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ALLIED MOTORS LIMITED |
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|
Annual Report 1996 |
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| Contents |
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Page # |
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|
| Company
Information |
|
2 |
|
|
| Notice
of Meeting |
|
3 |
|
|
| Directors'
Report |
|
4 |
|
|
| Auditors'
Report |
|
7 |
|
|
| Balance
Sheet |
|
8 |
|
|
| Profit
& Loss Account |
|
10 |
|
|
| Statement
of changes in financial |
|
|
|
| position |
|
11 |
|
|
|
|
| Notes
to the Accounts |
|
12 |
|
|
|
| Company
Information |
|
|
| BOARD
OF DIRECTORS |
|
| K.
A. Rahman |
|
Chairman & Chief
Executive |
|
| Manzoor
Saber |
|
| Razaul Haq |
|
| Tajammul
Hussain |
|
| Iqbal
Ghafur |
|
| Anver Majid |
|
| A.
Sattar Khan |
|
Director & Company
Secretary |
|
|
| AUDITORS |
|
| Ford,
Rhodes, Robson, Morrow |
|
| Chartered
Accountants |
|
| Finlay
House |
|
| I.
I.Chundrigar Road |
|
| Karachi. |
|
|
|
| REGISTERED
OFFICE |
|
| D-168,
Sindh Industrial Trading Estate |
|
| Haroonabad, |
|
| Karachi
- 75700 |
|
|
|
| FACTORY |
|
| Plot
Nos. A1-A50 Hub Industrial Trading Estate |
|
| Hub,
District Lasbela (Balochistan) |
|
|
| REGISTRARS |
|
| Gangjees
Investment & Finance Consultants |
|
| 513,
Clifton Centre, Khayaban-e-Roomi, Block-5 |
|
| Clifton,
Karachi-75600 |
|
|
|
| Notice
of Meeting |
|
| NOTICE
is hereby given that the Fourteenth Annual General Meeting of the
shareholders of Allied |
|
| Motors
Limited will be held on Sunday, December 15, 1996 at 3.30 p.m., at the
Registered office of |
|
| the
Company, Situated at D-t68, S.I.T.E., Haroonabad, Karachi to transact the
following business; |
|
|
| 1.
To confirm the Minutes of the Thirteenth Annual General Meeting held on
December 7, |
|
|
| 2.
To receive, consider and accept the Report of the Directors and the Audited
Accounts for the year |
|
| ended
June 30, 1996 together with the Auditors' Report thereon. |
|
|
| 3.
To appoint Auditors of the Company for the year 1996/97 and to fix their
remuneration. |
|
|
| 4.
To transact any other ordinary business of the Company with the permission of
the Chair. |
|
|
|
|
BY ORDER OF THE BOARD |
|
|
A. SATTAR KHAN |
|
| Dated
:Karachi, November 23, 1996 |
|
Director & Company
Secretary |
|
|
| NOTES: |
|
|
|
| 1.
The Share Transfer Books of the Company will remain closed from December 1,
1996 |
|
| through
December 15, 1996 (both days inclusive). |
|
|
| 2.
A member eligible to attend and vote at the Meeting may appoint another
Member as his/ |
|
| her
Proxy to attend and vote instead of him/her. Proxies in order to be effective
must be |
|
| deposited
at Registered Office of the company not later than 48 hours before the time
of |
|
| holding
of the meeting. |
|
|
| 3.
Shareholders are requested to immediately notify change of address, if any,
to our |
|
| Registrar,
Gangjees Investment & Finance Consultants, 513, Clifton CENTRE,
Khayaban-e- |
|
| Roomi,
Block-5, Clifton, Karachi-75600. |
|
|
|
| Directors'
Report |
|
| Your
Directors welcome you to the Fourteenth Annual General Meeting and place
before you the |
|
| Annual
Roped together with the Audited Accounts of the Company for the year ended
June 30, 1996. |
|
|
| FINANCIAL
RESULTS |
|
(Rs.000) |
|
|
1996 |
1995 |
|
|
|
| Net Sales |
|
5,267 |
3,939 |
|
| Gross
Profit/(Loss) |
|
(4,131 ) |
( 5,024 ) |
|
| Operating
Profit/(Loss) |
|
(11,027) |
(12,023) |
|
| Profit/(Loss)
Before Tax |
|
(10,975) |
(11,860) |
|
| Profit/(Loss)
After Tax |
|
(11,004) |
(11,711) |
|
| Unappropriated
Profit/(Loss) B/F |
|
(121,791) |
(110,080) |
|
| Accumulated
Profit/(Loss) |
|
(132,795) |
(121,791) |
|
|
|
|
|
| As
you know, your Company has left over inventory of small horse power tractors.
during th~ year under |
|
| review,
the Company sold 38 units of the Small Horse Power Tractors. The total
tractor industry sale |
|
| was
16,324 units including 49 units of Small Horse Power Tractors of which your
Company sold 38 units. |
|
| The
Company also sold one unit of Agrimotor 3-wheeler during the year. |
|
|
| AUDITORS'
OBSERVATIONS |
|
| Referring
to the Auditors' observations in paragraph 2 of the Auditors' Repeal to the
Members, it is stated |
|
| that
your Directors had no choice but to severe business relationship with Ford
New Holland Inc. in |
|
| order
to halt continuous loss incurring process and to look for some other product
which could assure |
|
| viability.
The management is concerned about the future of your Company and it is
actively engaged |
|
| in
its re-activation. The Company's properly is free from all encumbrances.
Further, the management |
|
| considers
that at present the assets and liabilities do not require any adjustment or
reclassification since |
| efforts
are being made to re-activate the operation. |
|
|
| As
to the Auditors' comments in paragraph 3 of their Report to the Members, it
is stated that your |
|
| Directors
consider the tangible fixed assets, loose tools, stock-in. trade as good and
realisable. |
|
| The
investment of Rs. 5 million in Polymer & Precision Engineers (Pvt.)
Limited, in the opinion of your |
|
| Directors,
may soon start yielding returns. |
|
|
| FUTURE
OUTLOOK |
|
| As
you are aware, with a view to re-activate the Company's operations, The
management of your |
|
| Company
had been actively negotiating with some manufacturers ot automobiles in
China, Japan and |
|
| Europe.
