Clover 2021

Annual
Report
2021
CL O VE R PAK IS TAN L IM IT E D
Annual Report | 2021
Content
1 COMPANY INFORMATION 03
2 NOTICE OF ANNUAL GENERAL MEETING 04
3 NOTICE OF ANNUAL GENERAL MEETING-URDU 06
4 REVIEW REPORT BY THE CHAIRMAN 08
5 REVIEW REPORT BY THE CHAIRMAN-URDU 10
6 DIRECTORS’ REPORT 12
7 DIRECTORS’ REPORT-URDU 17
8 STATEMENT OF VALUE ADDED 25
9 YEARWISE FINANCIAL HIGHLIGHTS 26
10 SIX YEAR AT A GLANCE 27
12 STATEMENT OF COMPLIANCE WITH LISTED COMPANIES
(CODE OF CORPORATE GOVERNANCE) 28
13 INDEPENDENT AUDITOR’S MODIFIED REVIEW REPORT 30
14 INDEPENDENT AUDITOR’S REPORT 32
15 STATEMENT OF FINANCIAL POSITION 37
16 STATEMENT OF PROFIT OR LOSS 38
17 STATEMENT OF COMPREHENSIVE INCOME 39
18 STATEMENT OF CHANGES IN EQUITY 40
19 STATEMENT OF CASH FLOW 41
20 NOTES TO THE FINANCIAL STATEMENTS 42
21 PATTERN OF SHAREHOLDING 79
22 PROXY FORM 82
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Clover Pakistan Limited
Company Information
Board of Directors
Mr. Salim Chamdia – Chairman
Mr. Khawar Jamil Butt
Mr. Shahzad Mohsin
Ms. Rima Athar
Mr. Zohaib Yaqoob
Mr. Asadullah Azizi – (Later on Resigned)
Mr. Sohail Allana – (Later on Resigned) – (Now Mr. Javaid Iqbal)
Audit Committee
Mr. Zohaib Yaqoob – Chairman
Mr. Salim Chamdia
Human Resource Committee

Mr. Asadullah Azizi – Chairman
Mr. Salim Chamdia
Company Secretary
Mr. Hassan Khurshid – (Later on Resigned) – (Now Mr. Muhammad Bilal)
Chief Financial Officer

Mr. Hassan Khurshid – (Later on Resigned) – (Now Mr. Owais Ali Khan)
External Auditors
Grant Thornton Anjum Rahman
Chartered Accountants
Registered Office
Banglow No. 23-B Lalazar, Off: M.T. Khan Road, Karachi, Pakistan.
Tel: (92 21) 38658896

Fax: (92 21) 35631960
Website: www.clover.com.pk
Share Registrar
FAMCO Associates (Pvt) Limited
8-F, Next to Hotel Faran, Nursery Block-6, P.E.C.H.S
Shahrah-e-Faisal, Karachi – 74000 Pakistan.
Tel: (92 21) 34380101-5
Fax: (92 21) 34380106
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Notice of the 35th Annual General Meeting

Notice is hereby given that the 35th Annual General Meeting (AGM) of the shareholders of Clover Pakistan Limited (the Company) will be held on
Thursday, February 24, 2022, at 11:00 a.m. via video conference facility due to Pandemic of COVID-19 to transact the following businesses:
Ordinary Business:
• To confirm the minutes of the Company's Annual General Meeting held on January 20, 2021.
• To receive, consider and adopt the annual audited financial statements of the Company for the year ended June 30, 2021, together with the
Directors' and Auditors' reports thereon.
• To appoint auditors of the Company for the Financial Year ending June 30, 2022, and to fix their remuneration. The Company's Board of
Directors has recommended retiring auditors M/S. Grant Thornton Anjum Rahman, Chartered Accountants, for their re-appointment as
external auditors for the year ending June 30, 2022. The retiring auditors, being eligible, have offered themselves for re-appointment for the
year ending June 30, 2022.
Any Other Business:
• To transact any other business as may be placed before the meeting with the permission of the Chair.
By order of the Board
Date: January 28, 2022 Muhammad Bilal

Place: Karachi Company Secretary
Notes:
1. Participation in the AGM Proceeding via Video Conference Facility:
Due to the recent increase in COVID-19 Omicron variant cases in Karachi and to avoid large indoor public gatherings at one place to control
the spread of the virus and in compliance with the decisions of the National Command and Operations Centre (NCOC), the Sindh
government banned all types of indoor gatherings, with effect from January 24, 2022, in Karachi, the Company shall hold its AGM through
video conference facility in pursuance to the letter issued on December 15, 2021, by the Securities and Exchange Commission of Pakistan
(SECP).
The members/proxies interested in participating in the AGM are requested to share the below information at
company-secretary@cloverpk.com with the subject "Registration for 35th AGM of Clover Pakistan Limited" along with a valid copy of
CNIC (both sides).
Shareholder Name Folio/CDC Number CNIC Number Cell Number Registered Email Address
Video link and login details will be shared with those whose emails contain all the required particulars will be received at the given email
address before 05:00 p.m. on February 17, 2022. The members can also provide their comments and suggestion to the agenda item of AGM
at the email address: company-secretary@cloverpk.com.
The login facility will be opened at 10:45 a.m. on February 24, 2022, enabling the shareholders to join the meeting, which will start at 11:00
a.m. sharp.
2. Closure of Share Transfer Books:
The Share Transfer Books of the Company will remain closed from February 18, 2022, to February 24, 2022 (both days inclusive).
Transfers received in order by our Share Registrar, M/S. FAMCO Associates Private Limited, 8-F, Near Hotel Faran, Nursery, Block-6,
PECHS, Shahra-e-Faisal, Karachi, Pakistan, by the close of business on February 17, 2022, will be considered in time for attending the
meeting.
3. Appointment of Proxies and Attending AGM:
i. A member entitled to attend and vote at the meeting may appoint another member as their proxy who shall have such rights as respects
attending, speaking and voting at the meeting as are available to a member.
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ii. A blank instrument of proxy (in English and Urdu) is attached in the Annual Report. The form of proxy is also available on the Company's
website.
iii. A duly completed instrument of proxy to be valid must be deposited at the registered office not less than 48 hours before the time of the
meeting. Attested copies of valid CNIC or the passport of the member and the proxy shall be furnished with the Proxy Form.
iv. The instrument of proxy should be duly signed, stamped and witnessed by two persons with their names, addresses, CNIC numbers and
signatures.
v. Central Depository Company (CDC) account holders are also required to follow the guidelines as laid down in Circular No.1 dated January
26, 2000, issued by the Securities and Exchange Commission of Pakistan (SECP).
vi. In the case of a corporate entity, the Board of Directors' resolution / Power of Attorney with specimen signature of the nominee shall be
submitted at the registered office not less than 48 hours before the time of the meeting.
4. Change in Members Addresses:
Members are requested to notify any change in their addresses immediately to the Share Registrar M/S. FAMCO Associates Private
Limited.
5. Availability of Financial Statements and Reports on the Website:
The Company's Annual Report for the year ended June 30, 2021, has been placed on the Company's website, and the same is circulated to
the members through CD.
6. Transmission of Annual Financial Statements and Notice of Meeting through email:
In pursuance to S.R.O.787(I)/2014 dated September 08, 2014, the SECP has permitted companies to circulate annual audited financial
statements along with notice of AGM to its members through email. Accordingly, members who desire to receive annual financial
statements and notices of the Company through email in the future (instead of receiving them through CD) are requested to submit their
consent on the form duly filled to the Company's Share Registrar. The consent form has been uploaded to the Company's website. Any
change to such arrangement(s) should be communicated to the Company on the standard request form.
7. Electronic Mode:
Under the provisions of section 242 of the Companies Act 2017, a listed company is required to pay cash dividends only through electronic
mode directly into the bank account designated by the entitled shareholders. Accordingly, the shareholders are requested to provide the
information on an E-Dividend Mandate Form available at the Company's website to the share registrar for future dividend payment. The
CDC account holders must submit their information directly to their broker (participant) / M/S FAMCO Associates Private Limited.
8. Shareholding Proportion:
The FBR has clarified that in the case of the joint account, each holder is to be treated individually as either a filer or non-filer and tax will
be deducted based on shareholding of each joint holder as may be notified by the Shareholder, in writing as follows, to the Company's share
registrar. Otherwise, it will be assumed that the joint shareholders equally hold the shares:
Company Name Folio/CDC Account Number Total Shares Principal Shareholder Joint Shareholder(s)
Name & CNIC Name & CNIC

Shareholding proportion Shareholding proportion
(No. of shares) (No. of shares)
9. Special Notice to the Shareholders for Conversion of Physical Shares into Book-Entry Form:
In compliance with section 72 of the Companies Act, 2017 and SECP's letter No. CSD/ED/Misc./2016-639-640 dated March 26, 2021,
listed companies are required to replace existing physical shares issued by them into the Book-Entry form. Given the above requirement,
shareholders of the Company having physical folios/ share certificates are requested to convert their shares from the physical form into
Book-Entry form as soon as possible.
Conversion of physical shares into Book-Entry form would facilitate the shareholders in many ways, i.e. safe custody of shares, readily
available market for instant sale and purchase of shares, eliminate the risk of loss & damage, easy & secure transfer with lesser formalities
as compared to physical shares. The Company's shareholders may contact Share Registrar of the Company [i.e. M/S. FAMCO Associates
Private Limited] for assistance in converting physical shares into Book-Entry Form.
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Review Report by the Chairman

For the year ended June 30, 2021
On behalf of the Board of Directors of Clover Pakistan Limited, I am pleased to present the report and audit the Company's
Financial Statements for the year ended June 30, 2021.
Impact of COVID-19 And Impairment of Goodwill
In this financial year, a pandemic COVID-19 continuously affected the Global economy significantly, resulting in a lockdown
in Pakistan. The economy's slowdown adversely affected the commercial & industrial sectors; consequently, industrial
chemicals and equipment sales fell significantly. During the year, the net revenue of the Company decreased to Rs. 374.437
million. The Company reported a net loss of Rs 604.999 million for the year after accounting for goodwill impairment
amounting to Rs 385.985 million.
The result of a decline in revenue is significantly impacted by the chemical and FMCG segment of the Company. Further, the
Company's business segments are at an infantry stage and post COVID scenario has further affected the revenue.
Performance Overview
Following its strategic plan, the Company has curtailed its business and trading activities during the period under review. The
net revenue of the Company decreased to Rs. 374.437 million resulting in a gross loss of 24.066 million and a net loss of Rs
604.999 million. Loss per share basic and diluted was Rs. 19.43 for the year. Due to the above scenario, no dividend has been
proposed.
The Company's revenue stream was impacted significantly due to the closure of the FMCG Business Segment during the year.
The Company had two marts, named Nisht Mart and Sahar Mart, located at Khayaban-e-Nishat and Khayaban-e-Sehar. The
Company's Mart was flooded with rainwater during the heavy rain.
The industrial and commercial chemical division has been added to the Company's revenue stream with solid prospects, but the
impact of COVID-19 has restricted the Company's growth in this division. The Company is also engaged in supplying goods
and maintenance services to the energy sector. However, COVID-19 impacted the business significantly. The Business
Solutions division and Petrotech Division of the Company also affected greatly.
Lubricants sales also fell during the year, averaging around 20,000 litres per month. Lubricants procurement is currently
managed through toll blending arrangements, initially geared towards the low-end market segment. The Company's focus
remains the domestic market segmented into High-Street and Industrial Consumers (B2B & B2Ci). Lubricants remains a high
margin product for the Company.
Technology
As part of its ongoing operational excellence initiative, the Company has implemented the SAP S/4 HANA ERP Business
Suite. The SAP solution will significantly facilitate our Group companies in improving their productivity and insight, reduce
costs through increased flexibility, enhance financial management and support changing industry requirements. For this
purpose, EY Ford Rhodes was appointed as the Implementation partner and provided the necessary end-to-end support for the
enterprise strategy, design, process re-engineering, deployment, and post-implementation control.
Governance
The Company's Board of Directors meets frequently enough to discharge its responsibilities. The Independent and
Non-executive directors are equally involved in important decisions. For the financial year ended June 30, 2021, the Board's
overall performance and effectiveness have been assessed as satisfactory. This assessment is in the process but based on an
evaluation of integral components, including the vision, mission and values; engagement in strategic planning; formulation of
policies; monitoring of business activities, and effective fiscal oversight.
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Directors' Training Programme
Directors of the Company have attended the Directors' Training Program conducted by the Institute of Cost and Management
Accountants of Pakistan (ICMA) through an online platform. ICMA is a member of the International Corporate Governance
Network.
Future Outlook
The recent slowdown in the country's economy, high inflation, rising interest rates and Rupee devaluation are likely to pose a
challenge to the overall business sector in Pakistan. However, we remain optimistic about meeting the impending challenges in
due course by repositioning ourselves.
Our future strategy is driven by innovation, expanding core segments and diversification in our product portfolio and customer
base. While focusing on revival in the existing Petrotech, Business Solutions, Lubricant and Auto Care segments, the Company
intends to further build upon its strengths and the Clover brand.
At Clover, we remain firm in our commitment to reinvigorate this Company and create value for all our stakeholders. This
revival will be underpinned by achieving operational excellence, elevated customer satisfaction, and driving cost efficiencies
across our divisions.
Acknowledgements
On behalf of the Board, I would like to express our appreciation to our shareholders and customers for their continued
patronage. We also highly value the services and dedication of our employees, who are relentless in their commitment to serve
our customers better. I would also like to thank our creditors and the regulators for their continued support and direction.
For and on behalf of the Board
Salim Chamdia
Chairman
Karachi: January 21, 2022
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DIRECTORS’ REPORT
The Directors present the Annual Report together with the Company's Financial Statements and the Auditors Report for the year ended June
30, 2021.
Financial Results
Financial highlights for 2021

The loss of financial statement for the year ended June 30, 2021, after providing selling and distribution expenses, financial and other charges
amount to be:
2021 2020
--------- (Rupees'000) ---------
Loss before taxation (567,123) (152,742)
Taxation (37,876) (2,476)
Loss for the year (604,999) (155,218)
------- (Rupees) -------

