| B.F. Modaraba |
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|
|
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|
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| Annual
Report 2000 |
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| CONTENTS |
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| Company Profile |
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| Directors' Report |
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| Auditors' Report |
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| Balance Sheet |
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| Profit
and Loss Account |
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| Cash
Flow Statement |
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| Notes
to the Accounts |
|
| Pattern
of certificate Holdings |
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|
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| COMPANY
PROFILE |
|
|
| BOARD
OF DIRECTORS |
|
|
|
| DIRECTORS
OF MODARABA COMPANY |
|
| Mr.
Omar Amin Bawany |
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| Chief Executive |
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| Mr.
Dawood Ebrahim Bawany |
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| Chairman |
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|
| Mr.
Esmail Ebrahim Bawany |
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| Mr.
Ahmed Ebrahim Bawany |
|
| Syed
Mehmood Ali |
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|
| COMPANY
SECRETARY |
|
| Mohammad
Yousuf Halai |
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|
| MODARABA
AUDITORS |
|
| Rahim
Iqbal Rafiq & Company |
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| Chartered
Accountants |
|
|
| BANKERS |
|
| Habib
Bank Limited |
|
| Faysal
Bank Ltd. |
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| Bank
Al-Habib Limited |
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| Metropolitan
Bank Ltd. |
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| Al-Baraka
Islamic Investment Bank |
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| REGISTERED
OFFICE AND SHARES DEPARTMENT |
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| 4th
Floor, Bank House No. 1, |
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| Habib
Square, M. A. Jinnah Road, |
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| Karachi
(Pakistan). |
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| Phone
: 2418050-54, 2422045 |
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| Fax : 2421010 |
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|
| TWELFTH
ANNUAL REPORT OF THE DIRECTORS |
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| OF
THE MODARABA COMPANY |
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| FOR
THE YEAR ENDED JUNE 30, 2000 |
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| IN
THE NAME OF ALLAH, THE MOST GRACIOUS, MOST MERCIFUL |
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|
| Dear
Certificate Holders, |
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|
| Assalamo
Alaikum |
|
|
| The
Directors of E. A. Management (Pvt) Limited present the 12th Annual Report
and |
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| Audited
Accounts of B. F. Modaraba for the year ended June 30, 2000. |
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| 1)
FINANCIAL RESULTS |
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|
|
|
| Operating
income |
|
|
9,284,776 |
|
|
|
|
------------------ |
|
| Operating
expenses |
|
|
(1,054,666) |
|
| Financial
charges |
|
|
(1,470) |
|
|
|
|
------------------ |
|
|
|
|
(1,056,136) |
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|
|
|
------------------ |
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|
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|
8,228,640 |
|
|
|
|
|
|
| Reversal
of provision for overdue lease rentals |
|
58,706 |
|
| Provision
for diminution in value of |
|
|
|
| marketable
securities |
|
|
(1,578,636) |
|
| Reversal
of provision in market value of Investment |
|
749,005 |
|
|
------------------ |
|
|
|
|
(770,925) |
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|
|
|
------------------ |
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| Profit
before taxation |
|
7,457,715 |
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|
|
| Taxation: |
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| Current |
|
|
|
(305,000) |
|
| Prior years |
|
|
|
(96,159) |
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|
|
|
------------------ |
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|
|
|
(401,159) |
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|
|
|
------------------ |
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| Profit
after taxation |
|
|
7,056,556 |
|
| Transfer
to Statutory Reserve @ 10% (1999: 20%) |
|
(705,656) |
|
| Appropriation
for the year: |
|
|
|
|
| Interim
dividend @ 5% |
|
|
(2,570,400) |
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|
------------------ |
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|
|
|
3,780,500 |
|
| Unappropriated
(loss)/profit brought forward |
|
(18,027,397) |
|
|
|
|
------------------ |
|
|
|
|
(14,246,897) |
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|
========== |
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| 2.