Further, the management had made arrangements with a Chinese automobile
manufacturer to |
|
| import
Truck, Bus and mini truck for test and trial purposes, Unfortunately, due to
the prevailing |
|
| economic
and political conditions of the country coupled with the law and order
situation in Karachi and |
|
| lack
ot support from vendors source, we had to defer the import of the said
vehicles for test and trial. |
|
| As
soon as the situation improves, the vehicles will be imported and after
satisfactory completion of the |
|
| test
and trial, a deletion programme for assembly-cum-progressive manufacture will
be drawn and |
|
| presented
to the Government for approval. |
|
|
| Recently,
a large European Group of automobile manufacturer has again contacted us and
our |
|
| negotiation
with them are progressing. In fact, their delegation was scheduled to visit
us for discussions |
|
| during
the last week of November 1996. But, due to sudden political change, they
have deferred their |
|
| visit
to February 1997 hoping that by then the new elected government will be
operational. |
|
|
| All
the 20 units of Agrimotor 3-wheelers have been assembled. The Company has so
far sold 2 units |
|
| and
they are operational in the interior of Sindh. The said Agrimotor 3-wheelers
are specially designed |
|
| for
agricultural applications. And, we have been making efforts to have these
enlisted with Agricultural |
|
| Development
Bank of Pakistan so as to enable the farmers to avail ADBP loan facilities
for the purchase |
|
| of
the Agrimotor 3-wheelers. |
|
|
| AUDITORS |
|
| The
present Auditors M/s. Ford, Rhodes, Robson, Morrow - Chartered Accountants
retire and being |
|
| eligible
offer themselves for re-appointment. |
|
|
| PATTERN
OF SHAREHOLDING |
|
| The
pattern of shareholding is attached. |
|
|
| FOR
AND ON BEHALF OF THE BOARD |
|
|
| ANVER MAJID |
|
| Director |
|
| TAJAMMUL
HUSSAIN |
|
| Director |
|
|
|
| Dated:
Karachi, November 7, 1996 |
|
|
|
|
|
| Pattern
of Shareholding |
|
|
|
|
PATTERN OF HOLDING OF SHARES HELD BY THE SHAREHOLDERS |
|
|
|
AS AT JUNE 30, 1996 |
|
|
| NO. OF |
|
SHARE HOLDING |
TOTAL SHARES |
|
| SHARE
HOLDERS |
FROM |
TO |
HELD |
|
|
|
|
| 242 |
|
1 |
100 |
22,712 |
|
| 587 |
|
101 |
500 |
117,673 |
|
| 85 |
|
501 |
1000 |
75,566 |
|
| 136 |
|
1001 |
5000 |
336,138 |
|
| 18 |
|
5001 |
10000 |
118,246 |
|
| 9 |
|
10001 |
15000 |
113,932 |
|
| 5 |
|
15001 |
20000 |
86 430 |
|
| 2 |
|
20001 |
25000 |
48 599 |
|
| 1 |
|
25001 |
30000 |
28 233 |
|
| 1 |
|
30001 |
35000 |
30 333 |
|
| 1 |
|
35001 |
40000 |
35200 |
|
| 2 |
|
45001 |
50000 |
97 199 |
|
| 1 |
|
55001 |
60000 |
57 731 |
|
| 1 |
|
60001 |
65000 |
61 733 |
|
| 1 |
|
70001 |
75000 |
70 833 |
|
| 1 |
|
110001 |
115000 |
113,800 |
|
| 1 |
|
360001 |
365000 |
362,933 |
|
| 1 |
|
690001 |
695000 |
691,094 |
|
| 1 |
|
890001 |
895000 |
891,500 |
|
| 1 |
|
1105001 |
1110000 |
1,108,906 |
|
| 1 |
|
1890001 |
1895000 |
1,895,000 |
|
| 1 |
|
2635001 |
2640000 |
2,636,009 |
|
| ----------- |
|
----------- |
|
| 1,049 |
|
9,000,000 |
|
| ============== |
|
============== |
|
|
|
|
|
| CATEGORIES
OF SHAREHOLDERS |
|
| AS
AT JUNE 30, 1996 |
|
|
|
|
|
| CATEGORIES
OF SHAREHOLDERS |
NUMBER |
SHARES HELD |
PERCENTAGE |
|
|
|
| INDIVIDUALS |
|
1037 |
1,110,129 |
12.33 |
|
| INVESTMENT
COMPANIES |
|
1 |
362,933 |
4.03 |
|
| INSURANCE
COMPANIES |
|
3 |
175,699 |
1.95 |
|
| JOINT
STOCK COMPANIES |
|
5 |
4,493,906 |
49.93 |
|
| FINANCIAL
INSTITUTIONS |
|
3 |
2,857,333 |
31.75 |
|
| MODARABA
COMPANIES |
|
0 |
0 |
0.00 |
|
| ASSOCIATED
COMPANIES |
|
0 |
0 |
0.00 |
|
| HOLDING
COMPANIES |
|
0 |
0 |
0.00 |
|
| OTHERS |
|
0 |
0 |
0.00 |
|
|
|
----------- |
----------- |
----------- |
|
|
|
1049 |
9,000,000 |
100.00 |
|
|
============== |
============== |
============== |
|
|
|
| Auditors'
Report TO THE MEMBER$ |
|
| 1.
We have audited the annexed balance sheet of ALLIED MOTORS LIMITED as at June
30, 1996 |
|
| and
the related profit ana loss account and statement of changes in financial
position (cash flow |
|
| statement),
together with the |
|
|
| 2.
As shown in the financial statements, the company hag a carried forward net
loss of |
|
| Rs.
132,795 million as at June 30, 1996 and we have also been unable to satisfy
ourselves that further |
|
| financial
assistance from banks or other lenders will be available to the company.
