Nbp Internship Report Essays

Nbp Internship Report Essays Nbp Internship Report Essay Nbp Internship Report Essay Management Theory Practices by Robbins 7th Edition VI. Investment by Charles P. Jones 12th Edition VII. Mr. Azeem (Teacher N. K FACT) VIII. Mr. F. R Tariq (Teacher N. K FACT) IX. Mr Ayub (Branch Manager DHA) X. Fundamental of Financial Management by James C. Van John Wachowicz 12th Edition XI. Corporate Finance by Brealey Myers AIOU T-520728 1 Annexes Corporate Information Board of Directors Chairman President Syed Ali Raza Muhammed Ayub Khan Tarin Sikandar Hayat Jamali Azam Faruque Mian Kausar Hameed Ibrar A. Mumtaz Tariq Kirmani Muhammed Arshad Chaudhry Audit Committee Chairman Azam Faruque Ibrar A. Mumtaz Mian Kausar Hameed Auditors Chartered Accountants Ford Rhodes Sidat Hyder Co. Chartered Accountants M. Yousaf Adil Saleem Co. Legal Advisors Advocates Legal Consultants Mandviwala Zafar Registered Head Office NBP Building I. I. Chundrigar Road, Karachi Pakistan Wesbsite www. Nbp. com. pk AUDITORS’ REPORT TO THE MEMBERS We have audited the annexed balance sheet of National Bank of Pakistan (the Bank) as at December 31,2007 and the related profit AIOU T-520728 2 nd loss account, cash flow statement and statement of changes in equitytogether with the notes forming part thereof (here-in-after referred to as the ‘financial statements’) for theyear then ended, in which are incorporated the unaudited certified returns from the branches except for sixtybranches which have been audited by us and twelve branches audited by auditors abroad and we state thatwe have obtained all the information and explanations which, to the best of our knowledge and belief, werenecessary for the purposes of our audit. It is the responsibility of the Bank’s Board of Directors to establish and maintain a system of internal control,and prepare and present the financial statements in conformity with approved accounting standards and therequirements of the Banking Companies Ordinance, 1962 (LVII of 1962), and the Companies Ordinance,1984 (XLVII of 1984). Our responsibility is to express an opinion on these statements based on our audit. We conducted our audit in accordance with the International Standards on Auditing as applicable in Pakistan. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of any material misstatement. An audit includes examining, on a test basis, evidence supporting amounts and disclosures in the financial statements. An audit also includes assessing the accounting policies and significant estimates made by management, as well as, evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion and after due verification, which in case of loans and advances covered more than sixty percent of the total loans and advances of the Bank, we report that: (a) In our opinion proper the Bank as required by the Companies Ordinance, 1984 (XLVII of 1984) has kept books of account and the returns referred to above received from the branches have (b) In our opinion: AIOU T-520728 3 I) The balance sheet and profit and loss account together with the notes thereon have been drawn up in conformity with the Banking Companies Ordinance, 1962 (LVII of 1962), and the Companies Ordinance, 1984 (XLVII of 1984), and are in agreement with the books of account and are further in accordance with accounting policies consistently applied; (ii) the expenditure incurred during the year was for the purpose of the Bank’s business; and (iii) The business conducted, investments made and the expenditure incurred during the year were i n accordance with the objects of the Bank and the transactions of the Bank which have come to our notice have been within the powers of the Bank; (c) in our opinion and to the best of our information and according to the explanations given to us the balance sheet, profit and loss account, cash flow statement and statement of changes in equity together with the notes forming part thereof conform with approved accounting standards as applicable in Pakistan and give the information required by the Banking Companies Ordinance, 1962(LVII of 1962), and the Companies Ordinance, 1984 (XLVII of 1984), in the manner so required and give a true and fair view of the state of the Bank’s affairs as at December 31, 2007 and its true balance of the profit, its cash flows and changes in equity for the year then ended; and ASSETS National Bank of Pakistan Categories of shareholders AIOU T-520728 4 Particulars Percentage Shareholders GOVERNMENT OF PAKISTAN THE PRESIDENT OF PAKISTAN STATE BANK O F PAKISTAN ASSOCIATED COMPANIES NIT ICP BANKS, DFI NBFI INSURANCE COMPANIES MODARABAS MUTUAL FUNDS GENERAL PUBLIC (LOCAL) GENERAL PUBLIC (FOREIGN) OTHERS 301 22. 6250 FOREIGN COMPANIES COMPANY TOTAL 2 2 1 2 3 62 25 74 9355 241 .3251 . 0778 75. 1979 . 0006 . 5524 3. 0639 2. 7156 4. 4091 3. 8406 . 1305 54 7. 0609 10122 100. 0000 AIOU T-520728 5 Objective of studying the organization The following are the main objectives of studying the organization My Objective is to get maximum information about the National Bank of Pakistan regarding: Finance system of organization Accounting system of organization Get information about organization structure of NBP In finance system the purpose is to make financial analysis of bank balance sheet income statement to check the true position of the bank worth and its creditability in market through different analysis like as: Ratio analysis Profit analysis Vertical analysis Horizontal analysis AIOU T-520728 6 In Accounting system of the organization we study how the accounting networks operate in NBP what kind of accounting software operate in head office other branches across the country. Another purpose is to study the organizational structure of NBP and getting information about: How many branches around the country and outside the country. What is the structure of branch What is the organ gram of bank AIOU T-520728 7 Objectives National bank of Pakistan believes in the phrase â€Å" increase profitability and increase earning per share. Its objective is to enhance its investment and excellence in services products and services. Service excellence is one of the objectives of NBP. Bank focus is on Foreign Trade as primary niche of business. NBP objective is the complete automation and computerization of all of its banking activities. They are committed to put all their energies, resources and time to bring higher value And satisfaction to their customers, employees and shareholders. The introduction and development of innovative financial instrument will be another major objective of National bank of Pakistan. Core values Highest standards of integrity Institutionalizing a team work and performance culture Excellence in service Advancement of skills for tomorrow challenges AIOU T-520728 8 Value creation for all stakeholders Awareness of social and community responsibility AIOU T-520728 9 Overview of the organization History: NBP was established under the National Bank of Pakistan Ordinance 1949 in Pakistan. Special Role of NBP occupies a unique position in the financial sector of Pakistan. It acts as an agent of the Central Bank wherever the State Bank does not have its own Branch. It also undertakes Government Treasury operations. Ownership: NBP is 100% owned by the Government of Pakistan (GoP). Branch Network NBP has an extensive domestic branch network of over 1500 branches located all over Pakistan. The Bank also has a presence in 24 international locations including the USA, United Kingdom, Europe and the Far East. Deposits NBP holds 24. 