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Nestle Pakistan is planning to purchase a Generator for Rs. 150 Mn and got two offers from Islamic banks one based on Diminishing Musharakah from Meezan Bank & one based on Ijarah from Bank Islami. The company has 25 million available as cash for this project needs remaining from Bank for 5 years. Both bank is currently offering Finance at KIBOR+ 1 % ( KIBOR is 12%). As Manager Finance you are required to explain to the CEO The comparison in terms of accounting/recording in case the company had decided to use Ijarah modes Vs DM. What will be the impact on its balance sheet and liabilities? Nestle Pakistan is planning to purchase a Generator for Rs. 150 Mn and got two offers from Islamic banks one based on Diminishing Musharakah from Meezan Bank & one based on Ijarah from Bank Islami. The company has 25 million available as cash for this project needs remaining from Bank for 5 years. Both bank is currently offering Finance at KIBOR+1% ( KIBOR is 12). As Manager Finance you are required to explain to the CEO The comparison in terms of accounting/recording in case the company had decided to use Ijarah modes Vs DM. What will be the impact on its balance sheet and liabilities? How is DM financing is recorded in terms of accounting in the books of the account/balance sheet of the bank balance sheet of the bank and how bank is earning income & what is the impact on the income statement. Nestle Pakistan is planning to purchase a Generator for Rs. 150 Mn and got two offers from Islamic banks one based on Diminishing Musharakah from Meezan Bank & one based on Ijarah from Bank Islami. The company has 25 million available as cash for this project needs remaining from Bank for 5 years. Both bank is currently offering Finance at KIBOR+ 1 % ( KIBOR is 12%). As Manager Finance you are required to explain to the CEO The comparison in terms of accounting/recording in case the company had decided to use Ijarah modes Vs DM. What will be the impact on its balance sheet and liabilities? Nestle Pakistan is planning to purchase a Generator for Rs. 150 Mn and got two offers from Islamic banks one based on Diminishing Musharakah from Meezan Bank & one based on Ijarah from Bank Islami. The company has 25 million available as cash for this project needs remaining from Bank for 5 years. Both bank is currently offering Finance at KIBOR+1% ( KIBOR is 12). As Manager Finance you are required to explain to the CEO The comparison in terms of accounting/recording in case the company had decided to use Ijarah modes Vs DM. What will be the impact on its balance sheet and liabilities? How is DM financing is recorded in terms of accounting in the books of the account/balance sheet of the bank balance sheet of the bank and how bank is earning income & what is the impact on the income statement