| Allied Motors Limited |
|
|
|
|
|
|
|
| ANNUAL
REPORT 1998 |
|
|
|
| CONTENTS |
|
|
| Company
Information |
|
| Notice
of Meeting |
|
| Directors'
Report |
|
| Auditors'
Report |
|
| Balance
Sheet |
|
| Profit
& Loss Account |
|
| Statement
of Changes in Financial Position |
|
| Notes
to the Accounts |
|
|
|
| COMPANY
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
|
| K.
Asif Rahman |
|
Chairman & Chief
Executive |
|
|
| Manzoor
Saber |
|
| (Nominee
of NDFC) |
|
|
| Raziur
Rahman Khan |
|
| (Nominee
of NIT) |
|
|
| Tajammul
Hussain |
|
|
| P.
K. Shahani |
|
| (Alternate
Director of Iqbal Ghafur) |
|
|
| Anver Majid |
|
|
| Kamal
Mahmood |
|
|
| COMPANY
SECRETARY |
|
| Asif Mahmood |
|
|
| 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-R0omi, Block-5, |
|
| Clifton,
Karachi-75600 |
|
|
|
| NOTICE
OF MEETING |
|
|
| NOTICE
is hereby given that the Sixteenth Annual General Meeting of the Shareholders
of Allied Motors |
|
| Limited
will be held on Monday December 28, 1998 at 12.00 Noon at the Registered
office of the Company, |
|
| situated
at D-168, S.I.T.E., Haroonabad, Karachi to transact the following business: |
|
|
| 1.
To confirm the Minutes of the fifteenth Annual General Meeting held on
December 23, 1997. |
|
|
|
|
| 2.
To receive, consider and adopt the Audited Accounts of the Company for the
year ended June 30, |
|
| 1998,
together with the Directors' Auditors' Report thereon. |
|
|
| 3.
To elect Seven (7) Directors for a period of 3 years in place of retiring
Directors messers |
|
| K.
Asif Rahman, Manzoor Saber, Raziur Rahman Khan, Tajammul Hussain, P.K.
Shahani (Alternate |
|
| Director
of Iqbal Ghafur) Anver Majid, Kamal Mahmood & Fazlur Rahman. The number
of Directors |
|
| fixed
by the Board for election is seven (7) |
|
|
| 4.
To appoint Auditors of the Company for the year 1998/99and to fix their
remuneration. The present |
|
| Auditors
- Ford, Rhodes, Robson, Morrow - Chartered Accountants - retire and, being
eligible, offer |
|
| themselves
for reappointment. The Company has received a notice from a shareholder under
section |
|
| 253(I)
of the Companies ordinance 1984, Proposing to appoint Nasir Javaid & Co.
Chartered |
|
| Accountants
as Auditors for the financial year ending 30th June 1999. |
|
|
| 5.
To transact any other ordinary business of the Company with the permission of
the Chair. |
|
|
|
|
BY ORDER OF THE BOARD |
|
|
|
|
|
|
| Dated:
Karachi, December 3, 1998 |
|
ASIF MAHMOOD |
|
|
|
|
Company Secretary |
|
|
| NOTES: |
|
|
| 1.
The Share Transfer Books of the Company will remain closed from December 14,
1998 through |
|
| December
28 1998 (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 sixteenth Annual General Meeting and place
before you the Annual |
|
| Report
together with the Audited Accounts of the Company for the year ended June 30,
1998. |
|
|
| FINANCIAL
RESULTS |
|
| The
financial results are summarized as under: |
|
|
|
|
(Rs. 000) |
|
|
|
1998 |
1997 |
|
|
| Net Sales |
|
|
4,857 |
3,658 |
|
| Gross
Profit/(Loss) |
|
|
(2,616) |
(3,162) |
|
| Operating
Profit/(Loss) |
|
|
(9,260) |
(9,059) |
|
| Profit/(Loss)
Before Tax |
|
|
(8,861) |
(10,287) |
|
| Profit/(Loss)
After Tax |
|
|
(12,921) |
(30,006) |
|
| Unappropriated
Profit/(Loss) B/F |
|
(162,801) |
(132,795) |
|
| Accumulated
Profit/(Loss) |
|
(149,880) |
(162,801) |
|
|
| During
the year under review, the Company sold 33 units of small horse power
Tractors from the left over |
|
| inventory,
under the brand name of "Allied-35". The total tractor industry
sales was 11,971 units including 33 |
| units
of small horse power tractors which were sold by your Company. |
|
|
| Between
the last Directors' Report and during the financial year under review, there
has been no material |
|
| changes
and commitments affecting the financial position of the Company. |
