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ZENITH BANK (GHANA) LIMITED
Profit after taxAdjustments for:Depreciation and amortizationNet impairment loss on financial assetsNet interest incomeProfit on disposal of property and equipmentAsset write-offTax expense
Changes in:Investments (Other than securities)InvestmentsLoans and advances to customersOther assetsBorrowingsCustomer depositsOther liabilities
Interest receivedInterest paidTaxes paidNet cash flow from operating activitiesCash flow from investing activitiesAcquisition of property and equipmentProceeds from disposal of property and equipmentAcquisition of intangible assetsNet cash flow used in investing activities
Net increase in cash and cash equivalentsBalance at beginningCash and cash equivalents at 31 DecemberEffect of exchange rate fluctuations on cash and cash equivalents heldCash and bank balances
Cash balancesShort-term investmentsCash and cash equivalents at 31 December
2016GH¢
140,265,212
8,835,47013,026,463
(262,836,341)(904,229)
78,81562,324,342
(39,210,268)
(292,677,000)69,959,575
(32,931,674)(28,770,387)
85,025,696627,866,376
2,701,224391,963,542437,250,172
(174,413,831)(53,184,324)601,615,559
(46,228,553)1,627,142
(1,025,036)(45,626,447)
555,989,1121,293,661,1821,849,650,294
(10,318,850)
1,839,331,444
808,017,8051,031,313,6391,839,331,444
2015GH¢
83,076,943
6,771,29454,517,824
(276,187,598)(188,498)
-32,003,197
(100,006,838)
-799,910,748
59,765,1013,689,319
(794,948,016)163,332,813
16,577,760148,320,887447,872,621
(171,685,023)(70,896,831)353,611,654
(79,555,633)245,480
(1,175,650)(80,485,803)
273,125,851977,422,409
1,250,548,26043,112,922
1,293,661,182
691,726,903601,934,279
1,293,661,182
Balance as at 1 January 2015Profit for the year
Other comprehensive income,net of taxRegulatory and other reservestransfersTransfer from credit risk reserveTransfer to statutory reserveNet transfers to/(from) reserves
Balance at 31 December 2015
Balance at 1 January 2016Profit for the year
Other comprehensive income,net of taxRegulatory and other reservestransfersTransfer to credit risk reserveTransfer to statutory reserveNet transfers to/(from) reserves
Balance at 31 December 2016
Stated Capital
GH¢
61,221,496-
-
- - -
61,221,496
61,221,496-
-
- -
-
61,221,496
StatutoryReserve
GH¢
79,726,308-
-
-10,384,61810,384,618
90,110,926
90,110,926-
-
-17,533,15217,533,152
107,644,078
Credit riskReserve
GH¢
27,370,680-
-
(4,535,245)-
(4,535,245)
22,835,435
22,835,435-
-
3,486,579 -
3,486,579
26,322,014
RetainedEarnings
GH¢
183,125,05083,076,943
-
4,535,245(10,384,618)
(5,849,373)
260,352,620
260,352,620140,265,212
-
(3,486,579)(17,533,152)(21,019,731)
379,598,101
TotalGH¢
351,443,53483,076,943
-
- - -
434,520,477
434,520,477140,265,212
-
- - -
574,785,689
STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER
FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2016
Assets
Cash and cash equivalentsInvestmentsInvestments (other than securities)Loans and advances to customersCurrent tax assetsProperty and equipmentIntangible assetsDeferred tax assetsOther assetsTotal assets
Liabilities
BorrowingsDeposits from customersDeposits from banks and other financial institutionsOther liabilitiesTotal liabilities
Equity
Stated capitalStatutory reserveCredit risk reserveRetained earningsTotal equity
Total equity and liabilities
2016GH¢
808,017,8051,080,681,114
292,677,0001,012,054,694
855,185130,061,809
1,558,7284,228,181
73,610,2513,403,744,767
110,151,3302,637,944,348
33,320,24047,543,160
2,828,959,078
61,221,496107,644,07826,322,014
379,598,101574,785,689
3,403,744,767
2015GH¢
691,726,903721,261,329
-983,074,431
6,174,20491,924,8992,079,2478,049,180
44,839,8642,549,130,057
25,125,6342,010,077,972
34,564,03844,841,936
2,114,609,580
61,221,49690,110,92622,835,435
260,352,620434,520,477
2,549,130,057
Interest incomeInterest expenseNet interest income
Fees and commissionNet trading income/(loss)Other incomeNet trading and other income
Revenue
Impairment loss on financial assetsPersonnel expensesDepreciation and amortizationOther expenses
Profit before income tax
