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41 views48 pagesThas Q4 2015
This document relates to the annual report of Taha spinning mills.
Uploaded by
usama zafarCopyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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G@NNGGL REPORT
FOR THE YEAR ENDED
JUNE 30, 2015
Taha
SPINNING MILLS LIMITED Sa ae
CONTENTS
Company Information
Vision and Mission Statement
Notice of Annual General Meeting
Director's Report to the Shareholders
Statements of Ethics and Business Practices
Key Operating and Financial Results
Statement of Compliance with the
Code of Corporate Governance
Review Report to the Members on Statement of
Compliance of Code of Corporate Governance
Auditor's Report to the Members
Balance Sheet
Profit and Loss Account
Statement of Comprehensive Income
Cash Flow Statement
Statement of Changes in Equity
Notes to the Financial Statements
Pattern of Share Holders
Form of Proxy TAHA SPINNING MILLS LIMITED
Board of Directors
Audit Committee
‘Human Resource &
‘Remuneration Committee
Chief Financial Officer
Company Secretary
Auditors
Bankers
Legal Advisor
‘COMPANY INFORMATION
Nu Ashfaq Ahmed Chief Executive
Me Saqib Ashfaq Non Executive Ditector
Me Amie Ashfaq sxecutive Director
Ne Niaz Mohammad —Independer
Me Mohammad Azam’ Non Executive
Me: Qamar Iqbal
MeSaleem Abbas
MeNiaz Mohammad — Chairman
Me-Mohamrmad Azam
Ms: Qamar Iqbal
MeAmir Ashfaq Chairman
MeQamar Iqbal
Me
een Abbas.
Me Shakeel Akhtar
Me: Muharasnad Saefeaz
Navowd Zufar Ashfng Jaery & C
Chartered Accountants
P*Mloor, Modern House
amount Road
rach
Habib Bank Limited
Askar Bank Limited
National Bank of Pakistan
arog Rashid & Co
Advocates and Coeporste Consultants
4013 Commerce Centie
aseat Mohaai Road
Karachi-74200 Share Registrar and Transfer Office
Registered Office
Phone No:
Fax No.
E-mail:
Website
usiness:
Status of Company
‘Company Registration No.
National Tax No.
Cont person:
Najeeb Consultants (Pvt)Ltd
408. Commerce Centre,
Haseat Mohani Road, Karachi
406-Commeree Cente,
‘aseat Mohani Road, Karachi
Karachi 74200
92-21.32638521-3
92-21-32639883
[email protected]
K-0023133,
994126
‘Me-Muhummad Sarfraz
Phonc:92-21-32638821-3,
E-mailsarfrazinto‘a
tmaiecom SPINNING MILLS LIMIT)
VISION STATEMENT
‘The primary vision is to reestablish the company and its manufacturing unit
and produce quality yam for its customers in local and intemational market,
‘The company has taken on a mission to reestablish itself with modern technology of
textile machinery, improve its profitability and meet its financial commitments and
give a fair return to its shareholders while complying with the best practices of
Corporate Governance. TAHA SPINNING MILLS LIMITED
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the 25th Annual General Meeting of the shareholders of Taha
Spinning Mills Limited will be held on Monday, 26th October, 2015 at 9.30 a.m at its
registered office at 406-Commerce Centre, Hasrat Mobani Road, Karachi to consider the
following business:
1, Toconfirm the minutes of Annual General Mecting held on 29th October.2014
2. To receive, consider and adopt the report of Directors, Auditors and the Audited
Accounts of the company for the year ended June 30, 2015.
To appoint the Auditors for the year ending 30.6.2016 and fix their remuneration.
The retiring auditors M/s, Naveed Zafar Ashfaq Jaffery & Co. Chartered Accountants
ing eligible, offers themselves for reappointment.
4. To consider any other business with the permission of the Chair.
By order of the Board
‘Company Secretary
Karachi: October 5, 2015
Notes:
1. ‘The share transfer books of the company will remain closed from 20th October, 2015 to
26th October 2015 (both days inclusive)
2, Armember entitied to attend and vote at this meeting may appoint to a member as his/her
proxy to attend, speak and vote on his/her behalf. Proxies in order to be effective must be
received by the company at the registered office not less than 48 hours before the meeting.
3. Any individual, beneficial owner of CDC, entitled to attend and vote at this meeting, must
boring his/her original NIC or Passport, Account No. and participant's I.D number, to prove
hishher identity, and in case of proxy must enclose an attested copy of his/her NIC or
Passport
4, In ease of corporate entity, the board of directors” resolution/power of attomey with
specimen signature of nominee/proxy shall be required
5, Shareholders are requested to notity any change in their address im TAHA SPINNING MILLS LIMITED
DIRECTORS’ REPORT TO THE SHARE HOLDERS,
‘The directors of your company are pleased to place their report together with the
auditors’ report and audited financial statements of the company for the year ended
June 30, 2015 before the 25th Annual General Meeting.
AN OVERVIEW
Textile industry is still in crises due to load shedding of electric and gas. High
inflation rate in the country is another major factor of concern. Cost of production is
increasing day by day due to high inflation. Inflation and law and order situation is
also affecting the competitiveness of textile products in the local and international
market. Rupee devaluation is also hurting the up gradation of textile machinery for
uality products.
OPERATING RESULTS
There is no manufacturing activity and no sale during the year under report. Operating
results for the year are as under:
30 June 2015 30 June 2014
Rupees Rupees
Sales — Net - -
Net (Loss) Profit before tax (3,295,642) 72,738,395
Provision for taxation:
Current. ~ (57,283)
Prior year $7,283 &
Deferred -
Profit (loss) after tax “(3.238,359) —72.681,112
Earning per share. (0.80) 17.95
FINANCE COST
Since the settlement of entire liabilities of the company, there is no borrowing cost for
the year.
TAXATION
Income tax returns are all upto date. Returns for the year are deemed to be accepted as
filed DIVIDEND
Due to adverse financial condition of the company, board is not recommending any
dividend,
OUTSTANDING STATUTORY PAYME
‘There are no overdue statutory payments.
CURRENT AND FUTURE OUTLOOK
‘The major issues faced by the industry is load shedding of electricity and gas in
industrial sector. High rate of mark-up and inflation rate is another factor. ‘These
issues need the attention of the government for revival of the industry.
Alhamdullah the management has settled the entire liabilities of the creditors.
Management is looking forward to set up a small spinning unit in the area where basic
industrial facilities are available. Management is also negotiating with the banks and
financial institutions to finance the proposed project. Management is facing
difficulties due to past bad experience of financial crunch.
RELATED PARTIES
It is the policy of the management to ensure that all transaction entered with related
parties must be at arm’s length basis. Relevant rates are to be determined as per the
‘comparable un-controlled price method,
ENVIRONMENT, HEALTH, SAFETY AND SOCIAL ACTIONS
Management provides and maintains, reasonably practicable, systems and wo!
conditions which are safe and without risk to the health of all employees and public.
