| FIRST CRESCENT MODARABA |
|
|
|
|
|
|
|
|
| ANNUAL
REPORT 1998 |
|
|
|
| CONTENTS |
|
|
| Corporate
Information |
|
|
|
| Directors'
Report and Chief Executive's Review |
|
| Auditors'
Report to the Certificate Holders |
|
| Balance
Sheet |
|
| Profit
and Loss Account |
|
| Statement
of Changes in Financial Position |
|
| Notes
to the Accounts |
|
| Pattern
of Holding of Certificates |
|
| Investors'
Information |
|
|
|
| CORPORATE
INFORMATION |
|
|
| ALTAF
M. SALEEM |
|
| Chairman |
|
|
| MAHMOOD
AHMED |
|
| Chief
Executive |
|
|
| DIRECTORS |
|
| (in
alphabetical order) |
|
|
| Muhammad
Awais Qureshi |
|
| Rashid Ahmed |
|
| Zaheer
A. Shaikh |
|
|
| CORPORATE
SECRETARY |
|
| Rashid Sadiq |
|
|
| AUDITORS |
|
| Riaz
Ahmad and Company |
|
| Chartered
Accountants |
|
|
| LEGAL
ADVISORS |
|
| Hassan
and Hassan Advocates |
|
|
| PRINCIPAL
OFFICE |
|
| 45-
Shahrah-e-Quaid-e-Azam, Lahore |
|
| Phones:
(042)7238336-7 |
|
| Fax:
92-42-7230504 |
|
| Telex:
44445 BANK PK |
|
|
| REGISTERED
OFFICE |
|
| a3-Babar
Block, New Garden Town, Lahore. |
|
| (042)
5839631, 5881974-75 |
|
| Fax:
92-42-5881976 |
|
|
|
| DIRECTORS'
REPORT & CHIEF EXECUTIVE'S REVIEW |
|
|
| It
is a great pleasure to present to you the Seventh Annual Report of First
Crescent Modaraba (FCM), which covers the seventh |
|
| full
year of operations of the Modaraba. Before the review of operating results of
the Modaraba, it will be pertinent to have a |
| brief
review of the national economic scenario. |
|
|
| MACRO
ECONOMIC SCENARIO |
|
| The
economy did show some signs of revival during the year 1997-98, although most
of the macro-economic targets were not |
|
| met,
GDP grew by 5.4 per cent during the year as compared to the previous year's
growth of 1.3 per cent. The inflation rate |
|
| was
contained at 7.8 per cent while fiscal deficit was reduced to 5.4 per cent of
GDP. The decline in imports and increase in |
|
| Foreign
Currency Accounts and remittances had a positive impact on the current
account and balance of payments. However, |
|
| the
post-nuclear scenario and the imposition of economic sanctions have struck a
major blow to the economic achievements of |
|
| last
year. As a result, the country is likely to witness deterioration vis-a-vis
most of the economic targets during the current |
| year. |
|
|
| Pakistan
has relied on extensive external financing to fund its domestic expenditure
and investment needs, which has led to an |
|
| un-sustainable
level of external debt. It is estimated that the economy will face a
financing gap of over US$ 3.5 billion in the |
| current
year. The non-availability of foreign assistance had an adverse impact on
both, Pakistan's external reserves (which |
|
| have
fallen to around US$ 540 million from US$ 1.4 billion before the nuclear
tests), and its long-term credit rating (which has |
| been
downgraded to triple C). |
|
|
| Given
the meager foreign exchange reserves and no other means of obtaining external
financing, the real crunch will be on |
|
| imports
since the country will be forced to run current account surpluses to meet its
external obligations. The Government of |
|
| Pakistan's
(GOP) efforts to cut imports sharply is likely to lead to a fall in
industrial activity since the economy relies heavily |
| on
imported raw materials and machinery. This will not only hamper economic
growth, but will also lead to inflation and un- |
|
| employment.