Income tax expenseProfit after tax attributable to equity holdersOther comprehensive income, net of tax
Total comprehensive income attributable to equity holders of the Bank
2016GH¢
437,250,172(174,413,831)
262,836,341
63,674,64031,371,7163,204,058
98,250,414
361,086,755
(13,026,463)(61,270,606)(8,835,470)
(75,364,662)
202,589,554
(62,324,342)140,265,212
-
140,265,212
2015GH¢
447,872,621(171,685,023)
276,187,598
64,859,675(40,842,007)
2,685,82326,703,491
302,891,089
(54,517,824)(58,233,265)(6,771,294)
(68,288,566)
115,080,140
(32,003,197)83,076,943
-
83,076,943
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER
ZENITH BANK (GHANA) LIMITED
FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2016
Reporting entityZenith Bank (Ghana) Limited (the Bank) is a bank incorporated in Ghana. The address of the Bank's registered office is Premier Towers, Liberia Road, PMB CT 393, Accra.
Basis of accountingThe financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and in the manner required by the Companies Act, 1963 (Act 179) and the Banking Act, 2004 (Act 673) as amended by the Banking Amendment Act, 2007 (Act 738). They were authorised for issue by the board of directors on January 27, 2017.
Functional and presentation currencyThese financial statements are presented in Ghana Cedi, which is the Bank's functional currency.
Use of judgements and estimatesIn preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of the Bank's accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.
Basis of measurementThe financial statements have been prepared on a historical cost basis except for the following material items.
Significant accounting policiesThe principal accounting policies applied in the preparation of these condensed financial statements are consistent with the accounting policies applied in the audited financial statement of the bank. These policies have been consistently applied to all the years presented, unless otherwise stated.
Risk ManagementThe Bank’s activities expose the business to risks. The Bank has exposure to the following types of risks: credit risk, liquidity risk, market risk and operational risk. These risks are managed professionally and in a targeted manner. The Bank’s risk management policies are established to identify and analyze risks faced by the Bank, set appropriate risks limits and controls as well as monitor these risks and adherence to established policies. Risk management policies and systems are reviewed regularly to reflect changes in market conditions, products and services offered.
Measurement basis
Non-derivative financial instruments atfair value through profit or loss
Fair valueDerivative financial instruments Fair value
Recognised financial assets and financialliabilities designated as hedged items inqualifying fair value hedge relationships`
Amortised cost adjusted for changes in fairvalue attributable to the risk being hedged
Items
1.
2.
3.
4.
5.
6.
7.
NOTES TO THE FINANCIAL STATEMENTS
The Directors in submitting to the shareholders the financial statements of the Bank for the year ended 31 December 2016 report as follows:
Directors' Responsibility StatementThe Bank’s Directors are responsible for the preparation of the financial statements that give a true and fair view of Zenith Bank (Ghana) Limited, comprising statement of financial position at 31 December, 2016 and the statements of comprehensive income, changes in equity and cash flows for the year then ended, and the notes to the financial statements which include a summary of significant accounting policies and other explanatory notes, in accordance with International Financial Reporting Standards, and in the manner required by the Companies Act, 1963 (Act 179), and the Banking Act, 2004 (Act 673) as amended by the Banking Amendment Act, 2007 (Act 738). In addition, the directors are responsible for the preparation of directors' report.
The Directors are also responsible for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and for maintaining adequate accounting records and an effective system of risk management.
