ACCOUNTS & TAXATION
Updated as on August 2012
1. When was Muthoot Finance Ltd.
Incorporated?
MFIN was incorporated as a Private Limited
Company on 14th March 1997 and was converted into a public limited Company on
18th November 2008.
2. Where is the Registered Office our
MFIN located?Banerji Cochin – 682018,
Kerala.
3. Who are the promoters of the Muthoot
Group?
The Company is promoted by Mr. M. G. George
Muthoot, Mr. George Thomas Muthoot, Mr. George Jacob Muthoot and Mr. George
Alexander Muthoot collectively
operating under the brand name of ‘The Muthoot Group’.
4. What are the businesses under the
Muthoot Group umbrella?
The Muthoot Group has diversified
interests in the fields of Financial Services, Healthcare, Education,
Plantations, Real Estate, Foreign Exchange, Information Technology, Insurance
Distribution, Hospitality etc.
5. How is MFIN licensed by the RBI to
function as a business?
The Company has obtained permission from
the Reserve Bank of India
6. What was the impact of the Initial
Public Offer (IPO) made by the company?
The Company made an Initial Public Offer
(IPO) of 5,15,00,000 Equity Shares of the face value Rs. 10/- each at a price
of Rs. 175/- raising Rs. 9,012,500,000.00 during the month of April 2011.
7. In which stock exchanges are MFIN’s
equity shares listed?
The equity shares of the Company are
listed on National Stock Exchange of India Limited and Bombay Stock Exchange
Limited from 6th May
2011.
8. What was the capital structure of MFIN
as on 31-March-2012?
The company has an Authorized Capital of
Rs.950 Crores as on 31st March
2012. Issued, subscribed
and paid up capital of the company as on 31st March 2012 is 371.17 Crores
(37,17,12,768 equity shares of Rs.10/- each).
Permanent Account Number (PAN) of the
company is : AABCT0343B
10. What
is the Tax Deduction Account Number of MFIN?
Tax Deduction Account Number (TAN) of the
company is : CHNT00811G
(Centralissed TAN for all branches of MFIN
Ltd.)
11. How
are income tax and TDS remitted to the authorities?
§ All income tax & TDS remittances
are made only form Head Office, Ernakulam.
§ Deduction of Tax at Source is made at
branch level, and transferred to H.O through Central office entries
§ Remittance to government account is
from TDS Section, H.O.
12. What
is the Service Tax Registration Number of MFIN?
Service Tax registration No. AABCT0343BST001
13. How
is Service Tax remitted to the authorities?
Company has obtained Centralized
registration for Service tax, with Central Excise Department at Ernakulam and
regularly paying Service tax for all taxable services provided at all branches
all over India and filing half yearly Returns also.
14. Does
MFIN have a VAT registration?
MFIN has obtained VAT Registration at
every state where Gold Auctions are conducted and regularly paying VAT / Sales
tax and filing monthly Returns also.
15. When
investments for bonds/debentures accepted by MFIN are vide crossed a/c payee
cheques or demand drafts?
Acceptance of funds for issuing Bonds
should be made by way of Crossed A/c Payee Cheque / Demand Draft only, if ;
a. The amount of such Bond or aggregate
amount of such Bonds is Rs.20,000/- or above.
b. On the date of taking or accepting
such Bond, the total balance outstanding including the fresh Bond is
Rs.20,000/- or above.
c. The amount or aggregate amount
referred in item no.(a) together with item No.(b) is
Rs.20,000/- or above.
16. When
are repayments of bonds / debentures made after closure of bonds made vide
crossed a/c payee cheques / demand drafts?
Repayment of funds to the investor towards
closure of Bonds should be made by way of Crossed A/c Payee Cheque / Demand
Draft only in the following conditions:
(a) the amount of such Bond together with
interest if any payable thereon, or
(b) the aggregate amount of Bonds held by
such person with the company in his own name or jointly with any other person
on the date of such repayment together with interest if any payable on such
Bonds is Rs.20,000/- or
above.
17. How
is Tax Deducted at Sources on interest payments?
§ As per Section 194A of the Income Tax
Act, deduction of Tax at Source is mandatory, if the aggregate amount of
interest paid / payable to a person exceeds Rs.5,000/- in a financial year.
§ Interest accrued as on 31st March also should be considered for
calculating the TDS liability.
§ However, investors not having taxable
income during the financial year (Rs.2,00,000/-, or Rs2,50,000/- or
Rs.5,00,000/- as the case may be) may submit Form No.15G / 15H with PAN for getting exemption from TDS.
18. When
is Form 15G used?