Moreover, a substantial increase in exports would be required to enhance
foreign inflows. The GOP has set a 15 |
|
| per
cent export growth target for the year 1998-99, which seems rather ambitious
since the country lacks exportable surplus |
|
| and
most of the exported items are price sensitive (especially textile exports
which form almost 65 per cent of total exports). |
| The
investors' confidence in the capital market as measured by KSE Index
barometer remained in the 'very low to low' |
|
| category
for most part of the year. During the first half of 1997-98, political
atmosphere was not conducive for investment |
|
| owing
mainly to GOP's row with the judiciary and the termination of alliance with a
political party. In the 4~'r quarter of the |
| year
under review, the IPP issue and decisions on freezing Foreign Currency
Accounts by GOP after the nuclear blasts, played |
|
| adversely
with the investors' confidence. The deteriorated level of investor's
confidence coupled with severe liquidity crunch |
|
| pockets
in the 2"d half of the year was reflective in the movements at the stock
market. KSE- 100 Index registered all time low |
| in
June 1998 and closed at 880 points on 30th June, 1998 from 1,566 points as on
June 30, 1997, a decline of 43.82 per cent in |
|
| the
market capitalization. |
|
|
| OPERATING
AND INVESTING PERFORMANCE |
|
| As
on 30 June 1998, total assets of First Crescent Modaraba were Rs. 1,131.49
million as against the outstanding of |
|
| Rs.
1,048.19 million on the corresponding date of last year. During the year
under review lease disbursement of Rs. 302.95 |
|
| million
were made. Net investment in leasing business as on June 30, 1998 amounted to
Rs. 603.62 million. The leases |
|
| disbursed
during the year comprised of 74.80 % for plant and machinery, 11.65 % for
office equipment and 13.60 % for |
|
| vehicles.
Depreciation charge for the year under review was Rs. 152.69 million as
compared to Rs. 99.98 million charged in |
|
| the
last year. |
|
|
| The
following schedule give the gross amounts of investments made by FCM in
comparison with the corresponding figures of |
|
| previous
year. |
|
|
|
|
|
Rupees in million |
|
|
|
|
|
1997-98 |
1996-97 |
|
| Funds Based: |
|
|
|
| Lease
Finance |
|
|
|
302.95 |
322.11 |
|
| Morabaha/Musharika
Financing |
|
|
308.81 |
457.59 |
|
|
| STOCK
MARKET OPERATIONS |
|
| The
nuclear detonations conducted on May 28, 1998 and its subsequent affects on
the economy as described in the foregoing |
|
| review,
had a major blow to the already bearish stock market. Resultantly, there has
been low return on the funds invested in |
|
| the
equity market. |
|
|
| The
Modaraba earned a dividend income of Rs. 6.49 million on its investments
during the year 1997-98. |
|
|
| RESOURCE
MOBILIZATION |
|
| As
at 30tH June 1998, the Modaraba had an outstanding amount of Rs. 808.73
million mobilized under Morabaha/Musharika |
|
| arrangements
etc. as against Rs. 731.77 million for the last year showing an increase of
10.52% over the previous year. |
|
|
| BALANCE
SHEET & OPERATING RESULTS |
|
| Total