The Directors have made an assessment of the Bank’s ability to continue as a going concern and have no reason to believe the business will not be a going concern.
The auditor is responsible for reporting on whether the financial statements give a true and fair view in accordance with the applicable financial reporting framework.
Nature of BusinessThe Bank is authorised by Bank of Ghana to carry on the business of universal banking.
Holding CompanyThe Bank is a subsidiary of Zenith Bank Plc, a company incorporated in the Federal Republic of Nigeria and licensed to undertake all banking and related services.
Approval of the Financial StatementsThe financial statements of the Bank, as identified in the first paragraph, were approved by the board of directors on 27 January 2017 and were signed on their behalf by:
.......................................………...... ……....….............…………… Henry Oroh Mary Chinery-Hesse (Mrs.) (Managing Director/CEO) (Chairman)
REPORT OF THE DIRECTORS
2016 GH¢
532,296,528(248,922,360)
283,374,1683,204,058
(13,026,463)
273,551,763
(856,133)(868,970)
(60,401,636)62,126,739
(62,324,342)
-
(8,835,470)(140,265,212)
2015 GH¢
471,890,289(239,145,604)
232,744,6852,685,823
(54,517,824)
180,912,684
(827,985)(1,667,295)
(56,565,970)59,061,250
(32,003,197)
-
(6,771,294)(83,076,943)
VALUE ADDED STATEMENT FOR THE YEAR ENDED 31 DECEMBER
To the Members of Zenith Bank (Ghana) Limited
OpinionThe condensed financial statements, which comprise the statement of financial position at 31 December 2016, and the statements of comprehensive income, changes in equity and cash flows for the year then ended and related notes, are derived from the audited financial statements of Zenith Bank (Ghana) Limited for the year ended 31 December 2016. In our opinion, the accompanying condensed financial statements are consistent, in all material respects, with the audited financial statements, in accordance with the basis described in the notes. Condensed Financial StatementsThe condensed financial statements do not contain all the disclosures required by International Financial Reporting Standards and in the manner required by the Companies Act 1963, (Act 179) and the Banking Act, 2004 (Act 673) as amended by the Banking Amendment Act, 2007 (Act 738) applied in the preparation of the audited financial statements of Zenith Bank (Ghana) Limited . Reading the condensed financial statements and our report thereon, therefore, is not a substitute for reading the audited financial statements and our report thereon. The condensed financial statements and the audited financial statements do not reflect the effects of events that occurred subsequent to that date of our report on the audited financial statements.
The Audited Financial Statements and Our Report ThereonWe expressed an unmodified audit opinion on the audited financial statements in our report dated 27 January 2017.
Directors' Responsibility for the Condensed Financial StatementsThe directors are responsible for the preparation of the condensed financial statements in accordance with the basis described in the notes.
Auditor's ResponsibilityOur responsibility is to express an opinion on whether the condensed financial statements are consistent, in all material respects, with the audited financial statements based on our procedures, which were conducted in accordance with International Standard on Auditing (ISA) 810 (Revised), Engagements to Report on Summary Financial Statements.
The engagement partner on the audit resulting in this independent auditor's report is Nathaniel D. Harlley (ICAG/P/1056).
For and on behalf of:KPMG: (ICAG/F/2017/038)CHARTERED ACCOUNTANTS13 YIYIWA DRIVE, ABELENKPEP. O. BOX GP 242ACCRA
February 28, 2017
INDEPENDENT AUDITOR'S REPORT
.................................................
Quantitative Disclosures
Capital adequacy ratioNon-performing loans to Gross loansLoan loss provisionLiquid Ratio
2016%
21.9810.629.70146
2015%
18.7210.489.63112
Interest earned and other operating incomeDirect cost of services and other costs
Value added by banking servicesNon-banking incomeImpairments
Value added
Distributed as follows:
To employeesDirectors (without executives)Executive DirectorsOther employeesTotal
To GovernmentIncome tax
To providers of capitalDividends to shareholders
To expansion and growthDepreciation and amortizationRetained earnings