Posted on 20th Dec 2024 12:05:44 AM Accounting
1.1. Introduction
A sound banking structure and system is necessary for rapid development of an economy. It helps capital formulation and capital accretion, which leads to economic growth. Financial resources specially scattered deposits of the country need to be mobilized in the banking channel and put into productive sectors of the economy. Commercial banks are the heart of the financial market and they have the ability to create additional purchasing power. Significance of commercial banks both as repositories of a community’s savings and as purveyors of credits for economic activities is emphasized by many economists. In reality, it is primarily the commercial banking system which, by serving many types of borrowers, provides the necessary flexibility to channel the funds from lesser to more urgent use and in this way assist significantly in financing change and progress in an economy and the role of commercial banking. Thus has an important implication for national policy.
1.2. An Overview of the National Bank PLC
National Bank PLC is the front ranking first generation commercial Banks in Bangladesh. With a noble vision of ensuring highest standard through application of latest information technology National Bank PLC started its journey. The bank is also committed to fulfill its responsibilities to the society and the country. National Bank PLC has its prosperous past, glorious present, prospective future and under processing projects and activities. Established as the first private sector bank fully owned by Bangladeshi entrepreneurs, Public Limited Company (PLC) has been flourishing as the largest private sector bank with the passage of time after facing many stress and strain. The members of the board of directors are creative businessmen and leading industrialists of the country. To keep pace with time and in harmony with national and international economic activities and for rendering all modern services, National Bank PLC, as a financial institution, automated all its branches with computer networks in accordance with the competitive commercial demand of time. Moreover, considering its forth-coming future, the infrastructure of the Bank has been rearranging.
National Bank PLC was established in 23rd March, 1983 with an Authorized Capital Tk. 100 million and Paid up capital Tk. 44 million. The President of the People's Republic of Bangladesh Justice Ahsanuddin Chowdhury inaugurated the bank formally on March 28, 1983 but the first branch at 48, Dilkusha Commercial Area, Dhaka started functioning on March 23, 1983. The 2nd Branch was opened on 11th May 1983 at Khatungonj, Chittagong. Today they have total 159 Branches and 12 SME (Small & Medium Enterprise) centers all over Bangladesh.
Mission
“Efforts for expansion of our activities at home and abroad by adding new dimensions to our banking services are being continued unabated. Alongside, we are also putting highest priority in ensuring transparency, accountability and improved clientele service as well as to our commitment to serve the society through which we want to get closer and closer to the people of all strata”.
Vision
“Ensuring highest standard of clientele services through best application of latest information technology, making due contribution of the national economy and establishing ourselves firmly at home and abroad as a front ranking bank of the country is our cherished vision”
Strategic Intent
Bring out new financial products and to ensure that customers receive a consistent standard quality of service.
Business Strategies
Achieve business vision through quality and customer acceptance by providing financial services.
Core values
Shareholders: By ensuring fair return on their investment through generating stable profit.
Customer: To become most caring bank by providing the most courteous and efficient service in every area of our business.
Employee: By promoting the well being of the members of the staff.
Community: Assuring our socially responsible corporate entity in a tangible manner through close adherence to national policies and objectives.
All these are to be attained upholding ethical values and best practices. Above all, the objective is continuously seeking to improve performance by aligning our goals with stakeholders’ expectation.
Functional Structure of National Bank PLC
There are a number of departments in the bank to keep the operations smoothly. Different departments and divisions of the bank are described below:
Logistics & Support Services (L&SSD): This division was formerly known as General Services Division (GSD). Their main function relates to the procurements and supply of all tangible goods to the branches as well as to the head office of the bank.
Financial Administration Department (FAD): This department mainly deals with the accounts side of the Bank. It maintains all the transactions of branches with head office. The accounts are maintained under these heads: income and expenditure, cash section, bills section, salary and wages of the employees, etc.
