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| Corporate Accounting Treatment |
The Murabaha Bill of Exchange (MBE) is a financial instrument used in Islamic finance, particularly in trade and export-import transactions. It combines the concept of Murabaha, an Islamic financing structure where goods are sold at a cost-plus-profit margin, and the Bill of Exchange, a financial document used to guarantee the payment of a specified amount at a future date.
Key Elements of Murabaha Bill of Exchange (MBE):
1.Murabaha Concept:
Murabaha is a Shariah-compliant mode of financing where a bank or financial institution buys goods and resells them to the buyer at an agreed markup.
The transaction must follow Islamic principles, meaning that the bank takes ownership of the goods before selling them and bears any risks associated with ownership.
It’s often used in trade finance, asset purchases, and working capital financing.
2.Bill of Exchange:
A Bill of Exchange is a written, unconditional order by one party (the drawer) directing another party (the drawee) to pay a specified sum of money to a third party (the payee) either on demand or at a predetermined future date.
In the case of MBE, the Bill of Exchange formalizes the terms of payment after the delivery of goods under a Murabaha agreement.
Lets start with Interest calculation sheet -With Practical Examples :(Only Learning Purpose) :
ABC Bank PLC
Principal Branch
20,Dilkusha C/A, Dhaka-100
A/C Statement
A/C : 0023320181920 Date From: 01/09/2024 To 21/11/2024
A/C : Corporate Practice bd LTD Type of Account : Murabaha Bill of Exchange
Address: NS Bhabun Date of Opening :18-Sep-2024
DHAKA -1213 Date of Expiry 18-Mar-2025
BANGLADESH Last Transaction Date:04-Nov-2024
Phone:08206465425646 Balance :0.00
Currency :BDT
A/C Status : CLOSED
|
Date |
Particulars |
Debit |
Credit |
Balance |
|
|
Balance B/F |
|
|
|
|
18/09/2024 |
MIB ACCOUNT # 120224256050 Bill:24/25620 Corporate Practice bd LTD for USD 100423.166@120 |
1,20,50,780 |
0.00 |
1,20,50,780 |
|
18/09/2024 |
MIB ACCOUNT # 120224236050 Bill:24/230034 Corporate Practice bd LTD for USD 5211.8644@118 |
6,15,000 |
0.00 |
1,26,65,780 |
|
04/11/2024 |
INVESTMENT REPAYMENT FROM A/C# 1520650 Corporate Practice bd LTD #MBE profit against LC 120224256050 |
0.00 |
1,50,800 |
1,25,14,980 |
|
04/11/2024 |
REBATE LC #12022256050 24/230250 of Corporate Practice bd LTD for USD 2715@120 |
0.00 |
3,25,800 |
1,21,89,180 |
|
04/11/2024 |
MIB ACCOUNT #12022256050 24/231250 of Corporate Practice bd LTD LTD for USD 101576.50@120 |
0.00 |
1,21,89,180 |
0.00
|
1,26,65,780.00 1,26,65,780.00
MBE-2332-18508, RC-LC Profit calculation sheet
|
Account Title |
From |
Upto |
Period |
Profit Charged |
Debit |
Credit |
Outstanding Balance |
|
Creation |
18.09.2024 |
0 |
0 |
0 |
0 |
1,2050780 |
1,2050780 |
|
MBE-Profit9.5849%
|
18.09.2024 |
04.11.2024 |
47 |
1,50,800 |
|
1,50,800 |
1,22,01,580
|
|
Total |
47 |
1,50,800 |
|
1,22,01,580
|
1,22,01,580
|
JV.Voucher No. 01
MBE Creation Journal Entry
|
Ledger Name |
Debit (TK) |
Credit (TK) |
Remarks |
|
Transit R/C -LC-120224256050 |
1,20,50,780 |
|
|
|
EDF-MBE-2332-18508, RC-LC |
|
1,20,50,780 |
Narration:
MBE Creation against R/C LC-4560 $10040023 @120 =TK.1,20,50,780 dt.18.09.2024
J.VVoucher No. 02
For Interest charge by Bank for TK. 1,50,800
|
Ledger Name |
Debit (TK) |
Credit (TK) |
Remarks |
|
Interest on EDF |
1,50,800 |
|
|
|
EDF-MBE-2332-18508, RC-LC |
|
1,50,800 |
Narration:
MBE Profit charged against LC-40560 for the period from (18.09.2024 to 04.11.2024) =47 days
@9.5849% dt.18.09.2024
BV.Voucher No. 03
For Interest payment by our CD Account for TK. 141,981.00
|
Ledger Name |
Debit (TK) |
Credit (TK) |
Remarks |
|
EDF-MBE-2332-18508, RC-LC |
1,50,800 |
|
|
|
ABC Bank Ltd CD-57634 |
|
1,50,800 |
Narration:
MBE Profit realizes by Bank against LC-4560 for the period from (18.09.2024 to 04.11.2024) =47
Days @89.5849% Tk.1,50,800 dt.04.11.2024
JV.Voucher No. 04
For Transfer MBE Balance TO EDF-2472-6058, RC-LC-5060
|
Ledger Name |
Debit (TK) |
Credit (TK) |
Remarks |
|
EDF-MBE-2332-18508, RC-LC-5060 |
1,21,89,180 |
|
|
|
EDF-2472-607890, RC-LC-5060
|
|
1,21,89,180 |
Narration:
MBE Balance transfer to EDF-2472-607890, RC-LC-5060 dt.28.07.2024
Bank Statement of EDF (CASH )
ABC Bank PLC
Principal Branch
20,Dilkusha C/A, Dhaka-100
A/C Statement
A/C : EDF-2472-607890, RC-LC-5060 Date From: 01/09/2024 To 21/11/2024
A/C : Corporate Practice bd LTD Type of Account : EDF -Cash
Address: ABC HouseI Date of Opening :04-Nov-2024
DHAKA -1213 Date of Expiry 04-Nov-2025
BANGLADESH Last Transaction Date:04-Nov-2024
Phone:540681610 Balance :12189180
Currency :BDT
A/C Status : Active
|
Date |
Particulars |
Debit |
Credit |
Balance |
|
|
Balance B/F |
|
|
|
|
04/11/2024 |
Principle # EDF-2472-607890, RC-LC-5060 Corporate Practice bd LTD for USD 102056.58@120 |
000 |
0.00 |
12189180 |
|
18/09/2024 |
MIB ACCOUNT # EDF-2472-607890,Corporate Practice bd LTD forUSD 4353.6017@118 |
00 |
0.00 |
00 |
|
04/11/2024 |
INVESTMENT REPAYMENT FROM EDF-2472-607890, RC-LC-5060 Corporate Practice bd LTD #MBE profit |
0.00 |
00 |
00 |
|
04/11/2024 |
REBATE LC # of Corporate Practice bd LTD for USD3097.8667@120 |
0.00 |
00 |
00 |
|
04/11/2024 |
MIB ACCOUNT #120224235060 24/230034 of Corporate Practice bd LTD for USD102056.5833@120 |
0.00 |
1 |
0.00
|
000000 000000