assets of the Modaraba increased by Rs. 83.30 million (7.95%) during 1997-98
to Rs. 1,048.19 million. The Modaraba |
|
| earned
an operating profit before provisions of Rs. 35.13 million during the year as
against Rs. 30.27 million last year. The |
|
| Modaraba
received a set back in its capital market operations due to substantial fall
in the prices of listed securities as a result |
| of
nuclear tests. As a matter of prudence, the Modaraba created a provision of
Rs. 33.70 million for the diminution in the value |
| of
its equity investments. The year under review was the fourth year during
which profits of the Modaraba were taxed, |
|
| however,
the tax depreciation loss on the lease portfolio has more than covered the
taxable profits of FCM for the period. |
|
| Composition
of the net loss after provisions is as follows:- |
|
|
|
|
(Rupees in million) |
|
|
|
|
|
|
Amount for |
Amount for |
% change |
|
|
|
the year |
the year |
over |
|
|
|
ended 30 |
ended 30 |
previous |
|
|
|
|
June 1998 |
June 1997 |
year |
|
|
|
|
|
|
|
| INCOME |
|
|
|
|
| Rental/Profit
on lease and Morabaha financing |
313.46 |
230.14 |
36.20 |
|
| Dividend/Capital
Gains |
|
6.49 |
4.08 |
59.06 |
|
| Fees
and Commission |
|
2.25 |
3.56 |
(36.79) |
|
| Profit
on placements etc. |
|
3.78 |
3.42 |
10.52 |
|
|
|
---------- |
---------- |
---------- |
|
| Total Income |
|
325.98 |
241.20 |
35.14 |
|
|
|
|
---------- |
---------- |
---------- |
|
|
|
|
|
|
| EXPENDITURE |
|
|
|
| Charges/profit/return paid on |
|
274.44 |
203.66 |
37.75 |
|
| lease,
Morabaha and Musharika |
|
|
|
| Provisions |
|
35.32 |
18.30 |
95.73 |
|
| Loss
on sale of investments |
|
6.80 |
0.74 |
(818.92) |
|
| Establishment
& other operating expenses |
9.61 |
6.53 |
47.16 |
|
|
|
---------- |
---------- |
---------- |
|
| Total
Expenditure |
|
326.17 |
229.23 |
42.29 |
|
|
|
|
---------- |
---------- |
---------- |
|
|
|
|
|
|
| NET
PROFIT (Before Management fee & tax) |
(0.19) |
11.97 |
(101.58) |
|
| Management
fee |
|
0.00 |
1.00 |
- |
|
| Provision
for taxation |
|
0.00 |
0.00 |
- |
|
|
|
---------- |
---------- |
---------- |
|
| NET
PROFIT/(LOSS) |
|
(0.19) |
10.97 |
(101.73) |
|
| Un-appropriated
profit b/f |
|
0.83 |
0.06 |
- |
|
|
|
---------- |
---------- |
---------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATION |
|
0.64 |
11.03 |
- |
|
|
|
|
---------- |
---------- |
---------- |
|
| APPROPRIATIONS |
|
|
|
| Transfer
to Statutory Reserve |
|
0.00 |
2.20 |
- |
|
| Transfer
to General Reserve |
|
0.00 |
8.00 |
- |
|
|
|
---------- |
---------- |
---------- |
|
| Un-appropriated
profit |
|
0.64 |
0.83 |
- |
|
|
|
---------- |
---------- |
---------- |
|
|
|
| THE
MILLENNIUM BUG |
|
| The
world is stormed by the Year 2000 problem posing a serious threat to the
computers all over the world. We, being a |
|
| financial
institution dealing in long-term facilities, were already conscious of the
problem and were constantly endeavoring |
|
| for
the achievement of Year 2000 compliance. For this purpose, a survey was
conducted of the possible areas, business |
|
| applications,
products, machines and equipments, which could be affected by this problem.