Loss per share – basic and diluted (19.43) (4.98)
Appropriations and movement in reserves have been disclosed in the Statement of Changes in Equity of the Annual Report.
During the year, the net revenue of the Company decreased to Rs. 374.437 million from Rs. 394.428 million resulting in a gross loss of Rs. 24.066
million. The Company reported a net loss of Rs 604.999 million for the year after accounting for total goodwill impairment amounting to Rs 385.985
million. This loss translated to Rs 19.43 per share compared to Rs 4.98 per share last year.
2020-21 was a challenging year with the impact of COVID-19 2nd and 3rd wave in the country and globally. The Pandemic affected the global
industries in two key ways; by causing drastic reductions in the demand and a sharp decline in the product price. Pakistan industry was also adversely
impacted, and due to local currency devaluation, the industry also had to account for high inventory loss and exchange loss.
The decline in revenue is due to multiple factors the Company faced. The Company's Chemical Business Division was significantly impacted as the
post COVID-19 outbreak, the price of the Chemical was highly volatile and frequently changed the national and international market environment.
Further, the devaluation of Rupees against the Dollar in the period also increased the market's uncertainty.
Further, the net loss for 2020-21 was also significantly impacted by the losses incurred due to shut down the FMCG Business Segment during the
year. The Company had two marts, named Nisht Mart and Sahar Mart, located at Khayaban-e-Nishat and Khayaban-e-Sehar. The Company's Mart
was flooded with rainwater during the heavy rain. The mart was full of fresh inventories, and packing materials caused stock damage and
subsequently expired, resulting in written-off stock and closure of both of the marts.
IMPAIRMENT OF GOODWILL
The Clover Pakistan Limited (Clover) merged with Hascombe Business Solutions Private Limited (Hascombe) effective April 01, 2018. Based on
the merger scheme duly approved by the Sindh Court, Goodwill recognized amounting to Rs. 548.9 million. Goodwill represented the difference
between the cost of acquisition (Rs. 605.3 million) and the carrying value of net assets (Rs. 56.4 million) acquired at the merger.
The Goodwill supports the assumption made by the Company on the merger, and FS 2019-20 were as follows:
• Revenue from Petrotech sales would increase on account of new sites (fuel stations) of Fossil Energy Private Limited (Fossil) corroborated
with annual maintenance contracts attached to that.
• Based on the license (OGRA-19(3)/(145)/217 ) approved by OGRA to open fuel stations in Punjab, Fossil is planning to set up 578 fuel
stations in Punjab in 5 years.
• Clover sells fuel dispensers units (FDU), digital screens, canopy board, generator, and other equipment to each fuel station. The types of
equipment include "Tank Overfill Protection Alarm System" & Submersible Set.
• Based on the analysis of gross profit margin for the year ended June 30, 2019, it was concluded that the gross profit margins remained stable
and increased in the upcoming years.
• Based on the service income earned from OMCs in past years, it was expected that the Company would continue to generate revenue with
an increase of 10%-15% from each pump from the first year of the projection. OMCs have 500 pumps.
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• Annual maintenance contracts were expected to increase two, three and four times each year, compared to the 1st year. The contracts income
expectations increased due to the sale of an equal number of FDU in the following years compared to the 1st year.
The Company made an assumption based on the historical figures of the Hascombe and future projection according to the Company's business plans,
including inflation impacts to the Company.
However, in 2019-20, the COVID-19 outbreak resulted in the lockdown in Pakistan significantly impacted the Company's business plan. The
COVID-19 affected the Company's assessments, estimates, and judgements regarding the recoverable amount based on the Company's business plan
and prospects. Based on the crisis in 2019-20, the Company impaired Goodwill by amount Rs. 162.9 million and recognized Goodwill by only Rs.
385.9 million in their Financial Statements.
The COVID-19 impact continued in 2020-21, resulting in Oil Marketing Companies (OMC) being in crisis. Due to these crises, the OMCs sale
declined, resulting in a decrease in Petrotech business with OMCs.
Further, due to COVID-19, the product import policies and terms were tightened along with the volatility of exchange rates and uncertain business
conditions.
In COVID-19, OMCs business suffered and decayed in 2020-2021, that's why OMCs did not expand their retail sites and tried to manage their
business with a previous number of sites, and it directly impacted our Petrotech Division of Clover and not received expected orders for FDUs and
Submersible Sets from OMCs.
Furthermore, due to COVID-19 sales in our Gestetner Business Division (Gestetner) also dropped, two main reasons are mentioned below:
- Government Offices and Embassies were working on/off in 2020-2021 just because of COVID-19; due to this, Gestetner products usage
was reduced in Embassies and not opened purchasing tenders by Government departments.
- Most companies shifted their work online, half-staff was presented in lockdowns of 2020-2021, usage of photocopiers and innovative office
equipment dropped significantly, and paperwork was transferred into emails.
Though there is a likelihood of Clover Pakistan Limited business renewal in the financial year 2022 – 2023, management now feels it is prudent to
write off Goodwill in its entirety.
RISK MITIGATION
The Board of Directors, Board's Audit Committee and Human Resource Committee comprising the senior management team, are responsible for
oversight of the Company's operations and evolving proactive strategy to mitigate any potential adverse impact of foreseen risks. The information
about significant risks and their mitigants is provided below:
STRATEGIC RISK
Strategic risk relates to the Company's future business plans and strategies, including the risks associated with the macro-environment it operates,
like demand for its products, competitive threats, technology and product innovation, et cetera. The Company regularly keeps track of the changing
market trends and seeks feedback from the Company's regular and prospective customers. The Company ensures that its products best suit its
customers' current and future needs at competitive prices with the finest quality to counter the competition and retain and improve its market share.
OPERATIONAL RISKS
Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the processes, technology and infrastructure
supporting the Company's activities, either internally within the Company or externally, and from external factors other than credit, market and
liquidity risks such as those arising from legal and regulatory requirements and generally accepted standards of operation behaviour. Operational
risks arise from all of the Company's activities. The Company's objective is to manage operational risk to balance limiting financial losses and
damage to its reputation while achieving its business objective and generating returns for investors. Primary responsibility for the development and
implementation of controls over operational risk rests with the management of the Company. This responsibility encompasses the controls in the
following areas:
- requirements for appropriate segregation of duties between various functions, roles and responsibilities;
- requirements for the reconciliation and monitoring of transactions;
- compliance with regulatory and other legal requirements;
- documentation of controls and procedures;
- requirements for the periodic assessment of operational risks faced, and the adequacy of controls and procedures to address the risks identified;
- ethical and business standards;
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- risk mitigation, including insurance where this is e active; and
The plant and equipment supplier's operational and qualitative track record and related service providers.
Business continuity plans for respective areas are in place and tested. Work-from-Home capabilities have been enabled for staff were required while
ensuring adequate controls to ensure that Company's information assets are adequately protected from emerging cyber threats.
FINANCIAL RISK
Credit Risk
Credit risk relates to the risk that a Company may encounter due to the failure of the counterparties to satisfy their debts or obligation following the
agreed terms of credit. All the Company's financial assets have credit risk other than "Cash in Hand". The Company has effectively managed the
credit risk with a well-devised credit strategy in place.
Liquidity Risk
Liquidity risk arises when the Company has insufficient ready cash and encounters difficulty meeting its financial obligation. Liquidity risk is
managed by ensuring the availability of sufficient funds to meet its financial obligations and commitments in any business condition.
Foreign Exchange Risk
The Company is not significantly exposed to foreign exchange risk on its import of raw material and plant and machinery to be settled in the short
term. For long-term contracts, Company makes arrangements to pass on, wherever possible, to counter foreign exchange risk.
CUSTOMER FOCUSING
The Company believes that its valued customers are the foundation of its business success. Company policies are entirely customers' focused.
Liaison with the market and customers has always enabled your Company to understand customers' needs best to offer the best suitable products and
service level to make your Company the first choice.
COMPLIANCE WITH THE CODE OF CORPORATE GOVERNANCE
The Directors are pleased to state that all necessary steps have been taken to comply with the Code of Corporate Governance requirements required
by the Securities and Exchange Commission of Pakistan (SECP). The Statement of Compliance with the Code of Corporate Governance is annexed
with the report.
CORPORATE AND FINANCIAL REPORTING FRAMEWORK
Following are the statements on the Corporate and Financial Reporting framework:
The financial statements prepared by the Company's management represent its state of affairs fairly, the results of its operations, cash flows and
changes in equity.
The Company has maintained proper books of accounts.
Appropriate accounting policies have been consistently applied in preparing financial statements and accounting estimates based on reasonable and
prudent judgment.
In preparation for these financial statements, International Financial Reporting Standards, as applicable in Pakistan, have been followed, and any
departures there have been adequately disclosed and explained.
The system of internal control is sound in design. The system is continuously monitored by Internal Audit and other such monitoring procedures.
Monitoring internal controls should continue as an ongoing process to further strengthen the controls and improve the system.
There are no significant doubts about the Company's ability to continue as a going concern.
There has been no material departure from the best practices of corporate governance, as detailed in the Listing Regulations.
The summary of the Company's key operating and financial date of the last six years, including the current period, is annexed in this report.
Information about taxes and levies is given in the notes to the accounts.
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BOARD OF DIRECTORS
The composition of the Board is as follows:
Male: 6
Female: 1
Independent Directors: Mr Zohaib Yaqoob

Mr Asadullah Azizi (Later on Resigned)
Other Non-executive Directors: Mr Salim Chamdia

Mr Shehzad Mohsin
Ms Rima Athar
Executive Directors: Mr Khawar Jamil Butt

Mr Sohail Allana (Later on Resigned)
After the year-end, Mr Asadullah Azizi and Mr Sohail Allana have resigned from the Company Board. The casual vacancy will be filled within the
due time as per the regulatory requirements. Mr Sohail Allana, CEO of the Company, resigned and replaced Mr Javaid Iqbal.
Board Committees
a) Audit Committee:
Mr Zohaib Yaqoob - Chairman
Mr Salim Chamdia
Mr Khawar Jamil Butt
b) Human Resource and Remuneration Committee:

Mr Asadullah Azizi – Chairman
Mr Salim Chamdia
Meetings of Board of Directors
During the year, six (6) meetings of the Board of Directors were held. Attendance by each Director was as follows:
Name of Director Meetings Attended
Mr Salim Chamdia 6
Mr Khawar Jamil Butt 3
Ms Rima Athar 3
Mr Farid Shamim – (Later on Resigned) 2
Mr Zohaib Yaqoob 2
Mr Sohail Allana – (Later on Resigned) 5
Mr Shahzad Mohsin 5
Mr Abu Talib Haidery – (Later on Resigned) 1
Mr Irfan Ali Hyder – (Later on Resigned) 3
Mr Nadeem Ahmed Butt – (Later on Resigned) 3
Mr Muhammad Jamshed Azmat – (Later on Resigned) 2
Audit Committee Meetings
By the Code of Corporate Governance, the Board has set up an Audit Committee. The Board of Directors has determined the terms of
reference of the Committee. The Audit Committee held four (4) meetings during the year. The attendance by each member was as follows:
Name of Audit Committee Member Meetings Attended

Mr Muhammad Jamshed Azmat - (Later on Resigned) 2
Mr Nadeem Ahmed Butt – (Later on Resigned) 2
Mr Abdul Wahab Kodvavi – (Later on Resigned) 1
Mr Rasheed Ahmed Jaffar – (Later on Resigned 1
Mr Abdul Rahim Suriya – (Later on Resigned) 1
Mr Salim Chamdia 2
Mr Shahzad Mohsin – (Later on Resigned) 1
Mr Zohaib Yaqoob 1
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Human Resource and Remuneration Committee Meetings
During the year, two (2) HR Committee meetings were held. Attendance by each member was as follows:
Name of the Human Resource Committee Member Meetings Attend
Mr Muhammad Jamshed Azmat - (Later on Resigned) 1

Mr Salim Chamdia 1
Mr Irfan Ali Hyder – (Later on Resigned) 1
Mr Asadullah Azizi – (Later on Resigned) 1
Directors' Remuneration
The Board of Directors has a formal policy and transparent procedures for directors' remuneration following the Companies Act, 2017 and Code of
Corporate Governance. The Board itself approves the remuneration of the Board members. However, under the Code of Corporate Governance, it is
ensured that no Director takes part in the proceedings of the Board Meetings in deciding his remuneration. The Company does not pay remuneration
to non-executive directors except for attending the meetings. The Company's remuneration policies are structured according to prevailing industry
trends and business practices. The details of the Directors and CEO's remuneration are adequately disclosed in respective notes to the Financial
statements
CONTRIBUTION TO THE NATIONAL EXCHEQUER AND ECONOMY
Your Company contributed to the national exchequer on import duties, general sales tax, income tax, and other government levies during the year.
EXTERNAL AUDITORS
The present auditors Messrs. Grant Thornton Anjum Rahman, Chartered Accountants, retire after the forthcoming Annual General Meeting and, being
eligible, have offered themselves for re-appointment. The Company's Board of Directors has endorsed the recommendation of the Audit Committee
for the re-appointment of Grant Thornton Anjum Rahman, Chartered Accountants, till the conclusion of the next Annual General Meeting. Grant
Thornton has been given a satisfactory rating under the Quality Control Review Program of the Institute of Chartered Accountants of Pakistan.
PATTERN OF SHAREHOLDING
A statement showing the Company's shareholding and additional information as of June 30, 2021, is annexed with this report.
There has been no transaction carried out by Directors / Chief Executive, CFO, Company Secretary and their spouses and minor children in the
Company's shares during the year.
FUTURE PROSPECTS
The recent slowdown in the country's economy, high inflation, rising interest rates and Rupee devaluation coupled with post COVID scenario is likely
to pose a challenge to the overall business sector in Pakistan. The same has already affected your Company in terms of lower revenue and resulting net
loss. However, the Company makes efforts in short to medium terms measures as part of the Company's plan related to the business revival and
financial restructuring plan.
Our future strategy is to keep strict cost control measures in place and keep the business segments afloat in their initial stages. Your Company is putting
all efforts, particularly in the Lubricants. The same is expected to give positive results to the Company and set the overall Company on track.
RELATED PARTY TRANSACTIONS
By the relevant regulations, the Company has a Related Party Transactions Policy approved by the Board of Directors that governs how arm's length
related transactions are dealt. All related party transactions carried out during the year are disclosed in the notes of the Financial Statements.
ACKNOWLEDGEMENT
We take this opportunity to thank all those who have provided us with their valuable support throughout the year.
On behalf of the Board of Directors
Shehzad Mohsin Javaid Iqbal