REVIEW OF OPERATIONS: |
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| We
are pleased to inform you that the modaraba has reported after tax profit of |
|
| Rs.7,056,556/-
in the year under review. Out of that profit modaraba has already |
|
| paid
an interim dividend @5%. Further Rs. 705,656/- has been transferred to |
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| statutory
reserve. Modaraba's earning per share remained at Rs.1.37 per |
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| certificate
as compaired to Rs. 0.48 in preceding year. The profit has been |
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| achieved
with tight control over expenses and optimizing all profitable avenues. |
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| FUTURE
PROSPECTS: |
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| Better
operational results are expected during the current year as your modaraba |
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| is
continuously trying to improve its profitability through diversification of
its |
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| business. |
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|
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| Further
we hope that the Stock market will again show up ward trend which may |
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| pave
the way for capital gains for your modaraba. |
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|
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| 4.
CHANGE OF THE CHIEF EXECUTIVE: |
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| Since
the last report there has been a change in the Board of Directors. Mr. Khalid |
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| Ebrahim
Bawany has resigned. The Board hereby appreciates the valuable |
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| services
of out going Chief Executive. |
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|
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| 5. AUDITORS: |
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| Our
existing auditors, Messrs Rahim Iqbal Rafiq & Co., Chartered Accountants |
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| are
due for retirement and being eligible offered themselves for re-appointment |
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| for
the year ending June 30, 2001. |
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| 6.
CONCLUSION: |
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| The
Directors place on record their appreciation for the utmost co-operation and |
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| continuous
guidance provided by the Registrar Modaraba. The management |
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| also
appreciates the sincerity and devotion shown by the staff members. |
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|
ON BEHALF OF THE BOARD |
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|
OMAR AMIN BAWANY |
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| Dated:
November 16, 2000 |
|
CHIEF EXECUTIVE |
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| AUDITORS'
REPORT TO THE CERTIFICATE HOLDERS |
|
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| We
have audited the annexed Balance Sheet as at June 30, 2000 and the related |
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| Profit
and Loss Account and Cash Flow Statement, together with the notes to the |
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| accounts
for the year ended June 30, 2000 of B.F. Modaraba which are Modaraba |
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| Company's
(E.A. Management (Private) Limited) representation and we state that |
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| we
have obtained all the information and explanation which we required and,
after |
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| due
verification thereof, we report that: |
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|
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| (a)
In our opinion, proper books of accounts have been kept by the Modaraba |
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| company
in respect of B.F. Modaraba as required by the Modaraba Companies |
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| and
Modaraba /(Floatation and Control) Ordinance, 1980 and Modaraba |
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| Companies
and Modaraba Rules, 1981. |
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|
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| (b)
In our opinion, the Balance Sheet and the Profit and Loss Account have been |
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| drawn
up in conformity with the Modaraba Companies and Modaraba (Floatation |
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| and
Control) Ordinance, 1980 and Modaraba Companies and Modaraba |
