Name Muhammad Ibrahim

Submitted to Sir Shoaib Hassan

Semester 5th320006

Project Financial Statement

Company Allied Bank Ltd

Allied bank main highlights:

 Allied bank limited was established in  The Bank is the holding company of ABL
Lahore in 1942 Asset Management Company Limited.
 It is the 5th largest operating bank in  The registered office of the Bank is
Pakistan situated at 3 - Tipu Block, Main
Boulevard, New Garden Town, Lahore
 The bank offers full range of retail,
commercial and corporate banking  Has a network of 1393 branches located in
services with a focus on service delivery almost 400 cities and towns.
through technology.
 Ibrahim Holdings (Private) Limited is the
parent company of the Bank and its
registered office is in Pakistan.
How well the statements has been prepared FY19?
 Need of an hour for financial statements:
Accountants have obligations to shareholders,
creditors, employees, suppliers, the government, the accounting professional and public at
large to prepare and bring true and fair view of the financial records and for this purpose .
These statements represent the financial performance of the entity and its current fascial year
and also educate the shareholders about the financial status and financial performance of the
company .
 The financial Statements of any company usually consist of 4 reports:
 Balance sheet
 Profit and loss statement
 Cash flow statement
 Statement of changes in equity
 How well the statements has been prepared FY19?

 ABL Ltd Balance Sheet Report:

ABL Ltd is Maintaining a strong balance sheet and safeguarding
asset quality which contributes towards sustainable performance.
Financial position improved by 10% to Rs. 1,481,121 million; And Bank’s Equity base stood at the
robust level of Rs. 115,351 million; NPLs reduced by Rs. 211 million causing infection ratio (non
performing loan) to fall by 0.12% and improving coverage ratio to 97% (easily interest payment by
bank taken receipt).

 ABL Ltd Profit and loss statement:

ABL Ltd also conducted review of the process of profit distribution
on monthly basis and ensured that the distribution is in line with instructions of SBP. Moreover,
internal Shariah audit of pool management has been conducted on quarterly basis, which has further
improved the process of pool management, profit and loss distribution and strengthened the
compliance of Shariah guidelines .
How well the statements has been prepared FY19?

 ABL Cash flow statement:

The Allied bank cash flow statement shows comprehensive and clear
graph of its yearly performance having as compared to previous year bring rise in the Cash Flow
from Operating Activities 98,946 million and Cash Flow from Investing Activities 69,017 and Cash
Flow from Financing Activities 10,967.
 ABL Notes to the Account:
ABL notes to the account justify and give us a comprehensive and detail of
all the given information and calculation happen in the said 5 financial reports of the bank .
 ABL Statement of changes in equity:
ABL given financial reports of statement of changes in equity clear us in
all the aspect of Share Total capital, Exchange translation reserve, Statutory reserve, General
reserve, Investments Fixed assets, Nonbanking assets, and non appropriated profit of the bank and
significance changes .
How well Allied bank Financial Statements FY19 prepared:

Financial statements are quantitative statements, based on numbers however the information they
provide to users have some important qualitative characteristics, and some of them are discussed
below:
 Relevance:
after analyzing the FS of Allied bank we can say this shows helpful information is
available for making sound financial decisions, and these statements are confirmatory and
predictive in nature which mean theses shows relevant past performance as well as possible future
events.
 Representational faithfulness:
Representational faithfulness or we can say reliability of these statements,
accurately reflect a company resources, obligatory claims and transaction etc. we found they are
complete neutral and free from error.
 Timeliness And Comparability:
Bank financial statements are quite easily accessible and timely prepared under its
financial statements for the year ended starting from 1 st Jan 2019 to 31 Dec 2019 and as for the
year ended for its profit and loss statements. As the financial statements should be issued before
the end of accounting period.
How well Allied bank Financial Statements Prepared
(Contd):
 Verifiability:
After analyzing the FS of the bank we can say to the extent that the given
information has certain usefulness under accounting standard because the purpose if
verifiability is to provide a significant degree of assurance that accounting measures represent
what they meant to represent.
 Materiality:
financial statements of ABL ltd are prepared comprehensive and concise as the
materiality refers to that not all the information is needed or should be communicated in the
accounting reports . materiality information is seen in ABL financial accounts.
 Consistency:
ABL is following consistent accounting procedure since the past several year as
inconsistency in the accounting procedure bring lack of comparability . But users need may
change over time which would require a change in accounting principles standard and
methods. Those improvements should only be made when there's any requirements.
 How well Allied bank Financial Statements Prepared
(Contd):