Director Chief Executive
Karachi.
Dated: January 21, 2022
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Statement Of Value Added

June 30, June 30,
2021 2020
Rupees Rupees
Wealth Generated
Total Revenue 377,540,000 447,520,000

Bought-in-Material & Services (398,591,473) (366,914,000)
(21,051,473) 80,606,000
Wealth distributed
To Employees 59,423,000 61,995,000

To Government
Duties & Taxes 72,939,000 94,275,000
To Providers Of Capital
Dividend To Shareholders - 717,000
Mark-up/interest Expense on
Interest Expense on borrowed funds 1,499,000 3,046,000
Utilized/Retained for reinvestment & future growth
Depreciation & retained profit for

future growth (154,912,473) (79,427,000)
(21,051,473) 80,606,000
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Yearwise Financial Highlights

2021 2020 2019 2018 2017 2016
-------------------------------(Rupees in `000)-------------------------
BALANCE SHEET
Fixed & intangibles assets - property,
plant & equipment 21,456 428,332 586,864 508 - 31
Long security deposits 1,210 4,485 4,110 10 10 20
Current assets 283,139 534,497 545,087 307,549 179,109 189,497
Currents liabilities 38,656 85,248 99,486 110,143 4,670 5,595
244,483 449,249 445,601 197,406 174,439 183,902
267,149 882,066 1,036,575 197,924 174,449 183,953
Equity 267,149 872,148 1,027,366 197,924 174,449 183,953

Liabilities against assets subject to
finance lease - 9,918 9,209 - - -
Deferred liabilities - - - - - -
267,149 882,066 1,036,575 197,924 174,449 183,953
PROFIT AND LOSS ACCOUNTS

Gross turnover 439,819 455,060 1,436,907 183,972 716 13,126
Less: Sales tax (64,928) (60,632) (192,942) 26,731 117 1,932
trade discounts (454) - - - - 190
(65,382) (60,632) (192,942) 26,731 117 2,122
Net turnover 374,437 394,428 1,243,965 157,241 600 11,013
Cost of sales (398,503) (309,444) (789,311) 125,658 487 11,692
Gross profit/loss (24,066) 84,984 454,654 31,583 113 (679)
Distributions & marketing expenses (63,681) (62,386) (26,465) (164) - (1,835)
Administrative expenses (88,473) (56,158) (104,783) (3,988) (4,707) (7,690)
Other operating expenses (6,522) (6,351) (7,101) - - (371)
Other operating income 3,103 53,092 2,506 7,007 8,109 33,333
Impairment of goodwill (385,985) (162,877)
Financial charges (1,499) (3,046) (6,984) (1,115) (86) (386)
Profit/loss before taxation (567,123) (152,742) 311,827 33,323 3,429 22,372
Taxation (37,876) (2,476) (59,331) (9,668) (3,097) (7,949)
Profit/loss after taxation (604,999) (155,218) 252,496 23,655 332 14,423
Earning/loss per share

- basic and diluted (Rupees) (19.43) (4.98) 8.11 2.51 0.04 1.52
Cash dividend 0% 0% 30% 0% 0% 585%
Operating profit/loss (176,220) (33,560) 323,406 34,438 3,514 22,758
Issued & paid up capital of Rs. 10 each 311,431 311,431 249,145 94,349 94,349 94,349
26
Six Year at a Glance
Gross Turnover Rs.'thousands Opera�ng Profit Rs.'thousands

1,600,000 400,000
1,400,000
300,000
1,200,000
200,000
1,000,000
100,000
800,000
2021 2020
600,000 -
2019 2018 2017 2016
400,000 (100,000)
200,000
(200,000)
-
2021 2020 2019 2018 2017 2016 (300,000)
Shareholders Equity Rs.'thousands Earning Per Share Rupees

1,200,000 10.00
1,000,000 5.00
2021 2020
800,000 -
2019 2018 2017 2016
(5.00)
600,000
(10.00)
400,000
(15.00)
200,000
(20.00)
-
2021 2020 2019 2018 2017 2016 (25.00)
Profit Before and A�er Tax Rs.'thousands Cash Dividend

400,000 700%
200,000 600%
2021 2020
- 500%
2019 2018 2017 2016
400%
(200,000)
300%
(400,000)
200%
(600,000)
100%
(800,000)
0%
Profit Before Taxta�on Profit a�er taxtaion 2021 2020 2019 2018 2017 2016
27
Statement of Compliance with Listed Companies

(Code of Corporate Governance) Regulations, 2019
Year ending June 30, 2021
Clover Pakistan Limited Year ended June 30, 2021 (hereinafter referred to as ‘The Company’) has complied with the requirements of the
Listed Companies (Code of Corporate Governance) Regulations, 2019 (“the Regulations”) in the following manner:
1. The total number of Directors are (7) as per the following:
a) Male: 6
b) Female: 1
2. The composition of the Board is as follows:
i. Independent Directors*: Mr Zohaib Yaqoob

Mr Asadullah Azizi
ii. Non-Executive Directors: Mr Salim Chamdia

Mr Shehzad Mohsin
Ms Rima Athar
iii. Executive Directors: Mr Sohail Allana

*During the year, the company did not fulfil the requirement of at least two or one third members of the Board, whichever is
higher, as independent directors. Further, the company is actively looking forward the third one in order to round up the number.
3. The directors have confirmed that none of them is serving as a director on more than seven listed companies, including this
Company;
4. The Company has prepared a code of conduct and has ensured that appropriate steps have been taken to disseminate it
throughout the Company along with its supporting policies and procedures;
5. The Board has developed a vision/mission statement, overall corporate strategy and significant policies of the Company. The
Board has ensured that a complete record of particulars of the significant policies along with their date of approval or updating
is maintained by the Company;
6. All the powers of the Board have been duly exercised, and decisions on relevant matters have been taken by the Board /
shareholders as empowered by the relevant provisions of the Act and these Regulations;
7. The meetings of the Board were presided over by the Chairman and, in his absence, by a director elected by the Board for this
purpose. The Board has complied with the requirements of Act and the Regulations with respect to frequency, recording and
circulating minutes of the meeting of the Board;
8. The Board have a formal policy and transparent procedures for remuneration of directors under the Act and these Regulations;
9. The Board has arranged Directors’ Training program for the following:
• Mr Salim Chamdia;
• Mr Sohail Allana;
• Mr Shehzad Mohsin;
• Ms Rima Athar;
• Mr Zohaib Yaqoob; and
• Mr Asadullah Azizi
10. The Board has approved the appointment of a Chief Financial Officer, Company Secretary and Head of Internal Audit, including
their remuneration and terms and conditions of employment and complied with relevant requirements of the Regulations;
11. Chief Financial Officer and Chief Executive Officer duly endorsed the financial statements before approval of the Board;
28
12. The Board has formed committees comprising of members given below:
a) Audit Committee:
Mr Zohaib Yaqoob Chairman

Mr Salim Chamdia Member
Mr Khawar Jamil Butt Member
b) HR and Remuneration Committee:
Mr Asadullah Azizi Chairman

Mr Salim Chamdia Member
Mr Khawar Jamil Butt Member
13. The terms of reference of the aforesaid committees have been formed, documented and advised to the committee for
compliance;
14. The frequency of meetings (quarterly/half-yearly/yearly) of the committee was as per the following, -
a) Audit Committee Quarterly

b) HR and Remuneration Committee Yearly
15. The Board has set up an effective internal audit function;
16. The statutory auditors of the Company have confirmed that they have been given a satisfactory rating under the Quality Control
Review program of the Institute of Chartered Accountants of Pakistan and registered with the Audit Oversight Board of
Pakistan, that they and all their partners comply with the International Federation of Accountants (IFAC) guidelines on code of
ethics as adopted by the Institute of Chartered Accountants of Pakistan and that they and the partners of the firm involved in the
audit are not a close relative (spouse, parent, dependent and non-dependent children) of the Chief Executive Officer, Chief
Financial Officer, Head of Internal Audit, Company Secretary or Director of the Company;
17. The statutory auditors or the persons associated with them have not been appointed to provide other services except under the
Act, these Regulations or any other regulatory requirement, and the auditors have confirmed that they have observed IFAC
guidelines in this regard;
18. We confirm that all requirements of regulations 3, 7, 8, 27, 32, 33 and 36 of the regulations have been complied with; and
19. Explanation for non-compliance with requirements, other than regulations 3, 6, 7, 8, 27, 32, 33 and 36 are below:
Non Compliance Explanation Subsequent to reporting date
As per Chapter VII Section 24: During the year, Chief Financial Officer Currently, Chief Financial Officer and
had resigned from his position dated Company Secretary position hold by
“Chief Financial Officer and Company June 11, 2021. Therefore, management two separate eligible person.
Secretary shall not be the same persons decided to hand over charge to Current
of a listed company.” Company Secretary to look after
Company financial Matters till next
suitable individual appointed to fill the
position.
SALIM CHAMDIA
Chairman
29
30
31
Key audit matters
32
33
34
35
36
CLOVER PAKISTAN LIMITED

STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2021
2021 2020
Note ---------- (Rupees in '000) ----------

ASSETS
Non-current assets
Property and equipment 6 16,883 22,139

Intangible assets 7 224 386,259
Long term deposits 8 1,210 4,485
Deferred tax asset 9 4,349 19,934
Total non-current assets 22,666 432,817
Current assets
Stock-in-trade 10 142,021 335,526

Trade debts - unsecured 11 43,272 68,360
Loans and advances 12 28,723 24,806
Trade deposits and short term prepayments 13 3,720 18,634
Short-term investments 14 - 7,780
Other receivables 15 21,334 21,759
Taxation-net 16 36,589 50,869
Sales tax receivable- net 434 -
Cash and bank balances 17 7,046 6,763
Total current assets 283,139 534,497
Total assets 305,805 967,314
EQUITY AND LIABILITIES

Shareholders' equity
Authorized share capital

40,000,000 (2020: 40,000,000) ordinary shares of Rs. 10 each 400,000 400,000
Issued, subscribed and paid-up share capital 18 311,431 311,431

Reserves 19 (44,282) 560,717
Total shareholders' equity 267,149 872,148
Non-current liabilities
Deferred liabilities 20 - 9,918
Current liabilities
Trade and other payables 21 34,488 79,450

Advance from customers - unsecured 232 238
Sales tax payable- net - 1,624
Unclaimed dividend 3,936 3,936
Total current liabilities 38,656 85,248
Total liabilities 38,656 95,166
Total equity and liabilities 305,805 967,314
Contingencies and commitments 22
The annexed notes from 1 to 41 form an integral part of these financial statements.
CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER DIRECTOR
37

STATEMENT OF PROFIT OR LOSS
FOR THE YEAR ENDED JUNE 30, 2021
2021 2020
Note ---------- (Rupees in '000) ----------
Revenue - net 23 374,437 394,428
Cost of sales 24 (398,503) (309,444)
Gross (loss) / profit (24,066) 84,984
Selling and distribution expenses 25 (63,681) (62,386)

Administrative expenses 26 (88,473) (56,158)
Operating loss (176,220) (33,560)
Other operating expenses 27 (1,984) (1,616)

Other income 28 3,103 53,092
(175,101) 17,916
Exchange loss (522) (4,735)

Finance cost (1,499) (3,046)
Impairment of trade receivable 11 (4,016) -
Impairment of goodwill 7.1 (385,985) (162,877)
Taxation 29 (37,876) (2,476)
Loss for the year (604,999) (155,218)

------------ (Rupees) ------------
Loss per share - basic and diluted 30 (19.43) (4.98)
38

STATEMENT OF COMPREHENSIVE INCOME
2021 2020
Note ---------- (Rupees in '000) ----------

Loss for the year (604,999) (155,218)
Other comprehensive income:
Items that may be reclassified subsequently to

the statement of profit or loss in subsequent periods - -
Items that will not be reclassified to the

statement of profit or loss in subsequent periods - -
Total other comprehensive income - -
Total comprehensive loss for the year (604,999) (155,218)
39

STATEMENT OF CHANGES IN EQUITY
Reserves
Capital reserve Revenue reserve
Issued,
subscribed and Share General Accumulated Total reserves Total
premium reserve Losses / shareholders'
paid-up share
Unappropriated equity
capital
profit
----------------------------------------------- (Rupees in '000) -----------------------------------------------
Balance as at July 01, 2019- (Restated) 249,145 450,455 64,600 263,166 778,221 1,027,366
Loss for the year - - - (155,218) (155,218) (155,218)

Other comprehensive income - - - - - -
Total comprehensive loss for the year - - - (155,218) (155,218) (155,218)
Transactions with owners recorded directly
in equity - distributions
Issuance of bonus shares in proportion of
1 share for every 4 shares 62,286 (62,286) - - (62,286) -
Balance as at June 30, 2020 311,431 388,169 64,600 107,948 560,717 872,148
Loss for the year - - - (604,999) (604,999) (604,999)

Other comprehensive income - - - - - -
Total comprehensive loss for the year - - - (604,999) (604,999) (604,999)
Balance as at June 30, 2021 311,431 388,169 64,600 (497,051) (44,282) 267,149
40

STATEMENT OF CASH FLOWS
2021 2020
Note ---------- (Rupees in '000) ----------
Cash generated from operations 31 14,620 668
Finance cost paid (1,499) (3,046)

Taxation paid 16 (8,011) (33,643)
Gratuity paid 20.1 (9,918) (361)
(19,428) (37,050)
Net cash used in operating activities (4,808) (36,382)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment (5,240) (7,681)

Sale proceed of property and equipment 4,200 -
Sales proceed from investments 8,451 9,751
Dividend income from short term investment 28 - 150
Net cash generated from investing activities 7,411 2,220
CASH FLOWS FROM FINANCING ACTIVITIES
Dividend paid - (717)

Ijarah payments (2,320) (1,673)
Net cash used in financing activities (2,320) (2,390)
Net increase / (decrease) in cash and cash equivalents 283 (36,552)
Cash and cash equivalents at beginning of the year 6,763 43,315
Cash and cash equivalents as at end of the year 7,046 6,763
41