The Modaraba will (Insha-Allah) |
|
| be
Year 2000 compliant by the end of 1998. The external parties like lenders,
customers, suppliers, utilities, etc. are also being |
| contacted
regarding their plans to ensure that they are also Year 2000 compliant. |
|
|
| OBJECTIVES
FOR 1998-99 |
|
| The
Modaraba plans to enhance its earnings by concentrating on small and medium
sized leases and generating cheaper |
|
| resources
for financing the activity. The Modaraba plans to reduce its current exposure
in other activities in planned and |
|
| phased
manner. |
|
|
| Last
year, the Modaraba started advisory services on lease syndication and it
intends to continue this activity during the year |
| 1998-99. |
|
|
| AUDITORS |
|
| The
Auditors M/s. Riaz Ahmad & Company, Chartered Accountants, retire and
offer themselves for re-election. |
|
|
| We
would also like to thank the Corporate Law Authority, Registrar of Modarabas
and the State Bank of Pakistan for their |
|
| continued
guidance and support as the regulators for the growth and betterment of the
financial sector. |
|
|
| In
the end, the Directors appreciate the dedication and hard work put in by the
officers and staff of the Modaraba. |
|
|
|
|
MAHMOOD AHMED |
|
|
| Dated:
December 09,1998 |
|
Chief Executive |
|
|
|
|
| AUDITORS'
REPORT TO THE CERTIFICATE HOLDERS |
|
|
| We
have audited the annexed Balance Sheet as at 30 June 1998 and the related
Profit and Loss Account and Statement o1' |
|
| Changes
in Financial Position together with the Notes to the Accounts for the year
ended 30 June 1998 of FIRST CRESCENT |
|
| MODARABA,
which are modaraba company's [Crescent Business Management (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 Crescent |
|
| Modaraba
as required by the Modaraba Companies and Modaraba (Floatation and Control)
Ordinance, 1980, and |
|
| Modaraba
Companies and Modaraba Rules, 1981; |
|
|
| (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 (Floatation and Control) Ordinance, 1980, and 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 30 June 1998 and the Loss and the Changes in the 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:-
December 09, 1998 |
|
RIAZ AHMAD AND COMPANY |
|
|
|
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET AS AT 30 JUNE 1998 |
|
|
|
NOTE |
1998 |
1997 |
|
|
|
Rupees |
Rupees |
|
|
|
|
| CAPITAL
AND RESERVES |
|
|
|
| Authorized
capital |
|
|
|
| 30,000,000
modaraba certificates of Rupees 10 each |
300,000,000 |
300,000,000 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
|
| Issued,
subscribed and paid up capital |
3 |
158,025,000 |
158,025,000 |
|
|
|
|
| Reserves
and surplus |
|
|
|
| Capital
reserve |
|
|
4 |
13,700,000 |
13,700,000 |
|
| Revenue
reserve-General |
|
|
|
25,000,000 |
25,000,000 |
|
| Unappropriated
profit |
|
|
|
634,316 |
831,733 |
|
|
|
|
---------- |
---------- |
|
|
|
|
|
197,359,316 |
197,556,733 |
|
|
|
|
| FINANCES
UNDER MORABAHA |
|
|
|
| AND
MUSHARIKA ARRANGEMENTS |
|
5 |
312,196,882 |
161,404,880 |
|
|
|
|
| REDEEMABLE
CAPITAL |
|
6 |
230,250,000 |
200,800,000 |
|
|
|
|
| LONG
TERM DEPOSITS |
|
7 |
64,083,338 |
45,547,563 |
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Current
portion of long term finances and deposits |
8 |
14,920,086 |
34,894,016 |
|
| Finances
under morabaha and musharika arrangements |
9 |
258,281,148 |
340,561,550 |
|
| Creditors,
accrued and other liabilities |
10 |
54,406,945 |
67,431,940 |
