NOTES ON ACCOUNTS: (2002)

01. In conformity with the accounting policies and guidelines (issuea by the Royal monetary Authority of Bhutan) interest earnea (but not collected) amounting to Nu. 25,512,696.50 (previous year Nu.25,704,137.80 have not been recognised as income.

02. Guarantees given and letters of credit issued (on behalf of various clients) outstanding at the year end amounting to Nu. 201,928, 685.91 (Total Margin Nu. 239,050.00) and Nu.176,994,865.56 (Total Margin Nu. 6,444,465.58) respectivefy, previous year Nu. 177,719,538.07 and Nu. 150,077,681.12.

03. Depreciation on assets acquired (through capital grants) has been charged-off to revenue, instead of adjusting the same against capital reserve. Confirmations in respect of bafances appearing under roans, aavances, & otlier receivabfes are not avaifabfe.

04. Confirmations in respect of balances appearing under loans, advances & other receivable are not available.

05. Additional amount of Provision against loan amounting to Nu. 8,123,803.88 being the difference between provision required as per the Prudential Guidelines issued by Royal Monetary Authority of Bhutan Nu. 65,295,412.89 as on 31.12.2001 and the amount of provision Nu. 57,171,690.01 held as on 31.12.2000, has been provided for during the year.

06. Provision for taxation includes:-
Tax on current year's profit          : 33,473,48336
Less: advance tax paid                : 12.424,559.69
Total                                              : 21,048,923.67

07. Capital works-in-progress amounting to Nu. 1,057,173.00 (previous year Nu. 558,163.00 represents the expenditure incurred in connection with preparation of model and drawing of the proposed office building and cabling work between Head Office and Branch.

08. Classification of loan, like secured/partly secured/unsecured, based on security coverage are not made due to incomplete information/ documentation.

09. Other assets (advance, claims, pre-payments, deferrals, etc.) include an unadjusted balance in debits-in suspense account, amounting to Nu. 15,006,194.84 Similarly, other current liabifities include an unadjusted balance of Nu. 17,838,246.09, in creait-in-suspense account.

10. 'Tax deducted at source' on income from interest on time deposits with banks for the year is amounting to Nu. 3,053,181.00

11. 'Surplus on disposal of fixed assets' amounting to Nu. 293,169.44 is net of 'Loss of disposal of fixed assets' incurred to the tune of Nu. 141,681.83.

12. Market value of Quoted Equity Investments at the end of the year is amounting to Nu. 37,711,800 (previous year Nu. 28,700,600).

13. Remuneration and expenditure paid/reimbursed to the Managing Director was as follows:

Salary & otlier benefits           - 613,575.00
Travel local Foreign                - 268,736.00
Medical reimbursement           -   13,093.00
Training & seminars                -   95,877.00
Total                                       : 991,281.00

14. Previous year's figures liave been re-arranged & regrouped, wherever necessary.