NOTES TO THE FINANCIAL STATEMENTS
1 LEGAL STATUS AND OPERATIONS
Clover Pakistan Limited (the Company) was incorporated in Pakistan on September 30, 1986 as a public limited
company under the repealed Companies Ordinance, 1984 (Now: Companies Act, 2017). The shares of the Company are
quoted on Pakistan Stock Exchange Limited. The Company is a subsidiary of Fossil Energy (Private) Limited (the
'Holding Company') which holds 58% (2020: 71%) shares of the Company. The registered office and geographical
location of business units of the Company are as follows:
1) Banglow No.23-B, Lalazar, Off M.T. Khan Road, Karachi. (Head Office).
2) 5th Floor, LSE Building 19-Khayaban-e-Aiwan-e-Iqbal, Lahore (Administrative office).
3) Ground floor - Qamar plaza, IJP road. Rawalpindi (Administrative office).
4) New Church Building, Tilak Incline, Jacob Road, Hyderabad Sindh, 71000 (Administrative Office).
5) Plot No B-10 Zeeshan Housing Scheme Qasimabad, Hyderabad (Warehouse).
6) Plot No 25/A-1 Nadirabad Phaatak Main Industrial State Road Multan (Warehouse).
7) House No AK-487, Sector 6-B B-186 Mehran Town Korangi Karachi (Warehouse).
The principal business of the Company includes sale of food products, consumer durables, chemicals and lubricants and
also import & trade of gantry equipment's air/oil filter and other car care products. The Company is also involved in
marketing & distribution and after sales support of office automation products, fuel dispensers, vending machines and
digital screens.
2 SIGNIFICANT EVENTS AND TRANSACTIONS
a) During the year, the Company has closed its Nishat and Sehar mart located in Karachi and consequently the
Company has written off stock as disclosed in note 26.3 of these financial statements.
b) The amount of Goodwill have been impaired as disclosed in note 7.1.2.
c) Case registered during the year by the custom authorities dated September 03, 2020 against the Company and its
Directors for the unauthorized withdrawal of VAM from the Bonded Warehouse having duty involving
Rs. 17.407 million has been decided in favor of the Company vide order dated September 29,2021.
3 BASIS OF PREPARATION
3.1 Statement of compliance
These financial statements have been prepared in accordance with the accounting and reporting standards as applicable
in Pakistan. The accounting and reporting standards applicable in Pakistan comprise of:
- International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board
(IASB) as notified under the Companies Act, 2017;
- Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as
are notified under the Companies Act, 2017; and
- Provisions of and directives issued under the Companies Act, 2017.
Where provisions of and directives issued under the Companies Act, 2017 differ from the IFRS, the provisions of and
directives issued under the Companies Act, 2017 have been followed.
42

3.2 Basis of measurement
These financial statements have been prepared under the historical cost convention except as otherwise disclosed in the
respective accounting policies' note and statement of cash flows.
3.3 Functional and presentation currency
Items included in the financial statements are measured using the currency of the primary economic environment in
which the Company operates. The financial statements are presented in Pakistani Rupee, which is the Company's
functional and presentation currency. The figures have been rounded off to the nearest thousand.
3.4 Standards, Amendments and Interpretations to Approved Accounting Standards
3.4.1 Standards, amendments and interpretations to the published standards that may be relevant to the company and
adopted in the current year
The Company has adopted the following new standards, amendments to published standards and interpretations of
IFRSs which became effective during the current year.
Effective Date
(Annual periods beginning
Standard or interpretation on or after)
Various Amendments to References to the Conceptual Framework in IFRS Standards January 1, 2020
IFRS 3 'Definition of a business' Amendment to IFRS 3 January 1, 2020
IAS 1/IAS 8 'Definition of Material' (Amendments to IAS 1 and IAS 8) January 1, 2020
IFRS 9, and IAS 39 - Interest Rate Benchmark Reform - Phase I January 1, 2020
Adoption of the above standard have no significant effect on the amounts for the year ended June 30, 2021.
3.4.2 Standards, amendments and interpretations to the published standards that may be relevant but not yet effective
and not early adopted by the Company
The following new standards, amendments to published standards and interpretations would be effective from the dates
mentioned below against the respective standard or interpretation.
Effective Date
IBOR Reform and its Effects on Financial Reporting—Phase 2 January 01, 2021
Onerous Contracts—Cost of Fulfilling a Contract (Amendments to IAS 37) January 01, 2022
Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16) January 01, 2022
Fees in the ‘10 per cent’ Test for Derecognition of Financial Liabilities
(Amendment to IFRS 9) January 01, 2022
Subsidiary as a First-time Adopter (Amendment to IFRS 1) January 01, 2022
Taxation in Fair Value Measurements (Amendment to IAS 41) January 01, 2022
43

Effective Date
Updating a Reference to the Conceptual Framework (Amendments to IFRS 3) January 01, 2022
Classification of Liabilities as Current or Non-current (Amendments to IAS 1) January 01, 2023
Deferred Tax related to Assets and Liabilities arising from a Single

Transaction (Amendments to IAS 12) January 01, 2023
Definition of Accounting Estimates (Amendments to IAS 8) January 01, 2023
Disclosure Initiative—Accounting Policies January 01, 2023
The Company is in the process of assessing the impact of these Standards, amendments and interpretations to the
published standards on the financial statements of the Company.
3.4.3 Standards, amendments and interpretations to the published standards that are not yet notified by the Securities
and Exchange Commission of Pakistan (SECP)
Following new standards have been issued by the International Accounting Standards Board (IASB) which are yet to be
notified by the SECP for the purpose of applicability in Pakistan.
IASB effective date
IFRS 17 'Insurance Contracts' (amendments to IFRS 17) January 01, 2023
Amendments to IFRS 17 Insurance Contracts January 01, 2023
IFRS 1 - First time adoption of International Financial Reporting Standards July 01, 2009
4 Use of critical accounting estimates and judgments
The preparation of these financial statements in conformity with the approved accounting standards as applicable in
Pakistan requires management to make judgments, estimates and assumptions that affect the application of accounting
policies and the reported amount of assets, liabilities, income and expenses.
The estimates and associated assumptions are based on historical experience and various other factors that are believed
to be reasonable under the circumstances, the results of which form the basis of making the judgments about the carrying
values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these
estimates. The estimates underlying the assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the
period of the revision and future periods if the revision affects both current and future periods.
In the process of applying the Company’s accounting policies, management has made the following accounting
estimates and judgments which are significant to the financial statements:
44

a) property and equipment 5.1

b) intangible assets 5.2
c) stock in trade 5.4
d) impairment of financial assets 5.5.5
e) trade debts and other receivables 5.7
f) impairment of non-financial assets 5.12
g) employees' benefits 5.13
h) taxation 5.14
i) provisions 5.15
j) contingent liabilities 5.23
5 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies adopted in the preparation of these financial statements are set out below. These
policies have been consistently applied to all the years presented.
5.1 Property and equipment
5.1.1 Owned
Property and equipment are stated at cost less accumulated depreciation and accumulated impairment losses (if any).
Impairment losses if any are recorded on the basis as defined in note 5.12.
Depreciation is charged on straight line basis at the rates specified in note no. 6 of these financial statements.
Depreciation on additions is charged from the month in which the asset is available for use and on disposals up to the
month immediately preceding the month of disposal.
The useful lives, residual values and depreciation method are reviewed on a regular basis. The effect of any changes in
estimate is accounted for on a prospective basis.
Major renewals and improvements for assets are capitalized and the assets so replaced, if any, are retired. Maintenance
and normal repairs are charged to statement of profit or loss, as and when incurred.
An item of property and equipment is derecognized upon disposal or when no future economic benefits are expected to
arise from the continued use of the asset. Gains or losses on disposal or retirement of an asset represented by the
difference between the sale proceeds and the carrying amount of the asset are charged to statement of profit or loss.
Capital work-in-progress is stated at cost less accumulated impairment if any. All expenditures connected to the specific
assets incurred during installation and construction period are carried under capital work-in-progress. These
expenditures are transferred to relevant category of property, plant and equipment as and when the assets start operation.
5.1.2 Assets held under ijarah financing
Assets held under Ijarah financing are accounted for using the guidelines of Islamic Financial Accounting Standard-2
(IFAS-2), "Ijarah". The assets are not recognized on the Company's statement of financial position and payments made
under Ijarah financing are recognized in the statement of profit or loss on a straight line basis over the term of the Ijarah.
45

5.2 Intangible assets
An intangible asset is recognized if it is probable that the future economic benefits that are attributable to the asset will
flow to the enterprise and the cost of such assets can also be measured reliably.
The useful lives, residual values and amortization method are reviewed on a regular basis. The effect of any changes in
estimate is accounted for on a prospective basis.
Generally, costs associated with developing and maintaining the computer software programs are recognized as expense
when incurred. However, costs that are directly associated with identifiable software and have probable economic
benefit exceeding the cost beyond one year, are recognized as intangible asset. Direct costs include the purchase cost of
software and related overhead cost.
Expenditure which enhances or extends the performance of computer software beyond its original specification and
useful life is recognized as a capital improvement and added to the original cost of the software.
These are stated at cost less accumulated amortization and accumulated impairment losses, if any. Amortization is
charged on a straight line basis at the rate specified in note 7 of these financial statements. Amortization on additions is
charged from the month in which the asset is available for use and on disposals up to the month the respective asset was
in use. Impairment losses if any are recorded on the basis as defined in note 5.12.
Goodwill represent the difference between the cost of acquisition paid and carrying value of the net assets acquired.
5.3 Long term deposits
These are stated at amortized cost which represents the fair value of consideration given.
5.4 Stock in trade
Stock-in-trade is valued at the lower of cost, determined on weighted average basis or net realizable value, except items
in transit, which are stated at cost comprising invoice value and plus other charges incurred thereon.
Net realizable value is the estimated selling price in the ordinary course of business less estimated costs of completion
and estimated costs necessary to be incurred to make the sale.
Inventory write-down is made based on the current market conditions, historical experience and selling goods of similar
nature. It could change significantly as a result of changes in market conditions. A review is made on each reporting date
on inventories for excess inventories, obsolescence and declines in net realisable value and an allowance is recorded
against the inventory balances for any such declines. Inventory write off is made when inventory is discarded without
consideration and in case of loss of inventory.
5.5 Financial instruments - initial recognition and subsequent measurement
5.5.1 Initial recognition
All financial assets and liabilities are initially measured at cost which is the fair value of the consideration given or
received. These are subsequently measured at fair value, amortized cost as the case may be.
46

5.5.2 Classification of financial assets
The Company classifies its financial instruments in the following categories:

- at fair value through profit or loss (""FVTPL"")
- at fair value through other comprehensive income (""FVTOCI""), or
- at amortized cost.
The Company determines the classifications of financial assets at initial recognition. The classification of instruments
(other than equity instruments) is driven by the Company's business model for managing the financial assets and their
contractual cash flow characteristics.
Financial assets that meet the following conditions are subsequently measured at amortized cost:
- the financial asset is held within a business model whose objective is to hold financial assets in order to collect
contractual cash flows; and
- the contractual terms of the financial assets give rise on specified date to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
Financial assets that meet the following conditions are subsequently measured at FVTOCI:
- the financial asset is held within a business model whose objective achieved by both collecting contractual cash
flows and selling the financial assets; and
- the contractual terms of the financial assets give rise on specified date to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
By default, all other financial assets are subsequently measured at FVTPL.
5.5.3 Classification of financial liabilities
The Company classifies its financial liabilities in the following categories:
- at fair value through profit or loss ("FVTPL"); or
- at amortized cost
Financial liabilities are measured at amortized cost, unless they are required to be measured at FVTPL (such as
instrument held for trading or derivatives) or the Company has opted to measure them at FVTPL.
5.5.4 Subsequent measurement
i) Financial assets at FVTOCI
Elected investments in equity instruments at FVTOCI are initially recognized at fair value plus transaction costs.
Subsequently, they are measured at fair value, with gains or losses arising from changes in fair value recognized in other
comprehensive income/(loss).
47

ii) Financial assets and liabilities at amortized cost
Financial assets and liabilities at amortized cost are initially recognized at fair value, and subsequently carried at
amortized cost, and in the case of financial assets, less any impairment.
iii) Financial assets and liabilities at FVTPL
Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in
the statement of profit or loss. Realized and unrealized gains and losses arising from changes in the fair value of
financial assets and liabilities held at FVTPL are included in the statement of profit or loss in the period in which they
arise.
Where the management has opted to recognize a financial liability at FVTPL, any changes associated with the
Company's own credit risk will be recognized in other comprehensive income/(loss). Currently, there are no financial
liabilities designated at FVTPL.
5.5.5 Impairment of financial assets
The Company recognizes loss allowance for Expected Credit Loss (ECL) on financial assets measured at amortized cost
and FVTOCI at an amount equal to life time ECLs except for the financial assets in which there is no significant increase
in credit risk since initial recognition or financial assets which are determine to have low credit risk at the reporting date,
in which case twelve months' ECL is recorded. The following were either determine to have low or there was no credit
risk since initial recognition and at the reporting date:
- deposits;
- loans;
- short-term investments;
- other receivables; and
- bank balances;
Loss allowance for trade debts are always measured at an amount equal to life time ECLs.
Life time ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument.
Twelve months ECLs are portion of ECL that result from default events that are possible within twelve months after the
reporting date.
ECLs are a probability weighted estimate of credit losses. Credit losses are measured at the present value of all cash
short falls (i.e. the difference between cash flows due to the entity in accordance with the contract and cash flows that
the company expects to receive).
The gross carrying amount of a financial asset is written off when the Company has no reasonable expectation of
recovering a financial asset in entirety or a portion thereof.
48

