| First Ibrahim Modaraba |
|
|
|
|
|
| (Annual
Report 1996) |
|
|
| Contents |
|
| Modaraba
information |
|
2 |
|
| Chief
executive's review |
|
3 |
|
| Auditors'
report to the certificate holders |
5 |
|
| Balance
sheet |
|
6 |
|
| Profit
and loss account |
|
8 |
|
| Statement
of changes in financial position |
9 |
|
| Notes
to the accounts |
|
11 |
|
| Pattern
of certificate holdings |
|
20 |
|
|
|
|
MODARABA INFORMATION |
|
| Board
of Directors of Management Company |
|
|
| Sheikh
Mukhtar Ahmad |
|
Chairman |
|
| Sheikh
Muhammad Yaseen |
|
Director |
|
| Mr.
Muhammad Naeem Mukhtar |
Director |
|
| Mr.
Muhammad Waseem Mukhtar |
Director |
|
| Mr.
Abdul Waheed Mian |
|
Chief Executive |
|
|
|
| Auditors
of Modaraba |
|
Auditors of Modaraba |
|
|
Management |
|
|
Company |
|
| M/s.
M. Yousuf Adil & Co |
|
M/s. Patel & Co. |
|
| Chartered
Accountants, |
|
Chartered Accountants |
|
| A-35,
Block 7 & 8 |
|
50-A, Lalazar Drive |
|
| K.C.H.S.U. |
|
M.T. Khan Road |
|
| Shahrah-e-Faisal |
|
Karachi. |
|
| Karachi. |
|
|
| Bankers
of Modaraba |
|
Management Company |
|
|
| Muslim
Commercial Bank Limited |
Ibrahim Modaraba (Pvt)
Limited |
|
| Askari
Commercial Bank Limited |
Ibrahim Centre |
|
| Union
Bank Limited |
|
GK 7/59, Bagh-e-Zehra
Street |
|
| Emirate
Bank International Ltd. |
Kharadar |
|
| Habib
Bank AG Zurich |
|
Karachi. |
|
|
| Registered
Office/ |
|
Legal Advisor |
|
| Certificate
Transfer Office |
|
|
| Ibrahim
Centre |
|
M/s. Ch. Khurshid Law
Associates |
|
|
| GK
7/59 Bagh-e-Zehra Street |
Advocates |
|
| Kharadar |
|
158, District Courts |
|
| Karachi. |
|
Faisalabad. |
|
|
|
|
CHIEF EXECUTIVES REVIEW |
|
|
|
|
| We
are pleased to present before you the 4th Annual Review of First Ibrahim
Modaraba |
|
| together
with audited accounts for the year ended June 30, 1996. |
|
|
| FINANCIAL
RESULTS |
|
| The
financial results of First Ibrahirn Modaraba for the year ended June 30, 1996 |
|
| are
satisfactory. The trading activity had to be curtailed due to the imposition
of |
|
| withholding
tax @ 4% at import stage and 2.5% at the time of sale as final tax |
|
| liability.
The imposition of withholding tax had adversely affected the profitability, |
|
| as
such the Management had to divert its funds and had invested it in Musharaka |
|
| and
Morabaha Financing. |
|
|
| Your
Directors are pleased to declare 11% Cash Dividend i.e. Rs. 1.10 per Modaraba |
|
| Certificate
of Rs. 10/- each out of the profits earned. |
|
|
| The
results for the year ended June 30, 1996 are summarized as follows: |
|
|
|
For the |
For the |
|
|
Year Ended |
Six Months |
|
|
June 30, |
Ended June |
|
|
1996 |
30, 1995 |
|
|
Rupees |
Rupees |
|
|
| Profit
before management fee |
|
16,880,875 |
8,967,743 |
|
| Modaraba
Company's management fee |
|
1,534,625 |
815,249 |
|
|
| Net
profit available for appropriation |
15,950,104 |
8,614,353 |
|
| Appropriations: |
|
| Transfer
to special reserve |
|
3,069,250 |
1,630,499 |
|
| Cash
dividend @ 11% (1995 @ 5.5%) |
|
12,760,000 |
6,380,000 |
|
|
---------- |
---------- |
|
|
15,829,250 |
8,010,499 |
|
|
---------- |
---------- |
|
| Unappropriated
profit carried forward |
|
120,854 |
603,854 |
|
|
========== |
========== |
|
| FUTURE
PROSEPECTS |
|
|
|
| With
the conversion of specific purpose modaraba into general modaraba the
management |
|
| has
decided to invest in Musharaka and Morabaha financing. The switchover has |