Audit Comment on the Preparation of Financial reports:

 Based on our audit, we further report that in our opinion:
 a) proper books of account have been kept by the Bank as required by the Companies Act, 2017
(XIX of 2017) and the returns
 b) the unconsolidated statement of financial position, the unconsolidated profit and loss account,
the unconsolidated statement of
 comprehensive income, the unconsolidated statement of changes in equity and the unconsolidated
cash flow statement together
 with the notes thereon have been drawn up in conformity with the Banking Companies Ordinance,
1962 and the Companies Act,
 c) investments made, expenditure incurred and guarantees extended during the year were in
accordance with the objects and powers
 d) zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980), was
deducted by the Bank and deposited in the Central Zakat Fund established under section 7 of that
Ordinance.
How detailed and helpful are the ABL notes to the accounts are?

 THE Bank ABL Ltd contain the comprehensive and whole detail of the 1. Earnings per share
notes to the accounts some are
2. CASH AND BALANCES WITH TREASURY BANKS
1. Approved financial statements
3. BALANCES WITH OTHER BANKS
2. Proper classification of the investments
4. LENDINGS TO FINANCIAL INSTITUTIONS
3. Provision against non–performing loans and advances and debt securities
classified as investments 5. Quality of Available for Sale Securities

4. BASIS OF MEASUREMENT 6. BORROWINGS

5. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 7. DEPOSITS AND OTHER ACCOUNTS

6. Advances (Loans and advances, Net investment in finance lease, Islamic 8. DEFERRED TAX LIABILITIES
financing and related assets)
9. OTHER LIABILITIES
7. Fixed assets and depreciation
10. CONTINGENCIES AND COMMITMENTS
8. Taxation
11. DERIVATIVE INSTRUMENTS (Forward Exchange Contracts – Foreign
9. Staff retirement and other benefits Exchange Swaps – Equity Futures – Forward Contracts for Government
Securities)
10. Other long term benefit
12. OPERATING EXPENSES
11. Deposits
13. Auditors’ remuneration
12. Impairment
14. Fair value of Bank’s financial instruments included in plan assets
13. Financial assets and liabilities
15. CAPITAL ADEQUACY, LEVERAGE RATIO & LIQUIDITY
14. Dividend distribution and appropriations REQUIREMENTS
15. Foreign currencies 16. RISK MANAGEMENT (Credit Risk, Market Risk, Liquidity Risk,
Operational Risk, Reputational Risk. Information security risk, Strategic
16. Business Segment reporting Risk)
17. Geographical Segment Reporting 17. Etc.
How detailed and helpful are the ABL notes to the accounts are?

The notes to the account are helpful in explaining the practices employed while in preparing the financial
statements of the Allied bank, following the are the some of the purposes they serve for the financial statements:
 Providing details regarding certain figures in the financial statements:
Notes to the account helps in explaining and analyzing the calculation behind the
aggregates and totals of certain figures of certain figures which make up the part of ABL financial statements e.g
the Non performing loan and assets etc.
 Statutory Disclosure:
certain information of ABL that are not mentioned in the statements are disclosed in the
notes to the accounts schedules for further clarity e.g. advances, deposits, differed tax liability etc.
 Explaining the method of accounting principle used:
Notes to the accounts helps in identifying the various accounting methods being used in the
bank e.g. for calculation of tangible asset depreciation reducing method is used and for intangible assets straight
method is used.
 Changes in Accounting polices:
Certain changes in the accounting polices by the ABL are highlighted in the note of 2.2
which describe the new methods adopted by the bank for reporting that is the adoption of IFRS 16 leases from
January 2019.
How detailed and helpful are the ABL notes to the accounts are?

