Annual Report Laporan Tahunan - Baiduri Bank

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Notes to Financial Statements December 31, 2008 1 OPERATIONS The principal activities of the Company and the Group are to carry on the business of banking and related financial services including dealing in investment securities, stock broking and e-financial services. There have been no significant changes in the nature of these activities during the financial year. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The financial statements have been prepared in accordance with the historical cost convention, with the provisions of the Brunei Darussalam Companies Act, Cap. 39, the Brunei Darussalam Banking Order 2006 and generally accepted accounting principles in Brunei Darussalam, and are expressed in Brunei Darussalam dollars. Basis of Consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries for the financial year December 31, 2008. The subsidiaries consolidated are entities in which the Group has an equity interest of more than 50% in the issued share capital at the balance sheet date or has power to exercise control over the operations. Subsidiaries are consolidated from the date on which effective control is acquired by the Group. Intra group transactions, balances, income and expenses are eliminated on consolidation. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by other members of the Group. Minority interests in the net assets of consolidated subsidiaries are identified separately from the Group’s equity therein. Minority interests consist of the amount of those interest at the date of the origin business combination and the minority’s share of changes in equity since the date of combination. Goodwill Goodwill arising on consolidation represents the excess of cost of acquisition over the fair values of the net identifiable assets acquired. Goodwill is stated at cost less accumulated amortization. Goodwill is amortised through the Group income statement over 10 years. Interest Income and Expense (i) (ii) Interest income and expenses are recognized in the profit and loss statements on an accrual basis. When an account becomes non-performing, interest is suspended until it is realised on a cash basis. For the finance subsidiary, interest earned on hire purchase and leasing transactions are spread over the period of the agreements, using the commonly accepted method known as the “Rule-of- 78” so as to produce a constant periodic rate of interest. The income arising therefrom each year comprises interest in respect of those installments which have become due for payment during the financial year. The remainder is carried forward as a provision for unearned income. Baiduri Bank Annual Report 2008 29
Notes to Financial Statements December 31, 2008 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Loans and Allowance for Bad and Doubtful Receivables All loans and financing are recognised when cash is advanced to borrowers. Legal fees incurred in securing a loan and financing are treated as part of the cost of the transaction. Loans and financing are stated after deduction of allowance for possible losses. These allowances comprise specific allowances against non-performing receivables and financing and the related interestin-suspense. Specific allowance and suspension of interest are made for doubtful receivables and financing which have been individually reviewed and specifically identified as bad or doubtful. Known bad receivables are written off. An uncollectible loan and financing or portion of a loan and financing classified as bad or doubtful is either written off or provided for after taking into consideration the realizable value of collateral, if any, when in the judgement of the management there is no prospect of recovery. Depreciation Depreciation is calculated to write off the cost of the property, plant and equipment over their estimated useful lives by the straight line method. The estimated useful lives are as follows:- Freehold lands and buildings Leasehold lands and buildings Leasehold improvements Computers Office equipment Office furniture and fittings Household furniture and equipment Motor vehicles 50 years Over period of the lease 5 years 5 – 8 years 5 years 5 – 10 years 5 – 10 years 5 years Gains and losses on disposal of property, plant and equipment are determined by reference to their net book value and are taken into account in determining operating profit. Repairs and maintenance are charged to the profit and loss statements when the expenditure is incurred. Fully depreciated property, plant and equipment are retained in the financial statements until they are no longer in use. Investments (i) Investments in subsidiaries Investments in subsidiaries in the Company’s financial statement are stated at cost less amounts written off in recognition of any permanent fall in value. Dividend income is recorded in the profit and loss statements when received in the financial year or in which a dividend has been approved by the shareholders in the investee company. (ii) Other investments 30 Baiduri Bank Annual Report 2008 Quoted and unquoted investments intended to be held for long term are stated at cost less impairment in value that is other than temporary, determined on an individual investment basis, except for situation in which the Company is able to realize a profit in these investments, the realized profits are taken to the profit and loss statements. Interest earned on other investment is reported as interest income.
Page 1 and 2: Annual Report Laporan Tahunan
Page 4 and 5: Vision & Mission Statement VISION T
Page 6 and 7: Chairperson’s Statement and large
Page 8 and 9: Corporate Information MANAGEMENT CO
Page 10 and 11: 2008 Key Financial Figures OPERATIN
Page 12 and 13: 2008 Corporate Highlights Baiduri B
Page 14 and 15: Business Highlights Established in
Page 16 and 17: Operations Management The role of t
Page 18 and 19: Corporate Social Responsibility Bai
Page 20 and 21: Corporate Social Responsibility Pro
Page 22 and 23: Financial Statements For the year e
Page 24 and 25: Report of the Directors Directors T
Page 26 and 27: Balance Sheets December 31, 2008 Th
Page 28 and 29: Statements of Changes in Equity Yea
Page 32 and 33: Notes to Financial Statements Decem
Page 44 and 45: Offices, Branches and ATM Network B
Page 46: Head Office: Block A, Units 1-4, Ki

Annual Report Laporan Tahunan - Baiduri Bank

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