CHANGES IN THE BOARD OF DIRECTORS
‘There are no changes in the board of directors during the year under report.
MEETING OF BOARD OF DIRECTORS
Four board meetings were held during the year and cach director attended the
following number of meetings.
Direct No. of meetings
Mr. Ashfaq Ahmed 4
Mr. Sagib-Ashfaq
Mr. Amir Ashfaq,
Mr. Niaz Muhammad
Mr. Azam Nisar
Mr.Qamar Iqbal
Mr. Saleem Abbas
sonata Leave of absence was granted to the directors who could not attend some of the
meetings.
PATTERN OF SHARE HOLDING IS ANNFXED TO THIS REPORT.
There was no trading during the year in the company's share by its CEO, Directors
and CFO and their spouse and minor children.
AUDITORS
‘The present auditors of the company M/s. Naveed Zafar Ashfaq Jaflery & Co.,
Chartered Accountants retires and being eligible offer themselves for reappointment
under the terms of the Code of Corporaic Governance. The Audit Commitiee
recommended the board to appoint auditors for the year ending June 30, 2016.
CORPORATE GOVERNANCE
We are pleased to inform you that the company has taken necessary steps to comply
with the provisions of the Code of Corporate Governance as incorporated in the
regulations of Stock Exchanges.
STATEMENT OF DIRECTORS RESPONSIBILITIES UNDER 1
CORPORATE GOVERNANCE.
CODE OF
The Board of Directors state that:
The financial statements, prepared by the management of the company, present its
state of affairs fairly, the result of its operations, cash flows and changes in equity.
. Proper books of account of the company have been maintained.
consistently applied in preparation of
are based on reasonable and prudent
¢. Appropriate accounting policies have be
financial statements and accounting esti
judgment.
d. International Financial Reporting Standards, as applicable in Pakistan, have been
followed in preparation of financial statements and any departures there from has
been adequately disclosed.
€. The system of internal control is sound in design and has been effectively
implemented and monitored.
£ Due to settlement of entire liabilities of financial institutions and creditors and
efforts of the management for setting up a small spinning unit, there are no doubts.
upon 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. h. Key operating and financial data of last six years in a summarized form is
annexed.
i, The board of directors has adopted a vision and mission statement and a statement
of overall corporate strategy.
AUDIT COMMITTEE
‘The Board, in compliance to the Code of Corporate Governance, has formed an Audit
Committee. There are three members of the audit committee. Chairman of the
committee is an independent director. Four meetings of the committee were held
during the period, The names.of its members are given in the company profile. The
gs were attended by all the members.
HUMAN RESOURCE AND REMUNERATION COMMITTI
Human Resource Committee was formed but no meeting was held during the year
under review due to the fact the company has sold out its entire undertaking.
STATEMENT OF ETHICS AND BEST BUSINESS PRACTICES
The Board has prepared the statement of ethics and best business practices which has.
been circulated to all the directors and employees for their acknowledgement,
understanding and acceptance.
RELATIONSHIP WITH SHARE HOLDERS
The company reports formally to the shareholders four times a year all its financial
results alongwith directors review on the operations and future outlook of the
company. All the interim and final reports are being sent to The Karachi Stock
Exchange and at the registered addresses of the shareholders.
In addition to above, company sends its annual report and formal notification for
holding Annual General Meeting at least 2Idays in advance to facilitate the
shareholders to participate in the meeting. The financial results are also available on
the company’s website. “www.hmiml.com”
ACKNOWLEDGEMENTS
The Board acknowledges the hard work and efforts of the staff’ and hopes that this
will continue in the forthcoming years. ‘The Board also acknowledges ongoing support
from its bankers.
For and on behalf of the Board
Chief Executive
Karachi: October 2,2015 TAHA SPINNIN' MIT)
[STATEMENT OF EIICS AND BUSINESS PRACTICES
‘As approved by the Board of Directors, the management of Taha Spinning Mills Limited
is hereby advised to follow the under mentioned principles for excellent performance in
the attempt to achieve the objectives of the company.
‘ASDIRECTOR
peoge
Commit to all the necessary and appropriate resources.
Foster a conducive environment through responsive policies.
Maintain organizational effectiveness for the achievement of targets.
Encourage and support compliance of legal and industrial requirements.
Protect the interest of the company and employees.
SS EXECUTIVE AND MANAGER.
Protect the interest of the company and management.
Ensure inerease in productivity and profitability of the company.
Provide the direction and leadership to the organization,
Ensure total customer satisfaction through quality product and services.
J. Promote a culture of excellence, devotion and continual improvement.
k Cultivate work ethics and harmony among colleagues and associates.
1 Encourage initiatives and self-realization of responsibilities i
m, Ensure as equitable way of working and reward system.
ASEMPLOVEE AND STAKE
1. Devotion to your job.
©. Abide by company’s policies and regulations.
p. Promote and protect the interest of the company,
@ crcise prudence and honesty in using company’s resources.
F —_ Observe cost effective practices in daily activities
s. Avoid making any personal gain at the cost of the company.
smu
kickbacks in cash or kind to obtain business or otherwise’
ly prohibited.
‘The payment of bribe:
for the company is str
EIANCIAL INTEGRITY,
‘Compliance with accepted accounting rules and procedure is required at all times.
All information supplied to all concerns must be complete and not misleading.
‘The company will not knowingly assist fraudulent activities. If you have any
reason to believe that fraudulent activities are taking place within the company or
‘outside where we do business, you must inform the management immediately.
=10- TAHA SPINNING MILLS LIMITED
KEY OPERATING & FINANCIAL RESULTS
SIX YEARS ATA GLANC
i SEXYEARS ATA GLANCE —$—$— $$
i OPERATING DATA 2015 ao 208, 2m 20 2010
RUPEES.
