet:
First step: Head teller handover initial case to the individual teller for making payment at time of
opening
Second step: Each teller receive cash from the customer & passes entry of it as cash received with
serial number account number and amount and at the same time makes payments in the same
manner
Third step: after transaction hour they summarize the total cash receipt and payment and submit it
to head teller with closing balance.
What are the Vault management? Vault management is built in module of flora Bank. At the
beginning of the day Vault officer pay cash to the teller for daily operation and receives the balance
of the case from teller and deposit to vault at end of the day.
Covered area of Vault management?
 Daily cash position in vault
 Teller wise cash position
 Teller wise cash received register
 Auto generate cash memo
 Cash safe register
How important duplicate keys of a branch maintained?
 All-important duplicate keys of a branch must be kept in main branch of same station and
preferably Sonali Bank in other places.
 There should be a note/list about the duplicate keys in the safe deposit file duly signed by
the Manager and 2nd Officer.
 For better keeping, duplicate keys to be kept in a box (steel or wooden) of Greez and
covered by white paper with specific numbers of seal Gala.
 For safety, long life & better functioning, duplicate keys to be rotated with the originals
after six months and before one year.
Negotiable Instrument Act- 1881
 Date of Commencement: 9th December 1881
 Date of promulgation: 1st March 1882
 Negotiable instrument: As per negotiable instrument Act1881 promissory note, bill of
exchange and cheque are the negotiable instrument.
What are the Essential features of Negotiable Instrument?
 This can be freely Transferable
 This can be used for settlement and transaction
 The true owner of the Negotiable Instruments (i.e. holder in due course) can establish his
claim.

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What is Negotiation: When a promissory note bill of exchange or cheque is transferred to any person
so as to constitute that person the holder thereof the instrument is said to be negotiated.
What are Material parts/ features of a negotiable instrument?
 Date
 Amount
 Stamp
 Time for payment
 place of payment
 Designation of payee
 Signature of drawer
 Name of drawee
What are the different Kinds of Negotiable Instrument?
 promissory note
 Bill of exchange
 Cheque
 Demand Draft
Promissory Note: A promissory note is an instrument containing an unconditional undertaking,
signed by the maker, to pay on demand or at a fixed or determinable time a certain sum of money
only to, or to the order of, a certain person, or to the bearer of the instrument.
Parties of promissory note:
 Maker: The person who is maker of the note.
 Payee: The person to whom or to whose order the sum of the instrument of is payable.
Essential characteristics/Features:
 The instrument must be in writing
 It must contain and conditioner promise
 It must be signed by the maker
 The maker must be a certain person
 The promise must be to pay a some certain in money
 The promise to pay is on demand or at a fixed or determinable time
 The pay must be certain person
Bill of exchange:
A bill of exchange is an instrument in writing containing an unconditional order signed by the
maker, directing a certain person to pay on demand or at a fixed or determinable time a certain
sum of money only to, or to the order of a certain person or to the bearer of the instrument.
Essential characteristics/ Features:
 Bill of exchange must be in writing
 It must contain in unconditional order
 It must be signed by the drawer
 Drawee must be certain
 Sum payable must be certain
 The order to pay is on demand or at it fixed or determinable time

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Parties of bill of exchange:
i. Drawer: The person who is maker of the bill
ii. Drawee: The person who is directed to pay the bill
iii. Payee: The person to whom or to whose order the sum of the instrument is payable.
Cheque: Cheque is a bill of exchange drawn on a specific banker and not express to be payable others
then on demand. it is always drawn on a specific banker.
Characteristics/ Features of Cheque:
 It is always drawn on a specified banker.
 It is payable on demand.
 It must be in writing
 It must be signed by them drawer
 A check must be dated
 It must contain an unconditional order
 Amount in figure and word must be same
 It must be payable to order or a certain person or to the bearer
Types of check:
Mode of payment: Module payee: Mode of time:
 Open cheque  Bear cheque  Anti-dated cheque
 crossed cheque  Order cheque  Postdated cheque
 Stale cheque
Open cheque: An often cheque which is payable over the counter
Crossed cheque: A Crossed cheque which is payable only through a collection banker.
Parties of a cheque:
 Drawer: drawer is the account holder
 Drayee: Drayee is the bank who is to pay the money
 Payee: Payee is the beneficiary who is to receive the money
What are the essential characteristics of a DP Note, bill of exchange &Cheque?
DP Note Bill of exchange Cheque
It must be in writing -Do- -Do-
It must contain unconditional -Do- -Do-
undertaking
The amount must be certain -Do- -Do-
It must be signed by maker -Do- -Do-
As per sec 4 of NI Act 1881 As per sec 5 of NI Act 1881 As per sec 6 of NI Act 1881
The drawer & payee must be The drawer, payee & drawee The drawer, payee & drawee must
certain must be certian be certian
It should be properly stamped -Do- Does not require any stamp
Differences between DP Note, Bill of Exchange &Cheque?