 Detail of off balance sheet items:

certain information regarding the ABL which do not belong in the financial
statement but may be importance to the investor are also discussed in the notes to the account
schedules.
CONCLUSION:
 As mentioned in previous slide ABL note to the financial account contained a complete and
comprehensive detail of necessary aspect which reflect the visial representation of fact along the
data.
 It is not wrong to say that all the done calculation under the schedules head notes to the financial
accounts are reflect the main financial reports including balance sheet, income statement, notes to
financial statements, cash flow statement and statement of changes in equity.
 How informative and realistic is the directors report?

Initial Directors report to

the Shareholders:

Among different challenges emanating from struggling

domestic economy, changing business models,
increasing regulatory compliance, cyber security threats,
ABL’s Return on Equity (ROE) stood
asset liability repricing lag and rising risk of credit
at 16% in 2019, which is in line with
losses ABL Bank has maintained its bequest of steady
top 9 banks
growth along with robust progression in financial
position.

Effective tax rate thereby rising to 42% Profit before taxation for the year ended
and accordingly Profit after tax stood at December 31, 2019 grew by 15% and
Rs.14,113 million. stood at Rs.24,242million.

Healthy growth in CASA and Rack based

Super Tax, which was initially levied
deposits, noteworthy growth in non markup
vide Finance Act, 2015 has continued
income including 32% increase in foreign
and vide Finance Act 2019
exchange earnings capitalizing on favorable
(income>500M)
swap curve during the year.
 How informative and realistic is the directors report?
Certain main points have been discussed in the director report prepared by the BODs in the FY19:

 Macroeconomic Developments 2019:

Pakistan’s Gross Domestic Product (GDP) growth has moderated to 3.3% in FY 2018-19 from 5.8% in FY 2017-18 on account of measures implemented to address the twin
deficit crises (due to country having both fiscal and current account deficit ) effected not only the country financial, service, and manufacturing sector but also led to the bad balance of payment and
currency devaluation.

 Financial Performance:

Pakistan’s banking sector continued to face significant ramifications and private sector credit appetite has remained subdued from the prevailing economic circumstances.
Sector’s bottom line was affected by sharp repricing pace of funding liabilities, credit losses, rising cost of doing business, increasing compliance cost and regulatory changes. However, in second half of
the year ended December 31, 2019 improved asset repricing on the back of stabilizing interest rates has diluted the impact.

1. ABL bank focuses on Capitalizing on consistent growth in low and no cost deposits along with superior quality asset base, a multifaceted long-term strategy governing optimum
organizational structure, comprehensive risk management framework, investment towards digital transformation, enhanced customer acquisition and continuous enrichment of its innovative and well-
diversified service suite has facilitated Your Bank in achieving sustainable financial performance.

2. This helps the Bank to post a higher gross mark-up income by Rs. 49,363 million, higher by 67% over the last year.

3. Diversification of revenue streams through continuous enrichment of service suite along with concurrent focus on upholding highest service standards has enabled Your Bank to post a
robust growth of 17% in fee income which has reached Rs. 5,092 million.

4. Dividend income has decreased, as compared to the corresponding year, as aforementioned economic slowdown weighed in on shareholder returns, thereby impacting dividend payouts.
Correspondingly, non markup income stood at Rs. 10,891 million for the year as against Rs. 11,289 million in the corresponding year.

5. The economic slow down in the FY19 also reflected by the a lack luster performance by Pakistan Stock and this also effect the bank translation economic factors.

6. Loan growth momentum has slowed sharply as a weaker economic scenario and elevated interest rates has dampened credit demand; industry advances growth declined by 83% during the
year. Amidst aforementioned industry downtrend, ABL Bank’s pragmatic business strategy along with a robust risk management framework facilitated growth of 10% in gross advances, well above the
industry growth of 4%.

7. Accumulation of zero-cost and low-cost deposits during the year has remained a key strategic objective of Your Bank. Thereby, non-remunerative deposits have grown by 17% to close at
Rs. 388,019 million; constituting 37% of the total deposits mix as at end December 2019. Total Deposit base of ABL Bank has registered a healthy increase of 7% growth YoY.

