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The JAIIB and the Diploma in Banking & Finance has three papers, viz. This book, the courseware for the second paper on Accounting & Finance for Bankers, . (This book has been published by Indian Institute of Banking & Finance. This book, the courseware for the second paper on Accounting. Accounting & Finance for Bankers. PRESENTATION BY. Joint Director, IIBF. TOPICS. BANK RECONCILIATION; TRIAL BALANCE .

On 26th June. Basel II norms are centred on sustained economic development over the long haul and include www.

Basel I was originally designed to apply only to internationally active banks in the G countries. The revised credit risk measurement methods are more elaborate than the current accord. In this. The new proposal is based on three mutually reinforcing pillars that allow banks and supervisors to evaluate properly the various risks that banks face and realign the regulatory capital more closely with the underlying risks.

The new risk sensitive approach seeks to strengthen the safety and soundness of the industry by focusing on: Risk-based capital Pillar 1.

Influence of level ofNPAs. The Second Pillar. It proposes. High non-performing assets exacerbate the pressure on bank's capital by reducing the ratio of capital to risk-weighted assets the absolute value of capital and leaking revenue availability of less free capital.

Basel II focuses on improvement in measurement of risks. Minimum Capital Requirement The first pillar sets out the minimum capital requirement. It sets the minimum ratio of capital to risk weighted assets and in doing so. Supervisory Review Process Supervisory review process has been introduced to ensure. Each of these three pillars has risk mitigation as its central plank.

The new framework maintains the minimum capital requirement of 8 per cent of risk assets. What is Capital Adequacy? It is a cushion against unexpected losses Under the new accord. It is proposed to be effected through a series of disclosure requirements on the capital. Credit Loss within the entire banking group are considered.

Qualitative disclosures such as risk management objectives and policies. These disclosures should be made at least semi-annually and more frequently if appropriate. The Third Pillar. The requirements under this pillar are common to all regulated firms. The process has four key principles: The IRB method proposes two approaches: For the measurement of credit risk. Basel II proposes three principle options: Market Discipline Market discipline imposes strong incentives to banks to conduct their business in a safe.

Credit Risk To ensure that risks e.

Accounting finance for bankers pdf

Alternative methods for computing capital requirement for credit risk are depicted below. As per the guidelines. Trading book includes: The guidelines address the issues involved in computing capital charge for interest rate related instruments in the trading book.

This is similar to credit risk.

General Market Risk: Capital charge for general market risk is designed to capture the risk of loss arising from changes in market interest rates. Three approaches have been proposed for the measurement of operational risks: Specific risk. General market risk Specific Risk: Capital charge for specific risk is designed to protect against an adverse movement in price of an individual security due to factors related to the individual issuer.

As banks in India are still in a nascent stage of developing internal risk management models. The specific risk charges are divided into various categories such as investments in Govt securities. The Basel committee suggested two broad methodologies for computation of capital charge for market risk. RBI has stipulated and achieved a minimum capital adequacy of 9 per cent. As the duration method is a more accurate method of measuring interest rate risk. Approach to Prudential Norms The Reserve Bank's approach to the institution of prudential norms has been one of gradual convergence with international standards and best practices.

The process of providing financial services is changing rapidly from traditional banking to a one-stop shop of varied financial services. There are also the Regional Rural Banks with links to their parent commercial banks. The aim has been to reach global best standards in a deliberately phased manner. We also have cooperative banks in large numbers.

For this purpose. Foreign bank branches operate profitably in India and. RBI prefers that banks measure all of their general market risk by calculating the price sensitivity modified duration of each position separately. On the other hand. This has also been the guiding principle in the approach to the new Basel Accord. We have the dominance of Government ownership coupled with significant private shareholding in the public sector banks. Enhancing the area of disclosures Pillar III. Improving the level of corporate governance standards in banks.

Issues Proposed Measures www. The framework adopted by banks would need to be adaptable to changes in the business. These are largely in alignment with the international best practices. In terms of AS The non-fund based exposures to entities. The age of delinquency may also be reviewed to ensure that all working capital exposures beyond a delinquency of 36 months are fully provided. The provisioning requirements on substandard assets may be increased to 20 per cent for secured advances and 30 per cent for unsecured advances.

