BACHELOR OF BUSINESS ADMINISTRATION (HONS) ISLAMIC BANKING

FACULTY OF BUSINESS AND MANAGEMENT

ISLAMIC FINANCIAL PLANNING (ISB 535)

HOUSEHOLD FINANCIAL ANALYSIS AND TAX ASSESSMENT (20%)

PREPARED BY:

NAME: AIMAN NUR HAKIM BIN AZZIZI

STUDENT ID: 2021196217

GROUP/CLASS: JBA242 4B

PREPARED FOR:
MADAM MARDZIYANA BINTI MOHAMAD MALOM

DATE OF SUBMISSION:
9 JUNE 2022

NO. CONTENT PAGE

1 INTRODUCTION 1

2 BIO DATA OF THE MR AZZIZI’S FAMILY 2

3 MR AZZIZI AND FAMILY FINANCIAL INFORMATION 4

4 MR AZZIZI AND FAMILY MONTHLY EXPENSES 7

5 MR AZZIZI’S BALANCE SHEET STATEMENT 8

6 MR AZZIZI’S CASH FLOW STATEMENT 11

7 MR AZZIZI’S RATIO 13

8 MR AZZIZI’S INCOME TAX YEAR OF ASSESSMENT FOR 2021 15

9 COMMENT AND ADVICE 16

10 APPENDIXES 17
1.0 Introduction

For this assignment from ISB 535, household financial analysis and tax
assessment, I have been assigned to interview a family and get some information
regarding their financial planning. As one of the students who learn Islamic Financial
Planning, I need to analyse and investigate either the family financial planning is in
the good pace or not. After getting the information related to the subject, I need to
make balance sheet statement, cash flow statement and financial ratio and analysis
for 2021. The last task is to give my personal suggestion and advice to help the
family to improve their financial planning for upcoming year, 2022. At the last page of
this report, I have put my best judgement and opinion based on my knowledge that I
learn from this subject. In order to finish my assignment, I already interview Mr Azzizi
bin Abd Jalil and his spouse, Mrs Siti Aminah binti Muhammad.

1
2.0 Bio data of the Mr Azzizi’s family

Figure 1: Photo of Mr Azzizi and family

The figure above is showing the whole family of Mr Azzizi and his spouse, Mrs
Siti Aminah. Mr Azzizi bin Abd Jalil is a mathematic school teacher at SMK Simpang
Rengam, Johor for about 24 years. He lived in Ayer Hitam, Johor with his beloved
wife, Mrs Siti Aminah binti Muhammad who worked also as a teacher. She is an
English teacher in SMK Dato Menteri and also have the same year of teaching
experience with her husband. Both of them have eight children that included five
boys and three girls. The first two of them, Aiman Nur Hakim (21) and Anas Shouqi
(19) are university students who studied at UiTM Segamat, Johor and UiTM Sri
Iskandar, Perak. The middle three of the children are studying at two different
boarding school. Both of the girls, Hanan Sofea (17) and Izza Farahin (16) are at
SMKA Johor Bahru while the boy, Faiz Muzaffar (14) at SMKA Pagoh. The last three
of the children are still in primary school at SK Ayer Hitam which are Muhammad
Yusof (12), Zahid Khalis (10) and Aqilah Az Zahrah (9).

2
 As a secondary school teacher, Mr Azzizi earn RM 7,500 per month while his
wife earns RM 7,000 with the total income of RM 14,500. In addition, Mr Azzizi take
a job as a school tutor in his school and gain an extra RM 400 while Mrs Siti Aminah
gain another RM 500 for being a coach for netball team. He lived in Ayer Hitam,
which can be considered as town area. As the results, the cost living in that area is
not as high as city like Batu Pahat and Kluang. He lived in a semi-D house with two
cars which are Perodua Bezza and Perodua Aruz. Because of pandemic, the
needed for smart phone and laptop are quite demanded. Primary school child has
their own smartphone while their two eldest sons have their own laptop. The average
price of the smartphone is RM 600 while the laptop is RM 1,500 each. The monthly
cost for boarding school is about RM 100 each, not included their monthly pocket
money with total of RM 300 for those three children.