Sake g ‘ sar7z@ 1122000
Cost of pos sl ramey 42448
Geos prot onessay m0)
Operating profi/ om) CmKem 7K MIM nA STINET) GRIT)
Profits) before xanon GmKe «7S LAIKA) THIN) «RAT —_CATBBB08)
Prai/ ns) after ation Gans aR zeae) ——GTPNNET) AINA —_CIADBLADH
FINANCIAL DATA,
Pa op capital susmm singe SBM —MSENGO SND 4.504000
gu balance OS907 «2ST BIRTH) GKSSTZO LSAT «AD
Fae ase yest TISSISS SISSIES
| Carentan orm 10 aa ASKIN TST TOTEDWD
(Gare habits 75000 esom—TENSaNTIR msm SND 443TH
KEY RATIOS
Geass magi (6) Z 2536) ssn
Opersting magia (4) : : z 648) (319)
Net pro (9), 5 5 cum (03396)
Rerum om capital tees) 3H se sso nase asst)
Coren 0 ©) oot x an 2 208
ag per share (Rs) (0% 9s am om om)
‘Cash dnd 08) z z e
sTanisTics
Number of pies 15216 15216 15216
Prato ato 20/8 count
(ov mabe! Kes) : Taha Spinning Mills Limited
406 Commerce Centre, Hasrat Mohani Road, Karachi, Pakistan
Tel: 32638521-3 Fax: 32639843 E.mail:[email protected]
Statement of Compliance with the Code of
Corporate Governance
“Year Ending: June 30, 2015
This statement is being presented to comply with the Code of Corporate Governance
contained in Regulation No. 35 of listing regulations of Karachi Stock Exchange (Guarantee)
Limited for the purpose of establishing a framework of good governance, whereby a listed
company is managed in compliance with the best practices of corporate governance.
‘The company has applied the principles contained in the CCG in the following manner:
1. ‘The company encourages representation of independent non-executive directors and
directors representing minority interests on its board of directors. At present the board
includes:
(caiapony
[Independent | MrNiaz Mohame
Chief Exect Mr.Ashfaq Ahmed
Executive Directors | Mr-Amir Ashfaq.
‘Non-Executive Directors | MeMuhammad Azam
| MeSaib Ashfiag
Mr-Qamar Igbal
| MeSaleem Abbas
The directors have confirmed that none of them is serving as a director on more than seven
~ fisted companies, including this company
3, All the resident directors of the company are registered as taxpayers and none of them has
defaulted in payment of any loan to a banking company, a DET or an NBFT oF, being a
member of a stock exchange, has been declared as a defaulter by that stock exchange.
4. Nocasual vacancy occurred on the board during the year under report
5, The company has prepared a “Code of Conduct” and has ‘ensured that appropriate steps
2 ML
12,
have been taken to disseminate it throughout the company along with its supporting
policies and procedures.
The board has developed a vision/mission statement, overall corporate strategy and
significant policies of the company. A complete record of particulars of significant
policies along with the dates on which they were approved or amended has been
maintained
All the powers of the board have been duly exercised and decisions on material
transactions, including appointment and determination of remuneration and terms
and conditions of employment of the CEO, other executive and non-executive directors,
hhave been taken by the board.
‘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 and the board met at least once in every
quarter. Written notices of the board meetings, along with agenda and working papers,
were circulated at least seven days before the meetings. The minutes of the meetings were
appropriately recorded and circulated.
‘One of the directors meets the criteria of exemption under clause (xi) of the CCG and is
accordingly exempted from the directors training program. The condition of training of
other directors will be complied in due course.
‘There is no change of CFO, Company Secretary except Head of Internal Audit during the
year.
The directors’ report for this year has been prepared in compliance with the requirements
of the CCG and fully describes the salient matters required to be disclosed.
‘The financial statements of the company were duly endorsed'by CEO and CFO before
approval of the board
‘The directors, CEO and executives do not hold any interest in the shares of the company
‘other than that disclosed in the pattern of shareholding.
The company has complied with all the corporate and financial reporting requirements of
the CCG.
The board has formed an Audit Committee. It comprises three members, of whom two
are non-executive dircetors and the chairman of the committee is an independent director.
The meetings of the audit committee were held at least once every quarter prior to
approval of interim and final results of the company and as required by the CCG. The
-13- 20.
ai.
22,
23.
terms of reference of the committee have been formed and advised to the committee for
‘compliance.
‘The board has formed an HR and Remuneration Committee. It comprises three members, of
whom two are non-executive directors and the chairman of the committee is an Executive
director.
‘The board has set up an internal audit function which is conversant with the policies and
procedures of the Company. Qualification of Head of Internal Audit is not as per the
requirements, this condition will be complied in due course.
‘The statutory auditors of the company have confirmed that at the time of their appointment
they had a satisfactory rating under the quality control review program of the ICAP, that
they or any of the partners of the firm, their spouses and minor children do not hold shares
of the company and that the firm and all its partners are in compliance with International
Federation of Accountants (IFAC) guidelines on code of ethics as adopted by the ICAP.
‘The statutory auditors or the persons associated with them have not been appointed to
provide other services except in accordance with the listing regulations and the auditors
have confirmed that they have observed IFAC guidelines in this regard.
The ‘closed period’, prior to the announcement of interim/final results, and business
decisions, which may materially affect the market price of company’s securities
‘was determined and intimated to directors, employees and stock exchange(s).
Material/price sensitive information has been disseminated among all market participants
at once through stock exchange(s).
We confirm that all other applicable material principles contained in the CCG have
been complied with.
ASHFAQ AHMED
Chief Executive
Karachi: October 2, 2015
214 PORT TO THI EMBERS ON STATEMENT OF Cé PLIAN(
BEST PRACTICES OF CODE OF CORPORATE GOVERNANCE
‘We have reviewed the Statement of Compliance with the best practices contained in the
Code of Corporate Governance prepared by the Board of Directors of Taha Spinning Mills
Limited ("the Company”), to comply with the Listing Regulations of the Karachi Stock
Exchange Limited, where the Company is listed.
‘The responsibility for compliance with the Code of Corporate Governance is that of the Board
of Directors of the Company. Our responsibility is to review, to the extent where such
compliance can be objectively verified, whether the Statement of Compliance reflects the
status of the Company's compliance with the provisions of the Code of Corporate Governance
and report if it does not. A review is limited primarily to inquiries of the Company personnel
and review of various documents prepared by the Company to comply with the Code.
As part of the audit of financial statements we are required to obtain an understanding of the
accounting and internal control systems sufficient to plan the audit and develop an effective
audit approach. We are not required to consider whether the Boards statement on internal
control covers all risks and control, or to form an opinion on the effectiveness of such internal
controls, the company corporate governance procedures and risks.
Further, Sub-Regulation (xiii a) of Listing Regulations 35 notified by the Karachi Stock
Exchange Limited requires the company to place before the Board of Directors for their
consideration and approval related party transactions distinguishing between transactions
carried out on terms equivalent to those that prevail in the arm’s length transactions and
transactions which are not executed at arm’s length price recording proper justification for
using such alternate pricing mechanism. Further, all such transactions are also required to be
separately placed before the audit committee. We are only required and have ensured
compliance of requirement to the extent of approval of related party transactions by the
board of directors and placement of such transactions before audit committee. We have not
carried out any procedures to determine whether the related party transactions were
undertaken at arm’s length price or not.