Secured advances 10 per cent of total outstanding. As a result. Unsecured advances. The proposed schedule for provisioning should be as under: Category Category Age of delinquency Provisioning per cent Substandard 90 days to 15 months.

Migration to a fuller CAC is likely to throw up numerous challenges to the banks' risk management systems. Migration to Basel II at the minimum approaches would be making the banks' capital adequacy framework more risk sensitive than under the Basel I.

The system should move forward to a differential capital regime. The 'complex' banks as defined in Paragraph 7. The capital adequacy framework. The working capital exposures in the NPA accounts will attract a per cent provisioning requirement on both the secured and unsecured portions. Banks are maintaining capital for both credit risk and market risk exposures.

As of March Reserve Bank has advised banks in India to implement the revised capital adequacy framework popularly known as Basel II with effect from 31st March. Considering the fact that retail exposures include a much wider weaker segment. The Indian banking system will be adopting the standardised approach for credit risk.

In view of this and since the system may not be able to rank risk objectively. It may be raised to at least 66 per cent. Banks will be maintaining capital for operational risks under the Basel II in addition to the credit risks and market risks.

On a quick broad assessment. The risk. Operational Risk Risk associated with unexpected disasters and events. Capital Adequacy It is the cushion against the unexpected losses and refers to the minimum capital requirement expressed in terms of percentage of the risk assets. RBI should decide on the methodology for setting off the losses against capital funds. Market Risk Risk associated with interest and other returns. Credit Risk Risk associated with the lending of loans.

They should be required to set off losses against capital funds. What are the three pillars of Basel II framework?

How is the capital adequacy measured? Explain the types of risks and name the methods prescribed for measuring them. Definition and Meaning 3. In India. In the payment of debts. Loans are granted by the banks or institutions based on the records and documentary evidences and. The holder of debt capital does not receive a share of ownership of the company when they provide funds to the firm.

In a still more enlarged sense. The mode and time of repayment are clearly expressed in the documents. The former means. In a less technical sense. In cases of insolvent estates. By a liquid debt. When the debtor fails to meet the conditions of repayment as per the contract of loan. Debts are discharged in various ways. Debts are also divided into active and passive. In return for loaning this money. The expected cash flows consist of annual interest payments plus repayment of principal.

Redemption Value: The value. Bonds issued by the government or the public sector companies are generally secured. Private sector companies can issue secured or unsecured bonds. If the company fails to pay the coupon interest or the redemption value. The interest payments on debt are said to be tax-deductible.

This tax deducibility of debt payments means that the debt capital provides a 'tax-shield' which is not provided by the equity capital and. The mix of debt and equity is known as the capital structure of the firm. A bond is redeemable after a specific period. Market Value: A bond may be traded on a stock exchange. In addition to the fact that debt is cheaper than equity capital because there is less risk. This advantage relates to the differential tax treatment of interest payments on debt and dividend payments on equity.

A bond is issued for a specified period. With the dividends now being taxed on the companies. Irrespective of the level of profits or losses.

Market value is the price at which the bond is usually bought or sold in the market. In contrast. It is to be repaid on maturity. It represents the amount borrowed by the firm. Market value may be different from the par value or the redemption value. Bonds are negotiable promissory notes that can be used by individuals. A bond is generally issued at a discount less than par value and redeemed at par. At the end of tenth year.

Face Value: Also known as the par value and stated on the face of the bond. In case of a bond. This entitles the bondholder to receive Rs. Coupon rate: A bond carries a specific rate of interest. The fact that debt capital has a lower cost than equity capital. What is the value of this bond?

It is quite clear that the holder of a bond receives a fixed annual interest payment for a certain value equal to par value at the time of maturity. The required rate of return on the bond is 10 per cent. The required rate of return on bond is 10 per cent. The bond carries a coupon rate of 8 per cent and has the maturity period of nine years.

The YTM is the discount rate. What would be the rate of return that an investor earns if he downloads the bond and holds until maturity? Solution If kd is the yield to maturity then.

Using it. Illustration Consider a Rs. When the required rate of return is less than the coupon rate. When the required rate of return kd is greater than the coupon rate. The required rate of return is 13 per cent. A bond price is inversely proportional to its yield to maturity.

Given the maturity. It is because. When the required rate of return is equal to the coupon rate. When the required rate of return kd is less than the coupon rate. For a given difference between YTM and coupon rate of the bonds.