1. This Form is to be used by the
Resident Individuals (below 60years) having total income below Rs.2,00,000/-, receiving income by way of Interest,
as a self-declaration for getting TDS exemption
2. This Form cannot be used if the
aggregate income of the declarant exceeds Rs.2 Lakhs. The penal consequences for submitting
false declarations are given in item No.6 of the Notes in Form 15G.
3. Separate Forms should be collected in
duplicate for every financial year.
4. Branch Manager should fill up and sign
Part II of the declaration and the original Forms for the current financial
year should be forwarded to Regional Office at the end of every month.
Duplicates should be kept in branch files.
5. PAN Number is Compulsory for
submitting this Form. Without
PAN, this Form is invalid.
19. When
is Form 15H used?
1. This form is exclusively meant for the
use of persons having 60 years or more at any time during the financial year.
Other provisions are applicable as in the case of Form 15 G.
2. This Form cannot be used if the
aggregate income of the declarant exceeds Rs.2,50,000/-. The penal consequences
for submitting false declarations are given in item No.4 of the Notes in Form
15H.
3. Separate Forms should be collected in
duplicate for every financial year.
4. Branch Manager should fill up and sign
Part II of the declaration and the original Forms for the Current financial
year should be forwarded to Regional Office at the end of every month. Duplicates should be kept in the
branch files.
5. PAN Number is Compulsory for
submitting this Form. Without
PAN, this Form is invalid.
20. When
is TDS on salary deducted and paid?
As per Section 192 of the Income Tax Act,
any person responsible for paying Salary shall deduct Income Tax (TDS) as per
the tax rates applicable for the financial year. Salary includes all Allowances,
Incentives, Bonus, etc.
21. What
is the procedure for deducting TDS on salary?
§ Branch manager / Branch-in- Charge is
responsible for ascertaining the TDS liability of every employee drawing salary
from their office and to deduct applicable TDS every month while paying salary.
§ TDS so deducted should be credited to
Central Office A/c, with type of transaction ‘TDS’ and nature of payment as
‘Salary’, quoting correct PAN number of the employee.
§ TDS Certificate in Form No.16 will be
issued from Head Office, Cochin
22. What
are points to be considered about TDS on salary?
1.
If
TDS is not deducted / Salary Tax Statement not submitted before due date, TDS amount with late payment interest /
penalty as applicable under the I.T Act will be paid directly from H.O and it
will be recovered from the employee.
23. What is the TDS on salary for FY 2012-13?
|
Income Upto Rs. 2 Lakhs
(Ladies & Gents)
|
NIL
|
|
|
For Senior Citizen(60 Years) -
Income upto Rs.2.50 Lakhs
|
NIL
|
|
|
For Super Senior Citizen(80
Years) - Income upto Rs.5 Lakhs
|
NIL
|
|
|
Rs.2 Lakh / 2.50 Lakhs to Rs.5 Lakhs
|
10.30%
|
|
|
Rs.5 Lakhs to Rs.10 Lakhs
|
20.60%
|
|
|
Above Rs.10 Lakhs
|
30.90%
|
|
24. What
are the TDS mandates for other payments?
TDS Rate Chart applicable for the current
financial year ( 2012-13) is given below for easy reference.
|
TDS RATES – FIN YEAR 2012-13
|
|
|
|
||
|
|
|
|
Payment made to :
|
||
|
I.T Act Section
|
Nature of Payment
|
Threshold Limit
|
Individuals & HUF
|
All Others
|
All
|
|
|
|
|
With PAN
|
With PAN
|
Without PAN
|
|
194A
|
INTEREST
|
Rs.5,000/- p.a
|
10%
|
10%
|
20%
|
|
194C
|
CONTRACT WORK
|
Rs.30,000/- per contract
Rs.75,000/- p.a
|
1%
|
2%
|
20%
|
|
194C
|
ADVERTISEMENT
|
Rs.30,000/- per contract Rs.75,000/- p.a
|
1%
|
2%
|
20%
|
|
194H
|
COMMISSION / BROKERAGE
|
Rs.5,000/- p.a
|
10%
|
10%
|
20%
|
|
194I
|
RENT - BUILDING & FURNITURE
|
Rs.1,80,000/- p.a
|
10%
|
10%
|
20%
|
|
194I
|
RENT - MACHINERY& EQUIPMENTS
|
Rs.1,80,000/- p.a
|
2%
|
2%
|
20%
|
|
194J
|
PROFESSIONAL / TECHNICAL SERVICES
|
Rs.30,000/- p.a
|
10%
|
10%
|
20%
|
|
194B
|
PRIZE SCHEMES
|
Rs.10,000/-
|
30%
|
30%
|
30%
|
25. What
is the IT Act stipulation of payment of revenue expenses?