5.5.6 Derecognition
i) Financial assets
The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets
expire or when it transfer the financial assets and substantially all the associated risks and reward of ownership to
another entity. On derecognition of financial assets measured at amortized cost, the difference between the assets
carrying value and the sum of the consideration received and receivable recognized in statement of profit or loss. In
addition, on derecognition of an investment in a debt instrument classified as at FVTOCI, the cumulative gain or loss
previously accumulated in the investments revaluation reserve reclassified to statement of profit or loss. In contrast, on
derecognition of an investment in equity instrument which the Company has elected on initial recognition to measure at
FVTOCI, the cumulative gain or loss previously accumulated in the investments revaluation reserve is not reclassified
to statement of profit or loss, but is transferred to statement of changes in equity.
ii) Financial liabilities
The Company derecognizes financial liabilities only when its obligations under the financial liabilities are discharged,
cancelled or expired. The difference between the carrying amount of the financial liabilities derecognized and the
consideration paid and payable, including any non-cash assets transferred or liabilities assumed, is recognized in
statement of profit or loss.
5.5.7 Off-setting of financial assets and liabilities
Financial assets and liabilities are off set and the net amount is reported in the statement of financial position if the
Company has a legal right to set-off the transactions and also intends either to settle on a net basis or to realize the asset
and settle the liability simultaneously.
5.6 Investments
Investment in equity instruments are classified at fair value through profit or loss and is initially measured at fair value
and subsequently is measured at fair value determined using the closing market value at each reporting date. Net gains
and losses are recognized in the statement of profit or loss.
5.7 Trade debts and other receivables
These are measured at original invoice amount less an estimate made for allowance for expected credit loss based on the
probability of default at reporting period. Bad debts are written off when identified. Impairment losses if any are
recorded on the basis as defined in note 5.5.5.
5.8 Trade and other payables
Liabilities for trade and other payables are measured at cost which is the fair value of the consideration to be paid in
future for goods and services.
5.9 Contract assets
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the
Company performs by transferring goods or services to a customer before the customer pays consideration or before
payment is due, a contract asset is recognized for the earned consideration that is conditional.
49

5.10 Contract liabilities
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received
consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the
Company transfers goods or services to the customer, a contract liability is recognized when the payment is made or the
payment is due (whichever is earlier). Contract liabilities are recognized as revenue when the Company performs
obligation under the contract.
5.11 Cash and cash equivalents
For the purposes of cash flow statement, cash and cash equivalents comprise of cash in hand and bank balances, short
term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an
insignificant risk of change in value and short term running finances under mark up arrangements (if any).
5.12 Impairment of non-financial assets
At each reporting date, the Company reviews the carrying amounts of its non-financial assets to determine whether there
is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill
is tested annually for impairment.
For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from
continuing use that are largely independent of the cash inflows of other assets or Cash Generating Units (CGUs).
Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from
the synergies of the combination.
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in
use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset or CGU.
An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its recoverable amount.
Impairment losses are recognized in profit or loss. They are allocated first to reduce the carrying amount of any goodwill
allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.
An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the
extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of
depreciation or amortization, if no impairment loss had been recognized. A reversal of impairment loss for a cash
generating unit is allocated to the assets of the unit, except for goodwill, pro rata with the carrying amounts of those
assets. The increase in the carrying amounts shall be treated as reversals of impairment losses for individual assets and
recognized in profit or loss unless the asset is measured at revalued amount. Any reversal of impairment loss of a
revalued asset shall be treated as a revaluation increase.
5.13 Employees' benefits
Provident fund
The Company operates a defined contribution plan in the form of recognized provident fund scheme for the permenent
employees. Contributions to fund are made monthly by the Company and employee at the of 10% of the basic salary.
The Company's contributions are recognized as employee benefit expense when they are due. If contribution payments
exceed the contribution due for service, the excess is recognized as an asset.
50

Gratuity
The Company operates an unfunded defined benefit gratuity scheme. The scheme provides for a graduated scale of
benefits dependent on the length of service of the employee on terminal date, subject to the completion of minimum
qualifying period of service. Gratuity is based on employee's last drawn salary for each completed year of service and
best estimates of the management. Refer to the note 20 of these financial statements.
5.14 Taxation
5.14.1 Current
Provision for current taxation is based on taxable income at the current rates of taxation after taking into account tax
credits and rebates available, if any, or minimum tax on turnover or Alternate Corporate Tax whichever is higher and
tax paid on final tax regime basis.
5.14.2 Deferred
Deferred tax is provided in full using the statement of financial position method, on all temporary differences arising at
the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognized for all taxable temporary differences, while deferred tax assets are recognized for
all deductible temporary differences, carry-forward of unused tax losses and unused tax credits, to the extent that it is
probable that taxable profit will be available against which the deductible temporary differences, carry forwards of
unused tax losses and unused tax credits can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.
Unrecognized deferred tax assets are reassessed at each reporting date and are recognized to the extent that it has become
probable that future taxable profits will allow deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is
realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantially enacted at the
reporting date. In this regard, the effects on deferred taxation of the portion of income expected to be subject to final tax
regime is adjusted in accordance with the requirement of Accounting Technical Release - 27 of the Institute of Chartered
Accountants of Pakistan. Deferred tax is charged or credited to the statement of profit or loss.
Deferred tax relating to items recognized directly in the other comprehensive income is recognized in the other
comprehensive income and not in statement of profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if there is a legally enforceable right to offset current tax
assets and liabilities and they relate to the income tax levied by the same tax authority.
5.15 Provisions
Provision is recognized in the statement of financial position when the Company has a present obligation (legal or
constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation and a reliable estimate can be made of the amount of obligation.
51

As the actual outflows can differ from estimates made for provisions due to changes in laws, regulations, public
expectations, technology, prices and conditions, and can take place many years in the future, the carrying amounts of
provisions are reviewed at each reporting date and adjusted to take account of such changes. Any adjustments to the
amount of previously recognized provision is recognized in the statement of profit or loss unless the provision was
originally recognized as part of cost of an asset.
5.16 Warranties
Warranty claims for replacement are accounted for in the year in which claims are settled. The Company issues warranty
on behalf of the manufacturers and re-route the claims to the respective manufacturer when the claim is received.
5.17 Foreign currency translation
Transactions in foreign currencies are accounted for in Pakistani Rupee at the foreign exchange rates prevailing on the
date of the transaction. Monetary assets and liabilities in foreign currencies are re-translated into Pakistani Rupee at the
foreign exchange rates approximating those prevailing at the statement of financial position date. Exchange differences
are taken to the statement of profit or loss on net basis within other income or other expense.
5.18 Revenue from contract with customers
The Company is in the business of sale of goods and provision of services. Revenue from contracts with customers is
recognized when control of the goods is transferred to the customer and thereby the performance obligations are
satisfied, at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those
goods net of discount, sales return and sales related direct expenses and indirect taxes.
The Company has concluded that based on the contractual arrangement for the revenue from sale of goods, performance
obligations are satisfied at a point in time i.e. when the goods are dispatched to the customers and control is transferred.
Service revenue is recognized over the contractual period or as and when services are rendered to customers.
The Company provides installation services that are either sold separately or bundled together with the sale of
equipment to a customer. The installation services are a promise to transfer services in the future and are part of the
negotiated exchange between the Company and the customer.
Other income
a) Gain or loss on sale of investments is taken to income in the period in which it arises.
b) Profit / interest on bank deposits income is recognized on an accrual basis using the effective interest method.
c) Dividend income is recognized on receipt / acknowledged basis.
d) Scrap sales is taken to income in the period in which it sold out.
5.19 Dividends and appropriation to reserve
Dividend and appropriation to reserves are recognized in the financial statement in the period in which these are
approved. However, if these are approved after the reporting period but before the financial statements are authorized
for issue, they are disclosed in the notes to the financial statements.
52

5.20 Earning per share
The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated
by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of
ordinary shares outstanding during the year. Diluted EPS is determined by adjusting the profit or loss attributable to
ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive
potential ordinary shares.
5.21 Related parties transactions
All transactions involving related parties arising in the normal course of business are conducted at arm’s length on the
same terms and conditions as third party transactions using valuation modes, as admissible, except in extremely rare
circumstances where, subject to the approval of the board, it is in the interest of the Company to do so.
5.22 Share capital
Ordinary shares are classified as equity and recognized at their face value. Incremental costs directly attributable to the
issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
5.23 Contingent liabilities
Contingent liability is disclosed when:
a) a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence
or non-occurrence of one or more uncertain future events not wholly within the control of the entity; or
b) a present obligation that arises from past events but it is not probable that an outflow of resources embodying
economic benefits will be required to settle the obligation or the amount of the obligation cannot be measured
with sufficient reliability.
5.24 Selling and distribution, administrative and operating expenses
These expenses are recognized in statement of profit or loss upon utilization of the services or as incurred except for
specifically stated in the financial statements.
5.25 Segment reporting
Segments are reported in a manner consistent with the internal reporting provided to the Company’s chief executive
decision maker in order to assess each segment’s performance and to allocate resources to them. The basis of
segmentation and reportable segments presented in these financial statements are the same which are presented to the
Board of Directors of the Company. Assets and liabilities are not segment wise reported to the Board of Directors. Refer
note 35 for brief description of reportable segment.
2021 2020
6 PROPERTY AND EQUIPMENT ------------ (Rupees in '000) ------------
Operating assets 16,883 22,139
53

Leasehold Furniture and Office

June 30, 2021 Machinery Computers Vehicles Total
improvements fittings equipments
------------------------------------------- Rupees in '000 -------------------------------------------
As at June 30, 2020
Cost 5,108 2,870 4,901 11,980 13,787 14,216 52,862
Accumulated depreciation (2,813) (201) (1,680) (9,074) (10,294) (6,661) (30,723)
Net book value 2,295 2,669 3,221 2,906 3,493 7,555 22,139
June 30, 2021
Opening net book value 2,295 2,669 3,221 2,906 3,493 7,555 22,139
Additions 2,405 - - - 489 2,346 5,240
Disposals
Cost - - (127) - - (2,346) (2,473)
Accumulated depreciation - - 42 - - - 42
- - (85) - - (2,346) (2,431)
Depreciation charge for the year (603) (574) (652) (1,159) (1,523) (3,554) (8,065)
Closing net book value 4,097 2,095 2,484 1,747 2,459 4,001 16,883
As at June 30, 2021
Cost 7,513 2,870 4,774 11,980 14,276 14,216 55,629
Net book value 4,097 2,095 2,484 1,747 2,459 4,001 16,883
Depreciation rate (%) 10% 20% 10% - 25% 25% 25% - 33% 25%
Office
Leasehold Furniture and
June 30, 2020 Machinery equipments Computers Vehicles Total
improvements fittings
----------------------------------------------Rupees in '000 -----------------------------------------------------------
As at June 30, 2019
Cost 5,108 - 3,805 11,964 12,618 11,686 45,181
Accumulated depreciation (2,305) - (1,172) (7,756) (8,864) (3,629) (23,726)
Net book value 2,803 - 2,633 4,208 3,754 8,057 21,455
June 30, 2020
Opening net book value 2,803 - 2,633 4,208 3,754 8,057 21,455
Additions - 2,870 1,096 16 1,169 2,530 7,681
Disposals
Cost - - - - - - -
Accumulated depreciation - - - - - - -
- - - - - - -
Depreciation charge for the year (508) (201) (508) (1,318) (1,430) (3,032) (6,997)
Closing net book value 2,295 2,669 3,221 2,906 3,493 7,555 22,139
As at June 30, 2020
Cost 5,108 2,870 4,901 11,980 13,787 14,216 52,862
Net book value 2,295 2,669 3,221 2,906 3,493 7,555 22,139
Depreciation rate (%) 10% 20% 10% - 25% 25% 25% - 33% 25%
2021 2020
6.1 The depreciation expense has been allocated as follows: ------------ (Rupees in '000) ------------
Cost of sales 24.2 2,823 2,435
Selling and distribution expenses 25 3,065 2,689
Administrative expenses 26 2,177 1,873
8,065 6,997
54

6.2 Office Equipments include printers installed at customers premises i.e. International Schools and A.F. Ferguson & Co.
having net book value of Rs. 6,755 (2020: 9,006). Such equipments are part of copier business plan where the Company
provide copier services to its customers.
6.3 Following are the particulars of the disposed assets having a book value of rupees five hundred thousand or more.
Accumulated Net book Sale Particulars Mode of

Cost depreciation value proceeds Gain / (loss) of buyer Relationship disposal
…………………………… Rupees in '000……………………………
Vehicles
Honda Civic
Shaikh
2,346 - 2,346 4,163 1,817 Touseef Independent Negotiations
Ahmed
2,346 - 2,346 4,163 1,817
6.4 Aggregate of assets disposed off having net book value below rupees five hundred thousand.
Accumulated Net book Sale Gain /

Description Cost
depreciation value proceed (loss)
--------------------------------Rupees in '000----------------------------------
Furniture and fixture 127 42 85 37 (48)
Sub-total 127 42 85 37 (48)
2021 - total 2,473 42 2,431 4,200 1,769
2020 - total - - - - -
2021 2020
---------- (Rupees in '000) ----------
7 INTANGIBLE ASSETS
Goodwill - 385,985
Software 224 274
224 386,259
7.1 Details of intangible assets are as follows:
2021 Goodwill Software Total
As at June 30, 2020

Cost 548,862 500 549,362
Accumulated amortization - (226) (226)
Impairment (162,877) - (162,877)
Net book value 385,985 274 386,259
55

2021 Note Goodwill Software Total

June 30, 2021
Opening net book value 385,985 274 386,259
Additions - - -
Impairment 7.1.2 (385,985) (385,985)
Amortization charge - (50) (50)
Closing net book value - 224 224
As at June 30, 2021

Cost 548,862 500 549,362
Accumulated impairment (548,862) - (548,862)
Net book value - 224 224
Amortization rate (%) 10%
2020 Goodwill Software Grand total
As at June 30, 2019

Cost 548,862 500 549,362
Net book value 548,862 324 549,186
June 30, 2020
Opening net book value 548,862 324 549,186
Additions - - -
Impairment 7.1.2 (162,877) - (162,877)
Amortization charge - (50) (50)
Closing net book value 385,985 274 386,259
As at June 30, 2020

Cost 548,862 500 549,362
Impairment (162,877) - (162,877)
Net book value 385,985 274 386,259
Amortization rate (%) 10%
56

7.1.1 The software has finite useful life of 10 years.
7.1.2 During the current year, the Company's assessment, estimates and judgements regarding the recoverable amount based
on financial business plan and future prospects of the business has been changed. Hence, the management has fully
impaired the goodwill on prudent basis.
2021 2020
8 LONG TERM DEPOSITS Note ---------- (Rupees in '000) ----------
Rent deposits 369 3,315

Ijarah deposits 841 1,170
1,210 4,485
9 DEFERRED TAX ASSET
The details of deferred tax on temporary differences are as follows:
Property and equipment 881 3,672