|
|
| There
have been no changes that have occurred during the financial year concerning
the nature of business |
|
| of
the Company. |
|
|
| AUDITORS'
OBSERVATIONS |
|
| Auditors'
observation in para 2 of the Auditors' Report to the Members, it is stated
that: |
|
|
| The
management is concerned about the future of your Company and it is actively
engaged in its re-activation. |
|
| The
Company's property 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. |
|
|
| 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
OUT LOOK |
|
| As
you are already aware, the reactivization of the company has been the
management's main concern. This |
|
| to
date still holds true and whilst active discussions are on going with foreign
manufacturers, unfortunately |
|
| the
country's internal and external problems have had a very negative impact. The
imminent fears of default |
|
| looms
large, coupled with its consequences on company's business |
|
|
| Your
management sincerely hopes that the country's economic position improves to
enable us to conclude |
|
| our
efforts to your entire satisfaction. |
|
|
| YEAR
2000 COMPLIANCE OF COMPUTER SYSTEM |
|
| As
the millennium approaches, we know there is a mandatory Year-2000 date
problem which affects most |
|
| computer
operating systems including microchips and software programs that records the
year using only |
|
| the
last two digits. |
|
|
| Like
other we will also get affected by Year-2000 problem. However, our software
are not developed in the |
|
| earlier
generation language like Assembly or Cobol. We do not face any problems of
the same quantum. We |
|
| are
in PC environment under Novel NetWare 3.12 using FoxPro 2.6. This software
allows the use of a |
|
| command
such as "Set century on" which would to a great extent take care of
the problem. Allied Motors Ltd. |
|
| is
fully committed to beating the Millennium Bug. |
|
|
| PATTERN
OF SHAREHOLDING |
|
| The
pattern of shareholding is attached. |
|
|
| The
management would like to place on record its appreciation of the work of
senior management, executives |
|
| and
other members of the staff without whose unstinted support it would not have
been possible to continue |
|
| the
Company's operations. |
|
|
|
|
FOR AND ON BEHALF OF THE BOARD |
|
|
|
|
|
|
| Dated:
Karachi, November 17, 1998 |
|
K. ASIF RAHMAN |
|
|
|
|
Chairman |
|
|
|
| PATTERN
OF SHAREHOLDING |
|
|
| Pattern
of Holding of Shares Held by the Shareholders |
|
| As
at June 30, 1998 |
|
|
| No. of |
Share Holding |
Total |
|
| Shareholders |
From |
To |
Shares Held |
|
|
| 594 |
1 |
100 |
57,134 |
|
| 538 |
101 |
500 |
118,347 |
|
| 86 |
501 |
1000 |
76,000 |
|
| 138 |
1001 |
5000 |
336,808 |
|
| 19 |
5001 |
10000 |
127,346 |
|
| 8 |
10001 |
15000 |
100,232 |
|
| 5 |
15001 |
20000 |
85,630 |
|
| 2 |
20001 |
25000 |
48,399 |
|
| 1 |
25001 |
30000 |
27,633 |
|
| 2 |
30001 |
35000 |
64,933 |
|
| 2 |
45001 |
50000 |
93,899 |
|
| 1 |
55001 |
60000 |
57,731 |
|
| 1 |
60001 |
65000 |
61,633 |
|
| 1 |
70001 |
75000 |
70,833 |
|
| 1 |
105001 |
110000 |
109,700 |
|
| 1 |
355001 |
360000 |
355,333 |
|
| 1 |
690001 |
695000 |
691,094 |
|
| 1 |
885001 |
890000 |
889,200 |
|
| 1 |
1105001 |
1110000 |
1,108,906 |
|
| 1 |
1880001 |
1885000 |
1,883,200 |
|
| 1 |
2635001 |
2640000 |
2,636,009 |
|
| ---------- |
|
---------- |
|
| 1405 |
|
9,000,000 |
|
| ========== |
|
========== |
|
|
| CATEGORIES
OF SHAREHOLDERS |
|
| As
at June 30, 1998 |
|
|
| CATEGORIES
OF SHAREHOLDERS |
NUMBER |
SHARES HELD |
PERCENTAGE |
|
|
| 1.
Joint Stock Companies |
|
5 |
4,493,906 |
49.93 |
|
| 2.
Financial Institutions |
3 |
2,843,233 |
31.59 |
|
| 3.
Holding Companies |
|
0 |
0 |
0.00 |
|
| 4.
Modaraba Companies |
|
0 |
0 |
0.00 |
|
| 5.
Insurance Companies |
|
3 |
171,499 |
1.91 |
|
| 6.
Investment Companies |
|
1 |
355,333 |
3.95 |
|
| 7.