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| Rules, 1981; and |
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| (c)
In our opinion and to the best of our information and according to the |
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| explanations
given to us; |
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|
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| (i)
The Balance Sheet and the related Profit and Loss Account and the |
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| Statement
of Changes in Financial Position (Cash Flow Statement), |
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| which
are in agreement with the books of accounts, exhibit respectively |
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| a
true and fair view of the state of the Modaraba's affairs as at June 30, |
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| 2000
and the profit and the changes in financial position for the year |
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| ended
on that date; |
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|
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| (ii)
No Zakat was deductible at source under the Zakat and Ushr Ordinance, |
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| 1980; and |
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| (iii)
The business conducted, investments made and expenditure incurred by |
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| the
Modaraba are in accordance with the objects, terms and conditions |
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| of
the Modaraba. |
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|
| Karachi: |
|
RAHIM IQBAL RAFIQ & CO. |
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| Dated:
November 16, 2000 |
|
Chartered Accountants |
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|
|
| BALANCE
SHEET AS ON JUNE 30, 2000 |
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|
2000 |
1999 |
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|
NOTE |
RUPEES |
RUPEES |
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| CERTIFICATE
CAPITAL AND |
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| RESERVES |
|
|
|
| Authorised
capital |
|
| 10,000,000
Modaraba Certificates |
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| of Rs.10/- each |
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|
100,000,000 |
100,000,000 |
|
|
|
|
========== |
========== |
|
|
|
|
| Issued,
subscribed and paid-up |
|
3 |
51,408,000 |
51,408,000 |
|
| 5,140,800
(1999: 5,140,800) |
|
|
|
|
| Certificate
of Rs. 10/- each |
|
|
|
|
| Statutory
Reserve |
|
4 |
1,225,696 |
520,040 |
|
| General Reserve |
|
|
750,000 |
750,000 |
|
| Accumulated
loss |
|
|
(14,246,897) |
(18,027,397) |
|
|
|
|
------------------ |
------------------ |
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|
|
|
39,136,799 |
34,650,643 |
|
|
|
|
|
| DEFERRED
LIABILITIES |
|
|
114,249 |
115,276 |
|
|
|
|
|
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| CURRENT
LIABILITIES |
|
|
|
| Current
maturity of security |
|
|
|
| deposits
from lessees |
|
|
794,912 |
840,512 |
|
| Creditors,
accrued and other liabilities |
5 |
177,372 |
103,674 |
|
| Taxation |
|
|
305,000 |
189,042 |
|
| Dividend
Payable |
|
|
2,570,400 |
-- |
|
| Unclaimed
profit distribution |
|
|
15,075 |
15,075 |
|
|
|
|
------------------ |
------------------ |
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|
|
|
3,862,759 |
1,148,303 |
|
|
------------------ |
------------------ |
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|
43,113,807 |
35,914,222 |
|
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|
========== |
========== |
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| The
annexed notes form an integral part of these financial statements. |
|
|
|
|
|
| FIXED
CAPITAL EXPENDITURE |
|
|
| Operating
fixed assets |
|
6 |
1,424,880 |
1,581,694 |
|
|
|
|
|
| LONG
TERM LOAN - To Staff |
|
|
7,937 |
23,010 |
|
|
|
| CURRENT
ASSETS |
|
|
|
| Stock in trade |
|
7 |
-- |
1,250,000 |
|
| Investment
in marketable |
|
|
|
|
| securities |
|
8 |
11,748,287 |
12,803,827 |
|
| Lease
rental receivable |
|
9 |
972,520 |
972,520 |
|
| Morabaha
investment |
|
10 |
-- |
8,784,000 |
|
| Musharika
investment |
|
11 |
10,000,000 |
-- |
|
| Trade debts |
|
12 |
1,020,391 |
1,210,391 |
|
| Advances,
deposits, prepayments |
|
|
|
| and
other receivables |
|
13 |
3,501,491 |
1,885,867 |
|
| Cash
and bank balances |
|
14 |
14,438,301 |
7,402,913 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
41,680,990 |
34,309,518 |
|
|
------------------ |
------------------ |
|
|
|
43,113,807 |
35,914,222 |
|
|
|
========== |
========== |
|
|
|
Sd/- |
|
Sd/- |
|
Sd/- |
|
|
Chief Executive |
|
Director |
|
Director |
|
|
E. A. Management (Pvt.) Ltd. |
|
E.A. Management (Pvt.) Ltd. |
|
E.A. Management (Pvt.) Ltd. |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
|
|
2000 |
1999 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
| Operating
Income |
|
15 |