6% share of time and demand deposits in the country. Local currency deposits comprise 67% of bank’s total deposits while foreign currency deposits account for the rest. Assets NBP’s total assets stood at PKR350 billion on December 1999. This included total earning assets of about PKR268 billion with gross loan portfolio of PKR140 billion. The bank also has an investment portfolio of PKR91 billion, which comprises treasury securities, corporate bonds, shares and other securities. Equity: As of December 1999 NBP had a paid-up capital of PKR1. 46 billion divided into 146 million shares of 10 rupees each. Total shareholders’ equity was PKR10 billion, however, revaluation reserve has increased shareholders’ funds to PKR16 billion. NBP AIOU T-520728 10 NBP HISTORY NBP continued its journey of success based on our strategy of serving clients better a company agile enough to take advantage of its unique domestic and international footprint, capitalizing on the largest balance sheet and customer base in Pakistan with high cross sell potential. Our standalone AAA rating (the highest in the industry), our RoE, which is amongst the highest in the Asian banking industry, and our comfortable capital adequacy ratios, position us well in front of our competitors for future growth. Year 2007 has been an outstanding year with the bank recording the highest profit in its history. Our wide range of product offering, large branch network and committed workforce are some of our fundamental strengths that enabled us to achieve exceptional results in a very competitive market. The pre-tax profit increased to Rs. 28. 06 billion, an increase of 6. 6% over last year. Earning per share jumped by over 11. 7% from Rs. 20. 88 in 2006 to Rs. 23. 34 in 2007. Pre- tax return on equity stood at 45. 9%, whereas pre-tax return on assets stands at 4. 1% and cost to income ratio of 0. 30 remained one of the highest in the sector. These results were possible despite the fact that NBP had to make additional provision of over Rs. 3 billion as a result of withdrawal of Forced AIOU T-520728 11 Sales Value (FSV). This year NBP also availed the offer to redeem up to 10% of its holding in NIT Units held by the bank under Letter of Comfort (LoC) arrangement, this sell off resulted in a Capital gain of Rs. 1. 8 billion. Increase in pre-tax profit was achieved through strong growth in core banking income. Net Interest income increased by Rs. 3. 5 billion (11. 5%) due to better yields and volume driven growth spurred by increase in consumer loan portfolio. Dividend income and Capital Gains also made a healthy contributions it increased by Rs. 371 million and Rs. ,145 million over 2006 respectively mainly owing to higher dividends from NIT Units as well as Capital gains recorded on sell of 10% NIT Units. Advances increased by Rs. 25 billion due to impressive contribution by all business units. Deposits increased by a heal thy Rs. 90 billion or 18% over last year. The banks NPL provision coverage ratio also stands at an impressive 84%. AIOU T-520728 12 Business volume Five year performance at a glance (In millions) Year 2003 2004 2005 2006 2007 Deposits 395,492 465,492 463,427 501,872 591,908 Advances 161,266 220,794 268,839 316,110 340,677 Revenue 24,544 29,204 43,058 56,263 64,114 AIOU T-520728 13 Product lines CONSUMER BANKING Current account Foreign Currency Account PLS account Rupees Travelers Checks Defence Saving Certificates Monthly Income Account Money Gram Safe Deposit Lockers Home finance NBP karobar NBP kissan dost NBP cash card CORPORATE BANKING Current accounts Foreign currency accounts Clearing Funds transfer Trade services Overdraft facilities Term loans Project financing Agriculture financing Industrial financing AIOU T-520728 14 CONSUMER FINANCING Car financing NBP debit cards Personal loan Housing finance NBP rozgaar NBP advance salary ELECTRONIC BANKING ATM Online Banking Phone Banking E-Banking AIOU T-520728 15 ORGANIZATIONAL STRUCTURE Organizational Structure describes the rganization’s formal framework or system of communication and authority. In other words, the organization structure sets forth each principal, management position and helps to define authority, responsibility and accountability. An organization chart is essential to the development of a cost system and cost repo rts which indicates the responsibilities of individuals for implementing management plans. In NBP President / CEO is the head of the bank, ie State management, Finance, Technical, Operations, HR Admin and Corporate affairs. So Senior Executive Vice President (SEVP) who are the head of these units generally reports directly to the President. The main purpose of NBP is allowing them to effectively and efficiently accomplish organizational goals and objectives. Designing an appropriate structure means that managers must decide how to coordinate work activities and efforts both vertically and horizontally. AIOU T-520728 16 AIOU T-520728 17 Branch organgram CHIEF MANAGER / BRANCH MANAGER Manger Operations Manager International Banking Manger Credits Accounts Departmen t Imports Departmen t Leasing Departmen t Cash Departmen t Exports Department Home finance Department Account opening Department Foreign Exchange Department Remittances Department Car finance Departmen Credit card Departmen t Internal Audit Department Marketing Department Clearing Department AIOU T-520728 18 REGIONAL OFFICES 1 Karachi (south) 2 Karachi (west) 3 Hyderabad 4 Larkana 5 6 7 8 9 10 11 12 13 14 15 Sukkur Quetta Gawadar Lahore (east) Lahore (central) Gujranwala Sialkot Faisalabad Jhang Sargodha Multan 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Bhalwalpur Dera shazi khan Sahieal Federal Islamabad Rawalpindi Jhelum Gujrat Gilgit Peshawar Mardan Dera ismail khan Abottabad Muzaffarabad Mirpur capital Web site: www. Nbp. com. pk AIOU T-520728 19 18 OVERSEAS BRANCHES United states of America France Germany Bahrin Turkmenistan Pakistan epz Afghanistan 2 1 1 1 1 1 2 Bangladesh Republic of korea Kyrgyzstan Japan Hong kong Azerbaijan 2 1 1 2 2 1 AIOU T-520728 20 REVIEW OF VARIOUS DEPARTMENTS OF THE ORGANIZATION IN TERMS OF THEIR FUNCTIONS AND RESPONSINILITIES Corporate Banking The Corporate Banking Group achieved excellent results in 2007 with a number of land mark transactions in cement, energy, communication and fertilizer sectors. In addition to the funded income our corporate and investment banking has substantially increased its fee base income this year by being the lead advisor in a number of transactions in the Corporate world of Pakistan. The challenges to corporate business in year 2007 were manifold, including reduction in private credit investment as a result of slowing down of economy as well as rising interest rates. The increasing pressure on the textile industry reduced the lending to this sector. In addition the bank’s corporate loans yields also faced pressure as substitute form of funding sources are available in the market in form of Islamic financing, mutual funds, issuance of debt instruments like TFCs and Bonds and the Capital markets. AIOU T-520728 21 Despite these threats and challenges at NBP our corporate team not only increased the volume as well as the yield of the loans they also maintained a strong franchise with the leading Pakistani corporate so as to ensure that NBP not only maintains its market share but is in a position to meet any challenges in future. NBP during the year also participated in a number of TFC issues and mutual funds subscriptions thereby increasing the overall yield on investment portfolio. NBP has the largest equity portfolio in the banking sector primarily due to 27% holding in NIT units, the largest mutual fund in Pakistan. During the year the bank redeemed 10% of its NIT holding covered under LoC , which resulted in capital gain of Rs. 1. 