8. ABL continue to focus on Implementation of envisaged governance and structural reforms to strengthen institutional frameworks and enhancing documentation of economic activities shall
remain critical to credibly reversing the trend of fiscal deterioration; while further laying the foundation for achieving long term sustainable and balanced GDP growth.
How informative and realistic is the directors report?
 Risk Management Framework:
The ABL Board of Directors manages risk through a framework of sound risk principles which include establishment
of risk tolerance limits, identification of potential risks, assessment of their impact on the Bank and formulation of strategies to mitigate all
foreseeable risks.
1. Risk mitigating strategies were recommended and monitored through Board of Directors’ sub-committee “Board Risk
Management Committee” (BRMC). Management sub-committees “Risk Management Committee” (RMC), Compliance Committee and
“Asset and Liability Committee” (ALCO) ensuring effective risk management.
2. ABL Risk Management Group (RMG) is mandated to implement this framework as a function, independent of commercial
lines of business. RMG took following major initiatives in 2019 to further strengthen the risk management framework:
3. Owing to Small and Medium Enterprises economic significance and in light of SBP’s initiative to promote SME financing,
ABL Bank participated in Innovative Challenge Fund.
4. State Bank of Pakistan (SBP) issued detailed directions on implementation of International Financial Reporting Standard-9
(IFRS 9) vide BPRD Circular No. 04, dated October 24, 2019. The effective date for implementation of IFRS 9 is January 1, 2021 and
the Banks are required to conduct parallel run and make necessary preparations for its implementation during 2020.
5. The Bank has an in-house developed state of the art Risk Assessment and Management System (RAMS) for loans
processing and Monitoring. The system has enabled the Bank towards effective management of Credit Risk, also reflected by one of the
lowest infection ratios in the industry.
6. In compliance with the Green Banking Guidelines issued by the State Bank of Pakistan, ABL Bank has established a
dedicated Green Banking Office (GBO) to promote environmentally friendly practices. In this regard, ABL Bank has formulated &
implemented a Green Banking Policy to reinforce its commitment for environmental sustainability.
How informative and realistic is the directors report?
 Chief Executive Officer’s Review:
Under ABL director report The Board of Directors fully endorses the Chief Executive Officer’s Review on the Bank’s
operational performance for the year ended December 31, 2019.
 Statement of Internal Control:
under this report The Board is pleased to endorse the statement made by management relating to internal controls
including management’s evaluation of ICFR.
 Corporate Sustainability:
ABL Board is pleased to endorse the Corporate Sustainability initiatives taken by ABL Bank as discussed in the director
reports.
 Corporate Governance Rating:
VIS Credit Rating Company Limited re-affirmed Allied Bank’s Corporate Governance Rating of ‘CGR-9+’. The rating
indicates a ‘very high level of corporate governance’; thus, depicting a strong commitment towards governance framework by the Board and
Management of Your Bank. VIS has noted that Human Resource and Remuneration Committee be chaired by an independent director as per
Listed Companies (Code of Corporate Governance) Regulations 2019, which is currently being headed by a non-executive director.
 Performance evaluation Mechanism for the Board:
The Director report under (BOD), explain while ensuring regulatory compliance is also joint with fiduciary
responsibility on behalf of the shareholders to protect Bank’s interests, provide strategic direction and monitor the execution of strategic
objectives.
 External Auditors:
The present Auditors M/s KPMG Taseer Hadi & Co, Chartered Accountants in pursuance of the Code of Corporate
Governance become ineligible for re-appointment having completed a term of five years. However, State Bank of Pakistan and Securities
Exchange Commission of Pakistan has granted permission to the Bank to extend the term of M/s KPMG Taseer Hadi & Co, Chartered
Accountants for next term.
How informative and realistic is the directors report?
 Conclusion:
As discussed in the previous slides director report of ABL explain us the complete and
comprehensive information which is necessary for any knowledgeable and investor point of view, all
of the above discussed point are effective and realistic in nature no biased or fraudulent activity is
faced while analyzing the director report .Almost all information given is as per the compliance of
the ,
 State bank of Pakistan
 Security and exchange commission of Pakistan
 Accounting Structure IFRS
 As per social environmental practices
 How clean is the audit report?
Allied bank Audit (report) work under the audit Committee of the Board such committee comprises of three non-executive members including two
independent directors, one being Chairman of the Audit Committee. The members of the Audit Committee bring years of diversified rich experience
at senior management positions and strategic roles in commercial banking, investment banking, planning, energy, manufacturing and engineering
sectors.
Audit committee is diligently performed its duties and responsibilities in accordance with its approved by the Board of
Directors while compliant with the requirements of the Code of Corporate Governance and Regulations issued by State Bank of Pakistan (SBP).
