All posts by Tina Saha - 368. page

Professional Tax Consultant and Article Writer

On Partial Recoveries in NPAs In the absence of a clear agreement between the bank and the borrower for the purpose of appropriation of recoveries in NPAs (i.e., towards principal […]

On Take-out Finance In the case of take-out finance, if based on record of recovery, the account is classified by the lending bank as NPA, it should not recognise income […]

On Leased Assets 3.40 The finance charge component of finance income (as defined in AS 19 – Leases) on the leased asset which has accrued and was credited to income […]

Reversal of Income If any advance, including bills purchased and discounted, becomes NPA as at the close of any year, the entire interest accrued and credited to income account in […]

On Advances Granted Banks recognise income (such as interest, fees and commission) on accrual basis, i.e., as it is earned. It is an essential condition for accrual of income that […]

NPA Management The RBI has issued Master Circular dated July 1, 2015,on Prudential Norms on Income Recognition, Asset Classification and provisioning pertaining to Advances. The Circular stresses the importance of […]

Partial Credit Enhancement to Corporate Bonds In a waterfall mechanism, Credit Enhancement (CE) gets drawn only in a contingent situation of cash flow shortfall for servicing a debt / bond […]

Advances to Staff Interest bearing staff advances as a banker should be included as part of advances portfolio of the bank. In the case of housing loan or similar advances […]

Project Finance Under Moratorium Period In the case of bank finance given for industrial projects or for agricultural plantations etc., where moratorium is available for payment of interest, payment of […]

Net Worth of Borrower/Guarantor or Availability of Security Since income recognition is based on recoveries, net worth of borrower/guarantor should not be taken into account for the purpose of treating […]