Individuals |
|
1393 |
1,136,029 |
12.62 |
|
| 8.
Associated Companies |
|
0 |
0 |
0.00 |
|
| 9. Others |
|
0 |
0 |
0.00 |
|
|
|
---------- |
---------- |
---------- |
|
|
|
1405 |
9,000,000 |
10,000 |
|
|
|
========== |
========== |
========== |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| 1
.We have audited the annexed balance sheet of ALLIED MOTORS LIMITED as at
June 30, 1998 and |
|
| the
related profit and loss account and statement of changes in financial
position (cash flow state- |
|
| ment),
together with the notes forming part thereof, for the year then ended. |
|
|
|
|
| 2.
As shown in the financial statements, the company has an operating loss for
the year of Rs. 9.260 |
|
| million
and a carried forward net loss of Rs. 149.880 million as at June 30, 1998
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 compa- |
|
| nies
withdrawal from and termination of its franchise agreements with the company,
raise substan- |
|
| tial
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.
Consequently adjustments |
|
| may
be required to the recorded asset amounts or to the amounts and
classification of liabilities. The |
|
| financial
statements (and notes thereto) do not disclose this fact. |
|
|
| 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 not 14) and an amount of Rs. 5
million in |
|
| respect
of investment, against which no provisions have been made. |
|
|
| 3.
We state that we have obtained all the information and explanations which to
the best of our knowl- |
|
| edge
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 agree- |
|
| ment
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
busi- |
|
| ness; and |
|
|
| (iii)
the business conducted, investments made and the expenditure incurred during
the |
|
| year
were in accordance with the objects of the company; |
|
|
| (c)
in our opinion, except for the omission of the information referred to in 2
above and subject |
|
| to
the matters stated in 3 above, to the best of our information and according
to the explana- |
|
| tions
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, |
|
| 1998
and of the loss and the statement of changes in financial position (cash flow
state- |
|
| ment)
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 |
|
| Karachi
- 19 November 1998 |
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET |
|
| AS
AT JUNE 30, 1998 |
|
|
|
NOTE |
1998 |
1997 |
|
|
|
Rs. 000 |
Rs. 000 |
|
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
| Authorised
Capital |
|
|
|
| 21,800,000
ordinary share 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 |
(139,980) |
(152,901) |
|
|
|
|
---------- |
---------- |
|
|
|
|
(53,786) |
(66,707) |
|
|
|
|
---------- |
---------- |
|
|
|
|
36,214 |
23,293 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
| Short
term finance |
|
6 |
18,793 |
18,299 |
|
| Due
to associated company |
|
7 |
8,591 |
6,550 |
|
| Creditors,
accrued expenses and other liabilities |
8 |
5,995 |
26,228 |
|
|
|
|
---------- |
---------- |
|
|
|
|
33,379 |
51,077 |
|
| CONTINGENCY |
|
|
9 |
|
|
|
|
---------- |
---------- |
|
|
|
|
|
69,593 |
74,370 |
|
|
|
|
|
========== |
========== |
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating
fixed assets - Net |
|
10 |
31,939 |
34,022 |
|
| Other |
|
11 |
9,482 |
9,482 |
|
|
|
|
---------- |
---------- |
|
|
|
|
41,421 |
435.04 |
|
|
|
|
|
|
|
| LONG
TERM INVESTMENT |
|
12 |
5,000 |
5,000 |
|
| CURRENT
ASSETS |
|
|
|
|
|
|
|
|
| Loose tools |
|
13 |
437 |
485 |
|
| Stock-in-trade |
|
14 |
22,045 |
24,982 |
|
| Advances |
|
15 |
- |
12 |
|
|
|
|
|
|
| Deposits
and prepayments |
|
16 |
90 |
92 |
|
| Other
receivables |
|
|
- |
33 |
|
|
|
|
|
|
| Income
tax receivable |
|
|
502 |
139 |
|
| Cash
and bank balances |
|
17 |
98 |
123 |
|
|
|
|
---------- |
---------- |
|
|
|
|
|
23,172 |
25,866 |
|
|
|
|
|
---------- |
---------- |
|
|
|
|
|
69,593 |
74,370 |
|
|
|
|
|
========== |
========== |
|
|
