| Modaraba Al - Tijarah |
|
|
|
|
|
|
|
|
|
| Annual
Report 1999 |
|
|
| Corporate
Information |
|
| Directors'
Report |
|
| Auditors'
Report |
|
| Balance Sheet |
|
|
| Profit
& Loss Account |
|
| Cash
Flow Statement |
|
| Notes
to the Accounts |
|
| Pattern
of Certificate Holdings |
|
|
| CORPORATE
INFORMATION |
|
|
| BOARD
OF DIRECTORS: |
|
| Mr.
Syed Iradat Husain |
|
Chairman |
|
| Mr.
Maqbool Hussain |
|
Vice Chairman |
|
| Mr.
Mohammad Kamil |
|
Director |
|
| Mr.
Ashraf Kalam |
|
Director |
|
| Mr.
Ahmad H. I. Dada |
|
Director |
|
| Mr. Imdad Ali |
|
Director |
|
| Mr.
Faisal Hussain |
|
Director |
|
| Mr.
Zafar H. Naqvi |
|
Chief Executive |
|
|
| MANAGEMENT
TEAM : |
|
| Mr.
Zafar H. Naqvi |
|
Chief Executive |
|
| Mr.
S. Shakeel-ur-Renman |
|
Chief Manager |
|
| Mr.
S. Masood Akhter |
|
Financial Controller |
|
| Mr. D.V. Karia |
|
Company Secretary |
|
|
| AUDITORS: |
|
| Ford,
Rhodes, Robson, Morrow, |
|
| Chartered
Accountants |
|
| Finlay House |
|
| I.I.
Chundrigar Road |
|
| Karachi. |
|
|
| BANKERS
& FINANCIERS: |
|
| Muslim
Commercial Bank Limited |
|
| Metropolitan
Bank Limited |
|
|
| REGISTERED
OFFICE: |
|
| 10th
Floor, Progressive Square, |
|
| Opposite
Nursery, Sharea Faisal, Karachi. |
|
| Phones
:4547521-5 Fax: (92-21) 4547526 |
|
|
| DIRECTORS'
REPORT |
|
| The
Board of Directors of AI-Mal Corporation Limited have pleasure in presenting
Eighth Annual Report of Modaraba |
|
| AI-Tijarah,
together with Audited Accounts for the year ended 30th June, 1999. |
|
|
| 1.
OPERATING RESULTS: |
|
| Operating
results, for the year ended June 30, 1999 are presented below in a summarized
form: |
|
|
(Rs. in
"000") |
|
|
1999 |
1998 |
|
| Operating profit |
|
928 |
2,866 |
|
| Financial
charges |
|
(1,175) |
(8) |
|
|
-------------------- |
-------------------- |
|
|
(247) |
2,858 |
|
| Other income |
|
177 |
539 |
|
|
-------------------- |
-------------------- |
|
|
(70) |
3,397 |
|
| Provision
for doubtful debts |
|
(946) |
(407) |
|
| Write
back / (provision) for diminution in value of |
|
| Long
term investments |
|
1,588 |
(18,217) |
|
| Marketable
securities |
|
102 |
(205) |
|
|
-------------------- |
-------------------- |
|
| Profit
/ (Loss) before taxation |
|
674 |
(15,432) |
|
| Taxation |
|
(504) |
(196) |
|
| Profit
/ (Loss) after taxation |
|
170 |
(15,628) |
|
| Loss
brought forward |
|
(49,474) |
(33,846) |
|
|
-------------------- |
-------------------- |
|
|
(49,304) |
(49,474) |
|
| Transfer
to Statutory Reserves |
|
(34) |
- |
|
|
-------------------- |
-------------------- |
|
| Loss
carried to the balance sheet |
|
(49,338) |
(49,474) |
|
|
============= |
============= |
|
| 2. STATUTORY RESERVES: |
|
| In
compliance with SBP Prudential Regulations, Directors have decided to
appropriate 20% of the year's |
|
| profits
to statutory Reserves until it equals the Certificate Capital of the
Modaraba. |
|
|
| 3.