Based on our review, except for the note 9 and 18.of non-compliance, nothing has come to
‘our attention, which causes us to believe that the Statement of Compliance does not
appropriately reflect the Company's compliance, in all material respects, with the best
practices contained in the Code of Corporate Governance as applicable to the Company for
the year ended June 30, 2015. Further, we highlight below instance(s) of non-compliance with the requirement(s) of the
Code as reflected in the note/paragraph reference where these are stated in the Statement of
Compliance:
i. As disclosed in point 9 of the statement, none of the directors have obtained certification
under directors training program and Board did not arranged orientation courses for its
directors during the financial year to apprise them of their duties and responsit {
required under clause (xi) of the code
ji, As disclosed in point 18 of the statement, the qualification of Head of Internal Audit is not
as per the requirement of clause (xiv) of the code.
Karachi Naveed Zafar Ashfaq Jatfery & Co. \
Date: October 05, 2015 Chartered Accountants !
-16- AUDITORS' REPORT TO THE MEMBERS ~
We have audited the annexed balance sheet of TAHA SPINNING MILLS LIMITED
("the Company") as at June 30, 2015 and the related profit and loss account, statement of
comprehensive income, cash flow statement and statement of changes in equity together with
the notes forming part thereof, for the year then ended and we state that we have obtained all
the information and explanations which, to the best of our knowledge and belief, were
necessary for the purposes of our audit.
It is the responsibility of the Company's management to establish and maintain a system of
internal control, and prepare and present the above said statements in conformity with the
approved accounting standards and the requirements of the Companies Ordinance; 1984. Our
responsibility is to express an opinion on these statements based on our audit.
We conducted our audit in accordance with the auditing standards as applicable in Pakistan,
These standards require that we plan and perform the audit to obtain reasonable assurance
about whether the above said statements are free of any material misstatement. An audit
includes examining on a test basis, evidence supporting the amounts and disclosures in the
above said statements. An audit also includes assessing the accounting policies and significant
estimates made by management, as well as, evaluating the overall presentation of above said
statements, We believe that our audit provides a reasonable basis for our opinion, we report
that:
|. The financial statements of the Company have been prepared on going concern basis,
despite of the facts that the Company has closed down the factory in July 2008, and
production activities remained suspended. The management has disposed off the land
and building to pay off its major debts during the year. No further business activities
have been carried out by the Company. Furthermore, the Company has not prepared
any detailed business plan including profit or cash flow projection for an appropriate
period subsequent to the balance sheet date. The foregoing conditions indicate material
uncertainty which cast a significant doubt on the Company's ability to continue as a
Boing concern.
The significance of matters discussed in the preceding paragraph, lead us believe that
the going concern assumption used in preparation of the financial statements of the
Company is inappropriate: Consequently the assets and liabilities should have been
stated at their realizable and settlement amount respectively.
he a)
»)
in our opinion, proper books of accounts have been kept by the Company as required by the
Companies Ordinance, 1984;
in our opinion:
the balance sheet and profit and loss account together with the notes thereon have
been drawn up in conformity with the Companies Ordinance, 1984 , and are i
‘agreement with the books of account and are further in accordance with accounting
policies consistently applied ;
the expenditure incurred during the year was for the purpose of the Company's
business; and
the business conducted, investments made and the expenditure incurred during the
year were in accordance with the objects of the Company;
due to significance of the matter referred to in paragraph (1) above, in our opinion and
to the best of our information and according to the, explanations given to us, the
financial statements together with the notes have not been prepared in all material
respect as at June 30, 2015 and of its profit, comprehensive income, its cash flow and
‘changes in equity for the year then ended in accordance with approved accounting.
standards as applicable in Pakistan, and do not give the information required by the
Companies Ordinance, 1984, i
no Zakat was deductible at source under the Zakat and Ushr Ordinance, 1980.
Naveed Zafar Ashfaq Jaffery & Co.
Chartered Accountants
Engagement Partner: Ahsan Elahi Vohra - FCA
Karachi
Dated: October 05, 2015,
18 ‘TAHA SPINNING MILLS LIMITED
BALANCE SHEET
AS AT JUNE 30, 2015
2015 2014
Note Rupees Rupees
EQUITY AND LIABILITIES
‘SHARE CAPITAL AND RESERVES
Authorized share capital
6,100,000 (2014 : 6,100,000) ordinary shares of rupees 10 each 61,000,000_ __ 61,000,000
Issued, subscribed and paid up share capital 5 40,500,000 40,500,000
Accumulated loss (30,754,013) _ (27,512,654)
9,745,987 12,987,346
CURRENT LIABILITIES
Trade and other payables 6 78,000 65,000
TOTAL EQUITY AND LIABILITIES '9,823,987___ 13,052,346
Contigencies and commitments 7 - :
ASSETS
NON-CURRENT ASSETS
Long term deposits 8 25,000 25,000
CURRENT ASSETS
Advances tax - net of provision 217,069 155,810
Other receivables 9 5,481,716 || 5,950,745
Cash and bank balances 10 4,100,202 ||_ 6,920,791
9,798,987 13,027,346
TOTAL ASSETS 987 __ 13,052,346
The annexed notes from 1 to 25 form an integral part of these financial statements
CHIEF EXECUTIVE DIRECTOR
-19- ‘TAHA SPINNING MILLS LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED JUNE 30, 2015
2015, 2014
Note Rupees Rupees
Operating expenses
Administrative expenses 12 (3,333,861) (2,006,182)
Operating loss (3,333,861) (1,006,182)
Other operating income 13 37,665 572,839
Gain on disposal of assets held for sale 14 : 73,860,785
(3,296,196) 73,827,482
Finance cost 15 (2,446) (689,047)
(Loss) / profit before taxation (3,298,642) 72,738,395
Taxation 16 57,283 (57,283)
(Loss) / profit after taxation (3,241,359) 72,681,112
Earnings / (Loss) per share (Basic and diluted) 7 (0.80) 17.95
The annexed notes from 1 to 25 form an integral part of these financial statements.
{
CHIEF EXECUTIVE DIRECTOR
-20- TAHA SPINNING MILLS LIMITED
‘STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED JUNE 30, 2015,
2015 2014
Rupees Rupees
(Loss) / profit after taxation (3,241,359) 72,681,112
Other comprehensive income : -
Total comprehensive (loss) / income for the year (3,241,359) __72,681,112
The annexed notes from 1 to 25 form an integral part of these financial statements
CHIEF EXECUTIVE DIRECTOR ‘TAHA SPINNING MILLS LIMITED
CASH FLOW STATEMENT
FOR THE YEAR ENDED JUNE 30, 2015,
2015 2014
Rupees Rupees.