8 billion. AIOU T-520728 22 Retail Banking NBP Karobar’ under the â€Å"President’s Rozgar Scheme† recorded excellent growth after its full launch in April 2007. This is a unique product launched to tap into the un- banked and actually the so poor people of Pakistan and targeted towards the unemployed youths aged between 18 to 45 years. This product not only serves the bank’s commercial strategy but is also an effort toward poverty alleviation in the country. It is a unique Public – Private partnership where debt servicing is shared by the government, as well as providing free life and disability insurance. The portfolio at year end was over Rs. 2 billion. The target is almost 1. 8 million customers in the next five years. There are exciting new income generating products in the pipelines to achieve the targets of NBP. The income generation targeted is in excess of ten thousand rupees net per month for each customer. The bank plans on disbursing almost Rs 100 billion which will touch the lives of almost thirty million citizens. The flagship NBP ‘Advance Salary’ product continued to grow in 2007 and maintained its position as the single largest product in the country with its accumulated disbursement crossing Rs. 115 billion. The number of organizations whose employees are entitled to avail this scheme is gradually being increased ensuring continued growth. The latest addition is the Pakistan Army and the target is almost half a million new customers in the next three years in addition to the AIOU T-520728 23 existing base of one million satisfied customers approximately. Our retail banking is expanding its reach to its diversified customer base by offering new services and products through new delivery channels so as to minimize counter traffic, increase product offering and reduce administrative costs. NBP Saibaan is a home equity loan product that was introduced in August 2003. Loans, are available to Pakistani residents to finance the purchase, construction or renovation of a home, as well as for the purchase of land and the subsequent construction of a home thereon. We are the only bank in Pakistan to offer home equity loans throughout the country. NBP Saiban has witnessed growth of 77% in 2007, one of the highest in the sector. The development of alternate delivery channels, use of I. T. , and leveraging large customer base for cross selling potential are the key strategies of NBP for increasing its retail business. NBP holds 16% market share in the consumer loan business and we aim to increase it gradually without compromising on the quality of portfolio. Our call center is a value addition in the customer services and provides overall support to our retail products. It is a unique technology as it is not service provider specific and free calls can be made to the NBP ‘Help Line† on 0800 800 80 from any land or cell phone in the country AIOU T-520728 24 Commercial Banking We plan to establish commercial centers across the country looking at the business potential in the area, size of the branch and its capabilities to deliver the desired service in order to attract quality customers. The objective is to target the untapped sectors and provide them professional quality service, through one window operations and Relationship Managers stationed at those centers. We expect and hope to reduce the turn around time and become more competitive and market oriented. Further this customer friendly and dedicated set up at convenient locations would help in improving the image of the Bank as well. These Centers would work in conjunction with the existing set–up of Commercial Lending done throughout the NBP branch network. The main purpose of these centers is to generate ancillary business in addition to funded and non funded facilities, with quick turn around time in decisions for customer satisfaction. AIOU T-520728 25 Agriculture department NBP remains the largest agriculture lender in the banking sector in Agriculture with approximately 300,000 borrowers and gross disbursement of Rs. 2 Billion during the financial Year 2006-2007. Our vast domestic branch network having 45% branches in rural areas and unique Product offering under the banner of â€Å"Kissan Dost† provides us competitive edge over our peer banks. Our specialized Agricul ture, Filed Officers, being Agriculture graduates are trained to understand the needs and limitations of our borrowing farmers as well as versed with the latest trends in Agriculture production technology providing technical guidance and specialized services to our customers. Deposits NBP is the largest bank in terms of deposit. Our large clientele and confidence of our depositors belonging to all walks of life is a major strength. We have shown appreciable growth of 18% in deposits on YoY basis which is significant from the view point that with the consolidation in the banking sector competition for deposits is ever increasing. We are branding our liability products and will continue to AIOU T-520728 26 develop new liability side products for continuing our leadership position in this business. This year we introduced three new liability products; NBP Premium Saver account, NBP Premium Mahana Amdani account and NBP Enhanced Saver account. These schemes have received excellent response from the customers and we expect healthy growth in future under these and new products that the bank is going to launch on the liability side. Given the large base and competition in the banking sector, the bank’s performance is commendable in increasing its deposits by Rs. 0 billion especially low cost deposits. Special Assets Management With a provision coverage of 84% we believe that going forward our Special Assets Man agement Group will make major contribution towards the Bank’s profitability through recoveries and reversal of provision charge as a result of declassification / rescheduling. We have revamped our special assets management business and have coordinated our efforts to expedite recoveries and settlements. AIOU T-520728 27 International Operations NBP has the largest international franchise in terms of Assets. We are present in four continents and have branches in all the countries that are major trading partners of Pakistan. Our unique coverage of Central Asia, Fareast and South Asia is incomparable and we will be the major benefactor once the trade business from the Energy rich Central Asian Republics picks up. The bank is planning to start operations in Saudi Arabia (mid 2008) and further expand our branches in Afghanistan and Bangladesh. The bank’s international operations strategy is focused towards increasing trade business and expand where the bank has competitive advantage. Islamic Banking The year 2007 marked the first year of Islamic banking operations. During the year under review, in addition to active participation in various Sukuk transactions, two more Islamic banking branches at Lahore and Peshawar started operations. NBP’s plans for the year 2008 include opening of Faisalabad and Rawalpindi branches with the focus on growing organically by opening more standalone Islamic banking branches, utilizing NBP’s existing branch network of 1,200 plus conventional branches and looking into strategic acquisitions for expansion in