3
3.0 Mr Azzizi and family financial information

Details RM

Mr Azzizi monthly salary 7,500

Mrs Siti Aminah monthly salary 7,000

Mr Azzizi extra income as school tutor 400

Mrs Siti Aminah extra income as netball coach 500

Bonus Mr Azzizi received annually 600

Bonus Mrs Siti Aminah received annually 600

Mr Azzizi Maybank saving account 15,000

Mr Azzizi Bank Islam saving account 3,000

Mrs Siti Aminah Maybank saving account 10,000

Mrs Aminah CIMB saving account 1,000

Current value of the house 650,000

Current value of Perodua Bezza (2019) 26,000

Current value of Perodua Aruz (2019) 56,000

Mr Azzizi pension scheme 300,000

Mrs Siti Aminah pension scheme 200,000

Mr Azzizi Tabung Haji balanced as at 31 December 2021 22,000

Mrs Siti Aminah Tabung Haji balanced as at 31 December 22,000

2021

Monthly payment for children of Tabung Haji (20 x 8) 160

4
Mrs Siti Aminah jewelleries (30g x 240) 7,200

Personal loan balance as at 31 December 2021 4,400

Monthly personal loan paid 750

House loan balance as at 31 December 2021 330,000

Monthly house loan paid 1,500

Car loan balance for Perodua Aruz as at 31 December 2021 58,500

Car loan balance for Perodua Bezza as at 31 December 2021 16,800

Monthly car loan paid (both) 1,900

Monthly water bill 30

Monthly telephone bill 210

Monthly electricity bill 250

Monthly Wi-Fi bill 130

Monthly groceries 1,100

Monthly parent allowance 400

Monthly fuel and toll expenses 600

Monthly children bus fees 180

Monthly boarding school fees for meal (100 x 3) 300

Annual UiTM study fees (540 x 2 x 2) 2,160

Annual college fees (410 x 2) 820

Monthly pocket money for primary school children (40 x 3) 120

Monthly pocket money for boarding school children (100 x 3) 300

5
Enrolment and school necessities (1,500 x 6) 9,000

Annual car maintenance 2,200

Annual car insurance and road tax 2,500

Annual renewing driving license 120

Annual zakat of income 4,200

Annual income tax 2,500

Zakat fitrah 110

Monthly Great Eastern Takaful – family package 1,100

Purchasing 3 smartphone for primary school (600 x 3) 1,800

Purchasing 2 laptop for University (1800 x 2) 3,600

Monthly family dinner at restaurant 120

Annual family holiday 800

Purchasing sport tools 1,500

Borrowed from a friend due January 2022 2,500

6
 4.0 Mr Azzizi and family monthly expenses

Monthly Expenses

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Details
RM RM RM RM RM RM RM RM RM RM RM RM
Children saving for Tabung Haji 160 160 160 160 160 160 160 160 160 160 160 160
Personal loan paid 750 750 750 750 750 750 750 750 750 750 750 750
House loan paid 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500
Car loan paid 1,900 1,900 1,900 1,900 1,900 1,900 1,900 1,900 1,900 1,900 1,900 1,900
Water bill 30 30 30 30 30 30 30 30 30 30 30 30
Telephone bill 210 210 210 210 210 210 210 210 210 210 210 210
Electricity bill - 500 - 500 - 500 - 500 - 500 - 500
Wi-Fi bill 130 130 130 130 130 130 130 130 130 130 130 130
Groceries 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100
Parent allowance 400 400 400 400 400 400 400 400 400 400 400 400
Fuel and toll 600 600 600 600 600 600 600 600 600 600 600 600
Children bus fees - - 180 180 180 180 180 180 180 180 100 -
Boarding school fees for meal - - 300 300 300 300 300 300 300 300 120 -
UiTM study fees - - 1,080 - - - - - 1,080 - - -
College fees - - 410 - - - - - 410 - - -
Pocket money for primary school children 120 - 120 120 120 120 120 120 120 120 120 -
Pocket money for boarding school children 300 - 300 300 300 300 300 300 300 300 300
Enrolment and school necessities - 4,000 5,000 - - - - - - - - -
Car maintenance - - 550 - - 550 - - 550 - - 550
Car insurance and road tax - - - - - - - - - - - 2,500
Renewing driving license - - - - - - - - - - 120
Zakat on income - - - - 2,520 - - - - - - -
Income tax - - - - - - - - - - - -
Zakat on saving account - - - 450 - - - - - - - -
Zakat fitrah - - - 110 - - - - - - - -
Great eastern Takaful - Family package 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100 1,100
Purchasing smartphone 1,800 - - - - - - - - - - -
Purchasing laptop 3,600 - - - - - - - - - - -
Family dinner 120 120 120 120 120 120 120 120 120 120 120 120
Family holiday - - - - - 800 - - - - - 800
Sport tools - - 1,500 - - - - - - - - -
Total expenses 13,820 12,500 17,440 9,960 11,420 10,750 8,900 9,400 10,940 9,400 8,640 12,470

7
5.0 Mr Azzizi’s balance sheet statement

Balance Sheet Statement

Mr Azzizi and Family

Balance sheet statement for Mr Azzizi as at 31 December 2021
RM RM
Liquid Asset Non-current Liabilities
Mr Azzizi Maybank saving account 15,000 Personal loan balance 4,400
Mr Azzizi Bank Islam saving account 3,000 House loan balance 330,300
Mrs Siti Aminah Maybank saving account 10,000 Car loan balance 75,300
Mrs Aminah CIMB saving account 1,000