BUSINESS OPERATIONS: |
|
| The
year under review was again marred by serious uncertainties on the economic
front. The imposition of |
|
| economic
sanctions had a drastic effect on business environment. We continued to
follow a cautious approach |
|
| in
selection of business proposals. Consequently, volume of business remained
low. |
|
|
| We
managed to earn trading profit of Rs. 2.551 million as compared to Rs. 0.462
million during the previous |
|
| year.
However, operating income was Rs. 3.014 million as compared to 4.976 million
during the preceding |
|
| year.
The decline was mainly on account of reduction in gain on sale of export
quota. The net profit after tax |
|
| was
Rs. 170 thousand. |
|
|
| AUDITORS'
REPORT TO THE CERTIFICATE HOLDERS |
|
| We
have audited the annexed balance sheet as at June 30, 1999 and the related
profit and loss account |
|
| and
statement of changes in financial position (Cash Flow statement), together
with the notes to the |
|
| accounts
for the year ended June 30, 1 999 of MODARABA AL-TIJARAH which are Modaraba
Company's |
|
| (AI-Mal
Corporation 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 Modaraba |
|
| AI-Tijarah
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 profit and loss account have been drawn
up in conformity with the |
|
| Modaraba
Companies and Mordaraba (Floatation and Control) Ordinance, 1980 and Modaraba
Companies |
|
| and
Modaraba Rules, 1981; and |
|
|
| [3)
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 (cash flow statement), 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,
1999 and the profit and the changes in the financial position (cash flow
statement) for |
|
| the
year ended on that date; |
|
|
| (ii)
no zakat was deductible at source under the Zakat and Ushr Ordinance, 1980;
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. |
|
|
| Ford,
Rhodes Robson, Morrow |
|
| Karachi : December 06; 1999 |
Chartered Accountants |
|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
|
1999 |
1998 |
|
|
Note |
Rupees |
Rupees |
|
| TANGIBLE
FIXED ASSETS |
|
3 |
5,850,028 |
4,199,097 |
|
| LONG-
TERM INVESTMENTS |
|
4 |
6,306,543 |
5,440,064 |
|
| DEFERRED
EXPENDITURE |
|
5 |
1,298,368 |
- |
|
| CURRENT
ASSETS |
|
|
| Stock-in-trade |
|
6 |
14,517,018 |
15,233,746 |
|
| Marketable
securities |
|
7 |
1,534,486 |
1,520,280 |
|
| Trade debts |
|
8 |
- |
1,923,245 |
|
| Short-term
Musharaka |
|
9 |
2,783,741 |
3,453,522 |
|
| Short-term
Morabaha |
|
10 |
221,225 |
400,799 |
|
| Advances,
deposits, prepayments and other receivables |
|
11 |
3,747,059 |
4,091,642 |
|
| Cash
and bank balances |
|
12 |
573,104 |
2,454,277 |
|
|
|
--------------------- |
--------------------- |
|
|
23,376,633 |
29,077,511 |
|
|
|
|
|
|
--------------------- |
--------------------- |
|
|
36,831,572 |
38,716,772 |
|
|
============= |
============= |
|
| CAPITAL
AND RESERVES |
|
| Certificate
capital |
|
| Authorised |
|
| 10,000,000
Modaraba certificates of Rs. 10 each. |
|
100,000,000 |
100,000,000 |
|
|
============= |
============= |
|
|
13 |
75,778,150 |
75,778,150 |
|
| Reserves |
|
| Capital
reserve ' |
|
| Statutory
reserve |
|
| Balance
at the beginning of the year |
|
3,222,441 |
322,244 |
|
| Transfers
from profit and loss account |
|
34,108 |
- |
|
|
---------------------- |
---------------------- |
|
|
356,352 |
322,244 |
|
| Revenue |
|
| Accumulated
loss |
|
(49,338,067) |
(49,474,501 ) |
|
|
---------------------- |
---------------------- |
|
|
26,796,435 |
26,625,893 |
|
| CURRENT
LIABILITIES |
|
| Short-term
Musharaka |
|
14 |
5,940,000 |
5,940,000 |
|
| Creditors,
accrued and other liabilities |
|
15 |
3,675,578 |
5,731,220 |
|
| Unclaimed
profit distribution |
|
419,559 |
419,559 |
|
|
---------------------- |