 Allied bank Audit report can be classified into two parts:
1. Internal audit
2. External audit
Internal audit committee:
 this Committee oversees the functions of the Audit and Risk Review Group (A&RRG) and ensures that A&RRG has adequate financial,
technological and operational resources along with appropriate human resources having required skill-sets, expertise and trainings necessary to
perform A&RRG’s responsibilities independently, effectively and objectively.
 The Chief A&RRG reports directly to the Audit Committee.
 A&RRG assists the Audit Committee and the Board of Directors in discharging their responsibility in respect of Internal Control System.
 A&RRG periodically reviews, assesses adequacy and monitors the ongoing effectiveness of control systems.
 During the year 2019, six meetings of the Audit Committee were held.
 A&RPG make Review of the Bank’s annual and interim financial statements prior to their approval by the Board of Directors. That included
detailed discussions with the Banks’ senior management, external auditors and A&RRG.
 Monitoring of compliance status of observations highlighted in SBP’s inspection reports.
 Chairman Audit Committee constitution : Zafar Iqba, Muhammad Waseem Mukhtar, Dr. Muhammad Akram Sheikh.
 The Audit Committee considers the quality and efficiency of the services provided by the external auditors, too the external auditors’
capabilities, technical expertise and knowledge of the Bank’s operations and industry.
 How clean is the audit report?
External Audit firm of ABL:
 External audit firm which perform audit of allied bank is KPMG Taseer Hadi & Co. Chartered
Accountants, As per corporate governance the period of 5 year of performing the audit under same firm is near
to end for the allied bank but the audit committee file an petition to the SBP and SECP in order to hold this AC
firm to carry on the audit for the coming period.
 External audit firm is responsible under Statement of Compliance with the Listed Companies
(Code of Corporate Governance) Regulations, 2019 (the Regulations) prepared by the Board of Directors of
Allied Bank Limited for the year ended 31 December 2019
 Firm responsibility is to review whether the Statement of Compliance reflects the status of the Bank’s
compliance with the provisions of the Regulations and report if it does not and to highlight any non-compliance
with the requirements of the Regulations.
 As a part of the audit of the financial statements this firm is required to obtain an understanding of
the accounting and internal control systems sufficient to plan the audit and develop an effective audit approach.
 This firm monitor whether the Board of Directors’ statement on internal control covers all risks
and, the Bank’s corporate governance procedures and risks.
 External audit firm only required and have ensured compliance of this requirement to the extent of
the approval of the related party transactions by the Board of Directors upon recommendation of the Audit
Committee.
ABL Clean audit report tells us:
 ABL audit (ACOB) driven, clear us about the appropriateness of measures taken by the Management to safeguard
Bank’s assets, review financial statements focusing on major judgmental areas, significant adjustments, going
concern assumption, any change in accounting policies, compliance with applicable statutory and regulatory
requirements and related party transactions.
 The Committee recommends appointment of the external auditors and also coordinates with them to fulfill
statutory and Code of Corporate Governance requirements. The Committee is inter-alia responsible to ascertain
the effectiveness of the Internal Control System including financial and operational controls, ensuring adequate
and effective accounting and reporting structure and monitoring compliance with the best practices of the
corporate governance.
 ACOB is also responsible to facilitate BOD in establishing strong and effective system of internal controls based
on & supported by strong ethical practices, culture, comprehensive policies, procedures, processes and
technological systems; keeping an oversight and quarterly review of the Internal Controls over Financial
Reporting and review of all findings of SBP Inspection Report, Management Letter by external auditors and
weaknesses identified in internal controls by Audit & Risk Review along with review of Bank’s Statement of
Internal Controls prior to endorsement by the Board.
 The other function of the Committee includes assurance that an independent and effective internal audit function
is in place.
How clean is the audit report?
 Conclusion:
Based on our analysis, nothing has come to our attention which causes us to believe that the
Statement of Compliance does not appropriately reflect the Bank’s compliance, in all material respects,
with the requirements contained in the Regulations as applicable to the Bank for the year ended 31
December 2019.
The other function of the Committees including internal and external , compliance
management, etc. give assurance that an independent and effective internal audit and external function is
in place
We Evaluate the overall presentation, structure and content of the consolidated as well as
unconsolidated financial statements, including the disclosures, and came to know theses report represent
the underlying transactions and events in a manner that achieves fair presentation.
We Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
 How difference is the composition of asset and liabilities:

