The Zarai Taraqiati Bank Limited

CHAPTER# 01

INTRODUCTION TO ZTBL

Zarai Taraqiati Bank Limited

The Zarai Taraqiati Bank Limited (ZTBL) formally known as

Agricultural Development Bank of Pakistan is a public sector largest

financial development institution with a wide network of 27 Zonal

Offices, 09 Audit Zones and 342 branches in the country.

1.1 Brief on ZTBL:

Zarai Taraqiati Bank Limited (ZTBL) formerly known as Agricultural Development

Bank of Pakistan (ADBP) is the premier financial institution towards the development of

agriculture sector through provision of financial services and technical know-how. The

restructuring of former ADBP is being carried out with the aim to uplift the agriculture

and rural sector by raising farm productivity, streamlining the institutional credit and

increasing income generating capacity of the farming community.

Institute of Management Sciences, UST Bannu | 1


1.2 History of ZTBL

Pakistan is basically an agricultural country, and finance has been needed for its rapid

development. With a view to meet this basic need the Agricultural Development Finance

Corporation was set-up in 1951, and was entrusted with the task of providing financial

facilities for the development and modernization of agriculture, including:

Forestry,

Fishery,

Animal Husbandry,

Poultry,

Dairy Farming

Later on the Agricultural Development Bank of Pakistan was also established in

September 1957, under the Agricultural Development Bank Act. The Bank is to provide

credit in cash or in kind, warehousing and storage facilities to agriculturists, cooperative

societies and other bodies, of which the majority of members are agriculturists.

As the functions of the Agricultural Development Finance Corporation and

Agricultural Development Bank were similar and since both were working with capital

provided by the Government, they were merged into one organization known as

Agricultural Development Bank of Pakistan on February 18. 1961.



1.3 Reason to Change ADBP to ZTBL:

The restructuring of the former ADBP is being carried out with the aim to uplift the

agriculture and rural sector by raising farm productivity, streamlining the institutional

credit and increasing the income generating capacity of the farming community.

KARACHI (December 14 2002), The Federal Government has converted the

Agricultural Development Bank of Pakistan (ADBP) into Zarai Taraqiati Bank Ltd

(ZTBL) and the new venture has started its operation with immediate effect.

The new corporate structure redefines the banks status as a public limited company with

an independent Board of Director which aims are to ensure good governance, autonomy,

delivering high quality, viable and timely financial services to a greater number of clients

in the agricultural and rural segment of the country.

1.4 President of ZTBL

The Principal Officer of the ZTBL is the president. The current President of Zarai

Taraqiati Bank Ltd is Muhammad Zaka Ashraf who took over the charge

from Mr. Mansur Khan in September 2008 for a three years term.

1.5 Board of Directors

Mr. Syed Qamar-uz-Zaman Shah, Chairman Board

Mr. Muhammad Zaka Ashraf, President & CEO

Mr. Shafqat Hussain Naghmi

Mr. Iftikhar Khan Mohammad

Mrs.Nazrat Bashir

Dr. Khalid Ahmad Khokhar

Mr. Imam Bux Sheikh

Mr. Tauqir Ahmad Faiq

Mr. Muazam Ali, Company Secretary


http://en.wikipedia.org/wiki/Agriculture



Dedicated to serve the needs of the farming community, by delivering

financial products and technical services on a competitive and sustainable

basis, in a convenient, efficient and professional manner, leading to success

of the Bank and the farmers

1.6 Vision Statement

To play effective role in the promotion of economic growth, by enhancing

the availability of credit to the agriculture sector, through reliable access to

sustainable financing, special lending programs, technical assistance, and

other products & services, and to promote career development opportunities

for increasing professionalism and technical proficiencies of employees.

1.7 Mission Statement



Non-clerical staff Clerical Staff

Grades of Bank

SEVP

EVP

SVP

VP

AVP

Grade-1

Grade-2

Grade-3

Assistants


1.8 Organizational Chart


CHAPTER# 02FINANCE AND ACCOUNT DIVISION


1.9 Zones and Branches:

Total No. of Branches 342

Zonal offices 27

Area Offices 8

1.10 Division of ZTBL:

President's Secretariat

HR Division

Finance & account division

Credit Division

Research & Planning

Information System

Operations

Recovery & SAM

Field Audit

Legal & Vigilance

Services

Agriculture Technology



I worked as internee in finance and accounts division for six weeks. Following are

the aim, objective and function of this division.