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DP Note Bill of Exchange Cheque
Parties – Drawer, payee Parties – Drawer, payee, drawee Parties – Drawer, payee, drawee
The drawee of a DP note may either The drawee of a cheque is always a
be a banker or be a non-banker banker
A DP note may be payable on A bill of exchange may be payable A cheque is always payable on
demand or future time on demand or future time demand

Cannot be crossed Cannot be crossed Can be crossed

A DP note must be stamped A bill of exchange must be stamped A cheque does not require any
stamp
Three days of grace are allowed on Three days of grace are allowed on No grace days are allowed
DP note bill of exchange
Self payment Entrusted payment Entrusted payment
Acceptance is not required Acceptance is required Acceptance is not required

Differences between Power of Attorney & Power of Attorney Mandate/Letter of Authority

Mandate Delegation of power by registered Delegation of power filling up a
deed to somebody to act his agent printed form to anybody to operate
an account
After delegation of power principle Principal and Mandate person can
has no signing authorities operate
It is always registered It is not registered
Witness required Witness is not required
For general/specific purpose For specific purpose
A notarized document Not an authenticated document
Mandate: A mandate is a written order to a bank asking it to open an account and allow same one to
sign cheques on behalf of the account holder. Time limit of mandate is 4 months.
Types of Mandate:
 Either or survivor
 Former or survivor
 Jointly or survival
 Anyone or survivor
What is Endorsement: Section 15 of negotiable instrument act 1881 defines endorsement in simple
words endorsement is the process of transferring the negotiable instrument
What are the different Kinds of endorsement?
 Blank or general endorsement
 full or special endorsement
 Restrictive endorsement
 Conditioner endorsement
[
 facultative endorsement
What is Allonge: An Allonge is a sheet of paper that is attached to a negotiable instrument and
endorsement.

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Blank or general endorsement: If the endorser signs his name only the endorsement is said to the
blank
Full or special endorsement: If the endorser adds a direction to pay the amount to the order of a
certain person then the endorsement is said to be full.
Essential of a valid endorsement/Endorsement must be on the back or face of the instrument.
 It should be made in ink
 It must be made by the maker or holder of the instrument
 It must be signed by the endorser
 endorsement must be completed by delivery of the instrument
 In the case of married women, the name of her husband must also be mentioned in the
endorsement
Can a Minor endorse Negotiable Instrument?
Sec.26 NI Act: Yes, Minor can draw, accept and endorse negotiable instrument without binding
himself
Crossing: A cheque bearing two parallel transverse line on its face is simple called crossed cheque.
Who can cross:
 The drawer
 The holder
 The banker
Types of crossing:
General crossing: Where chque bears across its face an addition of the world and company or
any Abbreviation thereof between to transverse or two parallel transverse.
Special Crossing: When the name of a particulars bank is mentioned in between the crossing
than the cheque is known as special crossed cheque.
What are difference of General crossing and special crossing:
General crossing Special crossing
Two transfer parallel line are drawn There is no necessity of drawing two transvers parallel
lines.
less safe more safe
money can be encased by any bank money can be uncashed only by the bank shown under
crossing.
What are Features/significance of general Crossing:
 The lines must be drawn parallel and transverse
 Two lines are Paramount importance in crossing
 The lines are generally drawn on the left hand side
 The word and company or its abbreviation may be written in between the line
Essential/ features/ significance of special crossing:
 Two parallel transverse lines are not at all essential for a special crossing.
 The name of the banker must be necessarily specified across the face of the cheque.
 The lines are generally drawn on the left hand side preferably on the corner
 The two parallel transvers line and the words not negotiable may be added to is special
crossing