 Bank balance sheet vs companies balance sheet:

 There is significant difference between bank and any other company balance sheet
or its asset and liabilities composition ,
 As there are no accounts receivables or inventory to gauge whether sales are rising
or falling. 
 The bank acts as an intermediary between two parties. The job of a bank is to assist
the company and individual in which it can help. Bank usually makes profits from the spread between
the rate it receives and the rate it pays, banks also earn revenue from fee income that they charge for
their products and services that include wealth management advice, checking account fees, overdraft
fees, ATM fees, interest and fees on credit cards.
 On the other hand, a manufacturing or service company operates to produce goods
or services and ultimately sell these goods or services to another business, end customer or to
Government. The objective of running a regular company is to generate and maximize wealth for its
shareholders.
 As the nature of both of these entities is different, it makes sense to prepare a unique
balance sheet for each of them.
 How difference is the composition of asset and liabilities:

 Bank Asset and liabilities composition:

bank assets and liabilities are usually mentioned in schedules as these schedules refer to the additional information, key assets
that are being used in bank balance sheets are,
Assets in ABL balance sheet:
1. Cash and bank balance
2. Investment
3. Net inter segment lending
4. Lending to financial institution
5. Advances performing
6. Advances non performing
7. Provision against advances
8. Advances net
9. Others
Liabilities in ABL balance sheet:
10. Borrowing
11. Deposits
12. Others
All these assets and liabilities class under the Balance Sheet of a bank is prepared according to the Banking Regulation Act, and proper
Schedules are prepared for its clear understanding.
How difference is the composition of asset and liabilities:

 Analyzing the composition of the asset and liabilities in the balance sheet of allied bank, following difference can be drawn:
Bank asset = bank liabilities + bank capital
ASSETS:
 ABL is the 4th largest private sector commercial bank and 5th largest bank in Pakistan in terms of total assets which accounts for
approximately 7.3% of sector assets
 ABL asset consist of Cash and balances with treasury banks, Balances with other banks, Lending's to financial institutions,
Investments - net, Advances, Fixed assets, intangible assets, Other assets:
 as compared to any other regular company bank assets do not consist of any inventory rather it is available in different above mentioned
form.
 Property and equipment owned by the Bank, other than land which is not depreciated, are stated at cost or revalued amount less
accumulated depreciation and impairment losses, if any. Land is carried at revalued amount.
 Depreciation is calculated using the straight line method, except buildings which are depreciated using the reducing balance
method, to write down the cost of property and equipment to their residual values over their estimated useful lives.
 Intangible assets are carried at cost less any accumulated amortization and impairment losses, if any. The cost of intangible assets is
amortized over their estimated useful lives, using the straight line method.
LIABILITIES:
 ABL liabilities consist of bills payable, borrowing, Deposits and other accounts, Liabilities against assets subject to finance lease,
Deferred tax liabilities, Other liabilities .
 one of the main liabilities of bank, Deposits are initially recorded at the amount of proceeds received. Mark-up accrued on deposits
is recognized separately as part of other liabilities and is accrued to the profit and loss accounts
 ABL liabilities and bill payable increased to 2% as compared to the pervious year -1% with the figure of 7879.M
Do these report capable of fulfilling of three function of information, control,
and planning?
 Allied bank financial statements clearly fulfill the necessary functions as mentioned below:
 The information function:
1. Financial statement to Management
2. Financial statement to government
3. Financial statement to creditor
4. Financial statement to investor
Investor need necessary information to invest in the company, government need to impose tax,
creditor need to lend and even own management need a clear information to improve its performance and KPIs, thus by analyzing ABL
financial statements give us a clear, comprehensive, and complete view of information that is necessary for any decision.
 The Control function:
 ABL reports helps in controlling the decision of directors while pertaining the necessary
information.
 These reports becomes the reason to better control and monitor the department and sub
department of the bank or company and theses reports helps to monitor and control the root cause of any negative or positive impact
happening.
 Control function do not ensure compliance with laws and regulation, but rather are designed to
help the bank or company operate in a best possible manner for all stakeholders.
 Having better control function is ultimately helping the bank to provide true and fair
information and which leads to the better planning & strategy and which will become the outcome to achieve the bank or company
objective.
Do these report capable of fulfilling of three function of information, control,
and planning?
 The Planning function:
 By analyzing the reports we found that ABL bank have solid financial controlling
with base information which ultimately lead to the better planning of the bank future.
 As the bank is more risk taker then any regular company thus having better
informative and control reports help the bank to allocate its future investments and payments with
best possible strategy.
 planning functions helps the bank to use its resources, equipment and its finances in
best possible way to achieves it objective.
 Conclusion:
By analyzing the above mentioned reports we can say that the Allied bank financial
reports are capable of fulfilling the above mentioned functions that are planning, controlling, and
providing relevant information.
Is there any evidence of deliberate misstatement?