|
| been
completed in July 1996. |
|
|
| AUDITORS |
|
| The
present auditors, M/s. M. Yousuf Adil & Co. Chartered Accountants, being
due for |
|
| retirement,
have offered themselves for re-appointment for the year ending June 30, 1997. |
|
| Their
appointment has been confirmed by the Board subject to approval by the
Registrar |
|
| Modaraba. |
|
|
| ACKNOWLEDGEMENT |
|
| The
board expresses its appreciation for hard work and positive efforts made by
the |
|
| staff,
guidance provided by Corporate Law Authority, Registrar Modaraba and State |
|
| Bank
of Pakistan and continued support from certificate holders and banks. |
|
|
|
On Behalf of the Board |
|
| Lahore: |
|
ABDUL WAHEED MIAN |
|
| Date:
02-12-1996 |
Chief Executive |
|
|
|
|
AUDITORS REPORT TO THE
CERTIFICATE HOLDERS |
|
|
|
|
| We
have audited the annexed balance sheet as at June 30, 1996 and the related |
|
| profit
and loss account and statement of changes in financial position, together
with |
|
| the
notes to the accounts for the year ended June 30, 1996 of First Ibrahim
Modaraba, |
|
| which
are Modaraba Company's (Ibrahim Modaraba (Private) Limited) representation |
|
| and
we state that we have obtained all the information and explanations which we |
|
| required
and after due verification thereof, we report that: |
|
|
| (a)
in our opinion proper books of account have been kept by the Modaraba Company |
|
| in
respect of First Ibrahim Modaraba as required by the Modaraba Companies |
|
| and
Modaraba (Flotation and Control) Ordinance, 1980 and Modaraba Companies |
|
| and
Modaraba Rules, 1981; and |
|
|
| (b)
in our opinion the balance sheet and the profit and loss account have been |
|
| drawn up in conformity with the Modaraba
Companies and Modaraba (Flotation |
|
| and Control) Ordinance, 1980 and the
Modaraba Companies and Modaraba |
|
| Rules 1981; and |
|
|
| (c)
in our opinion and to the best of our information and according to the
explanations |
|
| given to us; |
|
|
| (i)
the balance sheet and the related profit and loss account and statement |
|
| of
changes in financial position, which are in agreement with the books |
|
| of
account, exhibit respectively a true and fair view of the state of the |
|
| Modaraba's
affairs as at June 30, 1996 and the profit and the changes |
|
| in
financial position for the year ended on that date; |
|
|
| (ii)
Zakat deductible at source under the Zakat and Ushr Ordinance, 1980, |
|
| has been deducted by the Modaraba and
deposited in the Central Zakat |
|
| Fund established under section 7 of that
ordinance; and |
|
|
| (iii)
the business conducted, investments made and expenditure incurred by |
|
| the
Modaraba are in accordance with the objects, terms and conditions |
|
| of
the Modaraba. |
|
|
| Lahore |
|
M. YOUSUF ADIL & CO., |
|
| Date:
02-12-1996 |
|
Chartered Accountants |
|
|
|
|
BALANCE SHEET AS AT JUNE
30, 1996 |
|
|
|
|
1996 |
1995 |
|
|
Note |
Rupees |
Rupees |
|
|
| CAPITAL
AND RESERVES |
|
| Certificate
Capital |
|
| Authorised |
|
| 20,000,000
Modaraba Certificates |
|
| of
Rs. 10/- each |
|
200,000,000 |
200,000,000 |
|
|
| Issued,
subscribed and paid up |
2 |
116,000,000 |
116,000,000 |
|
|
|
|
| Special
reserve |
|
3 |
11,132,302 |
8,063,052 |
|
| Unappropriated
profit |
|
|
120,854 |
603,854 |
|
|
|
---------- |
---------- |
|
|
|
127,253,156 |
124,666,906 |
|
|
|
|
| LIABILITIES