CASH FLOWS FROM OPERATING ACTIVITIES
(Loss) / profit before taxation (3,298,642) 72,738,395
Adjustments for: "
Gain on sale of fixed assets i (73,860,785)
Finance cost 2. 689,047 ‘
: (73,171,738)
{Loss) before working capital changes (3,298,642) (433,343)
{Increase)/Decrease in current assets
Other receivable 469,029 -
Increase/(Decrease) in current liabilities
Trade and other payables 13,000 __(1,398,670)
Cash used in operations (2,816,613) (1,832,013)
Finance cost paid (1,626,773)|
Taxes paid/adjustment (3,376) (66,705)
(3,976) (1,693,478)
Net cash used in operating activities (2,820,589) (3,525,491)
CASH FLOWS FROM INVESTING ACTIVITIES,
Proceeds from disposal of fixed assets and stores - 116,879,000
Security deposits : 521,250
Net cash generated from investing activities 5 117,400,250
CASH FLOWS FROM FINANCING ACTIVITIES
Long term financing =) (7222.139,312)
Net cash used in financing activities = (121,139,312)
tents. (2,820,589) 2,735,447,
Net (decrease) / increase in cash and cash equi
Cash and cash equivalents at beginning of the year 6,920,791 4,185,344
100,202, 632
Cash and cash equivalents at end of the year 79 '
The annexed notes from 1 to 25 form an integral part of these financial statements.
CHIEF EXECUTIVE DIRECTOR e
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22
‘TAHA SPINNING MILLS LIMITED
NOTES TO THE THE FINANCIAL STATEMENTS
For the Year Ended June 30, 2015,
‘THE COMPANY AND ITS OPERATIONS
Taha Spinning Mills Limited (the "Company") was incorporated in Pakistan as a Private Limited
‘Company under the Companies Ordinance, 1984 in 1991 and subsequently converted to a Public
Limited company on June 16, 1991. Shares of the company were listed on the Karachi Stock Exchange
in Pakistan on February 01, 1994. The principal business of the company is to manufacture and sale of
‘yarn, Millis located at Sheikhupura in the Province of Punjab.
‘The Management has settled the liabilities of its creditors and all financial institutions amicably. Since
the sale of entire fixed assets management is focusing to set up a small spinning unit if financial
Assistance is provided by the banks. Negotiation with banks/financial institution are in progress .
Pending the arrangement of finance facilities, future business plan with a small capital in hand is not
feasible
‘BASIS OF PREPARATION
Statement of compliance
‘These financial statements have been prepared in accordance with approved accounting standards as
applicable in Pakistan. Approved accounting standards comprise of such International Financial
Reporting Standards (IFRS) issued by the International Accounting Standards Board as are notified
under the Companies Ordinance, 1984, provisions of and directives issued under the Companies
‘Ordinance, 1984. Wherever the requirements of the Companies Ordinance, 1984 or directives issued
by the Securities and Exchange Commission of Pakistan differ with the requirements of IFRS, the
requirements of the Companies Ordinance, 1984 or the requirements of the said directives prevail
Standards ammendments and interpretations
a) Standards, amendments or interpretations which became effective during the year
During the year certain amendments to standards or new interpretations became effective; however,
the amendments or interpretation did not have any materiabeffect on the financial statements of the
Company.
bb) Standards, amendments or interpretations not yet effective
= Amendments to 1AS 38 Intangible Assets and IAS 16 Property, Plant and Equipment (effective for
annual periods beginning on or after 1 January 2016) introduce severe restrictions on the use of
revenue-based amortization for intangible assets and explicitly state that revenue-based methods
of depreciation cannot be used for property, plant and equipment. The amendments have no
impact on Company's financial statements as the Company has the policy of depreciating /
‘amortizing its property, plant and equipment and intangible assets based on the assessed useful
lives.
+ IFRS 10 ‘Consolidated Financial Statements’ ~ (effective for annual periods beginning on or after 1
January 2015) replaces the part of 1AS 27 ‘Consolidated and Separate Financial Statements’. IFRS
10s not likely to have any impact on the financial statements of the Company,
= IFRS-11 ‘Joint Arrangements’ (effective for annual periods beginning on or after 1 January 2015)
replaces IAS 31 ‘Interests in Joint Ventures’. IFRS 11 is not likely to have any impact on the
financial statements of the Company.
24. Ba
32
+ IFRS 12 ‘Disclosure of interest in Other Entities’ (effective for annual periods beginning on or after
1 January 2015). The adoption of this standard is not like to have an impact on Company's financial
statements,
+ IFRS 13 ‘Fair Value Measurement’ effective for annual periods beginning on or after 1 January
2015). The adoption of this standard is not like to have an impact on Company's financial
statements.
= Amendment to 1AS 27 ‘Separate Financial Statement’ (effective for annual periods beginning on or
after 1 January 2016). The amendments to IAS 27 will allow entities to use the equity method to
account for investments in subsidiaries, joint ventures and associates in their separate financial
statements.
+ Agriculture: Bearer Plants [Amendment to IAS 16 and IAS 42] (effective for annual periods
beginning on or after 1 January 2016). These amendments have no impact on the financial
statements of the Company.
+ Sale or Contribution of Assets between an Investor and its Associate or Joint Venture
(Amendments to IFRS 10 and IAS 28) [effective for annual periods beginning on or after 1 January
2016]. The main consequence of the amendments is that a full gain or loss is recognised when 2
transaction involves a business (whether itis housed in a subsidiary or not). A partial gain or loss is
recognised when a transaction involves assets that do not constitute a business, even if these
assets are housed in a subsidiary.
Annual Improvements 2012-2014 cycles (amendments are effective for annual periods beginning on or
after 1 January 2016). The new cycle of improvements contain amendments to the following
standards:
= IFRS'S ‘Non-current Assets Held for Sale and Discontinued Operations’. These amendments are not
likely to have any implication on the Company's Financial Statements.
= IFRS 7 ‘Financial instruments Disclosures’. These amendments are not likely to have any
implication on the Company's Financial Statements.
= IAS 19 ‘Employee Benefits’, These amendments are not likely to have any implication on the
Company's Financial Statements.
= 1AS 34 ‘Interim Financial Reporting’. These amendments are not likely to have any implication on
the'Company’s Financial Statements.
‘BASIS OF MEASUREMENT
These financial statements have been prepared under the historical cost convention except for
revaluation of certain financial instruments at fair value and recognition of certain employee
retirement benefits at present value.
‘The company’s significant accounting policies are stated in note 4. Not all of these significant policies
require the management to make difficult, subjective or complex judgments or estimates. The
following is intended to provide an understanding of the policies the management considers critical
because of their complexity, judgment of estimation involved in their application and their impact on
these financial statements. Estimates and judgments are continually evaluated and are based on
historical experience, including expectations of future events that are believed to be reasonable under
the circumstances. These judgments involve assumptions or estimates in respect of future events and
the actual results may differ from these estimates. The areas involving higher degree of judgments or
complexity or areas where assumptions and estimates are significant to the financial statements are as
follows: 4a
42
Provision for taxation
The company takes into account the current income tax law and decisions taken by the appellate
authorities. Instances where the company’s’ view differs from the view taken by the income tax
department at the assessment stage and where the company considers that its view on items of
‘material nature isin accordance with law, the amounts are shown as contingent liabilities.