this field. AIOU T-520728 28 Treasury NBP has the largest treasury in terms of size. We are a major player in the foreign exchange and money markets and are a primary dealer of government securities. We have the capabilities to offer structured products to our customers as per their needs. Financial Institution and Cash Management NBP offers correspondent banking services through its overseas branches and more than 500 correspondent banks across the globe under the umbrella of Financial Institutions Cash Management Division. Our strategy is to build strong, long-term, multi-level relationship with financial institutions. We are optimally utilizing our extensive domestic branch network by offering structured products to our corporate customers. NBP has taken various measures to facilitate overseas Pakistanis to bring their home remittance back to the country in a convenient and efficient manner. AIOU T-520728 29 Operations We are committed and focused towards good quality customer service and in 2007 with the motto of ‘Putting as smile on our Customers face’; we made concerted efforts and took a number of initiatives. Workshops and seminars were conducted to disseminate the very important message of â€Å"excellent customer service†. We are transforming our branches to give a modern look and convenience. A number of branches have been shifted to prominent and spacious locations. We also have established specialized customer facilitation centers to exclusively cater to pension payments, utility and government collections. These are expected to reduce counter traffic at our branches and will increase our distribution channels for better and convenient services. Business hours have been extended with establishment of customer facilitation offices at the regional levels to help on the spot resolution of customer complaints. AIOU T-520728 30 Information Technology Today banking is becoming more and more mechanized and it is the I. T. support that can improve the customer service and reduce cost at the same time. At NBP we have elaborated plans for transformation of the entire I. T. architecture of the bank by implementing core banking solutions. The said echnology will not only increase our distribution capabilities by many folds but will also simplify our internal procedures thereby reducing the transactional cost and lead time for service. NBP has started a num ber of projects in relation to I. T. structure up-gradation. The bank is expanding its ATM network and connectivity to further expand our reach to the customers. This year we completed our automation of the government’s tax collection services thereby opening new opportunities for such services on behalf of other organizations. NBP is also looking into other I. T. products for salary and pension disbursements and E banking for better services. AIOU T-520728 31 Human Resource For NBP our dedicated staff is a key strength. NBP has been investing in developing this valuable HR through need base training and career growth development. Our objective is to become an employer of choice and to maintain complete industrial harmony within the institution. Our new hiring of top class MBAs as Management Trainee Officers (MTOs) and search for talent within the bank has helped in preparing second and third tier leadership lines which will shape our succession planning process and at the same time will ensure that with the passage of time our employee refinement and skill enrichment program continues. We also have started new ‘Employee communication program’ and internal organizational magazine to improve the interaction of top and middle level management with the lower management. Female employees are being encouraged through female empowerment program under which they are given responsible and challenging assignments. Currently over 60 females are employed as branch managers all over the country and some females hold senior management positions. AIOU T-520728 32 Credit and risk management NBP is continuously upgrading its risk management process to identify, evaluate and manage risk. During the year the bank established an Operational Risk Management Unit to supplement its already established Credit and Market risk units for comprehensive risk management. Our risk management in terms of adoption of Basel II guidelines is on time and is advancing smoothly with completion of internal gap analysis. Our Credit management system is based on elaborated risk assessment and credit rating system to ensure a very objective and timely assessment of each proposal. We have our internal filtration systems and approval hierarchy to ensure that proper authority and responsibility is established and at the same time to reduce the lead processing time of the credit application. We have proper monitoring system and have also setup a separate Credit Administration Department (CAD) to further improve our credit monitoring function. AIOU T-520728 33 ACCOUNTING SYSTEM OF THE ORGANIZATION These financial statements have been prepared in accordance with approved accounting standards as applicable in Pakistan. Approved accounting standards comprise of such International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board and Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as are notified under the Companies Ordinance, 1984, the requirements of the Companies Ordinance, 1984, the Banking Companies Ordinance, 1962 or directives issued by the Securities and Exchange Commission of Pakistan and the State Bank of Pakistan. Wherever the requirements of the Companies Ordinance, 1984, the Banking Companies Ordinance, 1962 or directives issued by the Securities and Exchange Commission of Pakistan and the State Bank of Pakistan differ with the requirements of IFRS or IFAS, the requirements of the Companies Ordinance, 1984, the Banking Companies Ordinance, 1962 or the requirements of the said directives prevail. The financial results of the Islamic banking branches of the Bank have been consolidated in th ese financial statements for reporting purposes, after eliminating intra branch transactions / balances. Key financial figures of the Islamic banking branches are disclosed in note 42 to these financial statements. AIOU T-520728 34 During the year, the Bank has increased its authorised share capital from Rs. 7,500 million (750,000,000 ordinary shares of Rs. 10/- each) to Rs. 10,000 million (1,000,000,000 ordinary shares of Rs. 10/- each) as approved by shareholders in their general meeting held on April 02, 2007. National Bank of Pakistan (the bank) was incorporated in Pakistan under the National Bank of Pakistan Ordinance,1949 and is listed on all the stock exchanges in Pakistan. Its registered and head office is situated at I. I. Chundrigar Road, Karachi. The bank is engaged in providing commercial banking and related services in Pakistan and overseas. The bank also handles treasury transactions for the Government of Pakistan (GoP) as an agent to the State Bank of Pakistan (SBP). The bank operates 1,243 (2006: 1,232) branches in Pakistan and 18 (2006: 18)overseas branches (including the Export Processing Zone branch, Karachi). Under a Trust Deed, the bank also provides services as trustee to National Investment Trust (NIT) including safe custody of securities on behalf of NIT. In accordance with the directives of the Federal Government of Pakistan regarding the shifting of the banking system to Islamic modes, the SBP has issued various circulars from time to time. Permissible form of trade related mode of financing includes purchase of goods by the bank from their customers and immediate resale to them at appropriate mark-up in price on deferred payment basis. AIOU T-520728 35 The purchases and sales arising under these arrangements are not reflected in these financial statements as such but are restricted to the amount of facility actually utilized and the appropriate portion of mark-up thereon. The US Dollar amounts shown on the balance sheet, profit and loss account and cash flow statement are stated as additional information solely for the convenience of readers. For the purpose of conversion to US Dollars, the rate of Rs. 62. 