These factors, the |
|
| closure
of the factory and the "Ford" group of companies withdrawal from
and termination of its |
|
| franchise
agreements with the company, raise doubt that the company will be able to
continue as a |
|
| going
concern and may be unable to realise its assets and discharge its liabilities
in the normal course |
|
| of
business. The financial statements do not include any adjustments relating to
the recoverability |
|
| and
classification of recorded asset amounts or to the amounts and classification
of liabilities that |
|
| might
be necessary should the company be unable to continue as a going concern. |
|
|
| 3.
We have been unable to satisfy ourselves as to, the realisable value of
tangible fixed assets, the net |
|
| realisable
value of loose tools, stock-in-trade (see also note 14) and an amount of Rs.
5 million in |
|
| respect
of investment, against which no provisions have been made. |
|
|
| 4.
We state that we have obtained all the information and explanations which to
the best of our |
|
| knowledge
and belief were necessary for the purposes of our audit and, after due
verification thereof, |
|
| we
report that: |
|
|
|
|
| (a)
in our opinion, proper books of account have been kept by the company as
required by the |
|
| Companies
Ordinance, 1984; |
|
|
| (b)
in our opinion: |
|
|
| (i)
the balance sheet and profit and loss account together with the notes thereon
have |
|
| been
drawn up in conformity with the Companies Ordinance, 1984 and are in |
|
| agreement
with the books of account and are further in accordance with accounting |
|
| policies
consistently applied; |
|
|
|
| (ii)
the expenditure incurred during the year was for the purpose of the company's |
|
| business;
and |
|
|
|
| (iii)
the business conducted, investments made and the expenditure incurred during
the |
|
| year
were in accordance with the objects of the company; |
|
|
|
| (c)
subject to the matters stated in 2 and 3 above, in our opinion and to the
best of our information |
|
| and
according to the explanations given to us, the balance sheet, profit and loss
account and |
|
| the
statement of changes in financial position (cash flow statement), together
with the notes |
|
| forming
part thereof, give the information required by the Companies Ordinance, 1984,
in the |
|
| manner
so required and respectively give a true and fair view of the state of the
company's |
|
| affairs
as at June 30, 1996 and of the loss and the statement of changes in financial
position |
|
| (cash
flow statement) for the year then ended; and |
|
|
|
| (d)
in our opinion no Zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980. |
|
|
|
| Ford,
Rhodes, Robson, Morrow |
|
| Chartered
Accountants |
|
|
|
| Karachi-
07 November 1996 |
|
|
|
| Balance
Sheet At June 30, 1996 |
|
|
|
|
1996 |
1995 |
|
|
Note |
Rs.000 |
Rs.000 |
|
| SHARE
CAPITAL AND RESERVES |
|
|
| Authorized
Capital |
|
|
|
|
| 21,800,000
ordinary shares of Rs. 10 each |
|
218,000 |
218,000 |
|
|
|
=========================== |
|
|
|
|
| Issued,
subscribed and paid-up capital |
3 |
90,000 |
90,000 |
|
| Reserves |
|
|
|
Capital |
|
4 |
86,194 |
86,194 |
|
|
Revenue |
|
5 |
'(122,895) |
(111,891 ) |
|
|
|
----------------------- |
|
|
|
|
(36,701) |
(25,697) |
|
|
|
|
|
----------------------- |
|
|
|
|
53,299 |
64,303 |
|
|
| CURRENT
LIABILITIES |
|
| Short
term finance |
|
6 |
16,890 |
12,692 |
|
| Due
to associated companies and undertakings |
7 |
4,960 |
3,463 |
|
| Creditors,
accrued expenses & other liabilities |
8 |
5,488 |
5,962 |
|
|
|
----------------------- |
|
|
|
27,338 |
22,117 |
|
|
| CONTINGENCY |
|
9 |
|
|
|
|
----------------------- |
|
|
|
80,637 |
86,420 |
|
|
|
======================= |
|
|
|
| TANGIBLE
FIXED ASSETS |
|
| Operating fixed assets -- Net |
|
10 |
36,665 |
39,387 |
|
| Other |
|
11 |
9,482 |
9,482 |
|
|
|
----------------------- |
|
|
46,147 |
48,869 |
|
|
|
|
| LONG
TERM INVESTMENT |
|
12 |
5,000 |
5,000 |
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Loose tools |
|
13 |
539 |
599 |
|
| Stock-in-trade |
|
14 |
27,465 |
30,874 |
|
| Trade
debtors - unsecured - considered good |
15 |
439 |
27 |
|
| Advances |
|
16 |
- |
73 |
|
| Deposits
and prepayments |
|
17 |
357 |
352 |
|
| Other
receiveables |
|
|
17 |
253 |
|
| Advance tax |
|
|
336 |
3O8 |
|
| Cash
and bank balances |
|
18 |
337 |
65 |
|
|
|
|
----------------------- |
|
|
|
29,490 |
32,551 |
|
|
|
|
|
|
----------------------- |
|
|
80,637 |
86,420 |
|
|
|
======================= |
