The banking activities in India are regulated by the Banking Regulation Act, 1949. Any bank which transacts this business in India is called a banking company. However, any company which is engaged in the manufacturer of

The banking activities in India are regulated by the Banking Regulation Act, 1949. Any bank which transacts this business in India is called a banking company. However, any company which is engaged in the manufacturer of goods or carries on any trade and which accepts deposits of money from the public merely for the purpose of financing its business as manufacturer or trader shall not be deemed to transact the business of banking. It may be mentioned that the Banking Regulation Act, 1949 is not applicable to a primary agriculture society, a co-operative society land mortgage bank and any other co-operative society except in the manner and to the extent specified in the Act. Section 6 of the Banking Regulation Act, 1949 specifies the form of business in which a banking company may engage. As per Section 9 banking company can only acquire immovable property for its own use. Other immovable properties acquired must be disposed-off within seven years from the date of acquisition. The General Ledger and Profit and Loss Ledger are two principal books of accounts. Formats for Balance Sheet and Profit and Loss Account are given in the Third Schedule of The Banking Regulation Act, 1949 which includes Form A (Balance Sheet) and Form B (Profit and Loss Account) and eighteen other schedules of which two relates to notes and accounting policies. The following are the ledger balances extracted from the books of Vaishnavi Bank Limited as on 31st March, 2019: Particulars Dr. (₹) Cr. (₹) Share Capital 1,90,000 Current Accounts Control 97,000 Employee Security Deposit 7,420 Investments in Govt. of India Bonds 94,370 Gold Bullion 15,130 Silver 2,000 Constituent Liabilities for acceptance and endorsement 56,500 56,500 Borrowings from banks 77,230 Buildings 65,000 Furniture 5,000 Money at call and short notice — With Banks = ₹ 23,000 — With other Institution = ₹ 3,000 26,000 Commission & Brokerage 25,300 Saving accounts 15,000 Fixed deposits 23,050 Balances with other banks — In Current Account = ₹ 26,350 — In other account = ₹ 20,000 46,350 Other Investments 55,630 Interest accrued on investments 24,620 Reserve Fund 1,40,000 P & L account 6,500 Bills for Collection 43,500 43,500 Interest 62,000 Loans 1,81,000 Bills Discounted 12,500 Interest 7,950 Discount 42,000 Rents 600 Audit Fees 5,000 Depreciation Reserve (Furniture) 200 Salaries 21,200 Rent, Rates and Taxes 12,000 Cash in hand and with Reserve Bank (i) Cash in hand (including currency notes) = ₹ 35,000 (ii) Balance with Reserve Bank of India (a) In Current Account = ₹ 32,000 (b) In other account = ₹ 8,000 75,000 Miscellaneous income 3,900 Depreciation reserve (Buildings) 800 Director's Fees 1,000 Postage 1,250 Loss on sale of Investments 20,000 Branch adjustment 20,000 Total 7,91,000 7,91,000 Note: In the absence of previous year figures, the same is not indicated. Other information: The Bank's Profit and Loss Account for the year ended and Balance Sheet as on 31st March, 2019 are required to be prepared in appropriate form. Further information (In Rupees thousands) available is as follows: (a) Rebate on bills discounted to be provided ₹ 4,000 (b) Depreciation for the year Buildings ₹ 5,000 Furniture ₹ 500 (c) Included in the current account's ledger are accounts overdrawn to the extent of ₹ 2,500. Based upon the above information answer the following: Explain in detail the basic characteristics of Retail Banking and Wholesale Banking.