For any given change in YTM. In tabulated form it can be represented as follows: Years to Maturity Bond Value 7 Let the YTM be 10 per cent. Market price of the bond will be equal to Rs. A 1 per cent increase in YTM to 11 per cent changes price to Rs. A decrease of 1 per cent YTM to 9 per cent changes the price to Rs. If the YTM increase by 20 per cent. Bond ABC: Determine the cash flows from holding the bond.

What is lost on reinvestment. Multiply each of the present values by respective numbers of years left before the present value is received. Sum these products up and divide by the present value to get the duration of the bond. YTM of bond X rises to 12 per cent 10 x 1. The market value of this bond will be Rs. The holding period for which the interest rate risk disappears. The concept was first introduced by F Macaulay and thus.

The converse is true when the interest rates fall. It is the weighted average of www. Determine the present value of these cash flows by discounting the flows with discount rate YTM. Consider another identical bond Y but with differing YTM of 20 per cent. For this holding period. The expected market rate is 15 per cent. When the interest rates rise. Consider a It indicates that interest rate risk will disappear if the holding of bond will be for 3.

There is a simple way of computing the desired holding period duration. For any bond. The market value of the bond will be Rs. It is also possible to compute the duration of an entire portfolio of bonds.

The duration of this bond can be computed as follows: For an Investor a bond will be risky if the holding period of the bond is different from its duration. Interest rate elasticity IE can be defined as: Anything that causes the duration of a bond to increase will also increase the bond's interest rate elasticity.

Bond prices and YTM are inversely related. Illustration Consider a bond having a face value of Rs. The interest rate risk is a function of the interest rate elasticity. The extent of change in the bond prices for a change in YTM measures the interest rate risk of a bond. If the current market rate 10 per cent is changed to 11 per cent. Bond price elasticity can also be computed with the help of following mathematical formula: Duration of a bond declines as the bond approaches maturity 3.

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Duration 4. Modified Duration of a bond for company A. Consider two bonds A and B. The face value of the bond is Rs. The interest payments are made annually.

Calculate the Macaulay Duration. We observe that percentage price change in case of increase or decrease in interest rate is asymmetrical. Assuming that interest is paid annually. It has a term to maturity of four years. What did you notice regarding the percentage price change in case of Bonds A and B identical in all respects. What did you observe when the interest rate rose by 1 per cent and fell by the same amount in case of the Bond A?

Solution a Since the bonds are available at their respective face values. A bond with a face value of Rs. The holder of this bond has an applicable income tax rate of 33 per cent and a capital gain tax rate of 15 per cent. PVIFA The percentage price change when the interest rate rose by basis point is computed below: Duration of Bond: The holding period for which interest rate risk disappears knows as the duration of the bond.

It is repaid on maturity. Bonds are less risky than equity but are not entirely risk free. Define debt. Recommend the techniques to reduce the risk involved in bond investment. Investors are assured about the fixed return on investment in bonds. It is the rate of return earned by an investor who downloads a bond and holds it till maturity. A bond may be traded in a stock exchange. It can be computed as follows: The value which bondholder gets on maturity is called redemption value.

It is also known as par value and stated on the face of the bond. Intrinsic Value: Market value may be different from par value or redemption value.

What are the salient features of debt? Coupon Rate: A bond carries a specific rate of interest which is also called as the coupon rate.

A bond is issued for a specified period of time. A bond may be redeemed at par. Explain the factors affecting the price of bond. Explain the concept duration. How duration of bond helps to reduce interest rate risk?

Short Notes-Accounting and Finance for Bankers.pdf

To illustrate, consider an investor, who is evaluating an investment opportunity that requires an immediate outlay of Rs. In deciding whether to go ahead with the investment, the investor will be concerned with how much income generation will be in the future. A rational investor will be unwilling to undertake the investment if he knows that he will receive less than what he can earn as interest. This illustration clarifies the importance of the timing of the receipt or expenditure of cash flows and that it is not sufficient to treat the money to be received in the future as having the same value as the money to be received immediately.

If the decision maker is to be able to make a choice about whether to go ahead with an investment or is to be able to rank the investment opportunities where there is more than one alternative, then a way must be found to allow money to be received at different points of time to be compared.