Lifestyle Asset Current liabilities

Current value of the house 650,000 Borrowed from a friend due Jan 2022 2,500
Current value of Perodua Bezza (2019) 26,000
Current value of Perodua Aruz (2019) 56,000
Current value of jewelleries 7,200
Current value of smartphone 1,800
Current valur of laptop 3,600

Investment Asset
Mr Azzizi Tabung Haji 22,000
Mrs Siti Aminah Tabung Haji 22,000
Pension scheme 500,000 Total Liabilities 412,500
Net Worth 905,100
Total Assets 1,317,600 Total Liabilities and Net Worth 1,317,600

Based on the Mr Azzizi balance sheet statement as at the end of 2021, he

has a total Asset worth of RM 1,317,600 with the biggest contribution from his house
and car. The total of liquid assets he and his spouse have are RM 29,000 which is
good for a big family. Next, for lifestyle asset, he has a total of RM12,600 after
deducting house and car and it are jewelleries, three smartphone and two laptops.
As I mention earlier, he buys laptop and smartphone for the use of his children to
continue study at home. If we include the house and cars, the total lifestyle assets
that he will have are RM 744,600. Both of the cars are still considered new because
he buys it at the early 2019. For Mr Azzizi investment asset, his and his wife have a
total of RM 44,000 that specifically for Haji and umrah purpose. He did not EPF
scheme, rather have pension scheme because he works under government agency.

On another part of the balance sheet statement is about the liabilities owned
by Mr Azzizi. Recently, he has a current liability which come from borrowing from his
friend with the total amount of RM 2,500. In addition, he owes a lot of money from

8
bank under non-current liabilities. He has three kind of loan which are personal loan,
car loan and house loan with total of RM 410,00 that he not paid yet.

Personal loan Detail

Total loan RM 12,500

Loan period 18 months

Interest rate 10 %

Monthly payment RM 750

Loan balance as at December 2019 RM 4,400

Loan balance period 6 months

Car loan for Perodua Bezza Detail

Total loan 35,000

Down payment 3,500

Loan period 5 years

Interest rate 4%

Monthly instalment RM 700

Loan balance as at December 2019 RM 16,800

Loan balance period 2 years

9
Car loan for Perodua Aruz Detail

Total loan RM 80,000

Down payment RM 8,000

Loan period 7 years

Interest rate 4%

Monthly instalment RM 1,200

Loan balance as at December 2019 RM 58,500

Loan balance period 4 years

House loan Detail

Total loan RM 500,000

Down payment RM 25,000

Loan period 35 years

Interest rate 2%

Monthly instalment RM 1,500

Loan balance as at December 2019 RM 330,300

Loan balance period 12 years

10
6.0 Mr Azzizi’s cash flow statement

11
 Cash Flow Statement

Mr Azzizi and family

Cash flow statement for the ended 31 December 2021
RM RM
Cash inflow
Monthly salary (7,500 x 12 + 7,000 x 12) 174,000
Mr Azzizi works as school tutor (400 x 9) 3,600
Mrs Siti Aminah works as netball coach (500 x 10) 5,000
Bonus (600 x 2) 1,200
Total cash inflow 183,800

Cash outflow
Children saving for Tabung Haji (160 x 12) 1,920
Personal loan paid (750 x 12) 9,000
House loan paid (1,500 x 12) 18,000
Car loan paid (1,900 x 12) 22,800
Water bill (30 x 12) 360
Telephone bill (210 x 12) 2,520
Electricity bill (500 x 6) 3,000
Wi-Fi bill (130 x 12) 1,560
Groceries (1,100 x 12) 13,200
Parent allowance (400 x 12) 4,800
Fuel and toll (600 x 12) 7,200
Children bus fees (180 x 8 + 100) 1,560
Boarding school fees for meal (300 x 8 + 120) 2,520
UiTM study fees (540 x 2 x 2) 2,160
College fees (410 x 2) 820
Pocket money for primary school children (120 x 10) 1,200
Pocket money for boarding school children (300 x 10) 3,000
Enrolment and school necessities (1,500 x 6) 9,000
Car maintenance (550 x 4) 2,200
Car insurance and road tax 2,500
Renewing driving license 120
Zakat on income 2,520
Income tax -
Zakat on savin account 450
Zakat fitrah 110
Great eastern Takaful - Family package (1,100 x 12) 13,200
Purchasing smartphone (600 x 3) 1,800
Purchasing laptop (1,800 x 2) 3,600
Family dinner (120 x 12) 1,440
Family holiday (800 x 2) 1,600
Sport tools 1,500
Total cash outflow 135,660
Total cash flow 48,140

12
 Cash flow statement above show the overall cash flow for Mr Azzizi and
family. It shows the source income of his cash inflow and also showing the overall
cash outflow from early until the end of the year 2021. He has a total of RM 183,800
total cash inflow and RM 139,390 total cash outflow. As a result, the whole family
has a positive outflow because it total cash inflow is bigger than total cash outflow.
Mr Azzizi still has RM 44,410 remained to be put in the saving account.

