(Continuation news of BIFC): (3) Bangladesh Industrial Finance Company Limited (BIFC) invested an amount of Tk. 117,500,000 for unquoted shares at the Banglalion Communication Limited and GMG Airlines Limited and BIFC made 100% provision against those investments. (End)
BIFC

(Continuation news of BIFC): continue as a going concern and therefore the company may be unable to realize its assets and repay its liabilities in the normal course of business. (2) Total outstanding amount Tk. 8,414,821,757 an amount of Tk. 8,096,801,865 has been classified as Bad and Loss as on December 31, 2018 which comprises 96.22% of the total outstanding amount. As a result, all the related financial indicators of this company suffered a serious setback. (cont. 19)
BIFC

(Continuation news of BIFC): Emphasis of Matter: (1) The company has been facing net loss for last three years as a result Returned Earning of Tk. (9,573,969,690), total Shareholder Equity of Tk. (7,998,665,811), Net Liquidity Gap of Tk. (7,998,665,811) are negative balance. Likewise, the investment disbursement amount is very poor. As a result, those circumstances indicate uncertainties that may cast significant doubt on the Company's ability to (cont. 18)
BIFC

(Continuation news of BIFC): (9) Unable to provide Loan Statement: Management of BIFC was unable to provide us 14 Loan statements from different bank as a result, we could not confirm actual liability position of those the loan balance amount of Tk. 2,329,800,264. (10) Unable to provide us Income Tax Refundable Assessment Order: Management of BIFC was unable to provide us the assessment order in support of tax refund (Note-10.04.01) for an amount of Tk. 5,309,867. (cont. 17)
BIFC

(Continuation news of BIFC): Name of the Month: December 2018; Required Balance (5% of total liabilities): Tk. 112,463,547; BIFC Maintained: Tk. 96,965,676; Shortfall: Tk. 105,497,871; Remarks: Deficit of SLR. (8) Unable to Provide Bank Statement: Management of BIFC was unable to provide us 4 Bank statements from different bank and bank reconciliation as a result, we could not verify below mentions bank statement transactions and bank balance amount of Tk.1,901,966,64. (cont. 16)
BIFC

(Continuation news of BIFC): Shortfall: Tk. 100,126,226; Remarks: Deficit of SLR. Name of the Month: September 2018; Required Balance (5% of total liabilities): Tk. 114,029,643; BIFC Maintained: Tk. 104,777,438; Shortfall: Tk. 9,252,205; Remarks: Deficit of SLR. Name of the Month: November 2018; Required Balance (5% of total liabilities): Tk. 121,900,299; BIFC Maintained: Tk. 98,893,353; Shortfall: Tk. 23,006,945; Remarks: Deficit of SLR. (cont. 15)
BIFC

(Continuation news of BIFC): Balance (5% of total liabilities): Tk. 122,361,258; BIFC Maintained: Tk. 105,908,368; Shortfall: Tk. 16,452,890; Remarks: Deficit of SLR. Name of the Month: July 2018; Required Balance (5% of total liabilities): Tk. 116,398,709; BIFC Maintained: Tk. 105,409,834; Shortfall: Tk.10,988,875; Remarks: Deficit of SLR. Name of the Month: August 2018; Required Balance (5% of total liabilities): Tk. 111,349,707; BIFC Maintained: Tk. 11,223,480; (cont. 14)
BIFC

(Continuation news of BIFC): Bangladesh Bank circular. Details are as follows: Name of the Month: March 2018; Required Balance (5% of total liabilities): Tk. 116, 185,608; BIFC Maintained: 113,220,259; Shortfall: 2,965,348; Remarks: Deficit of SLR. Name of the Month: April 2018; Required Balance (5% of total liabilities): Tk. 116,950,386; BIFC Maintained: Tk.105,155,195; Shortfall: Tk. 11,795,190; Remarks: Deficit of SLR. Name of the Month: June 2018; Required (cont. 13)
BIFC

(Continuation news of BIFC): (7) Deficit of Statutory Liquidity Requirement (SLR): As per FID circular No.-6, November-06, 2003 and FID Circular -2, Dated: November-10, 2004 every Financial Institutions of Bangladesh has to maintain 5% SLR on balance on average of total liability as prescribed by Bangladesh Bank circular from time to time, but in course of our audit for the year ended December 31, 2018, we observed that BIFC failed to maintain sufficient balance as per (cont. 12)
BIFC

(Continuation news of BIFC): Name of the month: December 2018 (1st 2 weeks); Required amount of the weekly average (2.5%): Tk. 45,539,559; BIFC maintained on weekly average: Tk. 74,243; Shortfall on weekly average: Tk. 45,465,315. Name of the month: December 2018 (2nd 2 weeks); Required amount of the weekly average (2.5%): Tk. 45,539,559; BIFC maintained on weekly average: Tk. 106,774; Shortfall on weekly average: Tk. 45,432,784. (cont. 11)
BIFC