One way of making the comparison is to use the approach adopted above; namely to work out what the value of money to be received now will be at any point in the future. Future value of Rs. However, when considering an investment opportunity, the decision maker is typically faced with a stream of cash inflows and outflows, rather than just comparing money to be expended now with a single money to be received at some point in the future, So, we need to convert all cash flows, received at different points of time, to a common reference point, to allow a direct comparison.

While it would be possible to convert all the sums of money to the future values, for the time period associated with the most distant cash flow resulting from the investment opportunity, it is easier to think in terms of what the future cash flows are worth now, thus using the present time as a common reference point.

This simply requires a reversal of the way in which the future values were calculated. For example, if two projects are to be compared, one that has an expected life of five years and the other having an expected life of nine years, it is easier to convert the cash flows to their present values than to a future value. Taking a future sum of money and calculating its present value in this way is known as discounting.

Following example illustrates the method: The illustration demonstrates that it is essential to take into account the time value of money and to discount the future sums to their present value, before making a decision on whether a particular investment opportunity is worth pursuing.

The concept of time value is of vital importance when considering investment opportunities. It is through the concept of the present values that the decision makers can make a trade-off between the money receivable at different points of time. Failure to take account of the time value of money may well lead the decision makers to make incorrect judgements about the desirability or otherwise of an investment opportunity. However, in the absence of such devices, discount tables are of great use.

The discount tables are of two types: Down the left hand side of the table, is the number of years. The main body of the table gives the present values of Re. The figures are called as discount factors. For an illustration, if the time in which Re. Thus, if the money to be received in the year ten is 1,, then its present value is x.

Table B is similar in layout to the Table A and is used in exactly the same way. However, the figures in.

For an illustration, an annuity of Re. Thus, an annuity of Rs. Two main assumptions that are made in discussing the two techniques, are as follows: With the above two caveats, both the methods are scientific methods of investment appraisal.

Explicitly, the NPV method involves comparing the present value of the future cash flows of an investment opportunity with the cash outlay that is required to finance the opportunity. In this way, we can determine whether the investment opportunity provides a surplus, when the cash flows are measured in present value terms. The stages involved in using the NPV method are as follows: Estimate all future net cash flows revenue minus cost associated with an investment opportunity; 2.

Convert these net cash flow figures to their present value equivalents by discounting at the appropriate discount rate; 3. Add all the present value figures of future cash flows; 4. Subtract from this value, the initial cost of investment.

The resulting figure from these calculations is the net present value. Mathematically, the NPV is calculated by using the following formula: Above formula calculates the surplus that is made as a result of undertaking the project, in excess of that which could be made by investing at the marginal rate of return. If the NPV is negative, the surplus is actually a deficit and undertaking the investment would reduce the wealth of the shareholders.

Thus, under condition of certainty, the NPV method provides a definite decision advice for independent investment projects: Similarly, when projects are mutually exclusive, NPV provides a definite ranking advice: The use of NPV can be explained using an illustration. Consider, a firm wants to set up toy making plant. Production of the toys requires new factory space and equipment. Either the firm can construct a factory on a site it has identified or it can refit a factory that it owns and that is currently lying idle.

The firm is faced with a choice of mutually exclusive investment opportunities. The net cost associated with the new built factory Project A and that of the renovated factory Project B are shown in Tables 1 and 2 respectively, as are the present values of the cash flows for a discount rate of 10 per cent.

Table 4. For Project A Year. If projects A and B were independent projects, rather than mutually exclusive investment opportunities, then the firm would maximise the increase in shareholder wealth by undertaking both projects, funds permitting.

This method has similarities to the. The method is mathematically represented as follows: The value of the IRR, calculated from this formula, provides a measure of the rate of return earned on that capital that was used in the project. Having determined the above formula, we can reach a decision on whether to go ahead with the project by comparing the IRR with the cost of capital. For independent investment opportunities, if the IRR is greater than the cost of capital, then the project should be undertaken, since a rate of return is being earned by the project that is greater than the amount that has to be paid out to the providers of capital.

Thus, the project is earning a surplus over and above the cost of funds and thus shareholders' wealth will be increased. If the IRR is less than the cost of capital, then the project, should not be undertaken, as going ahead with the project will have the result of reducing the shareholders' wealth. For mutually exclusive investment opportunities, the IRR decision rule involves undertaking that investment that has the highest IRR, provided that the IRR is greater than the cost of capital.