---------------------- |
|
|
10,035,137 |
12,090,779 |
|
| COMMITMENT
AND CONTINGENCY |
|
16 |
|
|
---------------------- |
---------------------- |
|
|
36,831,572 |
38,715,672 |
|
|
============= |
============= |
|
| The
annexed notes form an integral part of these accounts. |
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 1999 |
|
|
1999 |
1998 |
|
|
Rupees |
Rupees |
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Profit/(loss)
before taxation |
|
674,116 |
(15,431,983) |
|
|
| Adjustments
for: |
|
| Depreciation |
|
481,639 |
516,528 |
|
| Amortization
of deferred expenditure |
|
649,184 |
- |
|
| Gain
on sale of fixed assets |
|
- |
(283,271) |
|
| Loss
on sale of long-term investments |
|
217,449 |
166,901 |
|
| Provision
(write-back)/made for diminution in |
|
| value
of long-term investments |
|
(1,587,888) |
18,217,030 |
|
| Profit
on sale of export quota |
|
(53,920) |
(2,913,380) |
|
| Financial
charges |
|
1,175,203 |
8,303 |
|
| Dividend |
|
(234,262) |
(778,229) |
|
|
---------------------- |
---------------------- |
|
| Cash
generated from operations |
|
647,405 |
14,933,882 |
|
|
|
|
|
---------------------- |
---------------------- |
|
| Operating
profit/(Loss) before changes in operating assets/liabilities |
|
1,321,521 |
(498,101 ) |
|
|
| (Increase)/decrease
in operating assets |
|
| Stock-in-trade |
|
716,728 |
4,394,531 |
|
| Marketable
securities |
|
(14,206) |
(25,018) |
|
| Trade debts |
|
1,923,245 |
1,556,760 |
|
| Short-term
Musharaka |
|
669,781 |
(1,359,401) |
|
| Short-term
Morabaha |
|
179,574 |
522,841 |
|
| Advances,
deposits, prepayments and other receivables |
|
|
|
| excluding
advance tax and dividend |
|
568,587 |
800,872 |
|
|
---------------------- |
---------------------- |
|
|
4,043,709 |
5,890,585 |
|
| Increase/(decrease)
in operating liabilities |
|
| Short-term
Musharaka |
|
- |
(9,806,400) |
|
| Creditors,
accrued and other liabilities |
|
(3,275,361) |
3,430,776 |
|
|
---------------------- |
---------------------- |
|
|
(3,275,361) |
(6,375,624) |
|
|
|
|
|
---------------------- |
---------------------- |
|
| Cash
inflow/(outflow) from operating activities |
|
2,089,869 |
(983,140) |
|
|
|
|
|
|
| Financial
charges paid |
|
(35,671) |
(8,303) |
|
| Income-tax
paid |
|
(804,943) |
(2,353,849) |
|
|
---------------------- |
---------------------- |
|
| Net
Cash inflow/(out flow) from operating activities |
|
1,249,255 |
(3,345,292) |
|
|
|
|
1999 |
1998 |
|
|
|
Rupees |
Rupees |
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Purchase
of fixed assets |
|
(2,132,570) |
(823,918) |
|
| Proceeds
from sale of fixed assets |
|
- |
660,000 |
|
| Proceeds
from sale of long-term investments |
|
503,960 |
1,138,320 |
|
| Proceeds
from sale of export quota |
|
81,868 |
3,180,580 |
|
| Profit
received on bank deposits |
|
80,187 |
29,404 |
|
| Dividend
received |
|
311,627 |
718,222 |
|
|
--------------------- |
--------------------- |
|
| Net
cash (outflow)/inflow from investing activities |
|
(1,154,928) |
4,902,608 |
|
|
|
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Profit paid |
|
-- |
(4,832) |
|
| Deferred
expenditure paid |
|
(1,975,500) |
-- |
|
|
--------------------- |
--------------------- |
|
| Net
cash outflow from financing activities |
|
(1,975,500) |
(4,832) |
|
|
--------------------- |
--------------------- |
|
|
|
|
| NET
(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS |
|
(1,881,173) |
1,552,484 |
|
|
|
|
|
| CASH
AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR |
|
2,454,277 |
901,793 |
|
|
|
|
|
| CASH
AND CASH EQUIVALENTS AT END OF THE YEAR |
|
573,104 |
2,454,277 |
|
|
| Chief Executive |
|
Director |
|
Director |
|
|
| NOTES
TO THE ACCOUNTS FOR THE YEAR ENDED JUNE 30, 1999 |
|
|
| 1.