As per Section 40A(3) of the I.T Act,
payment of all revenue expenses should be made only by way of Crossed Account
payee Cheque or Demand draft, if such payment exceeds Rs.20,000/- to a person
in a single day. The
above rule should be strictly complied while making payment of Interest,
Salary, Rent, Commission/Incentives etc. or any other revenue expenses.
ACCOUNTING PROCEDURE
Company follows Double Entry System of
Book Keeping and the entire accounting operations are conducted in an automated
environment using the MuthootSoft Software. The distributed system of data base
maintenance followed requires that at each branch various heads of accounts are
maintained in the system through which transactions are passed through. We are in the process of developing
Core banking Solution and under the new system there will be a centralized
server connecting all branches through internet.
Accounting of major transactions like
Advance and Release of Loans, Acceptance and repayment of Bonds, Collection and
Payment of Interest, Purchase of Fixed assets etc are made through separate
Modules installed in the system. All
other entries are to be passed manually by debiting or crediting the concerned
account heads depending on the nature of transactions. A list of the heads of accounts, the
nature of transactions to be put through and the type of accounting entry to be
passed are given in the attached chart.
PAYMENTS
All payments should be either authorized
by the Branch Manager / Regional Manager / Zonal Manager / Authorized person at
Head Office, as the case may be, depending on the financial powers involved. TDS should be deducted as per the
provisions of Income Tax Act in all applicable cases. Payment revenue expenses
to a person exceeding Rs.20,000/- in day should be made only by Crossed A/c
Payee Cheque or Demand Draft. [As per Sec.40A(3) of the IT Act]
INTER BRANCH TRANSACTIONS
Transactions between branches / Regional
Offices / H.O are passed through central office Account. Central office entries received in a
day should be responded on the same day. If the entry is not relating to the
branch or in case of a wrong entry, the receiving branch should ‘Wrong mark’
the same immediately and inform the reason to the originating branch.
For clarification if any required
regarding the accounting of the above, branches should contact the Originating
branch / Regional Office / concerned Accounts Auditors. Central Office entries originated from
Head Office regarding payment of New branch expenses will be followed by an
email showing the breakup details for accounting.
If the clarification regarding the
posting of contra entry is not received on the same day even after consulting
the concerned persons, it may be temporarily posted in ‘Suspense Account’ only for a period
of 3 days. The entry
posted in Suspense A/c should be cleared within 3 days by transferring to the
concerned account head.
BANK RECONCILIATION
Bank Reconciliation should be prepared
every month using the BRS utility provided in FA module. For this, bank statements of all bank
accounts to be collected from banks and enter the value dates of all transactions
in BRS.
TDS on Accrued Interest
Take printout of ‘Accrued Interest - TDS’
Report from Bond Module (last report) and deduct TDS applicable, as per
procedure mentioned in Circular No.54 / 2012.
Depreciation on Fixed Assets:- No
depreciation is required to be provided in the branch books. Depreciation on Fixed Assets of all
branches will be provided in the Head Office Books.
Year End Procedure:- After
completing all entries for the day, do ‘Year End Processing’ in FA Module (Utilities
Menu) as per instructions from IT department. Then
the system will transfer all revenue account balances to Central Office A/c
automatically and the capital items will be carried forward to next year
opening Trial Balance.
LIST OF ACCOUNT HEADS IN FA MODULE
|
SL
|
Account Heads
|
Nature of Transaction
|
Accounting Entry
|
|
|
|
|
|
|
3
|
Central Office A/c
|
a) Inter branch / RO/ HO
transactions
|
According to the transaction
Debit/ Credit entry.
|
|
5
|
Muthoot Gold Bond
A/c (various types of Bonds)
|
Bond amount received / repaid
|
Debit / Credit concerned Bond
Account depending on the scheme.
|
|
6
|
Locker Security
Deposit A/c
|
Only those branches where Locker
facility available
|
When Locker Security Deposit
made-Credit Locker Security Deposit A/c
|
|
8
|
Other Advances
Received
|
Caution deposits from staff
|
When any such amount received-
Credit Other Adv. Received A/c
|
|
13
|
Personal Loans (
Gold Loans)
|
Gold Loan Advance / Release
|
Posting from concerned Gold Loan
Module.
|
|
14
|
DPN /Bond Loan A/c
|
Loan Given/ Repaid against said securities
|
Posting from concerned Loan
Module.
