A senior bank auditor reviews draft final accounts and notes: 1. 'Non-Banking Assets acquired in satisfaction of claims' is under Schedule 9. 2. 'Rebate on Bills Discounted' has been omitted. 3. Only 20% of net profit was transferred to the Statutory Reserve. Which identifies the reporting errors correctly?

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Accounting · Bank Financial Statements

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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Correct answer

All three are errors: Non-banking assets belong to Schedule 11, Rebate is a mandatory adjustment, and the transfer must be 25%.

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Answer 1

None of these are errors because the Banking Regulation Act allows flexibility for large banks.

Answer 2

The classification of non-banking assets is correct, but the other two items are errors.

Answer 3

Only the Statutory Reserve transfer is an error because the other two are optional accounting choices.

Answer 4

All three are errors: Non-banking assets belong to Schedule 11, Rebate is a mandatory adjustment, and the transfer must be 25%.

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