Staff retirement benefits - gratuity
Certain actuarial assumptions have been adopted as disclosed in relevant note to the financial
statements for valuation of present value of defined benefit obligation. Any changes in these
assumptions in future year might affect unrecognized gains and losses in those years.
Financial instruments
‘The fair value of financial instruments that are not traded in an active market is determined by using
valuation techniques based on assumptions that are dependent on market conditions existing at
balance sheet date.
Property, plant and equipment
‘The company reviews recoverable amount, useful life , residual value and possible impairment on an
annual basis. Any changes, if material in the estimates in future years might affect the carrying
amounts of the respective items of property, plant and equipment with a corresponding affect on the
depreciation charge and impairment.
‘SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Staff retirement benefit
Defined benefit plan
The company operates as unfunded gratuity scheme covering for all its perrhanent employees who
have attained the minimum qualifying period for entitlement to the gratuity.
Provision is made annually to cover the obligation on the basis of actuarial valUation and charged to
income. The most recent actuarial valuation was carried on June 30, 2013 using the Projected Unit
Credit Method.
‘Actuarial gains and losses are recognized as income or expense when the net cumulative unrecognized
actuarial gains and losses for the plan at the end of previous reporting exceeds 10 percent of the
present value of defined benefit obligation at that date.
Taxation
Current
Provision for current taxation is made on the taxable income, if any, after taking into account tax credit
and tax rebate available.
Deferred
Deferred tax is provided in full using the balance sheet liability method, on temporary differences
arising between the tax base of assets and liabilities and their carrying amounts in the financial
statements. The amount of deferred tax provided is based on the expected manner of realization or
settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantially
enacted at the balance sheet date.
The carrying amount of all deferred tax assets are reviewed at each balance sheet date and reduced to,
the extent, if itis no longer probable that sufficient taxable profits will be available to allow all or part
of the deferred tax assets to be utilized.
26: 43
a4
4s
46
Deferred income tax assets and liabilities are measured at the tax rate that are expected to apply to
the period when the asset is realized or the liability is settled, based on tax rates that have been
enacted or substantively enacted at the balance sheet date.
‘Trade and other payables
Liabilities for trade and other amounts payable are carried at cost which is the fair value of the
consideration to be paid in the future for goods and services received, whether or not billed to the
Company.
Provisions.
‘A provision is recognized in the balance sheet when the Company has a legal or constructive obligation
as a result of past event, and it is probable that an outflow of resource embodying economic benefits
will be required to settle the obligation and a reliable estimate can be made of the amount of
obligation.
Property, plant and equiprhent
Owned assets
Property, plant and equipment are stated at cost or revalued amount less accumulated depreciation
and impairment loss, if any except freehold land which is stated at revalued amount. Depreciation is
calculated on straight line method to write-off the cost or revalued amount of assets, less their
residual values, over their expected useful lives. Remaining useful lives of significant assets and their
residual values are reviewed periodically and changes in estimates arising from such review is
accounted for in current and future years.
Depreciation on additions during the year is charged on pro-rata basis when the asset is acquired or
‘capitalized. Similarly the depreciation was charged on additions and no depreciation was charged on
deletion during the period.
In the year of revaluation depreciation is charged after the date of valuation until the year end. Gain
‘or Loss on disposal of property, plant and equipments are included in operating income. Normal
repairs and maintenance are charged to income as and when incurred. Major renewals and
improvements are capitalized
Assets subject to finance lease
Assets held under finance leases are stated at lower of present value of minimum lease payments
under the lease agreement and the fair value of assets acquired on lease. Aggregate amount of
related obligations under the lease less financial charges allocated to future payments are shown as
liability. The financial charges are allocated to accounting period in a manner to provide constant
periodic rate of charge on the outstanding liability. Assets acquired under finance lease are
depreciated apply straight-line method on a basis similar to owned assets. Depreciation of leased
assets is charged to income currently.
Impairment.
‘At each balance sheet date, the company reviews the carrying amounts of its assets to determine
whether there is any indication that those assets have suffered an impairment loss. if any such
indication exists, the recoverable amount of the asset is estimated in order to determine the extent of
the impairment loss.
If the recoverable amount of an asset is estimated to be less than its carrying amount of the asset 1s
reduced to its recoverable amount, Impairment losses are recognized as an expense immediately.
‘Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the 47
fa)
(b)
49
revised estimate of its recoverable amount, but so that the increased carrying amount does nat exceed
the carrying amount does not exceed the carrying amiount that would have been determined had no
impairment loss been recognized for the asset in prior years, A reversal of an impairment loss is
recognized as income immediately.
Capital Work-in-progress
Capital work-in-progress (CWIP) is stated at cost. All expenditures connected to the specific assets
incurred during installation and construction period are carried under CWIP. These are transferred to
specific assets as and when assets are ready for their intended use.
Investment
The management determines the appropriate classification of its investment in accordance with the
requirements of International Accounting Standard (\AS 39) Financial Instrument: Recognition and
‘measurement at the time of the purchase and classifies these investments as fair value through profit
or loss account, held to maturity or available for sale.
Financial assets at fair value through profit or loss account
Investments that are acquired principally for the purpose of generating profit from short term
fluctuation in prices are classified as “fair value through profit or loss account”. These investments are
initially recognised at cost and transaction cost associated with the investment are taken directly to.
profit and loss account. Subsequent to initial measurement, investments at fair value through profit or
loss are marked to marked, using the closing market rates at the end of each day and are carried on
the balance sheet at fair value. Net gains and losses arising on changes in fair values of these
investments, based on the quoted market rates ruling at the day-end, are taken to profit and loss
account
Held to maturity
Held to maturity investments are financial assets with fixed or determinable payments and fixed
maturities that the company’s management has the positive intent and ability to hold to maturity.
‘Available for sale
Investments intended to be held for an indefinite period of time, which may be sold in response to
needs for liquidity or changes in equity prices, are classified as “available for sale” These investments
‘are initially recognized at cost which includes transaction cost which includes transaction costs
associated with the investment, Subsequent to initial measurement, “available for sale” investments
are revalued and are remeasured at fair value. Net gains and losses arising on changes in fair values of
these investments are taken to shareholder's equity.
All purchases and sales of investments that required delivery within the time frame established by
_fegulation or market convention ("regular way" purchases and sales) are recognised at trade date,
‘which is the date that the company commits to purchase or sale the asset. All other purchases and
sales are recognised as derivative forward transactions until settlement occurs.
Investments are derecognized when the right to received cash flows from the investments have
expired, have been realized or transferred and the company has transferred substantially all risk and
rewards of ownership.