|
|
15
|
DPN Clean Loan A/c
|
DPN Clean Loans
|
Posting from concerned Loan Module
|
|
16
|
DPN Installment
Scheme A/c
|
DPN Loans repaid in installments
|
Posting from concerned Loan Module
|
|
19
|
Debtors for TDS
|
TDS deducted on accrued interest
|
Posting from Other Loans Module.
|
|
20
|
Other Advances A/c
|
Advances made for any temporary
purpose – to be settled immediately.
|
When Advances made - Debit Other
Advances A/c & When Repayment made- Credit Other Advances A/c
|
|
22
|
Deposits with
Banks A/c
|
Deposits with Scheduled Banks
|
When Deposits made- Debit
Deposits with Bank A/c & When Deposits closed- Credit Deposits with Bank
A/c
|
|
24
|
Fixed Assets A/c /
Contra Debit or Credit A/c /
|
Purchase or
|
Purchase & sale of Fixed
Assets – Entry only through Fixed Asset Module.[FAM]
|
|
26
|
Telephone Deposit
A/c
|
Amount deposited for new
telephone connections
|
When Deposit is made- Debit
Telephone Deposit A/c & When Deposit is Adjusted/ Repaid- Credit
Telephone Deposit A/c
|
|
27
|
Electricity
Deposit A/c
|
Deposited for Electric connection
.
|
When Deposit is made- Debit
Electricity Deposit A/c
& When Deposit is Adjusted/ Repaid- Credit Electricity Deposit A/c
|
|
28
|
Rent Deposit A/c
|
Refundable deposit with Landlord
|
When Rent Deposit is made- Debit
Rent Deposit A/c & When Rent Deposit repaid - Credit Rent Deposit A/c
|
|
29
|
Rent Advance A/c
|
Any amount paid in advance as
Rent to the Building Owner at the time of starting business in new building.
This is to be adjusted monthly from the Rent Paid
|
When Rent Advance is made- Debit
Rent Advance A/c &
When Rent Advance Adjusted/ Repaid - Credit Rent Advance A/c
|
|
30
|
New Branch A/c
|
Expenses in connection with New
branch – Only at RO
|
When Expenses incurred- Debit New
Branch A/c & When expenses transferred to actual branch- Credit New
Branch A/c
|
|
31
|
Staff Loan A/c
|
Loan given to the staff. (staff
loan is given only in CO approved cases)
|
When Staff Loan is given- Debit
Staff Loan (Name) A/c & When Staff Loan Repaid- Credit Staff Loan(Name)A/c
|
|
32
|
Salary Advance A/c
|
Salary advance given to staff
|
When Salary Advance is given-
Debit Salary Advance A/c & When Salary Advance repaid- Credit Salary
Advance A/c
|
|
33
|
Staff Welfare
Scheme A/c
|
Old A/c
|
Not Applicable for new employees
|
|
35
|
Sundry Creditors
A/c
|
|
Only with permission of HO
|
|
36
|
Sundry Debtors A/c
|
|
Only with permission of HO
|
|
42
|
Current
Liabilities A/c
|
Amounts payable ( like rent
payable etc.)
|
When payable – Credit Current
Liabilities ( sub head) and
at the time of payment – Debit Current Liabilities A/c.
|
|
43
|
Service Tax A/c
|
Service Tax Collected / paid
|
Service Tax collected – credit
Service Tax paid – Only at HO
|
|
44
|
Bank A/c
|
Bank Accounts
|
When cash / cheque deposited -
Debit Bank ( Name of Bank) A/c
When cheque issued /cash
withdrawn -Credit Bank(Name of Bank) A/c
|
|
|
REVENUE ACCOUNTS
|
|
|
|
|
|
|
|
|
1
|
Salary A/c
|
Salary, Incentives & All
Allowances.
|
When Salary paid- Debit Salary A/c
|
|
2
|
Rent Paid A/c
|
Rent paid by Branch
|
Debit- Rent Paid A/c
|
|
3
|
Establishment
Expenses A/c
|
Sweeper Wages & Security
Charges
|
When payment is made- Debit
Establishment Expense A/c
|
|
4
|
Printing &
Stationery A/c
|
Charges for Printing & Stationery
Items such as, Cost of paper, cover, pen, files, pencil, books, Photostat
copy, stapler, staples, punching machine etc.
|
Debit- Printing & Stationery
A/c
|
|
5
|
Traveling &
Conveyance A/c
|
Traveling Expenses as per TA
Bills.
|
Debit- Traveling & Conveyance
A/c
|
|
6
|
Repairs &
Maintenance A/c
|
All types of repairs and
maintenance expenses incurred at branch.