Because of the Movement Control Order (MCO), only one son is staying at
the college while the other one is learning from home. In addition, new smartphones
are needed for primary school children to continue their study. Overall, some of the
month already exceed the budget of Mr Azzizi family monthly income while the rest
are still under control and manageable. The average monthly expenses are below of
his monthly income, but in certain month, he need to spend more money especially
for his own children education.

13
7.0 Mr Azzizi’s Ratio

7.1 Liquidity Ratio

7.1.1) Liquid asset to take-home pay ratio

= (Liquid assets / Take-home pay) x 100

= (RM 29,000 / RM 108,000) x 100

= 26.85%

Mr Azzizi liquid asset to take-home pay ratio is good and in safe position because it
is more than 25% and can cover 3-6 month of any emergency payment.

7.1.2) Current ratio

= Liquid assets / Current liability

= RM 29,000 / RM 2500

= 11.6

Mr Azzizi current ratio is good because it is more than 1, so he can meet any short-
term obligation in no time

7.2 Debt Ratio

7.2.1) Debt ratio

= (Total liabilities / Total assets) x 100

= (RM 412,500 / RM 1,317,600) x 100

= 31.31%

14
Mr Azzizi debt ratio is in good position because it has below 40% , so he will not
have any difficulties in getting new loans.

7.2.2) Debt service coverage ratio

= Take home pay / Debt service charge

= RM 108,000 / RM 49,800

= 2.16

The ratio is more than 1 which portrays Mr Azzizi’s ability to meet his current debt
obligation. The higher the ratio, the better because it means the family has the ability
to make payments of debt.

15
8.0 Mr Azzizi’s Income Tax Year of Assessment for 2021

Income Tax for Year of Assessemnet 2021

Mr Azzizi
Income Tax for the YA 2021
RM RM
Aggregate income
Salary (7,500 x 12) 90,000
Extra income (400 x 9 ) 3,600
Bonus (600 x 12) 7,200
Total aggregate income 100,800

(-) Reliefs
Individual 9,000
Lifestyle (1,500 + 1,800 + 3,600) (restricted 5,000) 5,000
Unmarried child and under the age of 18 years old (2,000 x 6) 12,000
Unmarried child of 18 years and above that receiving further education
16,000
in Malaysia in respect of an award of diploma or higher (8,000 x 2)
Deferred Annuity and Private Retirement Scheme (PRS) 3,000
Total reliefs 45,000

Chargeble income 55,800

Income tax computation
On the first RM 50,000 1,800
Next RM 20,000 ( 5,800 x 13%) 754
Total income tax 2,554
(-) Rebates
Not alliable because chargeble income > RM 35,000 -
Zakat (2520 + 450 + 110) 3,080
Total rebates 3080
Total tax charge - 526

16
9.0 Comment and Advice

Referring to the previous table and statement, Mr Azzizi have good and fine
financial plan, asset and liabilities. The total asset already reaches million with the
total amount of RM 1,317,600. In fact, he and his spouse have prepared saving
account in various of bank account, start with Maybank, Bank Islam and CIMB. It is a
good consideration to make multiple account with its own purpose. In instance,
Maybank is used to put excess money for every month, bank Islam for emergency
saving and CIMB is for side income money. Each time he wants to use the money,
he will only use it after knowing the purpose. In fact, it can help Mr Azzizi not to
waste money on useless item.

With the amount stated in the balance sheet and the percentages of ratios,
there is no problem for Mr Azzizi to pay his debt obligations such as current liabilities
and non-current liabilities and he also have the chances to make another loan
because the ability for his to pay the debt increased. The purpose of the loan can be
made to generate more income by putting the money in investment platform. For
example, share and stock market. Mr Azzizi also can make another investment other
than Tabung Haji and contributions to gain more savings in the future. Next, the net
worth of this family is RM 905,100 which the assets are more than the liabilities.

Based on the cash flow statement, Mr Azzizi experiences some savings

because the total income is bigger than the total expenses. Fortunately, He also
earned bonus per year as much as RM 600 as his family savings other than his
salary and Mrs Siti Aimah’s wages. However, it is quite a concern that this family’s
expenses are quite high despite they have sum of money that they could save. He
apparently spends more in electricity bills which is RM 250 per month which is quite
high and could reduce the usage of electricity. Besides that, all his children are still
studying, but because of unfortunate event such as the pandemic of COVID-19
happen, he need to spend an extra money just to buy smartphone for each primary
child.

17
10. Appendixes

10.1 water bills 10.2 Electricity bills

10.3 Perodua Bezza 10.4 Perodua Aruz

18