| The
annexed notes form part of these accounts. |
|
| The
auditors' report is annexed hereto. |
|
|
|
|
KAMAL MAHMOOD |
|
|
K. ASIF RAHMAN |
|
|
Director |
|
|
Chairman & Chief Executive |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
|
NOTE |
1998 |
1997 |
|
|
|
Rs.000 |
Rs. 000 |
|
|
|
|
| Sales |
|
18 |
4,857 |
3,658 |
|
| Cost
of sales |
|
19 |
(7,473) |
(6,820) |
|
|
|
|
---------- |
---------- |
|
|
|
|
(2,616) |
(3,162) |
|
| Selling,
distribution, administration |
|
|
|
|
| and
general expenses |
|
20 |
(3,493) |
(2,809) |
|
|
|
|
|
|
| Financial
charges |
|
21 |
(3,151) |
(3,088) |
|
|
|
|
---------- |
---------- |
|
|
|
|
(6,644) |
(5,897) |
|
|
|
|
---------- |
---------- |
|
| Operating
loss |
|
|
(9,260) |
(9,059) |
|
| Other income |
|
22 |
417 |
324 |
|
|
|
|
---------- |
---------- |
|
| Loss
for the year before taxation |
|
|
(8,843) |
(8,735) |
|
| Prior
period items |
|
23 |
(18) |
(1,552) |
|
|
|
|
---------- |
---------- |
|
| Loss
before taxation |
|
|
(8,861) |
(10,287) |
|
| Taxation |
|
24 |
21,782 |
(19,719) |
|
|
|
|
---------- |
---------- |
|
| Profit/(Ioss)
after taxation |
|
|
12,921 |
(30,006) |
|
| Loss
brought forward |
|
|
(162,801) |
(132,795) |
|
|
|
|
---------- |
---------- |
|
|
|
|
(149,880) |
(162,801) |
|
|
|
|
========== |
========== |
|
|
|
|
| The
annexed notes form part of these accounts |
|
|
|
KAMAL MAHMOOD |
|
|
K. ASIF RAHMAN |
|
|
Director |
|
|
Chairman & Chief Executive |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
|
|
1998 |
1997 |
|
|
|
Rs. 000 |
Rs. 000 |
|
| CASH
FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
| Funds
provided from operations |
|
|
|
| Profit/(loss)
after taxation |
|
12,921 |
(30,006) |
|
| Adjustment
for items not involving movement of funds: |
|
|
| Depreciation |
|
2,224 |
2,444 |
|
| Gain
on sale of fixed assets |
|
(251) |
(158) |
|
|
|
---------- |
---------- |
|
|
|
1,973 |
2,286 |
|
|
|
---------- |
---------- |
|
|
|
|
14,894 |
(27,720) |
|
| Working
capital changes |
|
|
|
|
|
|
|
| (Increase)/decrease
in current assets |
|
|
|
|
|
|
| Loose tools |
|
|
48 |
54 |
|
| stock-in-trade |
|
2,937 |
2,483 |
|
| Trade debts |
|
|
- |
439 |
|
| Advances |
|
|
12 |
(12) |
|
| Due
from associated companies |
|
258 |
(258) |
|
| Deposits
and prepayments |
|
2 |
375 |
|
| Other
receivables |
|
33 |
(16) |
|
| Advance tax |
|
|
(363) |
75 |
|
|
|
---------- |
---------- |
|
|
|
|
2,927 |
3,140 |
|
|
|
|
|
|
| Increase/(decrease)
in current liabilities |
|
|
|
|
|
| Short
term finance |
|
494 |
1,409 |
|
| Due
to associated companies |
|
1,783 |
1,848 |
|
| Creditors
accrued expenses and other liabilities |
|
(20,233) |
20,752 |
|
|
|
---------- |
---------- |
|
|
|
(17,956) |
24,009 |
|
|
|
---------- |
---------- |
|
| Net
cash used in operating activities |
|
(135) |
(571) |
|
|
|
|
|
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
|
|
| Capital
expenditure |
|
(150) |
(93) |
|
| Sale
proceeds of fixed assets |
|
260 |
450 |
|
|
|
---------- |
---------- |
|
| Net
cash generated from investing activities |
|
110 |
357 |
|
|
|
---------- |
---------- |
|
| Net
decrease in cash and cash equivalents |
|
(25) |
(214) |
|
|
|
---------- |
---------- |
|
| Cash
and cash equivalents at the beginning of the year |
123 |
337 |
|
|
|
---------- |
---------- |
|
| Cash
and cash equivalents at the end of the year |
|
98 |
123 |
|
|
|
========== |
========== |
|
|
|
KAMAL MAHMOOD |
|
K. ASIF RAHMAN |
|
|
|
Director |
|
Chairman & Chief Executive |
|
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
| 1.
STATUS AND NATURE OF BUSINESS |
|
| Allied
Motors Limited is a public limited company quoted. on stock exchanges in
Karachi (trading in |
|
| defaulters
counter) and Lahore. The company's business is the assembly-cure-progressive
manu- |
|
| facture
and sale of tractors 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 of 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. |
