BAW - II

Project 1 work effectively in the financial sector and customer account

Task1.1 Demonstrate the possible documents required for company to open current Bank account in CBE

Amount of initial deposit

Tax identification ID card

Employment and pension ID cards

Other signatories to the account primary account holders:
 Name
 Address
 Contact details
 Purpose for which the account will be used required links to other account held
Task 1.2 Demonstrate the advantages of saving deposit account to your company if you maintain saving
accounts
Saving account advantage
Aiming to repay existing debts and be debt free
Establishing a regular saving plan
To get some interest advantages
For safe keeping of finance
To facilitate payments to third party (CPO)
Accumulating a set amount of by a specified date in the future for the purposes of:
 Purchasing
 Financing holidays ,educational expenses, home renovations and other
known future expenses
Task 1.3 demonstrate the possible challenges that affect your job with regards to Banks activities
 Lack of integration among financial institution
 Inconsistency in operational procedures
 Size ,type and location of branch
 Types of equipment used
 Range of responsibility in the working areas
 Product and account service range given by banks
 Data base and IT systems interruption
 Administrative and clerical systems
Project 2 develop personal budget and savings
Ato Fanta is a permanent employee of Ethio Construction Company earning monthly net salary of 9,500
ETB. He has monthly personal expenditures as per the following details and the remaining amount will be
deposited to his personal saving account
 Clothing-----------------------15%
 Food and Beverage---------20%
 Medical-------------------------5%
 Rent-----------------------------20%
 Transportation---------------2%
 Education Fee----------------10%
He plans to open a barber shop with capital 80,520 ETB after one year. As per his business plan, his capital is
covered from annual personal saving account and the remaining from Addis saving and credit association at 8.5%
annual interest rate for three years and the principal amount will be paid semi-annually at equal instalment

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Task 2.1 prepares monthly and annual budget for the year consider that there is no change in earning and expenses
in the year.
Closing=9500*.15=1,425
Food=9500*.2=1900
Description January Total
Income 9,500 114,000
Closing 1425
Food n and Beverage 1,900
Medical 475
Rent 1,900
Transportation 190
Education Fee 950
Total Expense 6,840 82,080
Personal saving 2,660 31,920
Task 2.3 Determine
A. Amount of loan from Addis saving and credit association
 Amount of loan=80,520-31,920=48,600
B. Amount of principal and interest repayment for the first year
Installment paid amount=48,600/2*3=48,600/6=8,100
1st installment interest= 48,600*.085*1/2=2,065.5
Outstanding balance =48,600-8,100=40,500
2nd installment interest =40,500 *..085*1/2=1,721.25
Outstanding balance =40,500-8,100=32,400
Amount of principal repayment first year =8,100+8,100=16,200
Interest repayment for the first year=2,065.5+1,721.25=3,786.75
Total Principal paid =8,100*2=16,200
Total interest and principal payment =3,786.75+16,200=19,986.75
C. Amount of outstanding principal balances at the end of the second year
 Outstanding balance=48,600-32,400=16,200
Project 3 Develop customer account and transaction
Task 3.1 State the Financial and non-financial institutions that are participants in the financial markets
in Ethiopia
 Banks and non-banking financial institutions
 Investors:
 Corporations
 Individuals
 Local and international governments
 Speculators:
 Corporations
 Individuals.
Task3.2 State financial instrument that are used in the monetary cycle with in the economy and on a
global scale and instruments traded on the short term money market in the Ethiopian context
 Bills of exchange
 Commercial bills
 Government bills
 Promissory notes

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 Treasury bills
Task 3.3 Explain in the company strategies or opportunities for improvement the employee performance
 Career planning/development
 Coaching, mentoring and/or supervision
 Formal/informal learning programs
 Internal/external training provision
 Performance appraisals
 Personal study

Project 4 Understanding of Taxation and direct tax and indirect tax

Commercial bank of Ethiopia purchase It Infrastructure materials birr 300,000 before VAT and have five
employees and the company paid employment income tax birr 8,500 for the month of January 2015. The
company earns income for the year 2015 birr 1,081,000 VAT included
Task 4.1 Calculate direct and indirect tax for the year 2015
Direct tax = employee income tax=8,500*12=102,000
Indirect tax
Sales before VAT=1,081,000/1.15=940,000
VAT Output =1,081,000-940,000=141,000
VAT input=300,000*.15=45,000
Indirect tax VAT liability=VAT Output-VAT input=141,000-45,000=96,000
Task 4.2 States the necessary documents for tax in the question
 Sales documents
 Purchase documents
 Payroll sheet
 VAT reporting format

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