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Double crossing: when a cheque bears two special crossing it is said to have been double crossed.
Anti-dated check A cheque which bears a date before the date of issue is said to be anti-dated
cheque.
Stale cheque: A Stale cheque which is presented after 6 months from the Date written in cheque. It
is also called out of date cheque.
Postdated cheque: A cheque which bears a date later than the date of issue is said to be postdated
cheque.
Bearer cheque: A bearer cheque is the one in which the payment is made to the person bearing or
caring the cheque.
Features of bearer cheque:
 It bears the world self or bearer and the name of payee.
 It can be converted into bearer cheque
 It is payable on the counter
Order cheque: The order cheque is the one wherein the world bear is cancelled on the cheque.
Features/significance of order cheque:
 It bears the word order and the name of payee
 It can be converted into bearer cheque
 It can be transferred through endorsement
Holder: Holder is a person who simply lawfully holds or in possession of the instrument (section: 8)
Holder in the due course: Holder in the due course is a person who receives the instrument for value
without knowing defective little of previous owner in good faith and without negligence (section: 9 )
Payment in due course: Payments in due course means payment in accordance with the apparent
tenor of the instrument in good faith and without negligence to holder (sec:10).
What are the Procedure to make payment in due course?
 payment will be made as per apparent tenor of the instrument
 payment will be made in good faith and without negligence
 The person who the payment will be made has to be ascertained
What are difference between Holder vs Holder in due course?
Holder Holder in due course
Holder is a person who simply lawfully holds or Holder in the due course is a person who
in possession of the instrument (section: 8) receives the instrument for value without
knowing defective little of previous owner in
good faith and without negligence (section: 9
The Instrument May Or May Not Be Obtained In The instrument must be obtained in good faith
Good Faith
A Holder Cannot sue all Prior Parties A holder in due course can sue all prior parties
What are the rights and privileges of holder in due course?
 He obtains a better little to the instrument then there of a true owner.
 The defective little of the previous endorses (if any) will not adversely affect his right
 He can pass on a better little to others
[
 Until the instrument is finally discharged every party to that instrument is liable to him

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What are the liabilities /responsibilities of a collecting banker?
 Collecting bankers collect the payment with good faith and without negligence
 collecting Bank will collect the payment on behalf of the customer as agent
 collecting banker collect only the crossed cheque
 collecting banker will ensure The Identity of the payee
 collecting Bank Checks Apparent tenor of the instrument
 collecting Bank ensures the title of the depositors
What are the responsibility /liabilities of paying banker?
 The cheque will be in order that the apparent tenor of the instrument is alright and there is
no material alteration
 The cheque presented within its validity
 There will be sufficient fund in his account
 Whether the customer is dead insolvent or insane
 Whether there is any Garnishee order.
 Whether there is any account freezing order from tax office
 Stop payment notice by the drawer
What are the Payment procedures of mutilated cheque?
A mutilated cheque is one which is torn into two or more pieces before making payment of a
mutilated cheque the bankers should examine it carefully to a certain if the cheque was mutilated
with the intention to cancel it. If such intention is evident the bankers should not pay the cheque. In
other cases, the banker should get the drawers confirmation on the mutilated cheque. He may pay a
cheque which is torn at the corner and material fact is cancelled.
Material alterations/ Process of Material alteration?
Any alternation or correction in the cheque to be valid must be made by or with the consent of the
drawer and confirmed by his full signature. An alteration is considered as material if it effects the
operation of the instrument substantially and the liability of the parties. Concerned is changed
significantly example:
 Alteration of the date of the cheque
 Alteration of amount of the cheque
 An alteration of the crossing on a cheque the following cheque will not be treated as material
alterations in full.
 Crossing of an open cheque by the holder
 Conversion of general crossing into a special crossing
What are the important matter will you make before honoring a check presented for payment? or
what precautions to be taken by a paying banker before honoring a cheque?
 Banking hours
 Crossing
 Drawers signature
 Endorsement
 Form of cheque
 Fund of customer
 Sufficient amount
 Stop payment