|
|
| The
annexed notes form part of these accounts. |
|
| The
auditors' report is annexed hereto. |
|
|
| ANVER MAJID |
|
| Director |
|
|
| TAJAMMUL
HUSSAIN |
|
| Director |
|
|
| STATEMENT
UNDER SECTION 241(2) OF THE COMPANIES ORDINANCE, 1984 |
|
|
| The
Chief Executive being out of Pakistan due to health reasons, the Annual
Audited Accounts for the |
|
| year
ended June 30, 1996 have been signed by two Directors. |
|
|
| ANVER MAJID |
|
| Director |
|
|
| TAJAMMUL
HUSSAIN |
|
| Director |
|
|
| Profit
& Loss Account For the year ended
June 30, 1996 |
|
|
|
|
|
|
1996 |
1995 |
|
|
|
Note |
Rs.000 |
Rs.000 |
|
| Sales |
|
|
|
|
|
| Cost
of Sales |
|
19 |
5,267 |
3,939 |
|
|
|
20 |
9,398 |
8,962 |
|
|
----------------------- |
|
|
|
(4,131) |
(5,024) |
|
| Selling,
distribution, administration |
|
|
| and
general expenses |
|
21 |
4,446 |
5,532 |
|
| Financial
charges |
|
22 |
2,450 |
1,467 |
|
|
|
|
----------------------- |
|
|
|
|
6,896 |
6,999 |
|
|
|
|
|
|
|
|
----------------------- |
|
| Operating
Loss |
|
|
(11,027) |
(12,023) |
|
|
|
|
|
|
| Other
income |
|
23 |
50 |
163 |
|
|
|
----------------------- |
|
| Loss
for the year before taxation |
|
|
(10,977) |
(11,860 ) |
|
| Prior
period items |
|
24 |
2 |
- |
|
|
|
----------------------- |
|
| Loss
before taxation |
|
|
(10,975) |
(11,860) |
|
| Taxation |
|
25 |
29 |
(149) |
|
|
|
|
----------------------- |
|
| Loss
after taxation |
|
|
(11,004) |
(11,711) |
|
| Loss
brought forward |
|
|
(121,791) |
(110,080 ) |
|
|
|
|
|
|
|
|
----------------------- |
|
| Loss
carried forward |
|
(132,795 ) |
(121,791) |
|
|
|
======================= |
|
|
| The
annexed notes form part of these accounts. |
|
|
| ANVER MAJID |
|
| Director |
|
|
| TAJAMMUL
HUSSAIN |
|
| Director |
|
|
|
| STATEMENT
UNDER SECTION 241(2) OF THE COMPANIES ORDINANCE, 1984 |
|
|
| The
Chief Executive being out of Pakistan due to health reasons, the Annual
Audited Accounts for |
|
| the
year ended June 30, 1996 have been signed by two Directors. |
|
|
| ANVER MAJID |
|
| Director |
|
|
|
| TAJAMMUL
HUSSAIN |
|
| Director |
|
|
|
| Statement
of changes in Financial Position |
|
| (CASH
FLOW STATEIVIENT) |
|
| FOR
THE YEAR ENDED JUNE 30, 1996 |
|
|
1996 |
1995 |
|
|
|
Rs.000 |
Rs.000 |
|
| CASH
FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
|
| Fund
provided from operations |
|
| Low
after taxation |
|
(11,004) |
(11,711) |
|
|
|
| Adjustment/or
items not involving movement of funds: |
|
| Depreciation |
|
2,751 |
3,062 |
|
| Reversal
of deferred taxation |
|
- |
(171) |
|
| Gain
on sale of fixed assets |
|
'(1) |
(7) |
|
|
----------------------- |
|
|
|
2,750 |
2,884 |
|
|
|
|
|
|
|
----------------------- |
|
|
(8,254) |
(8,827) |
|
| Working
Capital changes |
|
|
|
| (Increase) / decrease in current assets |
|
|
|
| Loose tools |
|
60 |
67 |
|
| Stock-in-trade |
|
3,409 |
1,222 |
|
| Trade debts |
|
(412) |
171 |
|
| Advances |
|
73 |
(29) |
|
| Deposits
and prepayments |
|
(5) |
55 |
|
| Other
receivables |
|
236 |
(7) |
|
| Advance tax |
|
(28) |
(202) |
|
|
----------------------- |
|
|
|
3,333 |
1,277 |
|
| Increase
/ (decrease) in current liabilities |
|
|
|
| Short
term finance |
|
4,198 |
4,755 |
|
| Due
to associated companies and undertakings |
|
1,497 |
3,198 |
|
| Creditors,
accrued expenses and other liabilities |
(474) |
(785 |
|
|
----------------------- |
|
|
5,221 |
7,168 |
|
|
|
|
|
|
----------------------- |
|
| Net
cash from operating activities |
|
300 |
(382) |
|
|
|
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
|
|
| Capital
expenditure |
|
(29) |
(186) |
|
| Sale
proceeds of fixed assets |
|
1 |
212 |
|
|
----------------------- |
|
| Net
cash used in investing activities |
|
(28) |
26 |
|
|
|
|
|
----------------------- |
|
| Net
increase / (decrease) in cash and cash equivalents |
272 |
(356) |
|
| Cash
and cash equivalents at the beginning of the year |
65 |
421 |
|
|
|
|
|
|
----------------------- |
|
| Cash
and cash equivalents at the end of the year |
337 |
65 |
|
|
|
======================= |
|
| ANVER MAJID |
|
|
| Director |
|
|
| TAJAMMUL
HUSSAIN |
|
| Director |
|
|
|
| Notes
to the Accounts |
|
| FOR
THE YEAR ENDED JUNE 30, 1996 |
|
|
|
| STATUS
AND NATURE OP BUSINESS |
|
| Allied
Motors Limited is a public limited company quoted on stock exchanges in
Karachi and |
|
| Lahore.
Tile company's business is the assembly-cum progressive manufacture and sale
of |
|
| traders
and agrimotors and in the trading of parts and implements related thereto.