AGAINST ASSETS |
|
|
| SUBJECT
TO FINANCE LEASE |
|
4 |
-- |
10,878 |
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
|
|
| Short
term morabaha finances |
|
-- |
7,273,702 |
|
| Current
portion of lease |
|
|
|
|
| liabilities |
|
|
10,878 |
121,819 |
|
| Management
fee payable |
|
|
1,534,625 |
815,249 |
|
| Creditors,
accrued and |
|
|
|
|
| other
liabilities |
|
5 |
198,085 |
509,764,555 |
|
| Proposed
cash dividend |
|
|
12,760,000 |
6,380,000 |
|
| Cash
dividend payable |
|
|
354,199 |
25,520,000 |
|
|
|
|
|
|
|
14,857,787 |
549,875,325 |
|
| COMMITMENTS |
|
6 |
-- |
-- |
|
|
---------- |
---------- |
|
|
142,110,943 |
674,553,109 |
|
|
========== |
========== |
|
|
|
|
| The
annexed notes from 1 to 22 form an integral part of these accounts. |
|
|
| FIXED
ASSETS - Tangible |
|
7 |
1,101,947 |
1,138,754 |
|
|
| DEPOSITS AND |
|
| DEFERRED
COSTS |
|
8 |
1,116,806 |
1,839,344 |
|
|
| CURRENT
ASSETS |
|
|
| Stock
in trade |
|
|
-- |
643,143,081 |
|
| Investments
in securities |
9 |
11,503,028 |
13,655,206 |
|
| Morabaha
receivables |
|
10 |
20,000,000 |
-- |
|
| Musharaka
receivables |
|
11 |
40,000,000 |
-- |
|
| Advances,
deposits, prepayments |
|
---------- |
---------- |
|
| and
other receivables |
|
12 |
20,924,215 |
4,458,792 |
|
| Cash
and bank balances |
|
13 |
47,464,947 |
10,317,932 |
|
|
---------- |
---------- |
|
|
139,892,190 |
671,575,011 |
|
|
|
---------- |
---------- |
|
|
142,110,943 |
674,553,109 |
|
|
========== |
========== |
|
|
|
PROFIT AND LOSS ACCOUNT |
|
|
|
|
For the |
For the |
|
|
Year Ended |
Six Months |
|
|
June 30, |
Ended June |
|
|
1996 |
30, 1995 |
|
|
Note |
Rupees |
Rupees |
|
|
|
|
| Sales |
|
14 |
961,850,311 |
855,744,701 |
|
| Cost
of goods sold |
|
15 |
937,376,517 |
834,408,683 |
|
|
|
---------- |
---------- |
|
| Trading
profit |
|
|
24,473,794 |
21,336,018 |
|
| Profit
on Morabahas/Musharakas |
|
1,920,001 |
-- |
|
|
|
---------- |
---------- |
|
|
|
26,393,795 |
21,336,018 |
|
| Operating
expenses |
|
16 |
1,950,885 |
1,275,580 |
|
| Financial
charges |
|
17 |
4,241,844 |
2,006,589 |
|
|
|
---------- |
---------- |
|
|
|
6,192,729 |
3,282,169 |
|
|
|
---------- |
---------- |
|
| Operating
profit |
|
|
20,201,066 |
18,053,849 |
|
| Other income |
|
|
4,610 |
-- |
|
|
|
---------- |
---------- |
|
|
|
20,205,676 |
18,053,849 |
|
| Other
Charges' |
|
18 |
3,324,801 |
9,086,106 |
|
|
|
---------- |
---------- |
|
| Profit
before modaraba company's |
|
|
|
| management
fee |
|
|
16,880,875 |
8,967,743 |
|
| Modaraba
company's management fee |
|
1,534,625 |
815,249 |
|
|
|
---------- |
---------- |
|
| Net
profit for the year |
|
|
15,346,250 |
8,152,494 |
|
| Unappropriated
profit brought forward |
|
603,854 |
461,859 |
|
|
|
---------- |
---------- |
|
| Profit
available for appropriation |
|
15,950,104 |
8,614,353 |
|
|
|
|
| Appropriation: |
|
|
|
| Special
reserve (Refer Note 3) |
|
3,069,250 |
1,630,499 |
|
| Proposed
cash dividend @ ll% (1995: @ 5.5%) |
12,760,000 |
6,380,000 |
|
|
|
---------- |
---------- |
|
|
|
15,829,250 |
8,010,499 |
|
|
|
---------- |
---------- |
|
| Unappropriated
profit carried forward |
|
120,854 |
603,854 |
|
|
========== |
========== |
|
| The
annexed notes from 1 to 22 form an integral part of these accounts. |
|
|
|
|
For the |
For the |
|
|
Year Ended |
Six Months |
|
|
June 30, |
Ended June |
|
|
1996 |
30, 1995 |
|
|
Rupees |
Rupees |
|
|
| A.