9,284,776 |
3,889,672 |
|
| Operating
expenses |
|
16 |
|
|
| Financial
charges |
|
17 |
1,470 |
1,028 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(1,056,136) |
(973,442) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
8,228,640 |
2,916,230 |
|
|
|
|
|
|
| Reversal
of provision for overdue lease rentals |
|
58,706 |
96,634 |
|
| Provision
for diminution in value |
|
| of
marketable securities |
|
|
(1,578,636) |
(824,514) |
|
|
| Reversal
of provision in market value |
|
| of investment |
|
|
749,005 |
466,755 |
|
|
------------------ |
------------------ |
|
|
|
|
(770,925) |
(261,125) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
before taxation |
|
|
7,457,715 |
2,655,105 |
|
| Taxation |
|
|
|
| -- Current |
|
18 |
305,000 |
150,000 |
|
| -- Prior years |
|
|
96,159 |
25,968 |
|
|
------------------ |
------------------ |
|
|
|
|
401,159 |
175,968 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
|
7,056,556 |
2,479,137 |
|
| Transfer
to Statutory Reserve |
|
| @
10% (1999: 20%) |
|
|
(705,656) |
(495,827) |
|
|
|
|
|
|
| Appropriation
for the year: |
|
|
|
|
| Interim
dividend @ 5% (1999: Nil) |
|
|
(2,570,400) |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
3,780,500 |
1,983,310 |
|
| Unappropriated
loss brought forward |
|
(18,027,397) |
(20,010,707) |
|
|
|
|
------------------ |
------------------ |
|
| Accumulated
loss carried forward |
|
|
(14,246,897) |
(18,027,397) |
|
|
========== |
========== |
|
| Earning
per certificate - Basic |
|
19 |
1.37 |
0.48 |
|
|
| The
annexed notes form an integral part of these financial statements. |
|
|
|
Sd/- |
|
Sd/- |
|
Sd/- |
|
|
Chief Executive |
|
Director |
|
Director |
|
|
E. A. Management (Pvt.) Ltd. |
|
E.A. Management (Pvt.) Ltd. |
|
E.A. Management (Pvt.) Ltd. |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
|
|
|
2000 |
1999 |
|
|
|
|
RUPEES |
RUPEES |
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Profit
before taxation |
|
|
7,457,715 |
2,655,105 |
|
|
|
| Adjustment for: |
|
|
| Depreciation
on owned assets |
|
|
125,748 |
155,579 |
|
| Provision
for gratuity - net |
|
|
35,484 |
32,125 |
|
| Provision
for diminution in value of |
|
| marketable
securities |
|
|
1,578,636 |
824,514 |
|
| Reversal
of provision in market value |
|
|
| of Investment |
|
|
(749,005) |
(466,755) |
|
| Provision
for over due lease |
|
|
|
| rental- reversal |
|
|
(58,706) |
(96,634) |
|
| Gain
on sale of vehicle |
|
|
(74,534) |
(2,168) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
857,623 |
446,661 |
|
| Operating
profit before working |
|
|
------------------ |
------------------ |
|
| capital changes |
|
|
8,315,338 |
3,101,766 |
|
|
|
| Changes
in working capital |
|
| (Increase)/decrease
in current assets: |
|
| Stock-in-trade |
|
|
1,250,000 |
-- |
|
| Investment
in marketable securities |
|
225,910 |
(312,415) |
|
| Musharika
investment |
|
|
(10,000,000) |
-- |
|
| Morabaha
investment |
|
|
8,784,000 |
(8,784,000 |
|
| Lease
rentals receivable |
|
|
58,706 |
229,501 |
|
| Trade debts |
|
|
190,000 |
1,540,292 |
|
| Advances,
deposits, prepayments and |
|
|
|
| other
receivables |
|
|
(1,659,046) |
18,738 |
|
|
| Increase/(decrease)
in current liabilities |
|
| Decrease
in security deposit |
|
|
(45,600) |
(28,000) |
|
| Creditors,
accrued and other liabilities |
|
73,698 |
(58,281) |
|
|
|
|
------------------ |
------------------ |
|
| Net
increase in working capital |
|
|
(1,122,332) |
(7,394,165) |
|
|
|
|
------------------ |
------------------ |
|
| Cash
generated from operations |
|
|
7,193,006 |
(4,292,399) |
|
| Taxes paid |
|
|
(239,446) |
(56,539) |
|
| Gratuity paid |
|
|
(18,535) |
(101,304) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
6,935,025 |
(4,450,242) |
|
|
|
|
========== |
========== |
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Proceeds
from disposal of fixed assets |
|
100,000 |
30,000 |
|
| Proceeds
from disposal of leased assets |
|
45,600 |
28,000 |
|
| Addition
in fixed assets |
|
|
(40,000) |
-- |
|
| Net
cash generated (used in) / |
|
|
------------------ |
------------------ |
|
| from
investing activities |
|
|
105,600 |
58,000 |
|
|
|
|
------------------ |
------------------ |
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Long
term loan to staff |
|
|
(5,237) |
104,081 |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash used in financing activities |
|
(5,237) |
104,081 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
|
|
| Net
(decrease) / increase in cash and |
|
| bank balances |
|
|
7,035,388 |
(4,288,161) |
|
|
| Cash
and bank balances at the beginning |
|
| of the year |
|
|
7,402,913 |
11,691,074 |
|
|
|
|
| Cash
and bank balances at the |
|
|
------------------ |
------------------ |
|
| end of the year |
|
|
14,438,301 |
7,402,913 |
|
|
========== |
========== |
|
|
|
Sd/- |
|
Sd/- |
|
Sd/- |
|
|
Chief Executive |
|
Director |
|
Director |
|
|
E. A. Management (Pvt.) Ltd. |
|
E.A. Management (Pvt.) Ltd. |
|
E.A. Management (Pvt.) Ltd. |
|
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
| 1.