LEGAL STATUS AND NATURE OF BUSINESS |
|
| Modaraba
AI-Tijarah is a multipurpose, perpetual Modaraba formed in July, 1991 under
the Modaraba |
|
| Companies
and Modaraba (Floatation and Control) Ordinance, 1980, and Modaraba Companies
and |
|
| Modaraba
Rules, 1981 and is managed by AI-Mal Corporation Limited. It is engaged in
the business of |
|
| trading
and manufacturing on its own account, providing Musharaka, Morabaha finances,
purchase and |
|
| sale
of securities and other related business. It is listed on the Karachi, Lahore
and Islamabad Stock |
|
| Exchanges. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
| 2.1
Accounting convention |
|
| These
accounts have been prepared under the historical cost convention. |
|
|
| 2.2
Staff retirement benefits |
|
| (a) Staff gratuity |
|
| The
Modaraba operates a funded gratuity scheme for all its employees. |
|
|
| (b)
Provident fund |
|
| The
Modaraba operates an approved provident fund for all its employees.
Contributions in |
|
| respect
thereof are made in accordance with terms of the scheme. |
|
|
| 2.3
Tangible fixed assets |
|
| These
are stated at cost less accumulated depreciation. Depreciation is charged to
income |
|
| applying
the straight line method and the rates used are stated in note 3 to the
accounts. In |
|
| respect
of additions and disposals during the year, depreciation is charged
proportionately to |
|
| th
period of use. Profit or loss on disposal of fixed assets is included in
income currently. |
|
|
| 2.4
Long-term investments |
|
| These
are stated at moving average cost. Provision for diminution in value of
investments is made on |
|
| aggregate
basis, if considered permanent. |
|
|
| 2.5
Deferred expenditure |
|
| Expenses
incurred in connection with the expenses on purchase of export quota are
amortised over |
|
| three
years effective from the year of its utilization. |
|
|
| 2.6
Stock-in-trade |
|
| 2.6.1
Stock-in-trade is valued at the flower of cost and net realizable value. |
|
|
| 2.6.2
Cost signifies in relation to: |
|
|
- Trading stock |
|
- weighted average cost. |
|
|
|
- Stock-in-transit |
|
- actual cost
comprising invoice value plus other |
|
|
charges thereon. |
|
|
| 2.7 Marketable securities |
|
| These
are stated at moving average cost less provision for diminution in value of
investments which |
|
| is
made on aggregate basis. Gain or loss on sale of investments is accounted for
in the year in which |
|
| it arises. |
|
|
| 2.8
Foreign currency transactions |
|
| Assets
and liabilities in foreign currencies are translated into rupees at the rates
of exchange |
|
| approximating
to those prevalent on the balance sheet date. Exchange gains or losses are |
|
| taken
to income currently. |
|
|
| 2.9 Taxation |
|
| Provision
for current taxation is based on taxable income at the current rates of
taxation after taking |
|
| into
account tax credits available. |
|
|
| The
Modaraba accounts for deferred taxation on all significant timing differences
using the liability |
|
| method,
excluding the tax effects of those timing differences which are not likely to
reverse in the |
|
| foreseeable
future. Debit balance on deferred tax account is not set-up as an asset. |
|
|
| 2.1
Revenue recognition |
|
| 2.10.1
Profit generated from Morabaha transactions is recognized as income at the
time of sale. |
|
| 2.10.2
Return on short-term investments is recognized as income on an accrual basis. |
|
| 2.10.3
Dividend income is recognized at the time of closure of share transfer books
of the company |
|
| declaring
dividend. |
|
| 2.10.4
Sales are recorded on dispatch of goods. |
|
|
| 3.