|
Debit Repairs and Maintenance A/c
|
|
7
|
Staff Welfare A/c
|
Staff Welfare Expenses
|
Debit Staff Welfare A/c.
|
|
8
|
Bank Charges A/c
|
Bank charges
|
Debit Bank Charges A/c
|
|
9
|
Electricity
Charges A/c
|
Electricity Charges paid
|
Debit Electricity Charges A/c
|
|
10
|
Telephone Charges
A/c
|
Telephone charges of branch paid
as per bill
|
Debit Telephone charges A/c
|
|
11
|
Water Charges A/c
|
Water charges paid as per bill
received from water authority
|
Debit Water Charges A/c
|
|
12
|
Postage &
Telegram A/c
|
Cost of stamps, postage &
Courier charges
|
Debit Postage & Telegram A/c
|
|
13
|
Taxes &
Licence Fee A/c
|
Any tax or fee paid from branches.
|
Debit Taxes & License A/c
|
|
14
|
Legal Expenses A/c
|
Legal Expenses incurred at
branches
|
Debit Legal Expenses a/c
|
|
15
|
News Paper &
Periodicals A/c
|
It should be with the special
permission from HO
|
Debit News Paper & Periodicals
A/c
|
|
16
|
Insurance Charges
A/c
|
Insurance premium paid
|
Debit Insurance Charges A/c
|
|
17
|
Business Promotion
Expenses A/c
|
Expenses incurred for promotion
of business as per the instruction received from HO/RO.
|
Debit Business Promotion Expenses A/c
|
|
18
|
Advertisement A/c
|
Film Slides, Notice, Banners,
Announcements, Advertisement through notices in Dailies and Magazines, Name
Boards etc.
|
Debit Advertisement A/c
|
|
19
|
Vehicle
Maintenance A/c
|
Petrol/ Diesel Expenses for
Vehicles & Repairs
|
Debit- Vehicle Maintenance A/c
|
|
20
|
TDS A/c
|
Tax Deducted by others from us.
|
Debit TDS A/c.
|
|
21
|
Rent Received A/c
|
This will happen when we Let out
our building to others
|
Credit Rent Received A/c
|
|
23
|
Other Income A/c
|
Any Other miscellaneous Income.
|
Credit Other Income A/c.
|
|
24
|
Provident Fund A/c
|
PF Deduction for each month
|
When Deduction is made- Credit
Provident fund A/c
|
|
25
|
Audit &
Inspection Charges A/c
|
Audit expenses (TA bills etc)
|
Debit the A/c.
|
|
26
|
ESI A/c
|
ESI Contribution from employee
|
When ESI collected – Credit
ESI A/c and at the time of remittance to Government account, Debit ESI A/c.
|
|
27
|
Office Expenses
|
Miscellaneous office expenses
|
Debit Office Expenses A/c.
|
|
|
Interest paid on
Bonds A/c
(Scheme wise
Accounts)
|
Interest paid on various Bond
Schemes
|
Posting from concerned Bond
Module.
|
|
31
|
Interest Paid on
Others A/c
Bond Incentive A/c
|
Interest paid others
Broken period int to Bond holders
|
Debit-Interest paid on Others A/c.
Debit-Bond Incentive A/c
|
|
32
|
Interest Received
on Personal Loans
( Various Scheme
Accounts)
|
Interest received on various Gold
Loan schemes
|
Posting from Gold Loan Module.
|
|
33
|
Interest Received
on
FD/RD/Bond Loans
A/c
|
Interest received on FD/RD/Bond
Loans
|
Credit Interest received on
FD/RD/Bond Loans A/c
|
|
34
|
Interest Received
DPN Clean Loans A/c
|
DPN Clean Loan Interest Received
|
Credit Interest Received on DPN
Clean Loans A/c
|
|
35
|
Interest Received
on DPN Installment A/c
|
DPN Installment Interest Received
|
Credit Interest Received on DPN
Installment A/c
|
|
36
|
Interest Received
on KML Deposits A/c
|
Interest Received on KML
Deposits(old account no further deposits)
|
Credit Interest on KML Deposits
A/c
|
|
37
|
Interest Received Others A/c
|
Interest Received on Deposits
with Banks Etc
|
Credit Interest Received Others
A/c
|
|
38
|
Service Charges
Collected A/c
|
Service Charges Received from the
party
|
Credit Service Charges Collected
A/c
|
|
39
|
Late Fee Collected
A/c
|
Late fee received
|
Posting from GL Module.
|