2.1 Aim of Finance and Accounts Division:

Preparation of financial statements and maintenance of accounting record of the

bank.

To arrange sufficient funds and other resources the liquidity of the bank.

2.2 Objective of Finance and Accounts Division:

Submission of accounting results to the management for carrying out functions of

coordination, motivation, credit/financial planning, budgeting and control.

2.3 Functions of Finance and Accounts Division:

Issuance of instructions relating to accounting policies, procedures and closing

of accounts.

Reconciliation of inter-branch transactions/suspense accounts.

Preparation of periodical financial statements of the bank and to deal with all

related matters.

Preparation of payroll of head office and payments of all expenses incurred at

head office level.

Maintenance of books of accounts of head office.

Deal with tax matters relating to salaries/payments and submission of

statements to concerned quarters.

Payments and maintenance of record of staff advances at H.O

Arrange adequate resources for banks operations.

Optimize return on the resources of bank through efficient cash management

and investment activity.

Provide funds to branches requiring funds and receive back from branches

having surplus funds with them.


CHAPTER# 03

BUDGET AND FUND MANAGEMENT DEPARTMENT


Issuance of budget.

Compilation and processing information for preparation of annual budget.

Submission of budget proposals to the board of directors for approval.

Periodic evaluation/review of operational expenditure against budget

provision.

Preparation and submission of weekly, monthly, quarterly expenditure

monitoring report.

2.4 Departments in Finance and Accounts Division:

Finance and accounts division have four departments.

Budget and Fund Management Department

Head office Accounts Department

Regulatory Reporting Department

Central Accounts Department

3.1 Aim of Budget and Fund management Department:



Preparation of financial plan for Bank’s credit limits, funds review and their

application.

To arrange adequate resources for efficient disbursement, timely discharge of

liabilities and operations of Bank.

3.2 Units of Budget and Fund management Department:

Budget Planning Unit

Budget Analysis Unit

Treasury Unit

Fund Reconciliation Unit

3.3 Functions of Budget Planning Unit:

Develop departmental policies, procedures and standards for financial

management.

Develop budget planning process and parameters.



Communicate with administrative and governance groups on the budget process

and budget issues.

Issuance of budget calls memos.

Compilation and processing information for preparation of annual budget.

Arrange allocation of departmental code number with the change in

organizational set up whenever required.

Automation of budget making process and data.

Appropriation of capital and revenue expenditure for additional funds from

contingency/unforeseen reserves for new schemes introduced.

3.4 Functions of Budget Analysis Unit:

Prepare, analyze, coordinate and assess data reflecting performance information

of department wise financial activities.

Monitoring trend in expenses for ensuring financial discipline.

Take remedial administrative/financial steps for excess expenditure.

Communicate with administrative and governance groups.

Develop assumptions and strategy for the future budget cycle.

Quarterly evaluation/review of expenditures against provision and its submission

to audit committee.

Provide information and analysis to support institutional planning and decision

making.

Arrange training and support to departments and divisions throughout the budget

development cycle.

3.5 Functions of Treasury unit:

Arrangement of funds when required and maintaining record relating thereto.

Operation of Bank accounts with SBP and commercial banks.

Remittance of funds to the needy branches on daily basis.



Remittance of funds on weekly basis to the relevant branches for payment to

tractor manufacturing companies and maintenance/updating record.

Ensure that appropriate cash balance is maintained in branches.

Preparation of periodic statement showing movement of SBP loans and position

of Government Securities.

Attend various audit and inspection report of accounts of the Bank.

Maintenance/Monitoring of cash reserve with SBP.

Record keeping of cash inward/outward.

Matters relating to investment in securities/placement of surplus funds.

Coordination with SBP/Commercial/internal and external auditors with reference

to the matters of treasury unit.

Coordination with Accounts Unit in finalization of quarterly, semiannual and

annual accounts on issue regarding treasury unit.