TANGIBLE FIXED ASSETS |
|
|
|
COST |
|
DEPRECIATION |
|
|
Additions/ |
|
Charged/ |
|
written |
|
|
(deletion) |
|
(on disposals) |
|
down value |
|
| Description |
|
At June |
during the |
At June |
|
At June |
for the |
At June |
at June |
|
|
301,998 |
year |
301,999 |
Rate |
30, 1998 |
year |
301,999 |
30, 1999 |
|
|
Rupees |
Rupees |
Rupees |
% |
Rupees |
Rupees |
Rupees |
Rupees |
|
|
|
|
| Leasehold
shops |
1,809,494 |
- |
1,809,494 |
5 |
- |
- |
- |
1,809,494 |
|
|
|
|
| Office
premises |
3,184,406 |
- |
3,184,406 |
5 |
265,367 |
159,220 |
424,587 |
2,759,819 |
|
| Plant
and machinery - note 3.1 |
796,518 |
- |
796,518 |
20 |
136,110 |
159,304 |
295,414 |
501,104 |
|
| Furniture
and fixture |
526,154 |
3,000 |
529,154 |
20 |
231,094 |
92,329 |
323,423 |
205,731 |
|
| Equipments |
|
503,586 |
320,076 |
823,662 |
10 |
200,196 |
65,986 |
266,182 |
557,480 |
|
| Vehicle |
|
24,000 |
- |
24,000 |
20 |
2,800 |
4,800 |
7,600 |
16,400 |
|
|
---------------------- |
---------------------- |
---------------------- |
---------------------- |
---------------------- |
---------------------- |
|
|
5,034,664 |
2,132,570 |
7,167,234 |
|
835,567 |
481,639' |
1,317,206 |
5,850,028 |
|
|
============= |
============= |
============= |
============= |
============= |
============= |
|
| 1998 |
|
5,044,560 |
823,918 |
5,034,664 |
|
776,124 |
516,528 |
835,567 |
4,199,097 |
|
|
(833,814) |
|
(457.085) |
|
|
============= |
============= |
============= |
============= |
============= |
============= |
|
|
| 3.1
These have been affixed in the premises of the Modaraba's garment
manufacturers. |
|
|
| 4.