Carry forward tax losses 3,353 9,401
Provisions 115 3,159
Short term investments - 590
Minimum tax - 3,112
4,349 19,934
The movement in temporary differences are as follows:
Recognized in Recognized in
Recognized in Recognized in
Balance as at other Balance as at other Balance as at
Statement of Statement of
July 1, 2019 comprehensive June 30, 2020 comprehensive June 30, 2021
profit or loss profit or loss
income income
-----------------------------------------------------------------------Rupees'000'---------------------------------------------------------------
Property and equipment 2,666 1,006 - 3,672 (2,791) - 881
Carry forward tax losses 10,882 (1,481) - 9,401 (6,048) - 3,353
Provisions 2,674 485 - 3,159 (3,044) - 115
Short term investments - 590 - 590 (590) - -
Minimum tax - 3,112 - 3,112 (3,112) - -
16,222 3,712 - 19,934 (15,585) - 4,349
- -
9.1 Deferred tax asset has been recognized based on the projections prepared by the management indicating reasonable
probabilities that taxable profits will be available in the foreseeable future against which deferred tax asset will be
utilized on the basis of projections prepared by the management. The amount of deferred tax asset has been restricted to
Rs. 4.349 million (2020: Rs. 19.93 million) on prudent basis.
57

2021 2020
Note ---------- (Rupees in '000) ----------
10 STOCK-IN-TRADE
Stock-in-trade 10.1 160,488 335,526

Stock written-off 26.3 (18,467) -
Stock-in-trade - net 142,021 335,526
10.1 The slow moving/obselete/damage has been written off during the year amounting to Rs. 18.47 million (2020: Nil).
11 TRADE DEBTS - UNSECURED 2021 2020

Considered good Note ------------ (Rupees in '000) ------------
-Trade debt - related party 16,035 -
-Trade debt - other 32,228 69,335
Trade debts - gross 48,263 69,335
Allowance for expected credit loss - opening balance (975) (975)

Charge for the year (4,016) -
Allowance for expected credit loss - closing balance (4,991) (975)
Trade debts - net 43,272 68,360
11.1 Age analysis
Not more than 3 months 19,600 60,715

More than 3 months but not more than 6 months 19,929 4,497
More than 6 months but not more than 1 year 3,743 4,117
More than 1 year 4,991 6
48,263 69,335
11.2 Due from related parties which are not impaired includes the following:
Fossil Energy (Private) Limited

Not more than 3 months - -
More than 3 months but not more than 6 months 16,013 -
More than 6 months but not more than 1 year 22 -
More than 1 year - -
16,035 -
11.3 The maximum amount outstanding at any time during the year calculated with reference to month end balances are as
follows:
2021 2020
Note ------------ (Rupees in '000) ------------
VOS Petroleum Limited - 11,250
Market 786 (Private) Limited - 301
Fossil Energy (Private) Limited 17,605 18,030
58

2021 2020
Note ---------- (Rupees in '000) ----------
12 LOANS AND ADVANCES
Advances - unsecured
- employees and directors 12.1 2,992 -
- suppliers - advance to suppliers 25,731 24,806
28,723 24,806
12.1 These are non-interest bearing advances given to employees and directors to meet business expenses and are settled as
and when expenses are incurred.
2021 2020
12.1.1 Movement in advances to directors Note ---------- (Rupees in '000) ----------
Balance at the beginning of the year - -

Disbursements 200 -
Receipts (150) -
Balance at the end of the year 50 -
12.1.2 The amount is due from Salim Chamdia (Chairman). The maximum aggregate amount outstanding at any time during
the year is Rs. 0.15 million (2020: Rs. Nil) and Rs. 0.05 million (2020: Rs. Nil) from Sohail Allana and Salim Chamdia
respectively.
2021 2020
Note ---------- (Rupees in '000) ----------
13 TRADE DEPOSITS AND SHORT TERM PREPAYMENTS
Trade deposits-unsecured 1,845 4,184

Margin deposits 13.1 - 12,900
Short term prepayments 1,875 1,550
3,720 18,634
13.1 It represents amount deposit against letter of credit for import.
14 SHORT-TERM INVESTMENTS
2021 2020 2021 2020
Market Market
Number of shares Cost Cost
value value
---------------------- Rupees in '000 ------------------------
Dewan Cement Limited - 1,000,000 - - 9,814 7,780
- 1,000,000 - - 9,814 7,780
Unrealized loss on investments
classified as 'FVTPL' - - - - (2,034) -
Investments - net - 1,000,000 - - 7,780 7,780
59

2021 2020
15 OTHER RECEIVABLES Note ---------- (Rupees in '000) ----------
Duty refundable due from government 15.2 20,998 20,998

Others - other receivables 336 761
21,334 21,759
15.2 In the year 2009, the Federal Government issued SRO 787(1)/2008 dated July 26, 2008 under Section 19 of Customs
Act, 1969 (the Act) whereby, the customs duty on import of crystalline sugar was brought down to zero, as against 25%
given in First Schedule to the Act. The Company had imported crystalline sugar from July 26, 2008 to October 15, 2008
and paid custom duty of Rs. 17.012 million and Rs. 3.986 million without availing the benefit of subject SRO.
Thereafter, the refund claims were filed by the Company with the Custom Authorities and recognized the same in books
of account during the year ended June 30, 2009 The refund claims were rejected by the Additional Collectorate on the
ground that the incidence of duty and taxes has been passed on to the end consumers by incorporating it in the cost of
the product.
Being aggrieved with decision of Additional Collectorate, the Company had filed appeals before the Collector of
Customs as well as before the Appellate Tribunal in the year ended June 30, 2010 and 2011 respectively, which were
also rejected on the same grounds. The Company later filed references in the Honorable High Court of Sindh (SHC)
against the judgments of the Appellate Tribunal. Regarding the reference of Rs.17.012 million, the SHC vide its order
dated May 28, 2015 had allowed the reference application and remanded the case to the Customs Appellate Tribunal for
decision afresh on the basis of the evidence produced before the Tribunal to establish that the burden of tax under
Section 19-A of the Act has not been passed on to the end consumer. The Customs Appellate Tribunal vide its order
dated June 17, 2016 has decided the case in favor of the Company and has directed the tax department to refund the
claim to the Company. The Custom Authorities have subsequently filed an appeal in the SHC which is pending.
On the other hand, the Divisional Bench of the SHC dismissed the reference for Rs. 3.986 million in 2012. The
Company filed appeal against the decision of the SHC before the Honorable Supreme Court of Pakistan (SCP) on the
grounds that none of the forums above, including the SHC, had examined the evidence produced to establish that the
burden of duty and taxes has not been passed on to the end consumer. The SCP in order to examine this question granted
leave in the petition.
The said matter was fixed on January 11, 2018, on serial no. 11 before the Justice Mr. Munib Akhter and Mrs. Ashraf
Jahan now next date of hearing is January 26, 2022.
The management based on the view of its legal counsel is confident that the issue raised by the Customs Authorities is
without any basis and the ultimate decision of refund will be in favor of the Company. Accordingly, the Company has
maintained the already recognized refund claims of Rs. 20.998 million and is of the view that no provision for
impairment loss is required to be made.
2021 2020
Note ---------- (Rupees in '000) ----------
16 TAXATION - NET
Opening balance 50,869 23,415

Tax paid / deducted at source 8,011 33,643
Provision for taxation 29 (22,291) (6,189)
36,589 50,869
60

2021 2020
17 CASH AND BANK BALANCES
Note ------------ (Rupees in '000) ------------
Cash in hand 83 1,078

Cash at banks:
- current accounts - conventional 6,037 5,255
- islamic 117 229
- saving accounts - conventional 17.1 809 201
7,046 6,763
17.1 This carries mark-up ranging from 5.5% to 7.5% (2020: 6.25% to 8.5%) per annum.
18 ISSUED, SUBSCRIBED AND PAID-UP SHARE CAPITAL
Number of Shares 2021 2020

2021 2020
Note ------------ (Rupees in '000) ------------
------Number in '000------
Ordinary shares of Rs.10 each:
3,900 3,900 -fully paid for consideration paid in cash 39,000 39,000
11,763 11,763 -issued as bonus shares 117,635 117,635
-issued as fully paid for consideration other
than cash against share under scheme of
15,480 15,480 amalgamation 154,796 154,796
31,143 31,143 311,431 311,431
18.1 Fossil Energy (Private) Limited (related party) holds 18,205,121 (2020: 22,211,121) shares of the Company.
2021 2020
19 RESERVES
Note ------------ (Rupees in '000) ------------
Capital reserve
- Share premium 388,169 388,169
Revenue reserve
- General reserve 64,600 64,600
- Accumulated Losses / Unappropriated profit (497,051) 107,948
(44,282) 560,717
20 DEFERRED LIABILITIES
Provision for staff gratuity scheme - unfunded 20.1 - 9,918
20.1 Movement in balances of gratuity is as follows:
Opening balance 9,918 9,209

Provision for the year - 1,070
Payments made during the year (9,918) (361)
Closing balance - 9,918
61

20.2 During the year the Company has paid to its employees complete amount of gratuity being a full and final settlement of
gratuity plan.
2021 2020
Note ---------- (Rupees in '000) ----------
21 TRADE AND OTHER PAYABLES
Trade creditors 19,880 73,561

Accrued liabilities 4,778 1,237
Payable to provident fund 21.2 6,941 4,525
Withholding tax payable 16 127
Other liabilities 2,873 -
34,488 79,450
21.1 Trade and other payable include balances amounting to Rs. 0.3 million (2020: Rs. Nil) payable to Market 786 (Private)
Limited and Rs. 0.12 million (2020: Rs. Nil) payable to Fossil Energy (Private) Limited.
21.2 The Company's staff retirement benefits includes provident fund - a defined contribution plan. The Company has
established a separate provident fund. The un-audited information as on June 30, 2021 related to the provident fund is
as follows:
2021 2020
Size of provident fund (Rupees in '000) Note 12,243 11,368
Cost of investments made (Rupees in '000) 6,641 7,631
Percentage of investments made 54.24% 67.13%
Fair value of investment (Rupees in '000) 6,641 7,631
Break-up of investments - fair value:
- Balance in savings account and CDC deposit
Amount of investment (Rupees in '000) 6,641 7,631

Percentage of size of investment 54.24% 67.13%
All investments out of provident fund have been made in accordance with the provisions of section 218 of the Companies Act,
2017 and the rules formulated for this purpose.
22 CONTINGENCIES AND COMMITMENTS
22.1 Contingencies
The Trust Investment Bank Limited (TIBL) instituted a suit on August 12, 2015 for recovery of Rs. 40.243 million against
Hascombe Business Solution (Private) Limited (HBSPL) whose rights and obligations had been merged with and into the
Company, which is pending adjudicating before the Judge Banking Court No. I, Lahore.
In response to the summons issued by the Banking Court, the Company moved an application for leave to appear and defend
the suit under section 10 of the Financial Institutions (Recovery of Finances) Ordinance XLVI of 2001 as required by the law
which has been allowed by the Honorable Court unconditionally and granted leave to defend the suit on the basis of question
of facts and law raised by the Company in its leave to defend application.
62

The Honorable Court after considering the contents of the plaint and written statements framed issues whether the suit is
barred by limitation; whether the plaint is liable to be rejected under Order VII Rule 11 CPC; whether the suit is not
maintainable and plaint does not disclose any cause of action; whether the defendant is entitled to a decree in the sum of Rs.
0.690 million on account of set off in its favor against the plaintiff bank as prayed for; whether the plaintiff is entitled for
recovery of Rs. 40.243 million along with cost of suit and cost of funds as prayed for.
The Honourable Judge Banking Court No.I called the case for evidence and fixed the case for recording of evidence of TIBL.
In the last hearing dated October 13, 2021 , the evidence of the Company is still to be recorded for discharging the onus of
proof according to the issue framed out of divergent of pleadings of the parites to the suit.
In view of the advisor opinion that after recording of evidence of the TIBL, no adverse outcome is probable from the case.
2021 2020
22.2 Commitments
Note ------------ (Rupees in '000) ------------
Outstanding letters of credit for stock in trade - 21,906
Ijarah financing 22.2.1 5,046 8,122
22.2.1 The total of future Ijarah payments under Ijarah financing are as follows:
Not later than one year 2,068 3,046

Later than one year but not later than five years 2,978 5,076
22.2.1.1 5,046 8,122
22.2.1.1 The Company has obtained car ijarah facility from Meezan Bank Limited of amounting to Rs. 20 million (2020: Rs. 20
million) out of which Rs. 5.05 million (2020: Rs. 8.12 million) were un-utilised as at reporting date. The ownership of
the cars are with Meezan bank Limited during the tenor of the facility of each vehicle. As per requirement of IFAS-2,
ijarah financing has been treated as an operating lease.
2021 2020
23 REVENUE - NET Note ------------ (Rupees in '000) ------------
Revenue from
- Sale of goods 456,764 363,826
- Services 1,722 105,622
Revenue - gross 458,486 469,448
Less:
- Sales tax (64,928) (60,632)
- Cartage (10,607) (6,155)
-Sales return (8,060) (8,233)
-Sales discount (454) -
(84,049) (75,020)
374,437 394,428
24 COST OF SALES
Cost of sales 24.1 368,279 273,020

Cost of services 24.2 30,224 36,424
398,503 309,444
63

2021 2020
Note ---------- (Rupees in '000) ----------
24.1 Cost of sales
Opening stock 335,526 77,824

Add: Purchases 193,241 530,722
Less: Closing stock (160,488) (335,526)
368,279 273,020
24.2 Cost of services
Salaries, wages, allowances and other benefits 26.1 26,985 28,536

Consumption of repair material 416 2,971
Delivery and installation cost - 2,482
Depreciation 6.1 2,823 2,435
30,224 36,424
25 SELLING AND DISTRIBUTION EXPENSES

Travelling 4,176 3,623
Advertisement 3,613 3,277
Rent, rates and taxes 26.2 25,540 23,832
Miscellaneous 4,518 4,425
63,681 62,386
26 ADMINISTRATIVE EXPENSES

Travelling 1,044 883
Directors' remuneration 250 225
Office expenses 3,907 2,811
Communication 2,214 1,538
Utilities 5,511 841
Rent, rates and taxes 26.2 1,922 1,867
Legal and professional charges 11,828 3,212
Insurance 1,157 4,233
Repairs and maintenance 1,852 437
Amortization 7.1 50 50
Stock written off 26.3 18,467 -
Miscellaneous 1,440 773
88,473 56,158
26.1 The total amount recognised during the year in respect of provident fund expense amounting to Rs. 1.69 million (2020:
Rs. 2.26 million) and Gratuity expense amounting to Nil (2020: Rs. 1.07 million).
64

