"కంచె చేను మేస్తే...?" A proverb in Telugu - means: "If Fencing were to eat away the crop yield....?"
Srinivasa Murti Devulapalli
"కంచె చేను మేస్తే...?" A proverb in Telugu - means: "If Fencing were to eat away the crop yield....?"
UNUSUAL USE OF STAFF PENSION FUND TO HIDE LOSSES - ONE EXAMPLE
("కంచె చేను మేస్తే?" A proverb in Telugu - means: "If Fencing were to eat away the crop yield?")
PNB’s performance is not sustainable with the current pace of bad loan addition and higher provisions. Bad loan has been increasing year after year at high speed.
The bank grew advances 2.1% from a year ago while deposits grew 12.4%. Net interest margin, which is the difference between interest earned on advances and interest paid on deposits, fell to 2.69% for the three months to March from 2.76% a year earlier.
Bank resorted to write back of Rs2023 crore from employees pension fund to hide losses and booked profit of Rs250 crore in the FY ended March 2017. Such type of write back from staff pension fund has got no justification.
It is worthwhile to mention here that every bank is duty bound to contribute in pension fund to the extent of at least 20% of total pay of employee towards future liability of payment of pension and gratuity to retired employees.
As such any bank has no right to misuse pension fund which is meant for retired employees. Bank employees remember how they had to sacrifice huge amount from their arrears after IXth bipartite settlement on the excuse if IBA that bank has shortage f pension fund.
This is the status of a big bank like PNB which reportedly committed unusual act ( as good as improper and fraudulent) withdrawal from pension fund to hide losses and to shine the image of CEO of the bank, which provided lesser amount towards provision for NPA, a bank which has huge hidden NPA, which has been incurring losses in huge volume, a bank in which NPA has been rising fastly, where credit growth has remained dismal an so on.
Still this bank is considered a strong bank. Many other banks are considered weak in comparison to PNB. Position of SBI may also be more pathetic if their financial are also audited by a honest team of inspectors. I cannot comment on already declared weak banks when position of do called strong bank is do much pathetic.
However I raise some questions before you and expect answers on them to create awareness among bankers.
Can anyone justify the action of auditors who certified balance sheet despite illegal write back from provisions?
Can anyone justify revaluation of pension and gratuity fund undertaken by PNB management to book profit and to hide losses?
Can anyone imagine that a big bank like PNB incurred no expenses on employee cost, rather booked credit of more than Rs500 crore as at 31st March 2017?
Can anyone say why trade union leaders remained silent on such a big crime with employees fund even after lapse of about 3 months from balance sheet date?
Can anyone guarantee that other public sector banks in particular and banks in general have not resorted to similar type of illegal way to book profit and to hide losses?
Can anyone give reason why such type of unusual, improper , abnormal and as good as fraudulent act committed second time ?
Can anyone say why government of India and RBI are silent on such scandalous act?
Can anyone resist and stop IBA when they will deny updation on pension amount to bank staff making excuse of paucity of pension fund?
When bank employees demand higher wages and higher pension , IBA talk of profitability . Can anyone teach lesson to IBA and ask why misappropriation of staff related pension fund takes place?
Copied form Blog of Mr DANENDRA JAIN, with due regards.
PNB Pension Fund as at or 31/3/17 - Manipulation Jugglery?
Bank says it has charged only Rs208.67Cr in its P&L Account
But Net Liability recognised in the Balance Sheet is Rs1800.84Cr
(Amount required to be contributed but NOT done in the current Year)
But to window dress the figures in the B/S an identical figure is shown as "Resulting asset as per Paragraph 59 (b) of AS-15 ( R )"
This Jugglery is due to treating the Fair Value of Plan Assets in EXCESS, ie. Where, contribution paid exceeds the contribution payable for the period , excess is recognised as asset (prepaid contribution)
By over valuing the Plan Assets and not charging the P&L account to that extent has helped the Bank turn around from Loss of Last Year to Profit of this Year.
But , not making the required Contribution to the Pension Fund in FULL, Bank is indirectly plundering its Pension Fund as the Fund will be deprived of the Interest Benefit accruing on Rs1800.84Cr for future years)
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Pension Fund Details (Rs.in Crores)
Opening Value of Obligation... 20,179.68
Interest Cost............................. 1,598.26
Service Cost............................. 540.15
LESS Benefits Paid................. (--) 1,234.20
Actuarial Loss/Gain*............... 1,775.92
Closing Value of Present Obligation 22,859.81
Fair Value of Plan Assets................. 24,660.65
Difference (Recgd as ASSET) 1,800.84
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*Acturial Gain or Loss means effects of differences between the Previous Acturial Assumptions and what has actually occurred.
THE REPRESENTATIVES OF THE UNIONS – BOTH WORKMEN AND OFFICERS ON THE PENSION TRUST BOARD – ARE THEY NOT PARTIES TO THE EMBEZLEMENT OF FUNDS?? –MUCH DETRIMENTAL TO THE BENEFICIEARIES OF THE PENSION TRUST CORPUS? – NEXUS EXPOSED – A CRIMINAL BREACH OF TRUST !
MY APPREHENSIONS PROVED TO BE CORRECT BEYOND ANY DOUBT !!... PLEASE REACH OUT TO YOUR DEAR COLLEAGUE FRIENDS TO JOIN THE CRUSADE BY SIGNING THE PETITION...... ACT AT ONCE.... OUR EVERY SMALL INDIVIDUAL EFFORT IN THIS BEHALF IS GOING TO BE A GRAND ACHIEVEMENT COLLECTIVELY....... CLICK THE LINK TO SIGN AND JOIN THE MISSION FOR OUR COLLECTIVE COMMISSION...
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