Consolidation of Branch’s Account: All branches periodically (especially monthly) send their income and expenditure i.e. profit and loss accounts and head office make the consolidation statement of income and expenditure of the bank. Here branch statements are reviewed. This division also prepares monthly, quarterly, half-yearly statements and submits to Bangladesh Bank. It also analyzes and interprets financial statements for the management and board of directors.
Credit Division: The main function of this division is to maintain the bank’s credit portfolio. The major task of this department is receiving, proposing and appraising loan proposals, getting approval, sanctioning them, monitoring and following up the project, setting price for credit and measuring effectiveness, etc.
International Division: The aim of this division is to assist management for making international dealing decisions and guiding branches in their implementation. Its other objectives are maintaining correspondence relationship, monitoring foreign exchange rates, sending updated exchange rates to concerned branches, etc.
IT Division: National Bank operates and keeps records of its assets and liabilities in computers by using integrated software to maintain client ledger and general ledger. The main function of this division is to provide required hardware and software. In order to establish the most efficient bank in terms of service, profitability, and technology application, a world class IT infrastructure TEMENOS T24 of TEMONOS Holdings, NV Netherlands Antilles was chosen as the core banking software. All branches have been successfully migrated to the new CBS (computer based system). Again, various information on the bank can be found on its website www-plcbd.com
Public Relation Division: It has to perform certain functions related to all types of communication, i.e. receiving and sanctioning advertisement applications, keeping good relation with the newspapers and electronic media, etc.
Marketing Department: Marketing dept. is involved in two types of activities:
Asset marketing: Marketing of assets refers to marketing of various kinds of loans and advances. To perform these jobs the bank’s personnel often visit large organizations and attract them to borrow from the Bank to finance profitable ventures.
Liability Marketing: The process of liability marketing is almost same as asset marketing. In this case, various organizations having excess funds are solicited to deposit their excess fund to the bank. If the amount of money to be deposited is large, the banks sometimes offer a bit higher price than the prevailing.
Human Resource Department: This department deals with all kind of administrative and personnel related matters, i.e. selecting, recruiting, training new employees, managing transfer, promotion, leave of employees, termination and retrenchment, keeping records and personal files of every employee, running employee welfare fund, arranging training and workshop for executives, etc.
Inspection & Audit Department: This division works as internal audit department of the bank. The officers of this division randomly go to different branches and examine the necessary documents regarding each single account. If there is any discrepancy, they inform the concerned authority to take care of it. They help the bank to comply with the rules and regulation imposed by Bangladesh Bank.
1.3. An Overview of the National Bank PLC, Rajshahi Branch
National Bank PLC has a successful story in the Banking area. Under the expansion strategy of the Bank, Rajshahi Branch was established in 24th August, 1983. Since then, this branch is operated successfully with the major aims and objectives of head office. This branch has adopted most of the functions of National Bank PLC including deposit building, investment, foreign exchange business and other welfare oriented services.
Personnel Position of National Bank PLC (Rajshahi Branch)
There are 46 employees at National Bank PLC, Rajshahi Branch. The designations of them are given below:
Functions of National Bank PLC, Rajshahi Branch
The main function of National Bank PLC (Rajshahi Branch) is to collect deposit from public or organizations and to lend among the customers. The National Bank PLC is basically a service-oriented organization, which bears a supplementary objective of making profit. All the departments in the branch of the bank are always committed to propel the effort of achieving these objectives. It is also the starting point of all the banking operations.
Other functions of National Bank PLC, Rajshahi Branch
Profit & Loss of Rajshahi Branch
The revenues, expenses and profit of National Bank PLC (Rajshahi Branch) from 2009 to 2013 are shown in the following table.
1.4. Objectives of the Study
A research objective is defined as statement of purpose for which the investigation is to be conducted. The research objectives are a statement of purpose because this is to guide to be accomplished by the researcher in conducting his research project. Research objectives have the same characteristics, with research problem.
The main objective of the study is to analyze and evaluate the AIS of National Bank PLC in Rajshahi Branch.