The company |
|
| was
incorporated on May 6,1982 and commenced commercial operations in August,
1983 |
|
| Trading
in tractor parts and implements commenced from July 1, 1986, The company
started |
|
| assembly-cure-progressive
manufacture and sale ot Agrimotor 3-wheeler pick-up in 1994/1995. |
|
|
| 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|
|
| 2.1
Accounting convention |
|
| These
accounts have been prepared under the historical cost convention. |
|
|
| 2.2
Staff retirement benefits |
|
| The
company operates a provident fund scheme for all its employees eligible for
the benefit. |
|
|
| 2.3
Taxation |
|
| Provision
for taxation is made on current taxable income wherever necessary, and for |
|
| deferred
liabilities for taxation only if there are material timing differences which
are expected |
|
| to
reverse within the foreseeable future. |
|
|
|
| 2.4
Fixed capital expenditure |
|
| These
are stated at cost less accumulated depreciation except land and capital
work-in- |
|
| progress
and fixed assets-other which are stated at cost. |
|
|
| Depreciation
is charged to income applying the reducing balance method. The rates used |
|
| are
stated in note 10 to the accounts. |
|
|
| Maintenance
and normal repairs are charged to income as and when incurred. Major |
|
| renewals
and improvements are capitalised. Gain or loss, if any, on disposal of fixed
assets |
|
| is
included in income currently. |
|
|
| Full
year's depreciation is charged in the year of acquisition and none in the
year of sale. |
|
|
| 2.5
Stock-in-Trade |
|
| These
are stated at the lower of net realisable value or cost determined on the
first-in-first |
|
| out
method excluding exchange gain/loss. |
|
|
| 2.6
Loose tools |
|
| These
are stated at cost less an amount written off at the rate of 10% on
diminishing balance |
|
| method. |
|
|
| 2.7
Foreign currency translation. |
|
| Transactions
in foreign currencies are converted into rupees at the rates prevailing on
the |
|
| date
of transaction. |
|
|
| Assets
and liabilities in foreign currencies are translated into rupees at the rates
of |
|
| exchange
ruling on the balance sheet date except for liabilities covered under forward |
|
| exchange
contract which are translated at the contracted rates. |
|
|
| Exchange
gain or loss is included in income currently. |
|
|
| 2.8
Deferred costs |
|
| These
are written off during a period not exceeding five years commencing from the |
|
| financial
year in which the costs are incurred. |
|
|
| 2.9
Revenue recognition |
|
| Sales
are recognised at the time of delivery of goods from plant/delivery centres. |
|
|
| ISSUED,
SUBSCRIBED AND PAID-UP CAPITAL |
|
|
1996
1995 |
|
|
|
Rs. 000 Rs. 000 |
|
|
|
| 8,135,871
ordinary shares of Rs.10 each |
|
|
|
|
fully paid in cash |
|
81,359 |
81,359 |
|
| 864,129
ordinary shares of Rs.10 each issued |
|
|
as fully paid bonus
shares |
|
8,641 |
8,641 |
|
|
|
----------------------- |
|
|
|
90,000 |
90,000 |
|
|
|
======================= |
|
|
|
| 4.
This capital reserve has arisen consequent to the capital receipt from
"Ford" in terms of paragraph |
|
| 12
of the Compromise Agreement dated January 22, 1990 between "Ford"
and the company. |
|
|
|
| 5.
REVENUE RESERVE |
|
|
|
| General |
|
9,900 |
9,900 |
|
| Profit
and loss account - adverse balance |
|
(132,795) |
'(121,791) |
|
|
|
----------------------- |
|
|
(122,895) |
'(111,891) |
|
|
|
======================= |
|
|
|
| 6.
SHORT TERM FINANCES |
|
| 6.1. Running finance from Bank
: |
|
|
|
|
|
|
Credit |
|
|
limit in |
Mark-up |
|
|
|
|
millions |
rate |
1996
1995 |
|
|
Security |
|
RS. |
p.a. |
Rs. 000 |
'Rs. 000 |
|
|
|
| Citibank
N.A. |
Control unit approval
from |
|
| Karachi |
|
Citibank - Geneva |
8 |
18% |
7,486 |
4,901 |
|
|
|
|
|
|
|
| 6.2.
Finance from others |
|
|
|
| Midland
Motors Pakistan |
|
|
|
|
|
| (Pvt)
Limited ** |
Unsecured |
|
- |
8% |
9,404 |
7,791 |
|
|
------------------------ |
|
|
|
16,890 |
12,692 |
|
|
|
======================= |
|
|
| **Includes
the amount reflected in note no. 14.3 |
|
|
|
|
Mark-up |
1996
1995 |
|
|
|
rate |
Rs. 000 |
'Rs. 000 |
|
| 7.
DUE TO ASSOCIATED COMPANIES AND |
|
| UNDERTAKINGS |
|
| Allied
Engineering & Services Limited |
|
16% |
4,800 |
3,207 |
|
| Polymer
& Precision Engineers (Private) Limited |
|
16% |
160 |
256 |
|
|
|
------------------------ |
|
|
|
4,960 |
3,463 |
|
|
|
======================= |
|
|
|
| 8.
CREDITORS, ACCRUED EXPENSES AND OTHER LIABILITIES |
|
| Creditors |
|
|
1,976 |
2,082 |
|
| Accrued
expenses (8.1) |
|
|
1,106 |
1,141 |
|
| Mark-up
accrued on short term running finance |
|
346 |
213 |
|
| Taxation
(income-tax) |
|
1,878 |
1,871 |
|
| Corporate
asset tax |
|
182 |
655 |
|
|
|
------------------------ |
|
|
|
5,488 |
5,962 |
|
|
|
======================= |
|
|
|
| 8.1
Includes an amount of Rs. 68(704) [1995: Rs. 67(304)] payable to Allied
Engineering & |
|
| Services
Limited - an associated undertaking |
|
|
|
| 9.
CONTINGENCY |
|
| The
Company may be liable to customs duty of Rs. 5.8 million in rasped of 360
tractor units, |
|
| (released
on the basis of an undertaking given by the company) in the event that the
revised |
|
| deletion
programme, as requested for by the company is not approved by the Government
of |
|
| Pakistan.
The Company contested, through its lawyer who finally wrote to the oustoms on |
|
| September
27, 1987 stating that the demand is not sustainable under the law governing
import |
|
| of
the said 360 tracters. Since there has been no further demand from customs,
therefore, the |
|
| Company
considers that this contingent liability now stands null and void. |
|
|
| 10.