CASH FLOW FROM OPERATING ACTIVITIES |
|
| Profit
before taxation |
|
15,346,250 |
8,152,494 |
|
| Adjustment
for |
|
|
|
| Depreciation |
|
147,761 |
75,741 |
|
| Amortization |
|
722,538 |
361,269 |
|
| Provision
for diminution in |
|
|
|
| value
of investments |
|
2,602,263 |
8,724,837 |
|
| Profit
on disposal of fixed assets |
|
(4,610) |
-- |
|
| Financial
Charges |
|
4,241,844 |
2,006,589 |
|
|
---------- |
---------- |
|
| Operating
profit before working |
|
| capital
changes |
|
23,056,046 |
19,320,930 |
|
|
---------- |
---------- |
|
| Changes
in working capital |
|
|
| (Increase)/decrease
in current assets |
|
|
| Stock
in trade |
|
643,143,081 |
(236,237,037) |
|
| Advances,
deposits and prepayments |
|
(16,465,424) |
3,909,689 |
|
|
| Increase/(decrease)
in current liabilities |
|
|
| Management
fee |
|
719,376 |
(2,401,027) |
|
| Creditors,
accrued and other |
|
| liabilities |
|
(509,308,292) |
229,770,047 |
|
|
---------- |
---------- |
|
|
118,088,741 |
(4,958,328) |
|
|
---------- |
---------- |
|
| Cash
generated from operations |
|
141,144,787 |
14,362,602 |
|
| Financial
charges paid |
|
(4,500,021) |
(1,928,914) |
|
|
---------- |
---------- |
|
| Net
cash from operating activities |
|
136,644,766 |
12,433,688 |
|
|
========== |
========== |
|
|
| B.
CASH FROM INVESTING ACTIVITIES |
|
|
| Insurance
claim received |
|
47,000 |
-- |
|
| Capital
expenditure |
|
(153,344) |
(165,613) |
|
| Investments
in securities |
|
(450,085) |
(14,397,750) |
|
| Morabaha
receivables |
|
(20,000,000) |
-- |
|
| Musharaka
receivables |
|
(40,000,000) |
-- |
|
|
---------- |
---------- |
|
| Net
cash used in investing activities |
|
(60,556,429) |
(14,563,363) |
|
|
| C.
CASH FROM FINANCING ACTIVITIES |
|
| Payment
of lease liability |
|
(121,819) |
(55,259) |
|
| Dividend
paid |
|
(31,545,801) |
-- |
|
| Increase/(decrease)
in short |
|
|
|
| term
morabaha finances |
|
(7,273,702) |
1,185,154 |
|
|
---------- |
---------- |
|
| Net
cash from (used in) financing activities |
(38,941,322) |
1,129,895 |
|
|
========== |
========== |
|
| NET
(DECREASE)/INCREASE IN |
|
| CASH
AND BANK BALANCES (A+B+C) |
|
37,147,015 |
(999,780) |
|
|
| CASH
AND BANK BALANCES AT THE |
|
| BEGINNING
OF THE YEAR |
|
10,317,932 |
11,317,712 |
|
|
---------- |
---------- |
|
| CASH
AND BANK BALANCES AT THE |
|
| END
OF THE YEAR |
|
47,464,947 |
10,317,932 |
|
|
========== |
========== |
|
|
|
|
NOTES TO THE ACCOUNTS |
|
|
FOR THE YEAR ENDED JUNE
30, 1996 |
|
|
| 1.1
LEGAL STATUS AND NATURE OF BUSINESS |
|
| First
Ibrahim Modaraba is a multi purpose, perpetual modaraba formed under |
|
| the
Modaraba Companies and Modaraba (Flotation and Control) Ordinance |
|
| 1980
and rules framed thereunder and is managed by Ibrahim Modaraba |
|
| (Private)
Limited, a company incorporated in Pakistan under the Companies |
|
| Ordinance
1984 and registered with Registrar of Modaraba Companies and |
|
| Modarabas
under the Modaraba companies and Modaraba (Flotation and Control) |
|
| Ordinance,
1980. The Modaraba is listed on stock exchanges in Pakistan. |
|
|
| 1.2
SIGNIFICANT ACCOUNTING POLICIES |
|
| 1.2.1
Accounting Convention |
|
| These
accounts have been prepared on the basis of "Historical Cost |
|
| Convention". |
|
|
| 1.2.2
Taxation |
|
| Provision
for current taxation is based on taxable income at current tax |
|
| rates
after taking into account tax rebates and tax credit available if |
|
| any. |
|
|
| 1.2.3
Fixed assets |
|
| Fixed
assets are stated at cost less accumulated depreciation. Depreciation |
|
| is
charged to income on the reducing balance method at the rates specified |
|
| in
operating assets note. |
|
|
| Depreciation
on additions during the year is charged on the basis of |
|
| whole
year while no depreciation is charged on deletions during the |
|
| year. |
|
|
| 1.2.4
Deferred cost |
|
| These
are amortized to income over a maximum period of five years. |
|
|
| 1.2.5
Accounting for lease |
|
| The
Modaraba accounts for assets acquired under finance lease by recording |
|
| the
assets and related liability. Finance charges are allocated to accounting |
|
| period
in a manner so as to provide a constant periodic rate of charge on |
|
| the
outstanding liability. Assets are amortized over the period of their |
|
| useful
life at the rates specified in the fixed assets note. |
|
|
| 1.2.6
Stock in trade |
|
| These
are stated at the lower of cost, determined on specific lot basis, |
|
| and
net realisable value. Net realisable signifies the selling price in the |
|
| ordinary
course of business less cost necessarily to be incurred in order |
|
| to
make the sale. Goods in transit are stated at invoice value plus other |
|
| charges
incurred thereon. |
|
|
| 1.2.7
Marketable securities |
|
| Investment
in quoted shares are stated at lower of cost or market value |
|
| determined
on an aggregate portfolio basis. |
|
|
| 1.2.8
Revenue recognition |
|
| Sales
are recognised on despatch of goods to customers. |
|
|
|
|
As At |
As At |
|
|
June 30, |
June 30, |
|
|
1996 |
1995 |
|
|
Rupees |
Rupees |
|
| 2.