The specific objectives of the study are:
1.5. Importance of the study
We can achieve only theoretical knowledge by reading textbook. But main purpose of achieving knowledge is to implement it into practical life. The modern period is the era of large- scale industrialization and heavy production. It is also a business period and the business in this has emerged on globalize phenomenon due to rapid change of technical knowledge expected with the advent of the information and profit. There are necessities of research, which can be presented in this way-
Therefore, it can be said research is a crucial part of education for a student.
1.6. Scope of the Study
Accounting Information System is one of the most important parts and parcel of evaluation of the activities of bank. Accounting Information System includes data collection, data management, and providing information. It relates with the activities and overall performance of the bank.
Our study is confined to the accounting information system of National Bank PLC, Rajshahi Branch.
1.7. Literature Review
Ahmad (2000) in his unpublished master’s dissertation tried to present the overall scenario of National Bank PLC that is a brief history of the origin, growth, development, legal foundation of national bank. The study states the theory, practice and future prospects of National Bank PLC in Bangladesh. It is a theoretical study based on secondary data.
Alam (2000) in his study tried to examine the National Bank PLC’s banking activities in Bangladesh based on a case study of National Bank PLC. The study explains different deposit investment and the performance of National Bank PLC over a period of time using secondary data. The study shows that National Bank PLC has been successful in managing both its deposit and investment activities of the bank.
Netai (2012) has prepared an unpublished thesis on deposit and credit management of National Bank PLC. He has shown in this report “National Bank PLC is providing banking service among the people through its branch network located over the country. The Bank has expanded its coverage of financial products and customer segments and enhanced its service capabilities across multiple channels. The result achieved by the Bank reflects that it claimed to even higher operational height despite stiff competition.
With the commitment, sincerity, secrecy and safety of customers information, make National Bank PLC as one of pioneers of first generation private commercial Banks in Bangladesh. In order to keep abreast with the prevailing market scenario National Bank PLC has already strengthened its position in the industry”.
Poston and Grabski (2000) reported a comprehensive review and analysis of 17 years (1982–1998) of accounting information systems (AIS) research. The principal aim of their review was to identify trends in the underlying theories and research methods used in this research. They concluded that AIS research was entering a ‘more balanced phase of research progression’ noting that while computer science continued to dominate in informing AIS research theory, there was significant growth in psychology-based AIS research. They also concluded that while model building was still the dominant research method used to investigate AIS-related issues, the research design base had widened.
Poston and Grabski (2000) predicted that future AIS research would (i) maintain a balance between normative and positive work with organizational theory growing at the expense of computer science theory and (ii) expand model-building and analytical work ‘to cover a wider variety of theoretical foundations’
Accounting information systems research exists at the intersection of the accounting and information systems domains (McCarthy, 1987; Poston and Grabski, 2000; Sutton, 1992, 1996, 2004; Sutton and Arnold, 2002). The emergence of the AIS discipline arises primarily from the application of information and communication technology in the accounting and auditing environment (Sutton, 1996). It has continued to grow over the years1 since Poston and Grabski’s review, resulting in a critical stream of research that addresses such issues as, for example, the effects of knowledge-based systems on decision-making (Arnold et al., 2006), the impact of decision aids on users (Rose, 2002), and analysts’ forecasts and investments in information technology (Dehning et al., 2006).
1.8. Limitations of the Study
Although I have received co-operation from the concerning body but most of the time they were busy with their work that’s why I did not get so much time. The administrative authority, management policy and decision making policy is in the hands of the head office. As a MBA student it is needed to gather the experience that, how to take the decision when the bank fall into a program and what is it’s management policy, how to set up their portfolio, what is their business strategy but a branch does not do so.
The following limitations are apparent in the report:
1.9. Plan of the Study
The study has been divided into 5 chapters which are as follows:
Chapter One—Introduction including an over view of National Bank PLC & National Bank PLC, Rajshahi Branch, Objective of the study, importance of the study, scope of the study, literature review, limitation of the study.
Chapter Two—Methodology including methods of data collection, sources of data, selection of sample, reliability and validity of data, techniques of data analysis.