Impairment of investments is recognised when there is a permanent diminution in their values.
stores, spares and loose tools
‘These are valued at cost or net realizable value whichever is less. Cost is determined by moving
average method. Items considered obsolete are carried at nil value. Items in transit are valued at cost
comprising invoice value plus other charges incurred. 4.10
aan
412
443
ala
435
4.16
a7
Stock in trade
Stock in trade are valued at lower of average cost and net realizable value applying the following
basis.
Raw material
‘At average cost except those in transit which are stated at actual cost
‘Work in process and finished goods
Cost of direct material and a proportion of manufacturing overhead based on normal capacity
Waste
‘At net realizable value
Net realizable value signifies the estimated selling price in the ordinary course of business less costs
necessarily incurred in order to make the sale.
Foreign currencies
‘Transactions in foreign currency are recorded in Rupees at rates of exchange prevailing at the date of
transaction. All monetary assets and liabilities in foreign currency are re-translated at exchange rate
prevailing on the balance sheet date. All exchange differences are accounted for in income currently.
Cash and cash equivalents
Cash and cash equivalents comprises of cash in hand and bank balances.
Financial instruments
Financial instruments carried at the balance sheet date include trade debts, loans and advances, trade
deposits, other receivables, cash and bank balances, long term financing, short term borrowings, trade
‘and other payables and interest/mark-up on loans. Financial assets and liabilities are recognized when
the company becomes a party to the contractual provisions of the instrument and derecognized when
the company losses control of the contractual rights that comprise the financial asset and in case of
financial liability when the obligation specified into the contract is discharged, cancelled or expired.
Off setting of financial assets and financial liabilities
A financial asset and a financial liability is off set and the net account is reported in the balance sheet if
the company has a legally enforceable right to set off the recognized amounts and intends either to
settle on a net basis or to realize the asset and settle the liability simultaneously.
Trade debts
Trade Debts are carried at original invoice less an estimate made for doubtful debts based on a review
of all out standing amounts at the year end. Bad debts are written off when identified.
Borrowings
Financing and borrowings are recorded at the proceeds received. Finance cost are accounted for on
acerval basis.
Trade and other payables
These are recognised using the trade date accounting and are measured at cost which is the fair value
of the consideration to be paid for the goods and services in future. . 418
49
4.20
Borrowing cost
Borrowing costs directly attributable to acquisition end construction of qualifying assets are capitalized
Lup to the date of commencement of commercial production. All other borrowing costs are charged to
the income.
Related party transactions and transfer pricing
‘Transactions and contracts with related parties ar carried out at an arm’s length price determined in
accordance with the comparable uncontrolled price method.
Revenue recognition
Export sales are accounted for on shipment basis and exchange difference, if any on account of export
proceeds are adjusted in the period realization. Local sales are recognised on dispatch of goods to the
customer. Dividend is recognized as income when the right to receive dividend is established. Profit
‘on deposits is recognized on time proportion basis by reference to the principal outstanding and the
applicable rate of return
Dividend
The dividend distribution to the shareholders is recognised as a liability in the period in which it is
approved by the shareholders. . 2015 2014
Rupees Rupees
5 ISSUED, SUBSCRIBED AND PAID UP CAPITAL
2015 2014
Number of shares
Ordinary shares of Rs. 10 each fully
4,050,000 4,050,000 paid in cash 40,500,000 40,500,000
050,000 ,000 40,500,000 40,500,000
5.1. The shareholders are entitled to receive all distribution to them including dividend and other
entitlements in the form of bonus and right shares as and when declared by the company. All
shares carry “one vote" per share without restriction.
5.2. There is no movement in share capital during the year.
6 TRADE AND OTHER PAYABLES
Audit fee payable 78,000 65,000
78,000 65,000
7 CONTINGENCIES AND COMMITMENTS
CONTINGENCIES
There is no commitments as at June 30, 2015 (2024 : Nil).
COMMITMENTS
There is no commitments as at June 30, 2015 (2014 : Nil).
2015 2014
Note Rupees Rupees
8 LONG TERM DEPOSITS
CDC deposit 25,000 25,000
25,000 25,000, 9
10
Fr
ana
2015 2014
Note Rupees Rupees
OTHER RECEIVABLES
Considered good
Sales tax receivable 1,481,716 1,950,745,
Due from related party 4,000,000 4,000,000
5,481,716 5,950,745
CASH AND BANK BALANCES
Cash in hand 3,319,742 6,303,738
Cash at banks
Current accounts 780,460, 617,053
4,100,202 6,920,791
4,100,202 __ 6.920, 791
ASSETS HELD FOR SALES
‘Transfer from Property Plant and Equipment:-
Land - free hold +. 50,500,000
Building - free hold + 42,500,000
Generator :
Value of the assets = 93,000,000
Less : Sales of Generator
Sales of Land and Building : (93,000,000)
Revaluation of freehold land, building and generator was carried out on O1 January,2013 was
carried out to arrive a revalued amount of assets which was credited to assets held for sales
account to comply with the requirement of IFRS-5 Revaluation was carried out by an independent
PBC approved valuers M/s Asif Associates (Pvt) Limited.
Disposal of held for sales assets
Description Fair Unrealize Gain Sales Mode of Particular of
value Proceed Disposal Purchase
Land 50,500,000 47,253,903 50,000,000 Through bids Hassan limited
Building 42,500,000 3,124,392 66,479,000 Through bids Hassan limited
‘93,000,000 50,378,295 116,479,000 : 12 ADMINISTRATIVE EXPENSES:
Salaries, wages and other benefits
Postage and Courier
Auditors' remuneration
Legal and professional
Fire Loss
Repair and Maintenance office
Vehicle and misc. expenses
Printing and stationery
Fees and subscriptions
Advertisment Expenses
Other expenses
12.1 Auditors’ remuneration
Statutory audit fee
Half yearly review fee ’
13 OTHER OPERATING INCOME
Profit on bank account
14 GAIN ON DISPOSAL OF ASSETS HELD FOR SALES
Gain on disposal of assets held for sales
Gain on disposal of assets held for sales
Gain on sales of vehicle
15 FINANCE COST
Short term borrowings
Long term financing
Bank charges
16 TAXATION
Current
Prior year
Assessment will be fin:
2015 2014
Note Rupees Rupees
839,992 492,905,
2,582 1,695
122 78,000 78,000
127,750 -
1,452,300 :
254,780 =
: 58,700
20,000 25,500
133,606 212,033
7,250 =
417,601 137,349
~ 3,333,361 1,006,182
: 46,753,903
27,103,392
: 3,490
73,860,785.
57,283
(57,283) :
(57,283) 57,283
-d under the provisions of Income Tax Ordinance, 2001. 17 EARNINGS / (LOSS) PER SHARE - BASIC AND DILUTED
(Loss) / profit for the year
Weighted average number of ordinary shares
Earning / (Loss) per share - basic
17.1. There is no dilutive effect on basic Earning / (loss) per share.
18 REMUNERATION OF CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES
The chief executive and directors have waived off their remunerations and meeting fees for the year.
