cgap training accounting principles for mfis slides 2a

©CGAP/World Bank, 2009

The General Ledger

is a record of transactions organized by account number beginning

with the asset accounts and ending with expense accounts

A5-O1a

Cash Account No. 101

Date Explanation Debit Credit Balance

404,901 July 1 Purchased computer 4,000 400,901

3 Purchased motorcycles 4,000 396,901 31 Collected savings 51,000 447,901

Gross Fixed Assets Account No. 150



3 Purchased motorcycles 15,000 249,504


The General Journal is a chronological record of transactions

A5-O1b

Date Account Title and Explanation Ref

Num Debit Credit

July 1 Gross Fixed Assets – Computer 150 4,000

Cash (purchased equipment)

101 4,000

3 Gross Fixed Assets – Motorcycles 150 15,000

Cash 101 4,000

Short-term Liabilities (purchased motorcycles on cash & credit )

225 11,000

31 Cash 101 51,000

Demand Deposits (collect savings)

201 51,000


Ledger Accounts

Represents the accumulation of all information about

changes in an asset, liability, equity, revenue, or expense

item in one place.

Each Ledger account is identified by its account name and

number as stated on the Chart of Accounts.

A5-O2

Gross Fixed Assets Account No. 150





Cash Ledger – Account 101

Most Important

The number of Cash transactions in most MFIs is large.

The chances of committing fraud are higher than with other assets.

Importance of timely payments to reputation and financial position

A5-O3

Cash Account No. 101



3 Purchased motorcycles 4,000 396,901 31 Collected savings 51,000 447,901 31 July loan repayments 226,200 674,101 31 July loan disbursements 290,000 384,101 31 July loan fees 5,800 389,901


Posting

The process of copying journal entry information from the

General Journal to the General Ledger

A5-O4

General Journal

Chronological

General Ledger

By Accounts

POSTING

Journal Credits Ledger Credits

Journal Debits Ledger Debits


General Ledger A5-O5

Date Explanation Ref Debit Credit Balance


General Ledger September 2007 A5-O6a

Explanation REF Debit Credit Balance

CASH AND DUE FROM BANKS 101 404,901

July 1 Purchased computer 4,000 400,901


31 Collected savings 51,000 447,901

31 July loan repayments 226,200 674,101

31 July loan disbursements 290,000 384,101

31 July loan fees 5,800 389,901

Aug 1 Semiannual board meeting 3,100 386,801

7 Short-term deposit matures 10,400 397,201

9 Prepaid rent 2,000 395,201


31 August loan repayments 222,300 674,501

31 August loan disbursements 304,000 370,501

31 August loan fees 6,080 376,581

Sept 3 Paid short-term loan 9,200 367,381

6 Study tour 1,500 365,881


30 September loan repayments 343,200 772,081

30 September loan disbursements 341,000 431,081

30 September loan fees 6,820 437,901

30 Long-term investment 40,000 397,901

Monthly Expenses 204,300 193,601

Date


General Ledger September 2007 (continued) A5-O6b


TRADE INVESTMENTS 110 48,270

Aug 7 Short-term deposit matures 10,000 38,270

GROSS LOAN PORTFOLIO 120 956,406

July 31 July loan repayments 174,000 782,406

31 July loan disbursements 290,000 1,072,406

Aug 31 August loan repayments 171,000 901,406

31 August loan disbursements 304,000 1,205,406

Sept 30 September loan repayments 264,000 941,406

30 September loan disbursements 341,000 1,282,406

IMPAIRMENT LOSS ALLOWANCE 125 (19,128)

ACCOUNTS RECEIVABLE AND

OTHER ASSETS 135 36,415

Aug 9 Prepaid rent 2,000 38,415

OTHER LONG-TERM INVESTMENTS 140 -

Sept 31 Purchased term-deposit 40,000 40,000

GROSS FIXED ASSETS 150 230,504

July 1 Purchased computer 4,000 234,504

July 3 Purchased motorcycles 15,000 249,504

ACC. DEPRECIATION 155 (100,353)

Date


General Ledger September 2007 (continued) A5-O6c


DEMAND DEPOSITS 201 595,517

July 31 July savings collected 51,000 646,517

Aug 31 August savings collected 57,000 703,517

Sept 30 September savings collected 63,000 766,517

SHORT-TERM BORROWINGS 215 19,514

July 3 Purchased motorcycles 11,000 30,514

Sept 3 Paid short-term loan 8,000 22,514

Sept 6 Study tour 3,500 26,014

PAID-IN CAPITAL 301 50,000

DONATED EQUITY – PRIOR 310 1,389,241

PRIOR YEAR’S P/L 325 (778,735)

RESERVES 335 50,000

INTEREST ON LOANS 410 233,910

July 31 July loan repayments 52,200 286,110

Aug 31 August loan repayments 51,300 337,410

Sept 30 September loan repayments 79,200 416,610

Date


General Ledger September 2007 (continued) A5-O6d


LOAN FEES/SERVICE CHARGE 415 24,399

July 31 July loan disbursements 5,800 30,199

Aug 31 August loan disbursements 6,080 36,279

Sept 30 September loan disbursements 6,820 43,099

INTEREST ON INVESTMENTS 420 -

Aug 7 Short-term deposit matures 400 400

DONATIONS 440 442,031

INTEREST PAID ON ST DEBT 515 1,030

Sept 3 Paid interest on short-term loan 1,200 2,230

PROVISION FOR LOAN IMPAIRMENT 530 19,128

PERSONNEL 545 197,940

July 31 Salaries 32,000 229,940

Aug 31 Salaries 32,000 261,940

Sept 30 Salaries 32,000 293,940

TRAINING AND DEVELOPMENT 565 24,379

Sept 6 Study tour 5,000 29,379

Date


General Ledger September 2007 (continued) A5-O6e


RENT AND UTILITIES 566 64,256

July 31 Rent and utilities 10,700 74,956

Aug 31 Rent and utilities 10,700 85,656

Sept 30 Rent and utilities 10,700 96,356

COMMUNICATIONS 567 24,659

July 31 Phone, courier, etc. 4,000 28,659

Aug 31 Phone, courier, etc 4,000 32,659

Sept 30 Phone, courier, etc 4,000 36,659

BANK FEES 568 7,694

July 31 Bank fees 1,300 8,994

Aug 31 Bank fees 1,300 10,294

Sept 30 Bank fees 1,300 11,594

INSURANCE 569 33

PRINTING AND MATERIALS 570 29,102

July 31 Printing and materials 4,700 33,802

Aug 31 Printing and materials 4,700 38,502

Sept 30 Printing and materials 4,700 43,202

Date


General Ledger September 2007 (continued) A5-O6f


REPAIR AND MAINTENANCE 571 18,119

July 31 Repair and maintenance 3,000 21,119

Aug 31 Repair and maintenance 3,000 24,119

Sept 30 Repair and maintenance 3,000 27,119

TRAVEL AND TRANSPORT 572 74,400

July 31 Travel and transport 12,400 86,800

Aug 31 Travel and transport 12,400 99,200

Sept 30 Travel and transport 12,400 111,600

LEGAL AND AUDIT FEES 573 1,942

BOARD MEETING EXPENSES 574 3,522

Aug 1 Semiannual board meeting 3,100 6,622

OTHER ADMIN/MISC EXPENSES 575 2,658

Date

cgap training accounting principles for mfis slides 2a

Education

loan disbursements290

loan fees5

loan fees6

loan disbursements341

loan impairment53019

loan repayments222

loan repayments226

loan repayments79