26.2 This includes short term operating lease rentals, bounded warehouse rentals and ijarah lease rental amounting to Rs.
12.73 million (2020: 14.44 million), Rs. 9.11 million (2020: 5.92) and Rs. 2.32 million (2020: 2.81 million) respectively.
26.2.1 The Company had entered into an Ijarah agreement with Meezan Bank Limited for acquisition of a vehicle. Under the
agreement, the term of Ijarah is 4 years. It includes ijarah rentals amounting to Rs. 2.32 million.
26.3 This includes major amount pertianing to FMCG items which is due to the urban flooding in Karachi. Both of the
Company's Marts namely Clover Nishat Mart and Sehar Mart located at Khayaban-e-Nishat and Khayaban-e-Sehar
respectively were flooded with the rain water. Consequently, damage occurred to the inventory at the Marts. Therefore
the amount of inventory relating to FMCG items has been written off.
2021 2020
27 OTHER OPERATING EXPENSES Note ------------ (Rupees in '000) ------------
Auditor's remuneration 27.1 1,644 1,586

Unrealized loss on revaluation of investments - 30
Miscellaneous expenses 340 -
1,984 1,616
27.1 Auditor's remuneration
Audit fee 900 900

Fee for half yearly review 453 436
Fee for statutory certification 116 100
Out-of-pocket expense 175 150
1,644 1,586
28 OTHER INCOME
Income from financial assets
Profit on bank deposit / TDRs 28.1 27 10,730
Mark-up income on over due receivables - 37,130
Realized gain on sale of shares 671 4,942
Dividend income - 150
Income from non-financial assets

Recovery from sale of scrap 636 140
Gain on sale of property and equipment 1,769 -
3,103 53,092
28.1 This represents profit earned on conventional bank deposits and bank balances ranging from 5.5% to 7.5% (2020: 6.25%
to 8.5%) per annum.
2021 2020
Note ------------ (Rupees in '000) ------------

29 TAXATION
Current 16 6,179 6,189
Prior 16 16,112 -
Deferred 9 15,585 (3,713)
37,876 2,476
65

29.1 The relationship between tax expense and accounting profit has not been presented in these financial statements as the
current year's income of the Company falls under minimum tax regime as per Income Tax Ordinance, 2001.
2021 2020
30 LOSS PER SHARE - basic and diluted Note ------------ (Rupees in '000) ------------
Basic loss per share
Loss for the year (604,999) (155,218)
Number of shares Numbers in "000"
Weighted average number of shares outstanding as at year end 31,143 31,143

------------ Rupees ------------
Basic loss per share (19.43) (4.98)
30.1 There is no dilutive effect on the basic loss per share of the Company as at June 30, 2021 and June 30, 2020.
2021 2020
Note ------------ (Rupees in '000) ------------

31 CASH FLOWS FROM OPERATING ACTIVITIES
Adjustment for non-cash and other items:

Depreciation 8,065 6,997
Amortization 50 50
Exchange loss 522 4,735
Finance cost 1,499 3,046
Allowance for expected credit loss 4,016 -
Unrealized loss on revaluation of investments - 30
Realized gain on sale of shares 27 (671) (4,942)
Impairment of goodwill 385,985 162,877
Dividend income 28 - (150)
Write off stock in trade 18,467 -
Gain on sale of property and equipment (1,769) -
Provision for gratuity - 1,070
416,164 173,713
Operating (loss) / profit before working capital changes (150,959) 20,971
Working capital changes

(Increase)/ decrease to current assets
Long-term deposits 5,595 (375)
Stock-in-trade 175,038 (257,702)
Trade debts 21,072 130,887
Loans and advances (3,917) 17,584
Trade deposits and short term prepayments 14,914 3,906
Sales tax receivable- net (2,058) -
Other receivables 425 103,652
66

2021 2020
Note ------------ (Rupees in '000) ------------
Increase / (decrease) in current liabilities

Advance from customers - unsecured (6) (580)
Sales tax payable- net - (153)
Trade and other payables (45,484) (17,522)
Cash generated from operations 14,620 668
32 NUMBER OF EMPLOYEES
Number of employees as at the year end 99 109
Average number of employees during the year 107 124
33 RECONCILIATION OF MOVEMENT OF LIABILITIES TO CASH FLOWS ARISING FROM FINANCING

ACTIVITIES
Liabilities
Uncliamed Dividend
2021 2020
Balance as at July 01 3,936 4,653
Payment of unclaimed dividend - (717)
Balance as at June 30 3,936 3,936
34 REMUNERATION OF THE CHIEF EXECUTIVE OFFICER, DIRECTORS AND EXECUTIVES
2021 2020
Chief Chief
Executive Directors Executives Executive Director Executives
Officer Officer
------------------------------------- Rupees in '000 -------------------------------------
Managerial remuneration 6,150 - 18,034 6,000 - 15,864

Gratuity - - - - - 336
Provdident fund 90 - 603 - - -
Directors' fee - 250 - - 225 -
6,240 250 18,637 6,000 225 16,200
Number of persons 1 3 7 1 2 6
67

The allocation of above expenses are as follows:

2021 2020
Chief Chief
Executive Directors Executives Executive Directors Executives
Officer Officer
------------------------------------- Rupees in '000 -------------------------------------
Selling and distribution expenses - - 7,372 - - 3,645

Administrative expenses 6,240 250 11,265 6,000 225 12,555
6,240 250 18,637 6,000 225 16,200
Number of persons 1 3 7 1 2 6
34.1 In addition to the above, Company maintained cars are provided to the directors and executives.
35 OPERATING SEGMENT
The management has determined the operating segments based on the information that is presented to the Board of
Directors of the Company for allocation of resources and assessment of performance. The reportable segments of the
Company are as follows:
Business automation and related services: This segment includes selling of office equipment and provision of related
services such as installation and repair and maintenance.
Petrotech and related services: This segment includes selling of energy equipments (petrotech) and provision of
related services such as installation, repair and maintenance and cleaning service.
Chemicals: This segment includes selling of imported chemicals such as Mixed Xylene, Vinyle acetate monomer
(VAM) and Hexane.
Lubricant: This segment includes selling lubricants and car maintenance products.
Others: This segment includes selling of Fast Moving Consumer Goods (FMCG) through marts and distributors and
others.
68
69
For the year ended June 30, 2021 For the year ended June 30, 2020
Business Petrotech Business Petrotech
Description automation and and related Chemicals Lubricant Others Total automation and and related Chemicals Others Total
related services services related services services
-------------------------------------------Rupees in "000"--------------------------------------------- -------------------------------------------Rupees in "000"---------------------------------------------
Revenue - Gross 38,607 1,798 334,115 82,667 1,299 458,486 75,524 116,770 223,740 45,181 461,215
- Sales tax (5,467) (255) (47,315) (11,707) (184) (64,928) (8,594) (13,820) (32,509) (5,709) (60,632)
- Cartage (36) (100) (8,055) (2,062) (354) (10,607) (1,199) (301.00) (3,873) (782) (6,155)
-Sales return - - (915) (6,666) (479) (8,060) - - - - -

-Sales discount - - (15) (439) - (454) - - - - -

Revenue - net (Disaggregated) 33,104 1,443 277,815 61,793 282 374,437 65,731 102,649 187,358 38,690 394,428
Cost of sales (21,489) (24,179) (294,310) (54,874) (3,651) (398,503) (56,238) (37,477) (180,611) (35,118) (309,444)
Gross (loss) / profit 11,615 (22,736) (16,495) 6,919 (3,369) (24,066) 9,493 65,172 6,747 3,572 84,984
Selling and distribution expenses (17,905) (16,641) (4,000) (13,904) (11,231) (63,681) (10,219) (15,791) (30,263) (6,113) (62,386)
Administrative expenses (13,149) (912) (27,710) (8,244) (38,458) (88,473) (9,199) (14,219) (27,236.0) (5,504) (56,158)
Operating loss (19,439) (40,289) (48,205) (15,229) (53,058) (176,220) (9,925) 35,162 (50,752) (8,045) (33,560)
Other operating expenses (1,984) - - - (1,616)

Other income 3,103 - - - - 53,092
(19,439) (40,289) (48,205) (15,229) (53,058) (175,101) (9,925) 35,162 (50,752) (8,045) 17,916
Exchange loss (522) - - (4,735) - (4,735)
Finance cost (1,499) - - - - (3,046)
Impairment of trade receivable (4,016)
Impairment of goodwill (385,985) - - - - (162,877)
Loss before taxation (19,439) (40,289) (48,205) (15,229) (53,058) (567,123) (9,925) 35,162 (55,487) (8,045) (152,742)
Taxation (37,876) - - - - (2,476)
Loss for the year (19,439) (40,289) (48,205) (15,229) (53,058) (604,999) (9,925) 35,162 (55,487) (8,045) (155,218)

35.1 There were no intersegment sales during the year (2020: Nil).
35.2 During the year lubricant segment has become separate reportable segment as cretiria of revenue defined in IFRS
become applicable. Furthermore, all the Company's sales have been primarily made within Pakistan.
35.3 Following are the major customers of the Company which constituted 10 percent or more of the Company's revenue.
Name of Customers 2021 Name of Customers 2020

Rs. '000 Rs. '000
Olympic Services (Private) Limited 39,087 Khuwaja Hamid Gul 44,723
Archroma Pakistan Limited 63,774 Archroma Pakistan Limited 29,609
102,861 74,332
36 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company's activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest
rate risk and price risk), credit risk and liquidity risk. Overall, risks arising from the Company’s financial assets and
liabilities are limited. The Company manages its exposure to financial risk in following manner:
36.1 Market risk
Market risk refers to fluctuation in value of financial instruments as a result of changes in market prices. The Company
manages market risk as follows:
36.1.1 Foreign currency risk
Foreign exchange risk represents the risk that the fair value of future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. It arises mainly where payables exist due to transactions entered into
foreign currencies.
Exposure to Foreign currency risk
The Company is exposed to foreign exchange risk arising from currency value fluctuations due to the following:
2021 2020
------ Amount in Euro '000 -----
Trade creditors - 12
Off statement of financial position exposures
Letter of credit - -
Net exposure - 12
------- Amount in USD '000 -------
Trade creditors - -
Off statement of financial position exposures
Letter of credit - 204
Net exposure - 204
70

The following significant exchange rates were applied during the year.
2021 2020
Rupee per Euro
Reporting date rate 187.15 188.61
Average rate 187.88 185.47
Rupee per USD
Reporting date rate 157.54 168.05
Average rate 162.80 165.90
Foreign currency sensitivity analysis
A 10 percentage strengthening of the PKR against the USD and EURO at June 30, 2021 and 2020 would have effect on
the equity and statement of profit or loss of the Company as shown below. This analysis assumes that all other variables,
in particular interest rates, remain constant. The analysis is performed on the same basis for June 30, 2021.
2021 2020
Note ------------ (Rupees in '000) ------------

Strengthening of PKR against respective currencies - 3,654
Weakening of PKR against respective currencies - 3,654
A 10 percentage weakening of the PKR against the USD and EURO at June 30, 2021 and 2020 would have had the equal
but opposite effect on USD and EURO to the amounts shown above, on the basis that all other variables remain constant.
36.1.2 Price risk
Price risk represents the risk that the fair value of future cash flows of a financial instrument will fluctuate because of
changes in market prices (other than those arising from interest or currency rate risk), whether those changes are caused
by factors specified to the individual financial instrument or its issuer, or factors affecting all similar financial
instruments traded in the market. As at June 30, 2021, had there been increase / decrease in net asset value by 1%, with
all other variables held constant,the profit before tax for the year would have been higher / lower by Rs 2.67 million
(2020: Rs 8.72 million).
36.1.3 Interest / Mark-up rate risk
Interest rate risk is the risk that the fair value or future cash flows of the financial instruments will fluctuate because of
changes in market interest rates. The Company has no long term or short term finance.
71

2021
Mark-up / profit bearing Non Total
Less than One year to Over five mark-up /
one year Five years years profit
bearing
Note ------------------------ (Rupees in '000) ------------------------
Financial assets
At amortised cost
Long term deposits 8 - - - 1,210 1,210
Trade debts 11 - - - 48,263 48,263
Trade deposits 13 - - - 1,845 1,845
Other receivables 15 - - - 336 336
Cash and bank balances 17 809 - - 6,237 7,046
809 - - 57,891 58,700
Fair value through profit or loss
Short term investments 14 - - - - -
Financial liabilities
At amortised cost
Trade and other payables 21 - - - 34,472 34,472
Unclaimed dividend - - - 3,936 3,936
- - - 38,408 38,408
On statement of financial position gap 809 - - 19,483 20,292
Off statement of financial position gap
Commitments - - - 5,046 5,046
72

2020
Mark-up / profit bearing Non Total
Less than One year to Over five mark-up /
one year Five years years profit
bearing
Financial assets
Note ------------------------ (Rupees in '000) ------------------------
At amortised cost
Long term deposits 8 - - - 4,485 4,485
Trade debts 11 - - - 69,335 69,335
Trade deposits 13 - - - 17,084 17,084
Other receivables 15 - - - 761 761
Cash and bank balances 17 201 - - 6,562 6,763
201 - - 98,227 98,428
Fair value through profit or loss
Short term investments 14 - - - 7,780 7,780
At amortised cost
Trade and other payables 21 - - - 79,323 79,323
Unclaimed dividend - - - 3,936 3,936
- - - 83,259 83,259
On statement of financial position gap 201 - - 22,748 22,949
Off statement of financial position gap
Commitments - - - 30,028 30,028
(a) On statement of financial position gap represents the net amounts of statement of financial position items.
Fair value sensitivity analysis for fixed rate instruments
The Company does not account for any fixed rate financial assets and liabilities at fair value through profit or loss.
Therefore, a change in interest rate at the statement of financial position date would not affect profit or loss of the
Company.
Cash flow sensitivity analysis for variable rate instruments
At June 30, 2021, if interest rates on long term financing had been 1% higher / lower with all other variables held
constant, pre tax profit for the year would have been Rs. 0.016 million (2020: Rs. 0.012 million) higher / lower, mainly
as a result of higher / lower interest expense on floating rate borrowings.
73

