Export through bank

before any export import the buyer - seller execute a EXPOPRT IMPORT SALES CONTRACT  on the basis of the buyer send the order to the seller then  buyer open the LETTER OF CREDIT in the name of seller.

in current foreign trade policy the exporter can get the loan from their banker as a packing credit.

DEPB drawback, EPCG licence , ADVANCE LICENCE , CHAPTER -3 , CHAPTER -4,5,6 AS PER FOREIGN TRADE POLICY EXPORTER AVAIL THE INCENTIVE .

 FOR MORE INFOO:-

https://www.icrier.org/pdf/rajeev72try.PDF

2.USANCE BILL:-

Usance means period of credit or term. Usance bill is a bill of exchange which allows the drawee to have period of credit or term. The usance can begin from the date of the bill of lading or from the date of acceptance by the drawee and is stated in days or months. This is an essential feature of acceptance credits.

2.DEEMAND BILL:-

 A bill of exchange which must be paid when payment is asked for.

3. SO THAT THEY COULD NOT DO ANY FORGUREY IN THE DOCUMENTS .

4. EVERY BANKER RATE OF INTEREST BECOMES DIFFERENT.

thank u so much for sharing

I want to ensure that the link which u have given is latest / updated or not ?

Also in Q4, can u pls explain by taking any bank example,

thxs

Answer for 3rd Question:

1. Interest Verification:

Check party's Loan documents and sanction copies and find the Interest % to be charged from the customer.

Check if such % is properly feeded in System in case of automatic calculation by system

Check if changes were effected or updated in system whenever there is change in BPLR.

Test check for few accounts - Calculate in Ms Excel by applying Interest % for the outstanding balance on each day. - Revenue Leakage.

(I'm attaching a sample format. Check out the formulas applied in each cell)

2. In case of Export Advance by way of Discounting of Bills - Check the Discount Amount collected by the bank with that of actual % to be collected. (Check the actual % to be collected in Bank's Manual) - Revenue Leakage

3. And check the due dates for Discounted and Purchased Bills and See if the amount been realised on or before the due dates and report the unrealised bills - Revenue Postponement

@ Shruthi

"Check if such % is properly feeded in System in case of automatic calculation by system"

How to chk this after logging into system, can u help me in this step

"Test check for few accounts - Calculate in Ms Excel by applying Interest % for the outstanding balance on each day."

As per my opinion, in case of export bill purchase, interest is to be calculated on the amount of Bill instead of O/s bal on each, I think u r talking about loan sanctioned by bank. If it is post shipment credit, then how it (inteest) is to be calculated

pls correct if i'm confused

thxs for sloving and replying my queries

YES UPDATED.

Originally posted by : ABHINANDAN JAIN
	thank u so much for sharing I want to ensure that the link which u have given is latest / updated or not ?   Also in Q4, can u pls explain by taking any bank example,   thxs

How to check if the Interest rate is properly feeded in the system:

Tell me which software the bank is operating? If its finacle, then i can surely help you.

Yes u'r right.

If its Preshipment/Packing credit - then on the Outstanding balance

If its postshipment credit - then discount/commission/interest rate (whatever the name called) should be applied on the Bill amount only...

Originally posted by : Shruthi
	How to check if the Interest rate is properly feeded in the system: Tell me which software the bank is operating? If its finacle, then i can surely help you.   Yes u'r right. If its Preshipment/Packing credit - then on the Outstanding balance If its postshipment credit - then discount/commission/interest rate (whatever the name called) should be applied on the Bill amount only...

Thxs for clearing my confusion

when i will go Bank again , i will surely let u know the software bank is using as till now i hv not noticed which software the bank is using, 

@ Shruthi

Bank is using the software called ' Bancslink version 2.9.5'

can u help me now...?

@ Shruthi

the format which u attached above is very useful but still i hv some query regarding ur format.

In that file i hv not understood the sheet 1, i mean for wht purpose it will be used and one heading called otr days int amout-wht's the full form of otr , wht is meant by it..

Also in Sheet 2, one heading called the product for penal int rate, wht's the use of it in calculation of interest on packing credit

Also in int calculation formula, 36600 is divided, 

why it is so, i think it must be 36500 taking 365 days a year

Oh... I dint notice that sheet 1 while attaching, dont cc dat. dats rough sheet we worked. 

Sheet 2 only is the proper one.

In sheet 2 i've calculated for CC Account, so product for penal interest denotes the amount which is excess of the Drawing power.

Similar heading will apply for the packing credit accounts too....

Sometimes product for Penal interest may be the same as the normal outstanding amount in the account too - when penal interest to be charged due to non submission of stock statements.

And for another doubt in sheet 2 - actually i've calculated interest for the year 2008, 4th column.. 2008 is a leap year. therefore no.of days 366 days. thats y 36600.

@ Shruthi

In case of Packing Credit, whether bank will debit Penal Int separetely or deduct after combining normal int on o/s bal.

Also whether Penal int is to be charged on Drawing Power minus Outstanding balance...?

The file which u attached earlier was superb but i also hv two type of format using different ways in excel, if u want i can share here or mail u at ur id (if u gve ur id)

Pls solve my others queries also:

/forum/concurrent-auditing-for-export-related-transaction-thru-bank-158513.asp