1- With Accounting for credit risky financial instruments not recognized at observed market value generally involves estimating expected future Credit Risks and Losses with reference to its “Disclosers”.
Explain this statement “Disclosers”. in your own words with statistical examples of the data from the Saudi Local Banks or Financial Institutions. (Case Study) (1.5 marks)
2- Users of financial reports with a robust understanding of “How Fair Value Accounting” works in theory and in relatively simple contexts: How users can analyze the information with context to Local Saudi Banks as well as local financial Institutions. “Fair Value Accounting and Disclosures” to assess their
- Solvency and profitability better than is possible using amortized cost accounting information (use solvency and profitability ratio from the balance sheet)
- Discretionary “Gain Trading” (use disclosures and the assessment of Gain Trading)
Required:
a. Calculate the Solvency and Profitability ratio from the balance sheet of any Saudi Local banks or financial institutions b. Calculate Gain or Losses from securities – use Saudi Local banks or financial institutions
Hints to understand the above question
(That is the timing of the sale of securities and other financial instruments recognized at amortized cost to realize gain or losses and thereby manage income and book value) – Use the Financial Statements of the Bank for an explanation -Balance sheet for statistical example (case study) (2 marks).
3- Mortgage banking is primarily a fee-based rather than interest rate spread-based business.
You are required to describe and explain in brief from the structure of mortgage bank’s Balance sheet, Income statements, and Cash flow statements respectively from the statistical information of Saudi Local banks (mortgages banks) or financial institutions. (Case Study) (1.5 marks)
Answer: (Marks ??)
1)
2)
3)