0 to one US Dollar has been used for both 2007 and 2006 as it was the prevalent rate as on December 31, 2007. These financial statements are separate financial statements of the bank in which the investments in subsidiaries, associates and joint ventures are accounted for at cost and hence not on the basis of reporte d results and net assets of the investees. AIOU T-520728 36 FINANCE SYSTEM OF THE ORGANIZATION The Head office of the National bank of pakistan controls all financial activities and system of NBP. All financing decisions, capital budgeting decisions and processing on real and financial assets are major responsibilities of finance department of NBP. Necessary future plans and projects are analyzed and selected as per their positive results i. e; (Investment decision) start Islamic branches. of new conventional and Lending and borrowing decisions are also made as per loans, interest rates, time period and lending agencies and banks etc. Necessary sanctions of write-off and depreciation rate are also issued by the finance department. Finance department also plays a vital role in coordination, with dividend policy matters, internal and external auditors and share registrars. Pensions, insurance, preparation of budget and taxation dealings are also important factors of NBP finance department. Finance department of the NBP takes all financing decisions relating to the new investment in the country or in foreign country NBP involves in all Government financial decision making and also provide finance to the Government and Government agencies AIOU T-520728 37 Charts of Finance/Accounts Chief financial officer CFO (EVP) Financial accounts SVP Taxation VP Equity investment VP Manager finance North Manager finance South Manager taxation North Manager taxation South Manager Eqt inv North Manager Eqt inv South AIOU T-520728 38 Chart Of Audit Group Chief Of Audit (SEVP) Internal Audit Dept VP Admin (AIG) AVP Systems support VP EDP Audit Dept VP Monitoring Dept VP AIOU T-520728 39 ROLE OF FINANCIAL MANAGER IN NBP The financial plays a vital role in a banking company. The main role of the of manager is to see external factors like pestel framework of the company he is a team player in the overall effort of a company to create value. The key responsibility of the financial manager is to adapt change, raise funds, invest in the assets. and manage wisely all financial matter. Three things which financial manager does: Investment decisions Financing decision Asset management Financial manager in NBP or CFO takes all financial decision NBP investment banking focuses on origination and execution of project finance. Corporate finance. And acquisitions and mergers assignment associated with financing solutions. Financial manager also takes a steps with the provisions coverage of 84% we believe that our special assets management group will make major contributions towards the bank profitability through recoveries and reversal of provisions. Financial in NBP takes a decisions about where we invest our capital which investment give us better profit and also takes a AIOU T-520728 40 decision about what kind of assets we will buy which is best utilize for our operations. He also concentrate and maintained balance in advance to general public and deposits and use asset management liability approaches. AIOU T-520728 41 USE OF ELECTRONIC DATA IN DECISION MAKING Mostly offices of NBP are well equipped with computers and EDP facilities. Data is recorded on CDs and these CDs are sent to Finance department. Director. This data is fed in a main SERVER for use of different sections in decision making. For example balances of General Provident Fund, House Building Advance and Motor Cycle/Car Advances, Pay roll, etc are needed in pension section to prepare final emoluments of a retiring employee. This requisite information’s are taken from this SERVER (Book Budget Record Section) for necessary decision. NBP has a sound MIS System which helps all other departments in decision making and also to preserve it for future needs. Recently, the organization provides a separate internet connection to all its officers, so that they may connect to higher management regularly, keep their knowledge fresh about organization strategies/affairs and also for correspondence to other officers and higher management. AIOU T-520728 42 Sources of funds Funds are mainly generated through two main sources Decrease in assets Sale of fixed assets Redemption of long term investment Reduction trade debtor Increase in claim Deposits Long term loans Short term loans Equity (stocks + retained earning) AIOU T-520728 43 Generation of funds Following are the major sources of funds of NBP 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. Issued, subscribed and paid up capital. Long term and short term loans Income from operations Funds from securities Funds from Gross provident Funds Income from its subsidiaries in foreign domestic Interest on loans Sale of treasury bills Profit on investment Securities as collateral Borrowing from financial institution Issuance of bonus shares, right shares, preferred shares Issuance of different types of bonds, debentures, Income from leased assets Return on repurchase agreement Sale of securities Letter of credit Income from derivative securities AIOU T-520728 44 Allocation of funds In NBP funds are allocated by a sound system of charts of accounts. All the Drawing and Disbursing Officers are assigned their specific code-range through which necessary budgets and grants are allocated. All the heads have also their code numbers which is easy to computerize. 1) All the current assets allocate in current liabilities and current advances 2) All the short term funds allocated in short term investments 3) All the long term funds and loans invested and utilizes in long term investment and in long term projects according to principles of assets liabilities management 4) Funds are allocated in domestic foreign investment 5) Dividend payments 6) Financial cost (Interest markup payments) 7) Operating expenses 8) Fixed assets (purchasing of buildings, fixture and furniture) 9) Tax payments 10) Marketing and product promotion AIOU T-520728 45 CRITICAL ANALYSIS OF THEORETICAL CONCEPTS RELATING TO PRACTICAL EXPERIENCES (FINANCE DEPARTMENT) In my opinion, The Finance Department of the NBP has complied with all the material requirements of the Code of Corporate Governance. Proper accounting system is followed to record, classify, and summarize accounting data and information in conformity to Companies Ordinance 1984 and International Accounting Standards as applicable in Pakistan. My findings are as follow: Proper books of accounts of the company have been maintained. The financial statements prepared by the management of the Company present fairly its state of affairs, the result of its operations. Appropriate ccounting policies have been consistently applied in the