STATEMENT OF OPERATING FIXED ASSETS |
|
|
|
|
Accumu- |
|
|
|
|
|
lated |
|
|
|
|
Additions/ |
|
depre- |
Book |
Depreciation |
|
|
|
Cost |
(deletions) |
Cost |
ciation |
value |
for the year |
|
|
|
at July |
during the |
at June |
at June |
at June |
|
|
|
1, 1995 |
year |
30, 1996 |
30, 1996 |
30, 1996 |
Amount |
Rates |
|
| Description |
|
Rs. 000 |
Rs. 000 |
Rs. 000 |
Rs. 000 |
Rs. 000 |
Rs. 000 |
% |
|
|
|
|
|
| Leasehold
land |
12,217 |
- |
12,217 |
- |
12,217 |
- |
- |
|
| Factory
building |
|
|
| on
leasehold land |
42,195 |
- |
42,195 |
29,213 |
12,982 |
1,443 |
10 |
|
| Plant
& machinery |
32,938 |
- |
32,938 |
22,759 |
10,179 |
1,131 |
10 |
|
| Furniture
and |
|
|
| office
equipment |
2,119 |
29 |
2,148 |
1,373 |
775 |
86 |
10 |
|
| Motor
vehicles |
1,832 |
(10) |
1,822 |
1,574 |
248 |
62 |
20 |
|
| Refrigerators |
|
| and
airconditioners |
728 |
- |
728 |
464 |
264 |
29 |
10 |
|
|
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
|
|
|
|
|
|
1996 |
92,029 |
19 |
92,048 |
55,383 |
36,665 |
2,751 |
|
|
|
============ |
============ |
============ |
============ |
============ |
============ |
|
|
|
|
|
|
1995 |
92,427 |
(398) |
92,029 |
52,642 |
39,387 |
3,062 |
|
|
|
|
============ |
============ |
============ |
============ |
============ |
============ |
|
|
|
|
|
| 10.1
Details of disposal of operating fixed assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Original |
Accumulated |
Book |
Proceeds |
Gain/ |
Mode of |
Name |
|
| Description |
|
Cost |
Depreciation |
value |
of sale |
(loss) |
Sale |
Purchaser |
|
|
|
|
|
Rs. 000 |
Rs. 000 |
Rs. 000 |
Rs. 000 |
Rs. 000 |
|
|
|
|
|
|
| Vehicles |
|
10 |
10 |
- |
1 |
1 |
Nego- |
Mr. Muhammad Hanif |
|
tiation |
(an employee) |
|
|
----------- |
----------- |
----------- |
----------- |
----------- |
|
|
|
|
1996 |
10 |
10 |
- |
1 |
1 |
|
|
|
============ |
============ |
============ |
============ |
============ |
|
|
|
|
|
1995 |
584 |
379 |
205 |
212 |
7 |
|
|
|
============ |
============ |
============ |
============ |
============ |
|
|
|
| 11.
TANGIBLE FIXED ASSETS - OTHER |
|
| This
represents the "York Line" complete machinery and transfer line,
purchased from an |
|
| associated
company (imported under the Pakistan Government's Non-Repartriable Investment |
|
| Scheme).
According to the Company's board resolution, after utilizing such machines
that are |
|
| adaptable
for manufacture of tractor engines, the surplus will be disposed off. |
|
|
| 12.
LONG TERM INVESTMENT |
|
| This
represents investment at cost in ordinary shares in the equity of Polymer
& Precision |
|
| Engineers
(Pvt.) Limited - an associated undertaking. Based on the latest available
audited |
|
| accounts
of Polymer & Precision Engineers (Pvt.) Limited as of June 30, 1995, the
holding of the |
|
| company
represents 15.99% of the total equity of Polymer & Precision Engineers
(Pvt.) Limited and |
|
| the
net worth of the investment works out to Rs. 1.59 million (Previous year -
Rs. 1.403 million). |
|
|
|
|
|
1996 |
1995 |
|
| 13.
LOOSE TOOLS |
|
|
Rs.000 |
Rs.000 |
|
|
|
|
|
|
| Opening
Balance |
|
|
599 |
666 |
|
| Written Off |
|
|
(60) |
(67) |
|
|
|
|
----------- |
----------- |
|
|
|
539 |
599 |
|
|
============ |
============ |
|
|
|
| 14.
STOCK-IN-TRADE |
|
|
|
|
|
| 14.1
Tractors and Agrimotors" |
|
|
|
| Raw
materials and components |
|
19,134 |
23,485 |
|
| Work-in-Progress |
|
2,808 |
2,029 |
|
| Finished
goods |
|
975 |
895 |
|
|
------------ |
------------ |
|
|
|
22,917 |
26,389 |
|
|
|
|
|
| 14.2
Parts and implements |
|
2,229 |
2,229 |
|
|
|
------------ |
------------ |
|
|
|
25,145 |
28,618 |
|
| Provision
for obsolete stock |
|
(54) |
(65) |
|
|
|
------------ |
------------ |
|
|
25,091 |
28,553 |
|
| 14.3
Agrimotor development expenses ** |
|
2,374 |
2,321 |
|
|
|
------------ |
------------ |
|
|
|
27,465 |
30,874 |
|
|
|
============ |
============ |
|
|
|
| *In
accordance with the Compromise Agreement dated January 22, 1990 between
"Ford" and the |
|
| company,
the Company has undertaken that it will not after the effective date (i.e.
March 22, 1990) |
|
| manufacture,
assemble or sell any of the Licensed Products as defined in any of the
subsisting |
|
| agreements
or any Ford agricultural tractor or their parts or components or spare parts
or assemblies |
|
| or
sub-assemblies or use any of the Ford trade marks or the Ford trade name or
the Ford insignia or |
|
| logo
upon or in relation to or in connection with any goods, services or busiess
whatsoever, except for |
|
| such
units of the Model 1910 tractor which were at the agreement date in the
company's inventory and |
|
| were
to be assembled before June 30, 1990 and to be sold upto December 31, 1990.
At the request |
|
| of
the company for further extension of time, Ford has communicated their
consent that the company |
|
| may
sell the balance inventory of 1910 tractors by using any other name. The
company as such has |
|
| decided
to sell the 1910 tractors under the brand name "ALLIED 35" instead
of "FORD 1910". |
|
|
| Stock-in-trade
includes former "Ford trade mark" inventories of an estimated value
of Rs. 19.275 million |
|
| (1995
· Rs. 22.733 million) which have been valued at cost and no adjustment has
been made in the |
|
| financial
statements with regard to the aforestated. |
|
|
| **
This amount represents expenses incurred in acquiring some farm vehicles
(Agrimotors) for test and |
|
| trial.
Since Allied Motors Limited has not earned any profit during the past years,
the Chairman of the |
|
| company
has requested the Midland Motors Pakistan (Pvt.) Limited to provide funds for
the said |
|
| expenses.