Chapter Three—Conceptual Framework including functions of Rajshahi branch, services given to the customer by Rajshahi Branch, main credit of National Bank PLC Rajshahi Branch, interest on loan, procedure to open and close an account, payment of chaque, qualitative characteristics of AIS of National Bank PLC, internal check system and AIS, transaction processing system, different types of file, reliability and validity of data, development of AIS.
Chapter Four—Analysis and Interpretation including AIS practices of National Bank PLC, Rajshahi Branch, Chart of accounts, coding system, different types of report, preparation of report, accounting principles & standards, users of financial information of National Bank PLC, Comparative financial performance of National Bank PLC & National Bank PLC (Rajshahi Branch), measures of efficiency.
Chapter Five—Conclusion and Recommendation including major findings, recommendation, conclusion.
1.10. Conclusion
This chapter describes the importance of the study, scope, objectives, and limitation of the study along with review of related literature. Based on the literature review and research gap the justification of the study has also been presented here. It is evident from review of related literature that no researcher has yet addressed the AIS issues of National Bank PLC in Bangladesh. The present study has been planned with the objective of evaluating the overall AIS practices in National Bank PLC (Rajshahi Branch).
TABLE OF CONTENTS
Dedication
Acceptance Letter
Declaration
Acknowledgement
Preface
CHAPTER ONE-INTRODUCTION
1.1 Introduction
1.2 An Overview of the National Bank PLC in General
1.3 An Overview of the National Bank PLC, Rajshahi Branch
1.4 Objectives of the Study
1.5 Importance of the Study
1.6 Scope of the Study
1.7 Literature Review
1.8 Limitations of the Study
1.9 Plan of the Study
1.10 Conclusion
CHAPTER TWO-METHODOLOGY
2.1 Introduction
2.2 Sources of data
2.3 Selection of Sample
2.4 Choice of the period
2.5 Reliability and Validity of Data
2.6 Techniques of Data Analysis
2.7 Conclusion
CHAPTER THREE-CONCEPTUAL FRAMEWORK
3.1 Introduction
3.2 Functions of NB PLC, Rajshahi Branch
3.3 Services given to the customers by NB PLC (Rajshahi Branch) and Charges
3.4 Account Opening Procedure
3.5 Account Closing Procedure
3.6 Payment of a Cheque
3.7 Preserving and Balancing of Loan Account and Deposit Account
3.8 Preserving and writing of Supplementary Income and Expenditure Ledger
3.9 AIS of National Bank PLC
3.10 Characteristics of AIS of NB PLC (Rajshahi Branch)
3.11 Internal Check System and AIS
3.12 Transaction Processing System
3.13 Different Types of File
3.14 DSS and ESS
3.15 Development of AIS
3.16 Conclusion
CHAPTER FOUR-ANALYSIS AND INTERPRETATION
4.1 Introduction
4.2 AIS Practices in NB PLC (Rajshahi Branch)
4.3 Chart of Account NB PLC (Rajshahi Branch)
4.4 Coding System
4.5 Different Types of Report
4.6 Preparation of Report
4.7 Compliance with Accounting Principles
4.8 Compliance with Bangladesh Accounting Standard (BAS)
4.9 Auditing the Statements
4.10 Basis of Preparation of Financial Statements & significant account policies
4.11 Users of Financial Information of NB PLC (Rajshhi Branch)
4.12 Five Year's Performance at a Glance of NB PLC
4.13 Profit of NB PLC, Rajshahi Branch
4.14 Measures of Efficiency
4.15 Conclusion
CHAPTER FIVE-CONCLUSION AND RECOMMENDATION
5.1 Major Findings
5.2 Recommendation
5.3 Conclusion
BIBLIOGRAPHY
LIST OF ACRONYMS
Research, Report, Accounting, Information, System, National, Bank, PLC, Rajshahi, Branch, Major, Findings, Conceptual, Framework, Functions, Account, Opening, Closing, Procedure, Transaction, Processing, Internal, Check, Auditing, Financial
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