LEGAL STATUS AND NATURE OF BUSINESS |
|
| B.F.
Modaraba was formed under the Modaraba companies and Modaraba |
|
| (Floatation
and Control) Ordinance, 1980 and the rules framed there under, |
|
| and
is managed by E.A. Management (Pvt) Limited. The Modaraba is listed |
|
| on
Stock Exchanges in Pakistan. |
|
|
|
|
|
|
| It
is a perpetual multi-purpose Modaraba and is primarily engaged in leasing, |
|
| investments,
trading and rendering of services etc. |
|
|
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
|
| 2.1
i) Basis for Preparation |
|
|
|
| These
accounts have been prepared in accordance with International |
|
| Accounting
Standards, as applicable in Pakistan. |
|
|
|
| ii)
Accounting Convention |
|
|
| These
financial statements have been prepared under the historical |
|
| cost
convention. |
|
|
|
| 2.2 Gratuity |
|
|
| The
Modaraba operates an unfunded gratuity scheme for all its employees |
|
| eligible
for the scheme. Provision is made annually to cover the obligation |
|
| under
the scheme. |
|
|
| 2.3 Taxation |
|
|
|
| Current |
|
| The
charge for current taxation is based on taxable income at current rate |
|
| of
tax after recognizing tax credit and rebates available, if any or at the |
|
| rate
of 0.5 % of turnover, whichever is higher. |
|
|
| Deferred |
|
| The
Modaraba accounts for deferred taxation on all major timing differences |
|
| using
the liability method but does not account for deferred tax debits. |
|
|
| 2.4
Operating fixed assets and depreciation |
|
|
| a.
Assets lease out |
|
| Leased
assets are stated at cost less accumulated amortization. |
|
| Amortization
is charged to income applying the annuity method, |
|
| whereby
the depreciable values of assets are amortized over the |
|
| lease
period. In respect of acquisition and termination of the leased |
|
| assets
during the year, amortization is charged proportionately from |
|
| the
day of acquisition and upto termination respectively. |
|
|
| b.
Assets in own use |
|
| Operating
fixed assets are stated at cost less accumulated depreciation. |
|
| Depreciation
is charged to income applying the reducing balance |
|
| method
at the rates specified in operating assets note. Acquisition |
|
| in
the year are depreciated for a full year irrespective of the date of |
|
| purchase.
No depreciation is charged on assets in the year of their |
|
| disposal. |
|
|
| Maintenance
and normal repairs are charged to the income as and |
|
| when
incurred. Major renewals and replacement are capitalised and |
|
| assets
so rep aced, if any, are retired. |
|
|
| Gain
or loss on disposal of assets is included in the income currently. |
|
|
| 2.5
Stock in trade |
|
| Stock
is valued at lower of cost and net realisable value. Cost is |
|
| determined
on the basis of moving average cost. |
|
|
| 2.6 Investments |
|
| Investments
in shares are valued at cost & market value which ever is |
|
| lower. |
|
|
| Gain
or loss on sale of investment is included in the income currently. |
|
|
| 2.7
Revenue recognition |
|
|
|
| i)
Rental income is recognised as and when lease rentals become due on |
|
| a
systematic basis over the lease period. |
|
|
|
|
|
| ii)
Dividend income from quoted entities is recorded at time of closure of |
|
| share
transfer books of the company declaring the dividend. |
|
| </ |
