1.4       Query

Classification of Partly Secured Advances in Accounts.

What is the manner in which an advance, which is partly secured, be classified under “Particulars of advances”?

Should the secured portion only be shown under the head “Debtors considered good”, in respect of which the Banking Company is fully secured, and the balance under other heads?

                                             Opinion                                                                     January 30, 1962                                              

Classification of advances in the balance sheet of a Banking Company is prescribed in Form A of the Third Schedule to the Banking Companies Act, 1949. There are no “standing rules” regarding the classification of advances. Advances which are partly secured should be

Shown as secured to the extent of the market value of the securities held and the balance of the advances should be shown as unsecured.

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