Deposit rate declaration.

Fixation of cash limit.

3.6 Functions of Fund Reconciliation Unit:

Reconciliation of Bank Accounts being maintained with Commercial Banks at

Head Office.

Accounting of funds remitted/received to/from branches and other transactions

relating to department.

Responding of advices issued by the branches relating to un-changed deposits,

SBP penalties etc.


CHAPTER# 04

HEAD OFFICE ACCOUNT DEPARTMENT


Preparation of daily cash position relating to remittance/receipt of funds to/from

branches.

Monitoring of reconciliation of bank accounts of branches with other commercial

banks.

Monitoring of excess cash with branches.

Head office accounts department have four units and each unit perform its own

functions.



Employees Fund Unit

Payments Unit

Payroll Unit

Inter Branch Reconciliation Unit

4.1 Functions of Employees Fund Unit:

Recording of contributions towards employee’s funds and maintenance of

individual’s accounts in provident funds where applicable.

Investment of surplus funds, maintenance of books of accounts of trust funds and

arrangement of audit from the Chartered Accountants firm.

Payments of benefits of Benevolent Fund, Pension, Provident, Gratuity and Group

Term Insurance (GTI) to beneficiaries.

Payment of miscellaneous benefits like death compensation/donation to deceased

employee’s family, marriage grant to clerical staff etc.

Adjustment of outstanding staff advances of employees who die during bank

service.

Recoveries funds provident fund advances

4.1.1 Administration of Trust Fund:

Trustees are the administrators of trusts. Head of accounts department is the chief

trustee.

President of the bank nominates two or more employees to be the trustees of

funds.

Each trustee has one vote, decision of two third of trustees shall be final of whom

one shall be chief trustee.



4.1.2 Board of Trustees:

President ZTBL/Patron in Chief

Mr. Haider Ali Jan Arbab, SVP(HO Accounts)/Chief Trustee

SVP(HR)/Trustee

Mr. Ghulam Muhammad, VP(Employees Funds)/Trustee

Mr. Zahid Mahmood, AVP.Trustee

Mr. Muhammad Altaf, Officer (Payments)/Trustee

4.2 Function of Payments Unit:

Make all payments at Head Office and application of Income Tax as applicable.

Payment at H.O Level includes;

Payments to employees

Payments to Outside Agencies

4.2.1 Payments to Employees:

Payments of Misc. Advances (Petty Cash, Procurement Advances), T.A.

Advances, House Rent Ceiling Advances.

Procurement of Vehicle.

Entertainment charges, Furnishing Limit.

Payment related to Kissan Support Services (Pvt) Ltd.

4.2.2 Payment to Outside Agencies:

Payments of Budget and Fund Department Bills.

Payments of Stationery and press etc.



Payments of Repair bills of pool Vehicles.

Payments of Fee to teaching Institutions.

Payments of Hotel bills.

Payments of Consultancy charges.

Payments of Computer maintenance charges/New charges.

Payments of Medical and Utility bills.

4.3 Functions of Payroll Unit:

Preparation of Payroll of Employees posted at Head Office and disbursement to

them.

Payment of Leave Encashment, Overtime, Education Allowance/Stipend and

Lecture Fee etc.

Issuance of Last Pay Certificate (LPC) and No Demand Certificate (NDC)

Management of staff advances (House building, Conveyance, Personal, Computer

Advances etc.)

Maintenance of record/responding of advices regarding expenses of all Head

Office Units in the field.

4.4 Functions of Inter Branch Reconciliation Unit:

Timely reconciliation of inter branch transactions and communication in this

regard with Branches and Zonal Offices.

Generating reports of Inter Branch Transactions, Originating & Responding

outstanding entries.

Providing list of outstanding entries to the branches and those concerned at HO,

for reconciliation.


CHAPTER# 05

REGULATORY REPORTING DEPARTMENT


Coordinate with concerned Departments at Head Office for follow-up and timely action for reconciliation of outstanding entries.

Regulatory reporting department have main to units:

Financial management information system unit(FMISU)

Regulatory and internal reporting unit(R&IRU)



5.1 FMISU:

Financial Management Information Unit collects information from Field Offices

and various departments and provides this information to R&IRU for preparation of

reports.