(Continuation news of BIFC): Name of the month: July 2018 (1st 2 weeks); Required amount of the weekly average (2.5%): Tk. 47,379,192; BIFC maintained on weekly average: Tk. 57,184; Shortfall on weekly average: Tk. 47,322,008. Name of the month: November 2018 (2nd 2 weeks); Required amount of the weekly average (2.5%): Tk. 50,301,264; BIFC maintained on weekly average Tk. 47,130; Shortfall on weekly average: Tk. 50,254,133. (cont. 10)
BIFC

(Continuation news of BIFC): on a daily basis of the same total term deposit. While we are conducting our audit for the year ended December 31, 2018. We found that there were several time shortfalls of maintaining CRR on the bi-weekly average basis in the following months as per the following details: Name of the month: June 2018 (2nd 2 weeks); Required amount of the weekly average (2.5%): Tk. 50,338,581; BIFC maintained on weekly average Tk. 67,654; Shortfall on weekly average: Tk. 50,270,926. (cont. 9)
BIFC

(Continuation news of BIFC): All of these loans and leases are classified as Bad and Loss and there was only 1.30% recovery during this year. However, legal processes are ongoing to recover the amount. (6) Deficit Cash Reserve Requirement (CRR): As per FID circular No.-02, Dated: November 10, 2004 every Financial Institutions has to maintain Cash Reserve Requirement (CRR) of 2.5% on the bi-weekly average basis of their total term deposit with a provision of minimum 2% (cont. 8)
BIFC

(Continuation news of BIFC): There was no recovery on account of said outstanding amount during this year. All of these loans/leases were classified as bad and loss. However, the management of BIFC has taken all possible steps to recover this amount. b) As at December 31, 2018 outstanding of Loan, Lease & Advance against various concern of Biswas Group was Tk. 201,155,268. These amount represent 2.39% of total outstanding. (cont. 7)
BIFC

(Continuation news of BIFC): Income Tax Para-15 and 20, BIFC should compute deferred tax. As a result, liability and income tax being understated. (5) Loan, Lease & Advances: a) As at December 31, 2018 a total outstanding of Loans, Lease and Advances against various concerns of Sunman Group was TIC. 6,396,500,546 equivalents to 76.01% of total outstanding balance of Tk. 8,414,821,757. The amounts were carried forward from financial year 2014. (cont. 6)
BIFC

(Continuation news of BIFC): We scrutinized that the company's total equity becomes negative Tk. (7,998,665,811) because of net loss made during last 3 years and investment in share as on 31 December 2018 Tk. 205,573,951 in quoted and un-Quoted shares clearly state that non-compliance investment of the Financial Institutions Act 1993. (4) Taxation: We found that BIFC did not compute the deferred tax on the asset revaluation reserve amount of Tk. 403,425,667. As per IAS-12, (cont. 5)
BIFC

(Continuation news of BIFC): Capital Adequacy Ratio (CAR) was negative by 77.95% and Core Capital to RWA was stood negative by 80.1%. (3) Non-compliance of Financial Institution Act 1993: As per Financial Institutions Act 1993, Section-16 "No Financial Institution shall expend or use more than 25% of its Paid-up Capital and reserves for the acquisition or holding of any kind of shares of financial, commercial, agricultural or industrial institution or of any similar institution". (cont. 4)
BIFC

(Continuation news of BIFC): Provision made/charge: Tk. 359,972,546; Shortfall: Tk. 271,952,110. Year 2017; Required Provision: Tk. 641,325,687; Provision made/charge: Tk. 373,765,471; Shortfall: Tk. 267,560,216. Year 2018; Required Provision: Tk. 801,735,708; Provision made/charge: Tk. 578,443,479; Shortfall: Tk. 223,292,229. (2) Deficiency of Capital Adequacy: As per the statement of the Capital Adequacy and Market Discipline (CAMD)) of BIFC as on December 31, 2018 (cont. 3)
BIFC

(Continuation news of BIFC): However, as per our computation the Required Interest suspense account should be Tk. 801,735,708 as on 31 December 2018 and thus short Interest Suspense Accounts of Tk. 223,292,229 has been shown in Financial Statements. This is made up as follows: Year 2015; Required Provision: Tk. 723,973,846; Provision made/charge: Tk. 373,597,189; Shortfall: Tk. 350,376,657. Year 2016; Required Provision: Tk. 631,924,656; (cont. 2)
BIFC

The auditor of the company has given the following "Qualified Opinion and Emphasis of Matters" paragraph in the audit report of the company prepared for the year ended on 31 December 2018. Basis for Qualified Opinion: (1) Interest Suspense: As per Bangladesh Bank, FID circular No-6, Dated: August 20, 2016; BIFC has made interest suspense for an amount of Tk. 209,499,304 during the year and total interest suspense as on 31 December 2018 is Tk. 578,443,479. (cont. 1)
BIFC