|
|
|
|
---------- |
---------- |
|
|
|
|
327,608,179 |
442,887,506 |
|
|
|
|
|
|
| CONTINGENCIES
AND COMMITMENTS |
|
|
- |
- |
|
|
|
|
---------- |
---------- |
|
|
|
|
1,131,497,715 |
1,048,196,682 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
CHAIRMAN |
|
|
CHIEF EXECUTIVE |
|
|
|
|
|
|
|
|
NOTE |
1998 |
1997 |
|
|
|
|
Rupees |
Rupees |
|
|
|
|
| TANGIBLE
OPERATING FIXED ASSETS |
|
11 |
605,136,307 |
461,221,568 |
|
| LONG
TERM INVESTMENTS |
|
|
12 |
131,434,843 |
114,994,916 |
|
|
|
|
|
|
|
|
| DEFERRED
COSTS |
|
|
13 |
842,156 |
1,198,240 |
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Finances
under morabaha arrangements |
14 |
35,244,758 |
99,859,262 |
|
| Finances
under musharika arrangements |
15 |
181,844,084 |
215,154,613 |
|
| Short
term investments |
|
|
16 |
39,488,508 |
36,755,310 |
|
| Advances,
deposits, prepayments |
|
|
| and
other receivables |
|
|
17 |
125,740,311 |
106,048,329 |
|
| Bank
balances |
|
|
18 |
11,766,748 |
12,964,444 |
|
|
|
|
|
---------- |
---------- |
|
|
|
|
394,084,409 |
470,781,958 |
|
|
|
|
|
---------- |
---------- |
|
|
|
|
1,131,497,715 |
1,048,196,682 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
DIRECTOR |
|
|
|
| PROFIT
AND LOSS ACCOUNT FOR THE YEAR ENDED 30 JUNE 1998 |
|
|
|
|
NOTE |
1998 |
1997 |
|
|
|
|
Rupees |
Rupees |
|
| REVENUES |
|
|
|
| Lease
rentals |
|
|
256,961,805 |
175,612,955 |
|
| Profit
on morabaha/musharika finances |
|
56,494,756 |
54,530,574 |
|
| Fee,
commission and other income |
|
19 |
12,528,980 |
11,054,442 |
|
|
|
|
---------- |
---------- |
|
|
|
|
325,985,541 |
241,197,971 |
|
|
|
|
|
|
| OPERATING
EXPENSES |
|
|
|
| Financial
charges |
|
|
20 |
120,663,000 |
102,983,008 |
|
| Depreciation |
|
|
|
153,781,913 |
100,671,098 |
|
| Other
expenses and charges |
|
21 |
16,409,497 |
7,267,409 |
|
|
|
|
|
|
---------- |
---------- |
|
|
|
|
290,854,410 |
210,921,515 |
|
|
|
|
---------- |
---------- |
|
| Operating
profit before provisions |
|
|
35,131,131 |
30,276,456 |
|
|
|
|
---------- |
---------- |
|
| Provision
for diminution in value of investments |
|
33,704,360 |
14,861,558 |
|
| Provision
under NBFIs regulations for receivable |
|
1,624,188 |
3,441,355 |
|
|
|
|
---------- |
---------- |
|
|
|
|
35,328,548 |
18,302,913 |
|
|
|
|
---------- |
---------- |
|
| PROFIT/(LOSS)
FOR THE YEAR |
|
|
(197,417) |
11,973,543 |
|
| MODARABA
COMPANY'S MANAGEMENT FEE |
|
|
- |
1,000,000 |
|
|
|
|
---------- |
---------- |
|
|
|
|
(197,417) |
10,973,543 |
|
|
|
|
|
|
|
| UNAPPROPRIATED
PROFIT BROUGHT FORWARD |
|
831,733 |
58,190 |
|
|
|
|
|
---------- |
---------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATIONS |
|
|
634,316 |
11,031,733 |
|
|
|
|
| APPROPRIATIONS |
|
|
|
| Transferred
to: |
|
|
|
|
|
| Statutory
reserve |
|
|
|
- |
2,200,000 |
|
| General
reserve |
|
|
|
- |
8,000,000 |
|
|
|
|
---------- |
---------- |
|
|
|
|
- |
10,200,000 |
|
|
|
|
---------- |
---------- |
|
| UNAPPROPRIATED
PROFIT |
|
|
|
634,316 |
831,733 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
CHAIRMAN |
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| FOR
THE YEAR ENDED 30 JUNE 1998 |
|
|
1998 |
1997 |
|
|
|
Rupees |
Rupees |
|
|
| CASH
FLOWS FROM OPERATING ACTIVITIES |
|
| Net
profit/(1oss) for the year |
|
|
(197,417) |
10,973,543 |
|
|
|
|
|
|
|
|
| Adjustments
for non-cash and other items |
|
|
| Depreciation |
|
|
153,781,913 |
100,671,098 |
|
|
| Deferred
cost amortized |
|