preparation of financial statements and accounting estimates are based on reasonable and prudent judgment. International Accounting standards, as applicable in Pakistan, have been followed in the preparation of financial statements and any departure there fro m has been adequately disclosed. The system of internal controls is sound in design and has been effectively implemented and monitored. There are no significant doubts about the company’s ability to continue as a going concern. AIOU T-520728 46 There has been no material departure from the best practices of corporate governance, as detailed in the listed regulations. The NBP is not fully computerized yet and for this reason there are few problems like slow reporting, less efficiency, etc. further more all employees of finance department do not have sufficient computer skills to carry out the routing work of the finance department on computer based system which in turn reduces the overall efficiency of the finance department of the company. The company is not providing any proper training to the staff of finance department on new technologies to update their knowledge which also affects the performance of the finance department. All accounts and finance offices are not interconnected due to this reason communication between these departments gets slow that affects performance of the department. Receivable management of the company is not very good as there are huge amounts of outstanding bills are over due and yet to be collected. AIOU T-520728 47 FINANCIAL ANALYSIS Financial Analysis is crucial for understanding the working of any organization. Any business whether it possesses extremely popularity but cannot survive without proper financial management and that can be done through analysis of its statements. I have made financial analysis of National bank so that I can have better understanding and knowledge about the organization where I did my internship. I have focused on: Ratio analysis Financial statements are necessary for financial analysis as they give us the true figures. Statements that I needed for analysis of National bank are: Balance Sheet – Financial Position Profit and Loss Account - Financial Performance BALANCE SHEET Balance sheet contains assets, liabilities and shareholders equity and tells us about financial position of the firm. PROFIT AND LOSS ACCOUNT Profit and loss account shows incomes and expenditures of the organization and tells about financial performance of the firm. I have made analysis on the basis of last five years for assessing the current year’s position and performance. The statements of the bank for the financial year 2003 to 2007 are as under. AIOU T-520728 48 Interpretation of horizontal analysis Horizontal analysis of balance sheet can be supplemented by the expression of items relative to a base year. For National Bank of Pakistan the base year is 2003, for example comparing NBP cash bank balance in 2004 is (94,446,552) with cash bank balance in the base year 2003 is (64,232,588) the index would be 94,446,552-64,232,558 *100 = 47. 03% 64,232,558 All the other calculation is based on this formula we calculate the data of five year. As we see the analysis the change in percentage is clearly show the change in the items of balance sheet year to year. As we see in the analysis the cash bank balance is increase 47% in 2004 but gradually it is increasing with decrease rate and at the end in 2007 it is increases 48% this is due to change in liquidity of the bank. Balances with other bank is increases 26% in 2004 and decreases in the remaining year which effect assets. Lending to financial institution is increasing continuously and highest increase in year 2006. n the other hand investment is decreasing continuously and increase in last year which is good sign. Advances to the customer is also continuously increasing and high in 2007, this is increases due to increase in deposits of the bank as more the advances the more interest earned which ultimately increase the profit. The bank fixed assets and other assets is also continuously increases. On the other side (liability) of balance sheet analysis shows the bill payable is increasing through out the five year which increase the liability of bank, the borrowing of bank from financial institution is highest increases in 2004 and decrease in the remaining year as compared to base year. he tax liability of bank is also increases in 2004 2005 but decreases in 2006 2007 which is good impact on whole liability. Liability against lease assets is high in the year 2007 . the deposits of the bank is sharply increases which is life blood for bank and good impact on bank financial position this deposits is increase due to attraction and confidence of customer on this National bank and bank in the position to advances and ge t profit. If we see as a whole the bank total liability is increasing from 2003 to 2007 but bank assets is also increases with high rate from 2003 to 2007 which strengthens the position of bank. On the other hand share holder equity is also increasing during five years as well as reserve of bank is also increased. ver all bank going in positive and booming position in five year and its deposits increase sharply due to this increase finance department take good decision and utilized it into investment, advances and in operating activities which give lot of return in terms of interest earned and profit on investment. AIOU T-520728 49 AIOU T-520728 50 Interpretation of vertical analysis In the vertical or common-size analysis, we express the different components of a balance sheet as percentage of total assets of the bank and total liability of the bank. These are obtained by following method : 64,232,588 *100 =13. 7% 468,972,871 In the above analysis of balance sheet it shows that how the items of balance sheet change in terms of total assets and total liabilities. In the year 2003 the cash balance of bank is 13. 7% that show the good position of liquidity. And it is increased in 2004 and decreased in 2005 and remains constant in remaining year. It is decrease due to utilization in operating activity and mark up expenses. Same situation as bank balances high in 2004 and continuously decreases due to operating expenses. because expenses continuously increases during past five years. Lending to financial institution is high in 2006 as percentage of total these lending includes call money, repurchase agreement and bands higher the lending higher the return in terms of interest or capital cost. If we see in liabilities side as the deposits increases the lending is also increases. that show the management of finance department. Investment is also increases in terms total assets of bank finance department proper utilizes the assets of bank by investing the deposits of bank these investment is purchasing the different trading and market securities which give maximum return. Advances of NBP is increases continuously in terms of total assets. it is also related to liability against. advances increases due to increased deposits as the deposits percentage as total liabilities increases advances increases and it is also due to in time decision of finance department that utilization their deposits wisely in advances these advances includes the cash, credit loans, consumer loan secured and unsecured advances and short term, long term loans and foreign loans. AIOU T-520728 51 In liabilities side the main items we see is deposits which is 90% of total liabilities through out the five year which show its