The funds so provided will be reimbursed to the Midland Motors Pakistan (Pvt)
Limited with |
|
| markup
@ 8% only if the test marketing is successful. However, in the event the
product does not take |
|
| off,
the expenses so incurred will be borne by the Midland Motors Pakistan (Pvt)
Limited and mark-up |
|
| will
not be payable to Midland Motors Pakistan (Pvt.) Limited. |
|
|
|
1996 |
1995 |
|
|
Rs.000 |
Rs.000 |
|
| 15.
TRADE DEBTORS - UNSECURED - CONSIDERED GOOD |
|
| In
respect of tractor sales |
|
439 |
27 |
|
|
============ |
============ |
|
|
|
|
|
| 16.
ADVANCES - UNSECURED - CONSIDERED GOOD |
|
|
|
| To
employees |
|
- |
31 |
|
| To
suppliers |
|
- |
42 |
|
|
|
|
------------ |
------------ |
|
|
|
|
|
- |
73 |
|
|
|
|
============ |
============ |
|
|
|
|
|
|
|
| 17.
DEPOSITS AND PREPAYMENTS |
|
|
|
|
| Security
deposits |
|
|
341 |
341 |
|
| Short
term prepayments |
|
16 |
11 |
|
|
------------ |
------------ |
|
|
|
357 |
352 |
|
|
|
============ |
============ |
|
|
|
|
|
| 18.
CASH AND BANK BALANCES |
|
|
|
| With
banks on current accounts |
|
292 |
2O |
|
| In hand |
|
45 |
45 |
|
|
|
|
|
------------ |
------------ |
|
|
|
|
337 |
65 |
|
|
|
============ |
============ |
|
| 19. SALES |
|
|
|
| Tractors
and Agrimotors [net of discount of Rs. 78(550)] |
|
|
| Manufactured
goods |
|
5,734 |
4,302 |
|
| Less
:Commission paid |
|
468 |
363 |
|
|
|
|
------------ |
------------ |
|
|
|
5,266 |
3,939 |
|
| Trading
goods (parts and implements) |
|
1 |
- |
|
|
------------ |
------------ |
|
|
|
5,267 |
3,939 |
|
|
|
============ |
============ |
|
|
|
|
| 20.1
Tractors aria Agrimotors |
|
| Raw
materials consumed (20.1.1) |
|
5,162 |
1,333 |
|
| Manufacturing
expenses (20.1.2) |
|
5,048 |
5,376 |
|
| Inventory
adjustment |
|
45 |
(13) |
|
|
|
------------ |
------------ |
|
|
|
10,255 |
6,696 |
|
|
|
|
|
|
| Work-in-process
inventory at July 1, 1995 |
|
2,029 |
4,318 |
|
| Work-in-process
inventory at June 30, 1996 |
|
(2,807) |
(2,029) |
|
|
------------ |
------------ |
|
|
|
(778) |
2,289 |
|
|
|
|
|
| Finished
goods inventory at July 1, 1995 |
|
895 |
873 |
|
| Finished
goods inventory at June 30, 1996 |
|
(975) |
(895) |
|
|
------------ |
------------ |
|
|
|
(80) |
(22) |
|
|
|
|
|
|
|
------------ |
------------ |
|
|
|
9,397 |
8,963 |
|
| 20.2
Parts and implements - Tractors and Agrimotors |
|
|
|
| Stock
at July 1, 1995 |
|
2,229 |
2,186 |
|
|
|
|
|
| Purchases
(net of inventory adjustments) |
|
- |
43 |
|
| Stock
at June 30, 1996 |
|
(2,228) |
(2,229) |
|
|
|
------------ |
------------ |
|
|
|
(2,228) |
(2,186) |
|
|
|
|
|
|
|
|
------------ |
------------ |
|
|
|
1 |
- |
|
|
|
|
|
|
------------ |
------------ |
|
|
|
9,398 |
8,963 |
|
|
|
============ |
============ |
|
|
|
| 20.1.1
Raw materials consumed |
|
|
| Stock
at July 1, 1995 |
|
23,465 |
23,404 |
|
| Purchases
(Net of Inventory adjustments) |
|
831 |
1,394 |
|
|
------------ |
------------ |
|
|
|
24,296 |
24,798 |
|
| Stock
at June 30, 1996 |
|
(19,134) |
(23,465) |
|
|
|
------------ |
------------ |
|
|
|
5,162 |
1,333 |
|
|
|
============ |
============ |
|
|
|
| 20.1.2
Manufacturing expanses |
|
| Salaries,
wages and benefits |
|
1.21 |
1.21 |
|
| Travelling
and vehicles running |
|
140 |
105 |
|
| Insurance |
|
105 |
112 |
|
| Rent,
rates and taxes |
|
528 |
493 |
|
| Repairs
and maintenance |
|
1 |
24 |
|
| Electricity,
gas and water |
|
162 |
189 |
|
| Postage,
telephone and stationery |
|
11 |
15 |
|
| Stores
and supplies |
|
32 |
29 |
|
| Entertainment |
|
86 |
71 |
|
| Depreciation* |
|
2,637 |
2,934 |
|
| Loose
tools written off |
|
60 |
67 |
|
| Wastage
& process loss |
|
53 |
53 |
|
| Provision
for obsolete stock |
|
2 |
65 |
|
| Miscellaneous |
|
18 |
7 |
|
|
|
------------ |
------------ |
|
|
|
5,048 |
5,376 |
|
|
|
============ |
============ |
|
|
|
| *
Although the factory of the company was not in operation during the year,
depreciation |
|
| has been charged fully in accordance with
the company's accounting policy. |
|
|
|
| 21.