|
402,055 |
392,860 |
|
|
| Loss
on sale of investments |
|
|
6,809,621 |
735,762 |
|
|
| Gain
on sale of fixed assets |
|
|
(130,329) |
(181,570) |
|
| Provision
for diminution in value of investments |
|
33,704,360 |
14,861,558 |
|
| Provision
under NBFIs regulations for receivables |
1,624,188 |
3,441,355 |
|
|
|
---------- |
---------- |
|
|
|
|
|
196,191,808 |
119,921,063 |
|
|
|
---------- |
---------- |
|
| Operating
profit before working capital changes |
|
195,994,391 |
130,921,063 |
|
|
|
|
| Decrease
in morabaha arrangements |
|
|
64,614,504 |
34,590,738 |
|
| Decrease/(increase)
in musharika arrangements |
|
33,310,529 |
(214,154,613) |
|
| Increase
in advances, deposits, prepayments and other receivables |
(19,735,494) |
(48,347,778) |
|
| (Decrease)/increase
in creditors, accrued and other liabilities |
(13,023,015) |
37,975,023 |
|
|
|
---------- |
---------- |
|
|
|
65,166,524 |
(189,936,630) |
|
|
|
---------- |
---------- |
|
| Cash
flows from operating activities |
|
261,160,915 |
(59,042,024) |
|
|
|
|
|
| Income
tax paid |
|
|
(1,580,676) |
(42,049) |
|
| Dividend
paid |
|
|
(1,980) |
(53,570) |
|
|
|
---------- |
---------- |
|
| Net
cash flows from operating activities |
|
259,578,259 |
(59,137,643) |
|
|
|
|
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
|
| Deferred
cost incurred |
|
(45,971) |
(98,300) |
|
| Purchase
of fixed assets |
|
(304,384,062) |
(323,295,439) |
|
| Proceeds
from sale of fixed assets |
|
6,817,739 |
11,041,851 |
|
| Increase
in investments |
|
(37,967,033) |
(26,790,815) |
|
| Loss
on sale of investments |
|
(21,720,073) |
(735,762) |
|
|
|
---------- |
---------- |
|
|
|
(357,299,400) |
(339,878,465) |
|
|
|
|
|
1998 |
1997 |
|
|
|
Rupees |
Rupees |
|
| CASH
FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
| Redeemable
capital |
|
|
|
29,450,000 |
24,247,000 |
|
| Long
term finances under morabaha and musharika arrangements |
129,792,002 |
44,542,380 |
|
| Increase/(decrease)
in short term finances under |
|
|
|
| morabaha
and musharika arrangements |
|
|
(82,280,402) |
236,785,534 |
|
| Long
term deposits |
|
|
19,561,845 |
16,978,787 |
|
|
|
|
|
---------- |
---------- |
|
|
|
|
|
96,523,445 |
322,553,701 |
|
| NET
INCREASE/(DECREASE) IN |
|
|
|
| CASH
AND CASH EQUIVALENTS |
|
|
(1,197,696) |
(76,462,407) |
|
|
|
|
|
| CASH
AND CASH EQUIVALENTS AT |
|
|
|
| THE
BEGINNING OF THE YEAR |
|
|
12,964,444 |
89,426,851 |
|
|
|
|
| CASH
AND CASH EQUIVALENTS AT |
|
|
---------- |
---------- |
|
| THE
END OF THE YEAR (NOTE 18) |
|
|
11,766,748 |
12,964,444 |
|
|
|
|
|
========== |
========== |
|
|
|
CHAIRMAN |
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
| NOTES
TO THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 1998 |
|
|
| 1.
LEGAL STATUS AND NATURE OF BUSINESS |
|
| The
Modaraba is a multipurpose perpetual Modaraba formed under the Modaraba
Companies and Modaraba (Floatation and |
|
| Control)
Ordinance, 1980 and the rules framed thereunder and is managed by Crescent
Business Management (Private) Limited. |
|
| It
is listed on all the Stock Exchanges in Pakistan and is engaged in the
business of leasing, morabaha and musharika financing, |
| investment
in marketable securities and other related business. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
| 2.1
Overall valuation policy |
|
| These
accounts have been prepared under the historical cost convention. |
|
|
| 2.2
Tangible fixed assets |
|