5.2 R&IRU:

Regulatory and Internal Reporting Unit prepare and submits regulatory reports to

State Bank of Pakistan and Ministry of Finance.

5.3 Aims of Regulatory Reporting Department:

Compliance to the statutory reporting requirements.

Provide periodic financial reporting to the management.

Improve effectiveness in meeting statutory reporting obligations.

5.4 Functions of Regulatory Reporting Department:

Redesign system of data capturing, its consolidation and subsequent reporting as

per regulatory requirements.

Ensure implementation of changes in reporting requirements as amended from

time to time.

Design and implement internal reporting mechanism.

Coordinate with different departments and field offices for collection of requisite

data.



Issuance of guidelines for preparation/consolidation of data.

Arrange compliance of internal/external audit observation or regulatory reports.

Carry out periodic review/analysis of financial results and it reporting to

concerned.

Perform any other job as and when assigned by controlling authority.

5.5 Statements Prepared by Regulatory Reporting Department:

Regulatory reporting department collects information from various sources i.e. zonal

offices, field offices and consolidate this information and after verification and validation

generate Report and submit following statements to concern.

5.5.1 Weekly Statement

Weekly statement of position (Balance sheet), which contains assets and

liabilities.

5.5.2 Monthly Statements

Statement of cash balances with bank’s abroad

Statement of prize bonds

Monthly funds flow statement.

Statement of liabilities and assets-monthly for scheduled banks (new)

Statement of advances classified by securities/borrowers

Statement of advances classified by borrowers (online)

Statement of basic banking accounts

Statement of unsecured loans and advances.

Statement of rate of return on loans & deposits

5.5.3 Quarterly Statements


CHAPTER# 06

CENTRAL ACCOUNTS DEPARTMENT


Statements under section 4 & 12 of the banking co. Rules-1963:

Statement showing the names and address of the board of directors

Statement showing names designation and specimen signature of officers

authorized to sign the returns banking companies ordinance

Statement showing names and address of the higher management

Statement showing names of bank branches.

Quarterly statement of position.

Statement of minimum capital requirement.

5.5.4 Half yearly Statements

Schedule bank returns namely:

Liabilities & assets of scheduled banks

Classification of deposits and debits to deposit accounts

Classification of advances classification of investment in securities and

shares

Classification of bills purchased and discounted

5.5.5 Yearly Statements

Statement showing computation of rate of service charges

Statement of minimum capital requirement (audited)

6.1 Objectives of Central Accounts Department:

Formulation of accounting policies and procedures with a view to present the true

financial position of the bank in financial statements.

Preparation of financial statements as per requirement of statue.

Ensure proper accounting of assets, liabilities, income & expenditure.



6.2 Units of Central Accounts Departments:

Policy Unit

Accounts Unit

Tax Unit

Prepayment Verification Unit

6.3 Functions of Policy Unit: Plan accounting procedure for accounting in the branches as well as at head

office.

Arrange compliance of internal/external audit observation relating to field & head

office in respect of accounting matters.

Coordinate with other departments in the head office on policy matters.

Deal with policy matters relating to maintenance and operation of accounts.

Provide guidance to the branches regarding settlement of accounting errors and

audit observations.

Coordinate with credit rating Company for providing information for credit rating

of the bank.

Issue instructions relevant to books of accounts

Prepare agenda of management letters & executive summary for submission to

audit committee of board of directors.

6.4 Functions of Accounts Unit:

Coordinate with concerned departments for timely production of statement of

affairs.

Arrange compilation/merger of statement of affairs on country level.



Compile balances under relevant group of heads from trial balances for

preparation of financial statements.

Produce list of abnormal entries/balances for rectification.

Prepare quarterly, half yearly and yearly financial statements and its agenda for

presentation to audit committee & board of directors.

Provide statement of affairs of every branch and country to auditors for auditing

purposes.

Cooperate with external auditors, commercial auditors & SBP inspection team

regarding periodical accounts

6.5 Functions of Tax Units:

Issue guidelines regarding deduction of tax at source under the income tax

ordinance, 2001.