importance in whole financial statements, which life blood of bank. deposits includes the saving, current, and other types of deposits which show customer show confidence of NBP. In the assets side of balance sheet three items includes investment, advances and liquid assets is 75% of total assets through the five years. It is also directly related to deposits of bank and we can say in one word â€Å"deposits is utilized in advances, investment and liquid assets. without deposits we can’t runs NBP†. RATIO ANALYSIS Ratio analysis includes calculating different ratios for the organization of the figures taken from its financial statements. The basic purpose of ratio analysis is that absolute figures often give misleading image so comparison with other figures is necessary which can be done through ratio analysis. Liquidity ratio AIOU T-520728 52 Liquidity ratio are used to measure a firm’s ability to meet short term obligations, they compare short term obligations with short term resources available to meet these obligations, Current ratio Definition Current assets divided by current liabilities. it shows a firm ability to cover its current liabilities with its current assets. FORMULA = CURRENT CURRENT In millions ASSETS LIABILITY 2003 2004 2005 2006 2007 AIOU T-520728 53 0 5 , 4 2 8 1 7 5 , 2 1 0 =1. 74 3 1 5 , 8 6 8 1 9 1 , 4 5 6 =1. 64 3 1 8 , 9 9 9 1 8 9 , 5 4 8 =1. 68 3 4 2 , 1 1 2 2 0 4 , 2 1 1 =1. 675 4 7 2 , 4 5 6 2 3 8 , 4 2 1 =1. 98 Interpretation As we see in the above analysis current ratio is high in 2003 and then deceasing and at the end in 2007 it is at high level. Which is very healthy sign. Current ratio which is more than (gt;1) is positive sign. It shows bank have sufficient current assets to meet current obligation. Debt equity ratio Ratios that show the extent to which the firm is financed by debt it is simply computed by as follows Formula = Total debt Shareholders equity In millions AIOU T-520728 54 0 0 3 2004 2005 2006 2007 4 4 2 , 1 4 8 1 8 , 1 3 6 =24. 37 5 0 6 , 9 8 5 2 4 , 8 9 9 =20. 36 5 0 3 , 3 7 8 3 6 , 1 5 8 =13. 92 5 5 3 , 1 7 8 5 3 , 0 4 4 =10. 42 6 4 5 , 8 5 5 6 9 , 2 7 0 =9. 32 Interpretation As we see in above analysis debt to equity ratio gradually decreases which shows positive sign for creditors because creditors like this ratio to be low. The lower the ratio the higher the firm financing that is being provided by shareholders. Banks debt to equity ratio usually high in value and greater than (gt;1). Debt to total assets The d ebt to total assets ratio is divided by dividing a firm’s total debt by its total assets FORMULA = TOTAL TOTAL DEBT ASSETS 2003 2004 2005 2006 2007 AIOU T-520728 55 4 4 2 , 1 4 8 4 6 8 , 9 7 2 =0. 942 5 0 6 , 9 8 5 5 5 3 , 2 3 3 =0. 916 5 0 3 , 3 7 8 5 7 7 , 7 2 1 =0. 871 5 5 3 , 1 6 8 6 3 5 , 1 3 4 =0. 870 6 4 5 , 8 5 6 7 6 2 , 1 9 5 =0. 847 Interpretation This ratio serves a similar purpose to the debt to equity ratio it highlights the relative importance of debt financing to the firm by showing the percentage of the firms assets that is supported by debt financing. The above analysis shows ratio is continuously decreasing from 2003 to 2007 which is healthy sign it is because of increasing in the assets of bank. It shows company is secured . In 2003 the 94% of the assets is financed with debts whether in 2007 84% of the assets is financed with debts. This analysis also shows the financial risk of banks decreasing from 2003 to 2007 due to decrease in ratio. Coverage ratio Ratios that relate the financial charger of a firm to its ability to service or cover them Interest coverage ratio Earning before interest and taxes divided by interest charges it indicates a firm’s ability to cover interest charges. AIOU T-520728 56 FORMULA = EBIT INTEREST EXPENSE 2003 1 4 5 , 9 9 2 5 5 , 8 9 6 =2. 61 2004 1 8 , 5 3 6 6 , 5 5 9 =2. 82 2005 2 9 , 3 7 7 1 , 3 2 1 =2. 85 2006 4 0 , 2 5 7 1 3 , 9 4 7 =2. 89 007 4 5 , 0 0 0 1 6 , 9 4 0 =2. 65 Interpretation This ratio serves as one measure of the firm’s ability to meet interest expense and avoid bankruptcy. The above analysis shows that coverage ratio is low in 2003 and 2007 but in high in remaining years. In simple higher the ratio greater bank ability to cover its interest pa yments. Year 2004,2005,2006 is better than 2007 because of greater ratio. The last year (2007) is not good for bank. This is happened because of decrease in EBIT , AIOU T-520728 57 Return on equity ROE compares net profit after taxes with the equity that shareholders have invested in the firm AIOU T-520728 58 FORMULA = NET PROFIT AFTER TAXES SHAREHOLDERS EQUITY 2003 4 , 1 9 8 1 8 , 1 3 4 2004 6 , 1 9 5 2 4 , 8 9 9 2005 1 2 , 7 0 9 3 6 , 1 5 8 2006 1 7 , 0 2 2 5 3 , 0 4 4 2007 1 9 , 0 3 3 6 9 , 2 7 0 =23. 15% =25% =35% =32% =27. 48% Interpretation . A high return on equity often reflects the firm’s acceptance of strong investment opportunity and effective expense management. In the above analysis the ratio is low in 2003 and 2007 and high in the remaining years. The ratio is increasing in 2004,2005,2006 because of increasing in profit and in the remaining year (2003,2007) the ratio decreasing because of less increasing in the profit and increase in the shareholder equity. AIOU T-520728 59 Return on assets Its measure overall effectiveness in generating profits with available assets ROA OR ROI are both the same it can be obtained by the following formula AIOU T-520728 60 FORMULA = NET PROFIT A F T E R TA X E S TO TA L ASSETS 2 0 0 3 4 , 1 9 8 * 1 0 0 2 0 0 4 6 , 1 9 5 * 1 0 0 5 5 3 , 2 3 1 = 1 . 1 2 % 2 0 0 5 1 2 7 , 1 0 9 * 1 0 0 2 0 0 6 1 7 , 0 2 2 * 1 0 0 2 0 0 7 1 9 , 0 3 3 * 1 0 0 4 6 8 , 9 7 2 = 0 . 9 0 % 5 7 7 , 7 1 9 = 2 . 2 % 6 3 5 , 1 3 4 = 2 . 6 8 % 7 6 2 , 1 9 3 = 2 . 4 9 % Interpretation It is also called earning power of the firm if there is an increase in turnover on assets an increase in the net profit margin or both. Earning power of the bank increased . In the above analysis return on assets is continuously increasing but little decrease in the last year (2007). the 2. 49% earning power means every rupee invested in the assets return 2. 49% in profit (PAT). The increase in ROA is because increase in profit after tax and decrease in the last year is because of less increase in profit (PAT) and more increase in asset 61 AIOU T-520728 Net profit ratio Ratio that relates profits to investment. it shows firm overall effectiveness of operation, it is calculated by following formula AIOU T-520728 62 FORMULA = NET PROFIT AFTER TAX NET MARKUP/INTEREST AFTER PROVISION 003 4,198 * 100 11,264 =52. 51% 2004 6,195 * 100 12,639 =49. 01% 2005 12,709 * 100 21,088 =60. 26% 2006 17,022 * 100 27,782 =61. 27% 2007 19,033 * 100 28,906 =65. 84% Interpretation It tells firm net income per dollar of interest after provision in the above analysis, it shows the net profit ratio constantly increasing and show high growth i n year 2007. Analysis with other banks AIOU T-520728 63 BANKS NET ASSETS MCB HBL UBL NBP SONERI KASB 56 billions 12 billion PER 24. 30 63. 2 billion 11 billion 14. 49 48 billion 9. 23 billion 10. 38 1. 16 trillion 20 billion 23. 34 6. 6 b 4. 2b PROFIT/LOSS AFTER TAX EARNING SHARE 1. 03 b 2. 43 -10 karore . 