The main reason for this appears to be that people in business are more used to thinking in terms of rates of return than in terms of NPVs or surpluses. We saw the NPV was positive in Tables 4. It, therefore, follows that the IRR must be greater than 10 per cent. On applying the discount rate of 15 per cent, the NPV will be as follows: From Tables 4. Thus, IRR for both projects must be above 15 per cent.

Repeating this exercise with a discount rate of 20 per cent the NPV figure is -1,05, for project A and -1,39, for project B. Therefore, the IRR for both projects will lie in the range of 15 per cent and 20 per cent. By continuing with this trial and error method, it can be established that the IRR for the project A is Since the project A has the higher IRR and is greater than firm's cost of capital of 10 per cent, the IRR decision rule suggests that the firm should go ahead with project A.

This is in line with decision advice of NPV method. Alternative methods involved using the techniques of interpolation. While this does not provide a value for the IRR that is correct, it does give a close approximation. To use the method of interpolation, first we have to calculate the discount rate that gives positive NPV preferably small and a discount rate that gives negative NPV preferably small.

Having established these discount values for the negative and positive NPV values, it must be the case that the IRR falls somewhere between the two. Interpolation can then be used to determine the discount rate that yields a zero NPV figure by assuming that the relationship between the NPV and the discount rate is linear, i. The fact that the relationship between the NPV and the discount rate is not linear is the reason why this technique only provides an approximate value for the IRR and why it is first necessary to find the NPV figures one above and one below zero that are close to zero.

The actual relationship between the NPV and the discount rate is shown in Figure 4. The dashed line represents a linear relationship and demonstrates that such a relationship is only an approximation to the true curve.

By assuming a linear-relationship this figure can then be used as a basis for determining how big the increase in the discount rate from 15 per cent should be to lead to a reduction of 1. This compares with the figure shown above the accurate figure of We again stress that the accuracy of interpolation depends upon the closeness to zero of the two NPV figures used. This is borne out by the fact that if the NPV figures, calculated by using discount rates of 10 per cent and 20 per cent, were used as the basis for interpolation, the results would be less accurate at Thus, it is important to get the NPV figures closer to zero before using the process of interpolation.

However, there are some situations where the two methods will generate different rankings of projects. It is, therefore, important to understand fully the relative merits of NPV and IRR and why two methods can generate different results. Given that both the NPV and IRR are characterised by these advantages, it may be thought that either is equally acceptable, in terms of providing decision advice, which will help to meet the goals of the organisation.

However, while the two techniques are clearly similar, they do not always guarantee to provide the same investment decision advice. We, therefore, need to make a comparison of the two techniques to understand which one is superior. Check: A written order instructing a financial institution to pay immediately on demand a specified amount of money from the check writer's account to the person named on the check or, if a specific person is not named, to whoever bears the check to the institution for payment.

Check 21 Act: Check 21 is a Federal law that is designed to enable banks to handle more checks electronically, which is intended to make check processing faster and more efficient. Check 21 is the short name for the Check Clearing for the 21st Century Act, which went into effect on October 28, See also Check Check Truncation: The conversion of data on a check into an electronic image after a check enters the processing system.

Check truncation eliminates the need to return canceled checks to customers. Checking Account: A demand deposit account subject to withdrawal of funds by check. ChexSystems shares this information among member institutions to help them assess the risk of opening new accounts.

ChexSystems only shares information with the member institutions; it does not decide on new account openings. Generally, information remains on ChexSystems for five years. See also ChexSystems. Closed-End Credit : Generally, any credit sale agreement in which the amount advanced, plus any finance charges, is expected to be repaid in full by a specified date. Most real estate and automobile loans are closed-end agreements.

See also Closed-end Credit. Closed-End Loan: Generally, any loan in which the amount advanced, plus any finance charges, is expected to be repaid in full by a specified date. See also Consumer Loans and Mortgages. Closing a Mortgage Loan: The consummation of a contractual real estate transaction in which all appropriate documents are signed and the proceeds of the mortgage loan are then disbursed by the lender.

Closing Costs: The expenses incurred by sellers and downloaders in transferring ownership in real property. The costs of closing may include the origination fee, discount points, attorneys' fees, loan fees, title search and insurance, survey charge, recordation fees, and the credit report charge.