Collect tax payment documentary evidences for tax deducted at source from the

branches for submission, to tax advisor & tax department.

Coordinate with tax consultant, SBP & income tax authorities on tax issues.

Pursue the tax refund case with income tax offices, through tax consultant.

Prepare statement & payment of advance tax

Guide branches for settlement of tax issues.

Arrange payments to tax advisor, appeals fee & other mandatory payments

required under the income tax ordinance, 2001.

Attend tax related audit observations and arrange compliance thereof.

Perform any other assignment as and when assigned by the competent authority.

6.6 Functions of Prepayment Verification Unit:

Verify all payments relating to head office.

Check availability of sanction of the competent authority.

Check completeness of documentation and verification of arithmetic accuracy.

Check procedural compliance.


CHAPTER# 07


Perform any other assignment as and when assigned by the competent authority.

SWOT ANALYSIS

7.1 Introduction:

Swot is an acronym that stands for strengths, weaknesses, opportunities and threats;

Swot has a long history as a tool of strategic and marketing analysis, it can be used to

gauge the degree of “fit” between the organisation’s strategies and its environment, and

to suggest ways in which the organisation can gain benefit from strengths and

opportunities and shield itself against weaknesses and threats



SWOT analysis is one of the most important steps in formulating any strategy or

for evaluation an organization’s performance.

7.2 Strengths:

Credit rating report of Jun 22, 2005 JCR-VIS credit Rating Company has assigned

medium to long-term entity rating of ‘AAA’ (Triple A) with a Stable outlook and short

term rating of A-1+ (A-One Plus) to ZTBL.

This credit rating rate can help ZTBL to expand their business volume.

7.3 Weakness:

There is understaffing in some of the branches which causes unnecessary work

burden on employees decreasing their efficiency.

Lack of modern software, ZTBL only focus on Ms-Excel which is not enough for

competition, ZTBL needs to acquire software that can compete with the market.

Financial oracles or ERP (electronic resource planning) are the market prevailing

software, so bank should adopt these to compete with the market.

There is a lack of professional staff in different departments. Employees should

be appointed according to their qualification on specified seats. There must be a

job description which clearly identify that only whose are eligible for certain

posts.

7.4 Opportunity:

ZTBL can start mobile credit which is the best way to effectively utilize its

present resources to gain a competitive edge.

ZTBL can invest large amount in agriculture sector now-a-days in Pakistan

because too much area affected by he flood. issue a large amount of capital to

agriculture sector utilize its resources effectively earn more profit.

7.5 Threats:


CHAPTER# 08

CONCLUSION


Internet Banking the main problem was found to be a lack of trust in the new Banking

channel by customer. However, effective complaint management can increase customer’s

loyalty and trust in Internet Banking.

Furthermore a crises management plan has been developed which is under review by the

senior management. The objective of this plan is to have clear guidelines and

communication in the event of any crises occurrence.

I have completed my internship in ZTBL Head Office in Finance and Account

Division for Six weeks. During my internship in Finance and Account Division I worked

in different departments and units of Finance and Account Division.

All the staff member of Finance and Account Division are very cooperative and

friendly. I have learnt a lot during this internship and worked practically and I hope this


REFERENCES


internship will help me in my future life. And also hope that this internship training will

help me in interview when applying for a job.

At the end again I say thanks to all the staff member of Finance and Account

Division who help me through out smy internship training.

a. ZTBL Annual Report 2008

https://www.ztbl.com.pk/aboutus/financial_report/report_2008/

b. ZTBL Annual Report 2007






http://www.privatisation.gov.pk/Finance/ubl/UBL.asp?q=intr-ubl

e. ZTBL Manual: guide.

f. http://www.ztbl.com.pk

List of Contacts

Head Office Address:

Head Office: 1 Faisal Avenue P.O. Box No. 1400. Islamabad, Pakistan Email Address: [email protected]


http://www.ztbl.com.pk/

http://www.privatisation.gov.pk/Finance/ubl/UBL.asp?q=intr-ubl


Internee’s Address:

ADNAN KHAN BBA-IT (Hons) Cell # 0334-8832120 Email Address: [email protected]


The Zarai Taraqiati Bank Limited

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