 Although the accurate and complete evidence of any deliberate misstatement cannot be ensured
without any full nitty and gritty analysis of the bank reports, however the below mentioned points
may be subject to concern regarding financial statement,
 Misstatement on the investment evaluation:
 As at 31 December 2019, the Bank has investments classified as “Available-
for-sale”, “Held for trading”, “Held to maturity” and “Investment in subsidiary” amounting to Rs.
757,957 million which in aggregate represent 51.17% of the total assets of the Bank There may be
a risk of misstatement of Obtaining an understanding of and testing the design and operation
effectiveness of the controls relating to the valuation of investments.
 Risk of Misstatement on the disclosure of Interest by Director:
 No proper disclosure is given by the BODs regarding any interest of there
spouse and children whether directly or indirectly, concerned or interested in any contract or
arrangement entered into, or to be entered into, by or on behalf of the Bank is not disclosed in the
BODs meetings.
 The scope of our study and analyses clear us no such policy or types of
unlawful acts / orders, fraud, corruption, misconduct, collusive practices or any other activity which
undermines the Bank’s operations, financial position, reputation and mission is found.
Following are the some of the key metrics for the financial analysis of ABL
statements for the FY2019:

KYE METRICS FY2019

Profit before tax 58.40% ( 15%up )

Return on equity 16% ( last year 15%)

Earning per share 12.32 ( last year 11.25)

Income ratio 21% ( 15% up )

Price earning growth 0.82% as com to last year

Divided yield ratio 8.37%

Return on asset 1% increase

Dividend cover ratio 1.53

Capital adequacy ratio 22%

Profit after tax 14.1 billion pkr (10% growth) as com to last year 12.8 billion

No of outstanding shares 1,145,073,830

Total asset stood at 1481 billion pkr

Non performing loan reduction -1%

Full year dividend per share 8 Rs

Capital Adequacy Ratio (CAR) 22%

Following are the some of the key metrics for the financial analysis of ABL
statements for the FY2019:

KYE METRICS FY2019

Advances Growth 11%

Deposits Mobilization 7%

CASA Mix Improved 1%

Customer Complaint Resolutions 99%

myABL Registered Users (Approx) 4260000+

No. of Debit Cards issued (Approx 417000+

Digital Transactions increase 2%

Salaries and Benefits (Rs. In million) in FY2019 13180 million

Employee Retention Ratio 93%

Total Investmnet in Employee Trainings 97 million

Depositors stood at FY19 4.2 million

Total Number of Employees FY19 11,665

Deposits stood at FY19 1,049,043 million

Total Equity 115,351 million

Corporate Governance Rating CGR 9+