Fundamental of Financial

Management
Group Members
1. CHAI SHER CHI
BS13110073
2. KOK ZEN YANG
BS13110236
3.EMY AZIZAH BINTI MAJID
BS13110127
4.LLOYD LEE WEN FENG
BS13110288
5.NOR AINI NG
BS13110393
6.NURUL SHAKILA BINTI KHAIRUDIN
BS13110498
7. SHALINI SHALU A/P THALAGRAJA
BS13110560
8. TAN KANG CHIAN
BS13110635

Financial Institution

Bank
Non-Bank
Intermediary
Intermediary
Both supervised by
Bank Negara Malaysia

Bank Financial
Institution

Hong Leong Bank

Berhad

1905
Started in Kuching,
Sarawak under the
name of Kwong Lee
Mortgage and
Remittance

Incorporated as Kwong Lee Bank Limited

2011
Merged with EON Bank
Group
2012
Launched
Mach by
Hong Leong
Bank, a next
generation
banking subbrand

1989
Renamed Mui Bank, operating in
35 branches
1994
Acquired Mui Bank through Hong
Leong Credit Berhad (Now known
as Hong Leong Financial Group

Vision
An outstanding financial services
organisation, highly competitive,
and profitable, where people
make the difference

Characteristics

Public listed in Bursa Malaysia

Oldest financial institution
Founded by Lam Ji Chiew
Shareholding in Bank of
Chengdu Co., Ltd (20%)

Types of Service
1. Personal Financial Services
2. Business and Corporate
Banking
3. Global Markets
4. Islamic Bank

Sources of Fund

1. Interest income
2. Non-interest
income

Interest income:
loans, advances and financing
money at call & deposit placement
with financial institutions
securities purchased under resale
agreements
financial assets held for trading
financial investment available for
sale
financial investment held to maturity
others

Non-interest income:
Fee income
Net income from securities
Other income

Usage of Fund

1. Interest expenses
2. Overhead expenses
3. Allowance for impairment losses
on loans, advances and
financing
4. Taxation

Interest expense:
Deposits and placements of
banks and other financial
institutions
Deposits from other
customers
Senior bonds
Tier 2 subordinated bonds
Tier 2 capital cumulative
subordinated loan
Non-innovative Tier 1
stapled securities
Innovative Tier 1 capital

Overhead expenses:
Personnel costs
Establishment costs
Marketing expenses
Administration and general
expenses

Allowance for impairment

losses on loans, advances
and financing:
Allowance for impairment
losses on loans, advances and
financing:
collective assessment
allowance
individual assessment
allowance
Impaired loans and financing:
written off
recovered

Taxation:
Malaysian income tax
Transfer to deferred
taxation

Balance Sheet

Income Statement

Non-bank Financial
Institution

Malaysia Industrial Development

Finance Berhad (MIDF)
the only company involved in
development of financial
intermediaries listed by Bursa
Malaysia

Objective
stimulate growth in
certain industrial sector in
Malaysia

Mission
Promotes the progress in
Malaysias industrial sector by
providing loans for small and
medium industrial enterprise

Sources of Fund

Loans and investments

Islamic Banking Operations
Project Feasibilities Studies
Deposit from Customer
Fees received in capital market
activities

Usage of Funds

Salary
Electrical
Bill

Office
Equipment
Computer
Others such as Income tax; 2%

Operation Expenses; 34%

Investment; 50%

Property and asset ; 14%

MIDF Amanah Investment

(Local)
MIDF Amanah Investment
(Foreign)
UMB Nominees Sdn Bhd

Finance; 6% Mining; 8%
Wholesale; 8%
Construction; 2%

Manufacturing; 76%

INVESTMENT

Buy Somethin
on credit

Employee benefits; 1%

Account Payable; 7%
Accrued Liabilities; 9%

Amount due to brokers and clients; 83%

LIABILITIES

expense
s on the
income
stateme
nt that
have not
been
paid or
logged
under
accounts
payable

P1

JOURNALIZING &
POSTING TRANSACTIONS
Assets
Assets

Step 1: Analyze
transactions and source
documents.

ACCOUNT NAME:
Date

PR

Debit

Credit

Liabilities
Liabilities

Equity
Equity

Step 2: Apply doubleentry accounting

ACCOUNT No.
Description

GENERAL JOURNAL
Balance

Step 4: Post entry to ledger

Date

Description

Page
Post.
Ref.

Debit

123
Credit

Step 3: Record journal entry

Steps in preparing Financial

Statement
1.
2.
3.
4.

Trial Balance
Income statement
Statement change of Equity
Balance sheet

Income Statement

t Income = Revenues - Expens

Loans,
receivable,
securities
including
amortizations
of
Bank Operation
premiums
Expenses

P3

STATEMENT OF CHANGES IN EQUITY

FASTFORWARD
Statement of Changes in Equity
For the Month Ended December 31, 2011

C. Taylor, Capital 12/1/11

Connections

Net income for December

Plus: Investments by Owner
Less: Owner Withdrawals
C. Taylor, Capital, 12/31/11

3,470
30,000
33,470
200
33,270

Balance Sheet

Unearned
revenue
Is liability

Thank you