36.2 Credit risk
Credit risk represents the accounting loss that would be recognized at the reporting date if counter-parties failed
completely to perform as contracted. The Company does not have significant exposure to any individual counter-party.
To reduce exposure to credit risk the Company has developed a formal approval process whereby credit limits are
applied to its customers. The management also regularly monitors the credit exposure towards the customers and makes
allowance for ECLs against those balances considered doubtful of recovery. To mitigate the risk, the Company has a
system of assigning credit limits to its customers based on evaluation based on customer profile and payment history.
Outstanding customer receivables are regularly monitored.
The Company's gross maximum exposure to credit risk at the reporting date is as follows:
2021 2020
Financial assets Note ------------ (Rupees in '000) ------------
Long-term deposits 8 1,210 4,485

Trade debts 11 48,263 69,335
Trade deposits 13 1,845 17,084
Other receivables 15 336 761
Bank balances 17 6,963 5,685
58,617 97,350
Trade debts
The Company's exposure to credit risk arising from trade debtors is mainly influenced by the individual characteristics
of each customer. The majority of the customers have been transacting with the company for several years. Actual credit
loss experience over past years is used to base the calculation of expected credit loss. The ageing is disclosed in note
11.1. Actual credit loss experience over past years is used to base the calculation of expected credit loss.
Bank balances
The Company limits its exposure to credit risk by investing in liquid securities and maintaining bank accounts only with
counter-parties that have stable credit rating. Given these high credit ratings, management does not expect that any
counter party will fail to meet their obligations.
The bank balances along with the credit ratings are tabulated below:
Short-term 2021 2020
Ratings ------- (Rupees in '000) -------
Allied Bank Limited A1+ 2 2
Bank Al Habib Limited A1+ 8 25
Bank Al Falah Limited A1+ 46 636
Bank Islami Pakistan Limited-Islamic A1 713 32
Habib Bank Limited A1+ 2 2
Habib Metropolitan Bank Limited A1+ 2,276 243
MCB Bank Limited A1+ 6 6
Meezan Bank Limited A1+ 3,892 196
National Bank of Pakistan A1+ 14 15
Summit Bank Limited SUSPENDED 1 417
Askari bank Limited A1+ 3 4,111
6,963 5,685
74

36.3 Liquidity risk
Liquidity risk reflects the Company's inability in raising funds to meet commitments. Prudent liquidity risk management
implies maintaining sufficient cash and marketable securities, the availability of funding to an adequate amount of
committed credit facilities and the ability to close out market positions due to the dynamic nature of the business. The
Company's gross maximum exposure to liquidity risk at reporting date is as follows:
2021 2020
Financial liabilities Note ------------ (Rupees in '000) ------------
Trade and other payables 34,472 79,323

38,408 83,259
36.4 Fair value of financial instruments
Fair value is an amount for which an asset cou ld be exchanged, or a liability settled, between knowledgeable willing
parties in an arm's length transaction. Consequently, differences may arise between the carrying values and the fair value
estimates.
The Company classifies fair value measurements using a fair value hierarchy that reflects the significance of the inputs
used in making the measurements. The fair value hierarchy has the:
a) Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1).
b) Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly
(that is, as prices) or indirectly (that is, derived from prices) (level 2).
c) Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).
The Company recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during
which the transfer has occurred.
The Company’s policy for determining when transfers between levels in the hierarchy have occurred includes
monitoring of the following factors:
- changes in market and trading activity (e.g.. significant increases / decreases in activity)
- changes in inputs used in valuation techniques (e.g. inputs becoming / ceasing to be observable in the market)
There were no transfers between level 1, 2 or 3 of the fair value hierarchy during the year.
The valuation techniques used are as follows:
Level 1: Quoted prices (unadjusted) in active markets
The fair value of financial instruments traded in active markets is based on market value of shares at the reporting date.
A market is regarded as active when it is a market in which transactions for the asset or liability take place with sufficient
frequency and volume to provide pricing information on an ongoing basis.
The following table analysis within the fair value hierarchy of the Company’s financial assets (by class) measured at fair
value at June 30, 2021:
75

2021
Level 1 Level 2 Level 3 Total
--------------------------- (Rupees in '000) ---------------------------
Financial assets
Financial investments: FVTPL - - - -
2020
Level 1 Level 2 Level 3 Total
--------------------------- (Rupees in '000) ---------------------------
Financial assets
Financial investments: FVTPL 7,780 - - 7,780
36.5 Financial instruments by category

2021 2020
Financial assets
At amortized cost Note ------------ (Rupees in '000) ------------
Long term deposits 8 1,210 3,315

Trade debts - unsecured 11 48,263 69,335
Trade deposits 13 1,845 17,084
Other receivables 15 336 761
Cash and bank balances 17 7,046 6,763
At fair value through profit or loss
Short-term investments 14 - 7,780
Total financial assets 58,700 105,038
At amortized cost
Trade and other payables 21 34,472 79,323
Total financial liabilities 38,408 83,259
37 CAPITAL MANAGEMENT OBJECTIVES, POLICIES AND PROCEDURES
The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going
concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal
capital structure.
In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to
shareholders, return capital to shareholders or issue new shares or sell assets to reduce debt.
Consistent with others in the industry, the Company manages its capital risk by monitoring its liquid assets and keeping
in view future investment requirements and expectation of the shareholders.
The Company’s capital includes share capital and reserves. As at reporting date the capital of the Company is as follows:
76

2021 2020
Note ------------ (Rupees in '000) ------------

Share capital 18 311,431 311,431
Reserves 19 (44,282) 560,717
267,149 872,148
As at June 30, 2021 and 2020, the Company had surplus reserves to meet its requirements.
38 DISCLOSURES FOR ALL SHARES ISLAMIC INDEX
Following information has been disclosed as required under paragraph 10 of Part 1 of the 4th to Schedule to the
Companies Act, 2017 relating to "All Shares Islamic Index".
Description Explanation
As at June 30, 2021

1) Bank balances - Independent parties On bank deposits-disclosed in note 36.2.
2) Deposits Non-interest bearing-disclosed in note 8.
For the year ended June 30, 2021

3) Income on bank deposits On bank deposits-disclosed in note 28.
Disclsoures other than above are not applicable to the Company
39 TRANSACTIONS AND BALANCES WITH RELATED PARTIES
Related parties comprise associated undertakings, directors of the Company and key management personnel. The
Company continues to have a policy whereby all transactions with related parties are entered into at commercial terms
and conditions.
Details of transactions with related parties, other than those which have been specifically disclosed elsewhere in these
financial statements are as follows:
Key management personnel (KMP)

Name Direct shareholding %
Mr. Zohaib Yaqoob Nil
Mr. Asadullah Azizi Nil
Mr. Salim Chamdia Nil
Mr. Khawar Jamil Butt Nil
Mr. Shehzad Mohsin Nil
Mr. Sohail Allana Nil
Ms. Rima Athar Nil
Mr. Hassan Khurshid Nil
77

2021 2020
Percentage of -------- (Rupees in '000) --------

holding
Transactions for the year:
Holding Company - Fossil Energy (Private) Limited 58%

-Sale of goods 22,619 10,546
-Shared expenses - paid by Holding Company on behalf of CPL (1,100) -
-Shared expenses - paid by CPL on behalf of Holding Company 985 -
Associated Companies under common control
- Market 786 (Private) Limited 0%

-Recovery of rent deposit 300 52
Balances:
Holding Company - Fossil Energy (Private) Limited 58%
- Trade debts 16,035 -
- Payable to Holding Company 115 -
- Market 786 (Private) Limited 0%

- Payable to Market 786 (Private) Limited 300 -
40 CORRESPONDING FIGURES
Previous year figures have been rearranged and/or reclassified, wherever necessary, for better presentation.
Reclassification made in the financial statements are as follows:
Reclassification from Reclassification to Rupees in '000

- Sale of goods -Sales return 8,233
41 DATE OF AUTHORIZATION
These financial statements were authorized for issue on January 21, 2022 by the Board of Directors of the Company.
78

PATTERN OF SHAREHOLDING
AS AT JUNE 30, 2021
NO. OF SHARESHOLDINGS
NO OF
SHAREHOLDERS FROM TO Total Shares
691 1 100 10,760

538 101 500 200,471
431 501 1,000 388,760
648 1,001 5,000 1,578,637
133 5,001 10,000 1,031,071
47 10,001 15,000 594,701
22 15,001 20,000 397,027
10 20,001 25,000 233,186
7 25,001 30,000 198,125
2 30,001 35,000 70,000
8 35,001 40,000 301,375
1 40,001 45,000 45,000
5 45,001 50,000 250,000
2 50,001 55,000 107,125
1 55,001 60,000 58,000
2 65,001 70,000 134,750
2 80,001 85,000 162,500
1 90,001 95,000 90,625
2 95,001 100,000 198,500
1 100,001 105,000 101,500
3 110,001 115,000 335,625
1 115,001 120,000 120,000
1 120,001 125,000 122,000
1 130,001 135,000 133,750
1 140,001 145,000 142,000
1 155,001 160,000 160,000
1 160,001 165,000 161,500
1 165,001 170,000 169,000
1 215,001 220,000 220,000
1 240,001 245,000 245,000
1 295,001 300,000 298,500
1 370,001 375,000 375,000
1 395,001 400,000 400,000
2 595,001 600,000 1,200,000
1 600,001 605,000 602,625
1 650,001 655,000 650,025
1 700,001 705,000 700,050
1 750,001 755,000 750,750
1 2,300,001 2,305,000 2,304,000
1 15,900,001 15,905,000 15,901,121
2,577 31,143,059
79

AS AT JUNE 30, 2021
Information as required under Code of Corporate Governance
No. of No. of
Shareholders Category
Shareholder Share held
Associated Companies, Undertaking and Related Parties (name wise details)
FOSSIL ENERGY (PRIVATE) LIMITED 1 18,205,121

TOTAL 1 18,205,121
Mutual Funds (name wise details)
TOTAL - -
Directors and their spouse (to be confirmed by company)
TOTAL - -
Executives (To be Filled by company)
TOTAL - -
Public Sector Companies and Corporations
TOTAL - -
Banks, Development Finance Institutions, Non-Banking Finance Institutions,
Insurance Companies, Takaful, Modaraba and Pension Funds
TOTAL - -
Shareholder Holding five percent or more voting Rights in the Listed Company (name wise details)
FOSSIL ENERGY (PRIVATE) LIMITED 1 18,205,121

TOTAL 1 18,205,121
80

CATEGORIES OF SHAREHOLDING
AS AT JUNE 30, 2021
No. of No. of
SNO. Shareholders Category Percentage
Shareholder Shares
1 Directors, Chief Executive Officer, and their

spouse and minor children
(to be confirm by Company) 0 0 0.00
2 Associated Companies, Undertakings and

related Parties (to be confirm by Company) 2 18,205,121 58.46
3 NIT and ICP
4 Banks, Development Financial Institutions,

Non Banking Financial Institutions
5 Insurance Companies
6 Modarabas and Mutual Funds 5 751,000 2.41
7 Share holders holding 10% 1 15,901,121 51.06
8 General Public :
a. local 2,539 11,093,481 35.62
b .Foreign - - -
9 Others 31 1,093,457 3.51
Total (excluding : share holders holding 10%) 2,577 31,143,059 100.00
81
THIRTY-FIFTH (35th) ANNUAL GENERAL MEETING 2021
Thirty - fifth (35th)

Thursday,
February 24, 2022
2022
82
(35)
(35)
2022
83
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Annual

Human Resource Committee

Chief Financial Officer

Tel: (92 21) 38658896

Notice of the 35th Annual General Meeting

Any Other Business:

By order of the Board

Date: January 28, 2022 Muhammad Bilal

1. Participation in the AGM Proceeding via Video Conference Facility:

2. Closure of Share Transfer Books:

3. Appointment of Proxies and Attending AGM:

4. Change in Members Addresses:

5. Availability of Financial Statements and Reports on the Website:

6. Transmission of Annual Financial Statements and Notice of Meeting through email:

Name & CNIC Name & CNIC

Review Report by the Chairman

Impact of COVID-19 And Impairment of Goodwill

For and on behalf of the Board

Karachi: January 21, 2022

Financial highlights for 2021

------- (Rupees) -------

- requirements for the reconciliation and monitoring of transactions;

- compliance with regulatory and other legal requirements;

- documentation of controls and procedures;

- ethical and business standards;

Foreign Exchange Risk

COMPLIANCE WITH THE CODE OF CORPORATE GOVERNANCE

CORPORATE AND FINANCIAL REPORTING FRAMEWORK

The Company has maintained proper books of accounts.

The composition of the Board is as follows:

Independent Directors: Mr Zohaib Yaqoob

Other Non-executive Directors: Mr Salim Chamdia

Executive Directors: Mr Khawar Jamil Butt

b) Human Resource and Remuneration Committee:

Meetings of Board of Directors

Name of Director Meetings Attended

Audit Committee Meetings

Name of Audit Committee Member Meetings Attended

Name of the Human Resource Committee Member Meetings Attend

Mr Muhammad Jamshed Azmat - (Later on Resigned) 1

CONTRIBUTION TO THE NATIONAL EXCHEQUER AND ECONOMY

RELATED PARTY TRANSACTIONS

On behalf of the Board of Directors

Shehzad Mohsin Javaid Iqbal

Statement Of Value Added

Total Revenue 377,540,000 447,520,000

To Employees 59,423,000 61,995,000

Duties & Taxes 72,939,000 94,275,000

Utilized/Retained for reinvestment & future growth

Depreciation & retained profit for

Yearwise Financial Highlights

Equity 267,149 872,148 1,027,366 197,924 174,449 183,953

PROFIT AND LOSS ACCOUNTS

Distributions & marketing expenses (63,681) (62,386) (26,465) (164) - (1,835)

Administrative expenses (88,473) (56,158) (104,783) (3,988) (4,707) (7,690)

Other operating expenses (6,522) (6,351) (7,101) - - (371)

Other operating income 3,103 53,092 2,506 7,007 8,109 33,333

Impairment of goodwill (385,985) (162,877)

Financial charges (1,499) (3,046) (6,984) (1,115) (86) (386)