CERTIFICATE CAPITAL - ISSUED, |
|
|
|
| SUBSCRIBED
AND PAID-UP |
|
|
|
Modaraba certificates of
Rs. 10/- each |
|
|
| 10,000,000 |
Certificates fully paid
in cash |
|
100,000,000 |
100,000,000 |
|
| 1,600,000 |
Issued as fully paid
bonus certificates |
16,000,000 |
16,000,000 |
|
| ---------- |
|
---------- |
---------- |
|
| 11,600,000 |
|
116,000,000 |
116,000,000 |
|
| ========= |
|
========= |
========= |
|
|
|
|
|
| 3.
SPECIAL RESERVE |
|
| This
represents provision @ 20% of profit after tax as per the rules for |
|
| Non-Banking
Financial Institution of the State Bank of Pakistan. |
|
|
| 4.
LIABILITIES AGAINST ASSETS |
|
| SUBJECT
TO FINANCE LEASE |
|
|
| Balance
at the beginning of the period |
|
132,697 |
187,956 |
|
| Less:
Paid during the period |
|
121,819 |
55,259 |
|
|
---------- |
---------- |
|
|
10,878 |
132,697 |
|
| Payable
within one year |
|
| shown
under current liabilities |
|
(10,878) |
(121,819) |
|
|
---------- |
---------- |
|
|
- |
10,878 |
|
|
========= |
========= |
|
|
|
| Other
significant terms of financing are as under: |
|
| Number
of monthly instalment |
|
36 |
|
| Rupees each |
|
10,997 |
|
| Date
of first instalment |
|
August 01, 1993 |
|
| Finance
charges (Rs.) |
|
65,892 |
|
| Residue
value (Rs.) |
|
33,000 |
|
| Applicable
rate of finance |
|
13% |
|
|
| The
future minimum lease payments to which the Modaraba is committed as at |
|
|
| June 30, |
|
Rupees |
|
| 1997 |
|
10,997 |
|
| Financial
charges allocated to |
|
| future
period |
|
(119) |
|
|
---------- |
|
|
10,878 |
|
|
========= |
|
|
|
As At |
As At |
|
|
June 30,1996 |
June 30, 1995 |
|
|
Rupees |
Rupees |
|
| 5.
CREDITORS, ACCRUED AND OTHER |
|
| LIABILITIES |
|
|
| Advance
from customers |
|
-- |
168,468 |
|
| Creditors |
|
168,085 |
-- |
|
| Bills
payable for goods purchased |
|
-- |
499,052,739 |
|
| Accrued
expenses |
|
30,000 |
10,206,262 |
|
| Profit
payable on |
|
|
|
| short
term morabaha finances |
|
-- |
258,177 |
|
| Income
tax payable |
|
-- |
4,998 |
|
| Other |
|
-- |
73,911 |
|
|
---------- |
---------- |
|
|
198,085 |
509,764,555 |
|
|
========= |
========= |
|
| 6.
COMMITMENTS |
|
| Letters
of credit for goods |
|
-- |
98,770,707 |
|
|
|
========= |
========= |
|
|
| 7.
FIXED ASSETS - Tangible |
|
|
|
Cost At |
Additions/ |
Cost at |
Accumulated |
Written |
Depreciation |
Rate |
| Particulars |
|
1/7/1995 |
(Deletion) |
30-06-96 |
depreciation |
down value |
for the |
% |
|
At 30-06-96 |
At 30-06-96 |
year |
|
|
| Company
owned: |
|
| Furniture
and |
|
| fixture |
|
817,527 |
153,344 |
970,871 |
262,636 |
708,235 |