90 Explanation National bank of Pakistan is leading Bank of Pakistan as compared to other banks and financial institution in Pakistan, there are approximately 100 companies listed in stock exchange KSE, and their creditability is determined with their earning per share and other parameters there are some banks data is given below which shows national bank is Leading, one. fi we see the above table it shows net assts of national bank is high as compared to other’s and profit after tax is also high which is 20 billion, and if we see the earning per share it is also the 2nd one, so as overall it is better financial analysis than other. In Pakistan OGDC (Oil and gas development corporation) and steel mill is the greater volume assets companies if we compare the national bank to these companies in my point of view national bank gets 3rd position out of them. which is greater honor for this bank. AIOU T-520728 64 FUTURE PROSPECTS OF THE ORGANIZATION The overall analysis shows that company is in good condition throughout the analysis years 2003- 2007. The 2007 is the golden year for the company because in this year the company earns maximum profit. During this year the Operating Cost was minimum and its Operating Profit was maximum. Earning per share is also increasing during five years for the stock holders and the persons interested in NBP investment. Future Prospects of the Organization is to get more and more profit for its share holder by increasing revenue and operating profit by reducing its operating costs. NBP is a leading bank in Pakistan with its extensive networks all out the country. There are now fifty other banking companies in competition with NBP but NBP is the growing and leading bank in the Pakistan and go in the positive direction and if I say that it is the assets of Pakistan and has strategic important. it is also included world best bank, best in Asia. If we see the National Bank Of Pakistan in future it is very bright now NBP also starts Islamic banking which shows growth of bank is going in positive direction, it is an era of Islamic banking every bank open its Islamic branches and new Islamic bank comes in Pakistan. NBP is also face competition in Islamic banking as a whole it is the crocodile of Pakistan banking system in domestic and foreign. It has large amount of assets and earn highest profit in banking of Pakistan so it can use their resources wisely and gain confidence in foreign country and attract foreign customer, and have capacity to grow in foreign market. AIOU T-520728 65 Short falls /weaknesses of the finance department High interest expense Bank must emphasis on interest expense. because interest expense increase during last four year due to this bank interest coverage ratio decreases and bank ability to cover interest expense reduce. SHAREHOLDER EQUITY Bank equity not increase as compared to their liability increase in the previous year. EARNING PER SHARE AIOU T-520728 66 Earning per share not increase as compared to their profit bank are not providing or not transferred the benefit to their share holder it is also seen that ROE is decreases which means bank ability of getting opportunity is decrease. INVESTMENT Investment of the bank give less benefit and give negative cash flow. In overall cash from investing activating is decrease due to wrong policy of the finance department Recovery collection NBP Recovery collection system is weak and there is political influence in the bank matter which effect the decision making system of higher management. Capital budgeting NBP uses old financial techniques capital budgeting techniques. Banks uture planning is not up to date due. Bank capital budgeting performance is so low and they don’t give proper evaluation of investment. Consumer financing Finance department don’t emphasis on the consumer sector and consumer product. Different bank launching credit card and personal loans and earn intere st but national bank didn’t introduce these product during last year they only concentrate on corporate sector. AIOU T-520728 67 Foreign investment NBP don’t concentrate on foreign investment their investment is not diversified which is necessary to secure the bank from financial crisis in the period of domestic financial crisis of the country. Suggestions Diversified investment Bank must be concentrate on diversified investment, they must invest in different sector to minimize the risk if one sector is in crisis and give no return then we rely on other due to diversified investment foreign investment is also one tips of diversified investment if our economy is weak then we earn from foreign investment. Improve Consumer financing Consumer financing is must to earn maximum interest because it is an era of launching consumer product to attract the customer attention consumer financing is give high return in short period of time it includes following Credit card Debit card Auto loan Personal loan AIOU T-520728 68 Decrease account receivable To decrease possibility of bad debts bank should concentrate on recovery and collection of advances given to industrial and public sector. It also decrease our account receivable. Capital budgeting Bank should improve their capital budgeting department efficiency for taking good decision on investment and loan that what investment give better result and what loans has less effective rate. Assets Liability management Bank should adopt asset liability management techniques to abstain possible crisis they should use current assets to promote current liability and long term assets for long term liability Increase Interest rate Bank must increase interest rate on advances because NBP follow discount rate and get less profit on their IRR so it change the policy and follow KIBOR (Karachi inter bank offer rate). Reduce interest expense Bank should reduce their interest expense to increase the interest coverage ratio and avoid the bankruptcy they their interest expenses by taking less loan from AIOU T-520728 69 SBP and other financial institution and rely on their own . Increase earning per share(EPS) Bank must increase their EPS by increasing their profit to attract the shareholders attention Training session Management must conduct training session for financial department to give them overview of financial analysis and teach them the way for improving performance of finance department. Higher financial professional New blood specially finance specialist (Mba finance certified financial analyst (Cfa) should be injected and young professionals should be recruited on merit to induce enthusiasm in the bank. Customers should be focus of all activities to boost up the business. Conclusion In short I resulted during my internship in National bank of Pakistan and it can be concluded from the above prepared Internship Report, I concluded that the Banks’ use their own software for each and every department as for example National bank is using at present BANKING SOFTWARE system of accounting PMS (Payroll Management System) in the payroll section. There is confusion about using such accounting software because the student has learned other applications like MS-Excel and MS-Word for such purposes. AIOU T-520728 70 Management of bank always desire to be efficient. I observed that the management of National bank tries its best to hire the services of a person at no cost to the Bank as I was hired for my internship. I also observed that the employees of the Bank try their best to defend their job in the Bank and for this they use any means or methods. Also this report and internship has helped me very much to enter in the practical life since I was required to submit the same report to the Bank as well. The Practical Life of a person is quite different from Academic Life. In the academic life the student is required to learn from the class lectures, notes, and projects or home assignments assigned during the course. But in