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 Stale cheque
 Postdated cheque
 Mutilated cheque.
When a banker can return the cheque?
 when the required balance is not in the account insufficient balance
 Stop payment instrument by a/c holder i.e. drawer
 The drawer is dead insane or declared insolvent
 Court order garnishee order
 Any other order from the competent authority to freeze the account of the customer.
What are the different type of defective notes?
1) Altered Note- It is a note in which alteration has been made in the number, date, signature or
value or in any other respect.
2) Half Note- It is a half of a note which has been divided vertically through or near the centre.
3) Mismatched Note- It is and imperfect note formed by joining a half note of one note to half
note of another note.
4) Mutilated Note- It is a note of which a portion is missing
5) Obliterate Note- It is a note, not being a mutilated or altered note of which a portion has
become or has been rendered undecipherable.
Can order cheque be paid over the counter?
An order cheque can be paid over the counter upon identification of the Payee.
A bearer cheque is always bearer instrument? do u agree?
Yes, I agree. Has no restriction to negotiate and it can be easily paid over the counter of the bank.
A Cheque Crossed with the Words "Not Negotiable" what does it mean?
A cheque crossed with the Words "Not Negotiable" what does it mean that the cheque is not negotiable.
not Transfer other titled. Crossed Cheque with “Not Negotiable” must not be paid over the counter. The
significant of this words means that there is no guarantee about the genuineness of the instrument.
Means of A/C payee Crossing? or Crossing?
Protection of Cheque or instruments.
Can we DD, FDD and PO Cancel?
Yes, on request of the purchaser a DD, FDD and PO can be cancelled.
How and when NI act give Protection a banker?
1. The section 85(1), 85(2), 128 of negotiable instrument acts provide statutory protection
to paying banker for making payments of order cheque, bearer cheque or crossed
cheque in that order.
2. Cheque is crossed generally or specially before it is presented to the paying bank.
3. Statutory protection Under Section Section 131, a collecting bank has protection only if
the collecting bank, in good faith and without negligence, receives payment of the
customer by a cheque.
4. The paying banker has to fulfil before making payment of any cheque. the paying banker
gets the statutory or legal protection under NI Act.

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Write list of demand liabilities & time liabilities

Demand liabilities Time liabilities
 Outstanding bills/drafts  Fixed deposit
 Payment orders (PO)  Savings deposit
 Demand drafts (DD)  Special notice deposit
 TT  Short term deposit
 MT  Recurring deposit

Difference between CRR & SLR

CRR
CRR controls liquidity in bank
CRR uses only cash
Maintained in cash form with BB
Conventional:4%.Islamic: 4% ( Daily:3.50:)
SLR
SLR regulates credit growth in country
SLR uses as cash, gold or approved securities
Money deposited in Govt. securities
Conventional: 13% .& Islamic: 5.50%

What is Green Banking? Write the steps of implementing Green Banking?

Green Banking means
 To introduce innovative green products
 To save the environment from different hazards and pollution
 Green theme for Trust Bank as “Be Green, Remain Green & patronize Green”
Phases of Green Banking
As per BRPD circular, Green Banking activities to be completed by following three phases:
 Phase-I: to be implemented within December 31, 2011
 Phase-II: to be implemented within December 31, 2012
 Phase-III: to be implemented within December 31, 2013
What is Asset Liability Management (ALM)? What are the major components of ALM?
Asset Liability Management means the control/ management of a Bank’s deposit and lending
policies to ensure safety, liquidity and profitability.
Major components of ALM
 Asset management (Investment portfolio, fund, cash management)
 Capital management
 Liability management
 Risk management (Liquidity risk, profit rate risk, market risk, maturity mismatch, etc)
What are the objectives of ALM?
 Compliance regulatory requirement
 Formulation of effective business plan
 Formulation of liquidity contingency plan
 Establishment of effective internal control
 Identifying balance sheet gap
 Reducing average cost of fund
 Maintaining liquidity positions.

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Do you think that a Private/ schedule/ Commercial bank bound to comply with the provisions
of Company Act 1994?
Yes. The following provisions bank bound to comply
As per Company Act 1994,
A bank to be incorporated must prepare a memorandum of association (MoA) and articles of
association (AoA) with following documentations:

01. Name clearance from Bangladesh Bank.

02. Share Holder or Directors Personal Details.
03. Form XII details Directors share holding positions.
04. Formation of a Memorandum and take approval from Bangladesh Bank.
05. Obtaining license from Bangladesh Bank.
06. Trade License from Ministry of Commerce.
i) A Bank is a voluntary association of legal state, recognized by law, having a distinctive name, a
common seal, formed to carry on business for profit, with capital divisible into transferable
shares, limited liability, a corporate body and perpetual succession.
ii) To be considered a scheduled bank, a bank must meet the following requirements: A total of
Rs. 5 lakh in paid-up capital and reserves are needed.
iii) The bank must demonstrate to the central bank that its operations do not jeopardize
depositors' interests.

Compiled By: Md. Sirajul Islam Bhuiyan 27

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