Views
6 months ago

BOB_2017_SMALL

NOTES TO THE FINANCIAL

NOTES TO THE FINANCIAL STATEMENTS 2017 2016 kshs '000 kshs '000 11 impairment losses on loans and advances loans and advances to customers - Additional provisions 363,837 436,075 12 taxation major components of the tax expense current Current tax 1,146,648 910,463 Prior year underprovision 0 25,037 1,146,648 935,500 deferred Deferred tax charge / (credit) (16,211) (2,233) Prior year underprovision - (4,216) -16,211 -6,449 1,130,437 929,051 reconciliation of the tax expense Reconciliation between accounting profit and tax expense. Accounting profit 5,053,433 3,875,810 Tax at the applicable tax rate of 30% (2015: 30%) 1,516,030 1,162,743 tax effect of adjustments on taxable income Expenses not deductible for tax purposes 5,956 105,260 Income not subject to tax (391,549) (359,773) Prior year under provision of current tax - 25,037 Prior year under provision of deferred tax - (4,216) 1,130,437 929,051 13 other comprehensive income components of other comprehensive income - net available-for-sale financial assets adjustments Government securities 251,292 199,210 Corporate bonds (5,413) 4,487 Quoted shares 1,012 (692) 246,891 203,005 46

NOTES TO THE FINANCIAL STATEMENTS ANNUAL REPORT AND FINANCIAL STATMENTS 2017 14 cash in hand 2017 2016 kshs '000 kshs '000 Cash and cash equivalents consist of: Cash in hand 398,001 371,492 15 balances with central bank of kenya balances with central bank of kenya - Cash reserve ratio 3,919,032 3,624,425 - Other 56,911 58,597 3,975,943 3,683,022 The cash reserve ratio balance is non interest bearing and is based on the value of customer deposits as adjusted in accordance with Central Bank of Kenya requirements. As at 31 December 2016 the cash reserve ratio requirement was 5.25% (2015: 5.25%) of all customer deposits. These funds are not available for the Bank's day to day operations. 16 governement securities available-for-sale Treasury bonds 6,436,486 6,880,004 held-to-maturity Treasury bonds 35,316,640 31,059,903 Treasury bills 4,796,493 3,270,063 40,113,133 34,329,966 total government securities 46,549,619 41,209,970 Current assets Available-for-sale 6,436,486 6,880,004 Held to maturity 40,113,133 34,329,966 46,549,619 41,209,970 Government securities comprise of: Maturing within 91 days 1,724,895 1,879,265 Maturing after 91 days and within a year 1,798,693 3,133,704 Maturing after a year 12,540,686 12,057,565 Maturing after three years 30,485,345 24,139,436 46,549,619 41,209,970 The fair values of the government securities classified as ‘available-for-sale’ financial assets are categorised under Level 1 based on the information set out in the accounting policy. There were no gains or losses realised on the disposal of held-to-maturity financial assets in 2017 and 2016, as all the financial assets were disposed of at their redemption date. 47