SELLING, DISTRIBUTION, ADMINISTRATION AND |
|
| GENERAL
EXPENSES |
|
|
|
|
| Selling
and distribution expenses (21.1) |
|
2,187 |
2,383 |
|
| Administration
and general expenses (21.2) |
|
2,259 |
3,149 |
|
|
|
------------ |
------------ |
|
|
|
4,446 |
5,532 |
|
|
|
============ |
============ |
|
|
|
| 21.1
Selling and distribution expenses |
|
| Salaries
and benefits |
|
1,048 |
1,410 |
|
| Travelling
and vehicles running |
|
488 |
316 |
|
| Insurance |
|
21 |
22 |
|
| Rent,
rates and taxes |
|
94 |
94 |
|
| Repairs
and maintenance |
|
- |
1 |
|
| Pre-delivery
inspection, after sales service |
|
| charges and warranty charges |
|
22 |
- |
|
| Depreciation |
|
43 |
48 |
|
| Entertainment |
|
257 |
283 |
|
| Electricity,
gas and water |
|
65 |
42 |
|
| Postage,
telephone and stationery |
|
145 |
122 |
|
| Advertisement
/ Product support |
|
1 |
32 |
|
| Miscellaneous |
|
3 |
13 |
|
|
|
------------ |
------------ |
|
|
|
2,187 |
2,383 |
|
|
|
============ |
============ |
|
|
|
| 21.2
Administration and general expanses |
|
|
|
| Salaries,
wages and benefits |
|
865 |
1,284 |
|
| Travelling
and vehicles running |
|
265 |
476 |
|
| Insurance |
|
11 |
19 |
|
| Rent,
rates and faxes |
|
144 |
119 |
|
| Repairs
and maintenance |
|
78 |
25 |
|
| Electricity,
gas and water |
|
145 |
148 |
|
| Postage,
telephone and stationery |
|
205 |
386 |
|
| Entertainment |
|
91 |
102 |
|
| Legal
and professional charges |
|
114 |
257 |
|
| Auditor's
remuneration (21.2.1) |
|
70 |
70 |
|
| Depreciation
on fixed assets |
|
71 |
8O |
|
| Miscellaneous |
|
200 |
183 |
|
|
------------ |
------------ |
|
|
|
2,259 |
3,149 |
|
|
|
=========================== |
|
|
|
|
|
| 21.2.1
Auditor's remuneration |
|
|
|
| Audit fees |
|
30 |
30 |
|
| Accountancy
and consultancy |
|
30 |
30 |
|
| Out-of-pocket
expenses |
|
10 |
10 |
|
|
------------ |
------------ |
|
|
|
70 |
70 |
|
|
|
=========================== |
|
|
|
|
|
| 22.
FINANCIAL CHARGES |
|
|
|
| Mark-up
on shod term running finance |
|
2,378 |
1,420 |
|
| Bank
Charges |
|
72 |
47 |
|
|
------------ |
------------ |
|
|
|
2,450 |
1,467 |
|
|
|
=========================== |
|
| 23.
OTHER INCOME |
|
|
|
|
| Interest
on shod term deposit |
|
34 |
- |
|
| Gain
on sale of fixed assets (see note 10.1) |
|
1 |
- |
|
| Exchange
gain / (Loss) |
|
(151) |
(15) |
|
| Miscellaneous |
|
166 |
171 |
|
|
|
------------ |
------------ |
|
|
|
50 |
163 |
|
|
|
=========================== |
|
|
|
|
| 24.
PRIOR PERIOD ITEMS |
|
| Liabilities
written back |
|
23 |
- |
|
| Professional
tax |
|
37 |
- |
|
| Provision
for expenses |
|
(58) |
- |
|
|
------------ |
------------ |
|
|
|
2 |
- |
|
|
|
=========================== |
|
|
|
|
|
|
| 25.
TAXATION |
|
|
|
| Current |
|
- |
22 |
|
| Deferred |
|
29 |
(171) |
|
|
|
------------ |
------------ |
|
|
|
29 |
(149) |
|
|
|
=========================== |
|
|
|
|
|
| 26.
REMUNERATION OF CHIEF EXECUTIVE AND EXECUTIVES |
|
|
|
|
|
Chief Executive |
Executives |
|
|
|
1995 |
1995 |
1995 |
1995 |
|
|
|
|
| Managerial
remuneration |
|
- |
176 |
575 |
708 |
|
| House
rent/accommodation provided |
|
- |
79 |
304 |
319 |
|
| Provident
fund - Company's contribution |
- |
16 |
42 |
45 |
|
| Medical
expenses |
|
- |
4 |
32 |
54 |
|
| Telephone
expenses |
|
- |
84 |
13 |
23 |
|
| Utilities |
|
- |
17 |
48 |
56 |
|
|
------------ |
------------ |
------------ |
------------ |
|
|
|
- |
326 |
1,109 |
1,205 |
|
|
============ |
============ |
============ |
============ |
|
| Number
of persons |
|
1 |
1 |
4 |
4 |
|
|
| In
addition, the chief executive and one executive were provided with free use
of the |
|
| company's
car. |
|
|
| 27.
TRANSACTIONS WITH ASSOCIATED COMPANIES AND UNDERTAKINGS |
|
| The
aggregate amounts in respect of transactions with associated companies and
undertakings |
|
| during
the year other than those specified herein-above were. |
|
|
|
|
1996 |
1995 |
|
|
|
Rs. 000 |
Rs. 000 |
|
|
|
|
| (a)
Rent paid |
|
|
188 |
188 |
|
| (b)
Financial charges paid |
|
644 |
207 |
|
| (c)
Various other expenses incurred |
|
842 |
2,200 |
|
| (d)
Hire charges of tools and equipment (income) |
(166) |
(165) |
|
| (e)
Sale of fixed assets |
|
- |
90 |
|
| (f)
Purchase of fixed assets |
|
- |
162 |
|
|
| 28.
PLANT CAPACITY AND PRODUCTION |
|
| Plant
capacity |
|
6,000 |
6,000 |
|
| Actual
production - Tractor |
|
33 |
30 |
|
| Actual
production - Agrimotor |
|
11 |
1 |
|
|
| Production
capacity was under utilised due to slow movement in sales resulting from
adverse |
|
| impact
on the market emanating from severance of business relationship with Ford New
Holland. |
|
|
| 29.
COMPARATIVE FIGURES |
|
|
|
| (a)
Previous year's figures have been rearranged wherever necessary, for the
purposes of |
|
| comparison. |
|
| (b)
Figures have been rounded off to the nearest thousand of rupees unless stated
otherwise. |
|
|
| ANVER MAJID |
|
| Director |
|
|
| TAJAMMUL
HUSSAIN |
|
| Director |
|
|
|
|
|
|
|
|
|
|
|