Collateral: Assets that are offered to secure a loan or other credit. For example, if you get a real estate mortgage, the bank's collateral is typically your house. Collateral becomes subject to seizure on default. See also Insurance and Mortgages. Collected Funds: Cash deposits or checks that have been presented for payment and for which payment has been received.

See also Collected Funds. Collection Agency: A company hired by a creditor to collect a debt that is owed. Creditors typically hire a collection agency only after they have made efforts to collect the debt themselves, usually through letters and telephone calls. Collection Items: Items-such as drafts, notes, and acceptances-received for collection and credited to a depositor's account after payment has been received. Collection items are usually subject to special instructions and may involve additional fees.

Most banks impose a special fee, called a collection charge, for handling collection items. The Federal securities laws generally require entities that pool securities to register those pooled vehicles such as mutual funds with the SEC.

However, Congress created exemptions from these registration requirements for CIFs so long as the entity offering these funds is a bank or other authorized entity and so long as participation in the fund is restricted to only those customers covered by the exemption. See also Collective Investment Funds. Comaker: A person who signs a note to guarantee a loan made to another person and is jointly liable with the maker for repayment of the loan. Also known as a Cosigner.

Community Reinvestment Act: The Act is intended to encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods. It was enacted by the Congress in Consumer Credit Counseling Service: A service which specializes in working with consumers who are overextended with debts and need to make arrangements with creditors. Consumer Reporting Agency: An agency that regularly collects or evaluates individual consumer credit information or other information about consumers and sells consumer reports for a fee to creditors or others.

Typical clients include banks, mortgage lenders, credit card companies, and other financing companies. Conventional Fixed Rate Mortgage: A fixed-rate mortgage offers you a set interest rate and payments that do not change throughout the life, or "term," of the loan.

A conventional fixed-rate loan is fully paid off over a given number of years-usually 15, 20, or A portion of each monthly payment goes towards paying back the money borrowed, the "principal"; the rest is "interest.

Also known as a Comaker. See also Cosigner. Credit Application: A form to be completed by an applicant for a credit account, giving sufficient details residence, employment, income, and existing debt to allow the seller to establish the applicant's creditworthiness. Sometimes, an application fee is charged to cover the cost of loan processing. See also Credit or Loan Application. Credit Bureau: An agency that collects individual credit information and sells it for a fee to creditors so they can make a decision on granting loans.

Also commonly referred to as a consumer reporting agency or a credit reporting agency. See also Credit Bureaus. Credit Card Account Agreement: A written agreement that explains the terms and conditions of the account, credit usage and payment by the cardholder, and duties and responsibilities of the card issuer. See also Credit Cards. Credit Card Issuer: Any financial institution that issues bank cards to those who apply for them.

See also Credit Card Issuer. Credit Disability Insurance: A type of insurance, also known as accident and health insurance, that makes payments on the loan if you become ill or injured and cannot work. See also Credit Disability Insurance. Credit Life Insurance: A type of life insurance that helps repay a loan if you should die before the loan is fully repaid.

This is optional coverage. See also Credit Life Insurance. Credit Limit: The maximum amount of credit that is available on a credit card or other line of credit account. See also Credit Limit. Credit Repair Organization: A person or organization that sells, provides, performs, or assists in improving a consumer's credit record, credit history or credit rating or says that that they will do so in exchange for a fee or other payment.

It also includes a person or organization that provides advice or assistance about how to improve a consumer's credit record, credit history or credit rating. There are some important exceptions to this definition, including many non-profit organizations and the creditor that is owed the debt.

Accounting vs. Accounting is more about accurate reporting of what has already happened and compliance with laws and standards. Finance is about looking forward and growing a pot of money or mitigating losses. If you like thinking in terms of a longer time horizon you may be happier in finance than in accounting.

If you want to study accounting you can expect to take classes in accounting practices and accounting ethics, business law, tax law and accounting theory. Making the Choice: Finance vs. Alternatively, you could become a Tax Accountant , a Bookkeeper, Treasurer or Auditor, for yourself, a business, a non-profit or the government.YTM of bond X rises to 12 per cent 10 x 1. Ankita Joshi. If the balancing interest rate and length of the deposit all remain the same. In return for loaning this money.

Let us try with. Hire-downloadr only can claim depreciation. It is customary to use to and by while posting ledger. Customer images. To ensure that risks e.