LONG-TERM INVESTMENTS |
|
| Unless
stated otherwise the holdings are in ordinary certificates/shares of Rs. 10
each. |
|
|
|
No. of
shares/ |
Average cost |
Cost |
Market value |
|
| Name
Of Modaraba / Company |
Certificates |
per
share/certificate |
|
|
1999 |
1998 |
1999 |
1998 |
1999 |
1998 |
1999 |
1998 |
|
|
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
|
| MUTUAL
FUNDS |
|
| ICP Mutual Funds XXIII |
23,000 |
23,000 |
11.76 |
1,176 |
270,489 |
270,489 |
25,300 |
40,250 |
|
| ICP
Mutual Funds XXIV |
49,900 |
49,900 |
10.00 |
10.00 |
499,000 |
499,000 |
72,355 |
249,500 |
|
|
| GOVERNMENT
SECURITIES |
|
| National
Investment Trust - Units |
95,000 |
95,000 |
15.60 |
15.60 |
1,482,000 |
1,482,000 |
722,000 |
641,250 |
|
|
|
|
|
|
| ASSOCIATED
MODARABA |
|
| Modaraba
AI-Mali |
437,631 |
437,631 |
15.34 |
15.34 |
6,711,871 |
6,711,871 |
1,947,458 |
1,444,182 |
|
| (Managed
by AI-Mal Corp. Ltd.) |
|
|
| ASSOCIATED
UNDERTAKING |
|
| AI-Mal
Securities and Services Ltd. |
103,000 |
103,000 |
9.88 |
9.88 |
1,018,060 |
1,018,060 |
360,500 |
206,000 |
|
|
|
|
|
|
| LEASING
COMPANIES |
|
| Union
Leasing Company Limited |
59,823 |
52,020 |
20.70 |
23.81 |
1,238,405 |
1,238,405 |
179,469 |
156,060 |
|
|
|
|
|
|
| TEXTILE
SPINNING |
|
| Sana
Industries Limited |
1,500 |
1,500 |
78.00 |
78.00 |
117,000 |
117,000 |
94,500 |
104,850 |
|
| Idrees
Textile Mills Limited |
22,000 |
22,000 |
15.52 |
15.52 |
341,336 |
341,336 |
30,800 |
44,000 |
|
| Sadoon
Textile Mills Limited |
5,000 |
5,000 |
59.55 |
59.55 |
297,750 |
297,750 |
78,750 |
65,000 |
|
|
| TEXTILE
COMPOSITE |
|
| Ghazi
Fabrics International Limited |
35,100 |
35,100 |
9.22 |
9.22 |
323,653 |
323,653 |
38,610 |
38,610 |
|
|
|
|
|
|
| SYNTHETIC
AND RAYON |
|
| Ibrahim
Fibres Limited |
30,000 |
35.00 |
17.87 |
17.87 |
535,950 |
625,275 |
210,000 |
169,750 |
|
|
---------------------- |
---------------------- |
---------------------- |
---------------------- |
---------------------- |
---------------------- |
---------------------- |
---------------------- |
| Total
carried forward |
861,954 |
859,151 |
|
12,835,514 |
12,924,839 |
3,759,742 |
3,159,452 |
|
|
|
No. of
shares/ |
Average cost |
Cost |
Market value |
|
| Name
Of Modaraba / Company |
Certificates |
per
share/certificate |
|
|
1999 |
1998 |
1999 |
1998 |
1999 |
1998 |
1999 |
1998 |
|
|
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
|
|
| Total
brought forward |
861,954 |
859,151 |
|
12,835,514 |
12,924,839 |
3,759,742 |
3,159,452 |
|
|
|
|
|
|
| SUGAR |
|
| Chashma
Sugar Mills Limited |
40,700 |
41,700 |
10.88 |
10.88 |
442,846 |
453,727 |
183,150 |
417,000 |
|
|
|
|
|
|
| CEMENT |
|
| Pioneer
Cement Limited |
17,500 |
17,500 |
43.32 |
43.32 |
758,051 |
758,051 |
44,625 |
52,500 |
|
| Dadabhoy
Cement Industries Limited |
24,000 |
24,000 |
35.13 |
35.13 |
843,200 |
843,200 |
102,000 |
84,000 |
|
| Fecto
Cement Industries Limited |
15,000 |
15,000 |
60.20 |
60.20 |
903,046 |
903,046 |
60,000 |
75,000 |
|
| D.C.
Khan Cement Company Limited |
8,279 |
8,279 |
59.13 |
59.13 |
489,578 |
489,578 |
35,186 |
38,497 |
|
|
| AUTOS
AND ALLIED ENGINEERING |
|
| Indus
Motor Company Limited |
33,800 |
33,800 |
50.18 |
50.18 |
1,696,149 |
1,696,149 |
422,500 |
270,400 |
|
| Agriautos
Industries Limited (Rs. 5 each) |
304,558 |
324,058 |
7.50 |
7.50 |
2,284,185 |
2,430,435 |
898,446 |
388,870 |
|
|
| FOOD
AND ALLIED |
|
| Indus
Fruits Products Limited |