No employee of the company fall under the definition of executive as defined in the Companies
Ordinance, 1984.
2045 2014
Chief Executive Directors Chief Executive Directors
Meeting fees S - i
Remunerations : : a 3
Number of persons 1 6 1 6
18.1. Directors of the company have waived their remuneration.
19 FINANCIAL INSTRUMENT AND RELATED DISCLOSURES
‘The company has exposures to the following risks from its use of financial instruments.
19.1 Credit risk
19.2 Liquidity risk
19.3, Market risk
The board of directors has overall responsibility for the establishment and oversight of company’s risk
management framework. The board is also responsible for developing and monitoring the company's
risk management policies.
19.1 Credit risk
19.1.1 Exposure to credit risk
Credit risk is the risk of financial loss to the company if a customer or counterparty to a financial
instrument fails to meet its contractual obligations, and arises principally from the trade debts, loans
‘and advances, trade deposits and cash and bank balances. Out of total financial assets of Rs. 8.126
million (June 30, 2014 : Rs. 10.945 million), financial assets which are subject to credit risk aggregate to
Rs. 8.101 million (June 30, 2014 : Rs. 10.92 million). The carrying amount of financial assets represents
the maximum credit exposure. The maximum exposure to credit risk at the reporting date is as follows:
-34- 2015 2014
Rupees Rupees
Long term deposit 25,000 25,000
Other receivables 4,000,000 4,000,000
Cash and bank balances 4,100,202
8,125,202 8,731,594
19.2 Liquidity risk
Liquidity risk is the risk that the company will not be able to meet its financial obligations as they fall
‘due. The company's approach to managing liquidity is to ensure, as far as possible, that it will always
have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damages to the company's reputation. The following
are the contractual maturities of financial liabilities, including interest payments and excluding the
impact of netting agreements.
pe stones ae Z os
Carrying Contractual Sixtotwelve One tofive More than
Amount ~ Cash flows months years five years
Rupees,
Non - derivative
Financial liabilities
Trade and other payables 78,000 78,000 - : =
78,000 78,000 : =
2014
Carrying Contractual Sixtotwelve One tofive More than
Amount Cash flows months years five years
Rupees,
Non - derivative
Financial liabilities
Trade and other payables 78,000 75,000 13,000 : :
78,000 75,000 13,000 - -
19.2.1 The contractual cash flows relating to the above financial liabilities have been determined on the basis
of mark up rates effective as at June 30. The rates of mark up have been disclosed in relevant notes to
these financial statements.
35. 19.3
Market risk is the risk that the value of the financial instrument may fluctuate as a result of changes in
market interest rates or the market price due to @ change in credit rating of the issuer or the
instrument, change in market sentiments, speculative activities, supply and demand of securities, and
liquidity in the market. The company is exposed to currency risk and interest rate risk only.
19.3.1 Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market interest rates. Majority of the interest rate exposures arises
from short and long term borrowings from bank and term deposits and deposits in PLS saving accounts
with banks, At the balance sheet date the interest rate profile of the company’s interest bearing
financial instrument is as follows.
2015 2014
Rupees Rupees
” Fixed rate instruments
19.4
Financial liabilities a :
Variable rate instruments
Financial liabilities ‘ 5
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 and loss. Therefore, a change in interest rates at the reporting date would not affect profit and
loss account.
Cash flow sensitivity analysis for variable rate instruments
‘A change of 100 basis paints in interest rates at the reporting date would have increased / (decreased)
equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in
particular foreign currency rates, remain constant. The analysis is performed on the same basis for June
30,2014. ’
Equity
100 bp 100 bp 100 bp
decrease increase decrease
Cash flow sensitivity - variable rate instruments 2015 = = F
Cash flow sensitivity - variable rate instruments 2014 S 5 =
Fair value of financial assets and liabilities
‘The carrying value of all financial instruments reflected in the financial statements approximate to their
fair values. Fair value is determined on the basis of objective evidence at each reporting date.
26 19.5. The effective rate of interest / mark up for the monetary financial assets and liabilities are mentioned in
20
a
22
2B
respective notes to the financial statements.
CAPITAL RISK MANAGEMENT
The company's prime object when managing capital is to safeguard its ability to continue as a going
concern in order to provide adequate returns for shareholder and benefits for other stakeholders and
to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the company may adjust the amount of dividends
paid to shareholders, issue new shares or sell assets to reduce debt.
Consistent with others in the industry, the company monitors capital on the basis of the gearing ratio.
The ratio is calculated as total borrowings divided by total capital employed. Borrowings represent long
term financing, long term loan from directors and others and short term borrowings. Total capital
employed includes total equity as shown in the balance sheet plus borrowings.
2015 2014
Rupees Rupees
Borrowing = 2
Total 9,745,987 _12,987,346
Total capital employed Rupees 9,745,987 12,987,346
Gearing Percentage - -
PLANT CAPACITY AND PRODUCTION
‘Since the company has sold out its plant therefore no analysis has been given.
‘TRANSACTIONS WITH RELATED PARTIES.
Related parties comprise subsidiaries, directors and their close family members, major shareholders of
the Company, key management personnel and other companies under common management.
Transactions with related parties are on arm’s length. Remuneration and benefits to executives of the
Company are in accordance with the terms of the employment . No remuneration was paid to chief
executive, directors and executives which is disclosed in note 18 to the financial statements.
Details of transaction balances with related parties are as follows:
2015 2014
Rupees Rupees
HMI Energy (Pvt) Limited - Associate
- other receivables 4,000,000 4,000,000
NON-ADJUSTING EVENT AFTER THE BALANCE SHEET DATE
There is no adjusting event after the balance sheet date
a 24 GENERAL
24.1 The number of employees of the Company as at June 30, 2025 is 2 (2014: 2)
24.2 Figures have been round off to the nearest rupees
24,3 Certain prior year comparatives have been reclassified to conform to the current's years
presentation.
25. DATE OF AUTHORIZATION FOR ISSUE
These financial statements have been authorized for issue on October 02, 2015 by the board of
directors of the company.
(CHIEF EXECUTIVE DIRECTOR
38. TAHA SPINNING MILLS LIMITED
PATTERN OF HOLDING OF SHARES HELD BY
“THE SHAREHOLDERS AS AT JUNE 30, 2015
Wo. rare ‘Shares
Shareholders, Holding Hela
2 7 Te 3
6 101 To 25330
57 01 To 87.000
v2 1.003 1 327500
38 5.001 To 208717
8 10.001 To 120500
6 15,001 to 112000
8 20.001, to 138.000
4 25.001 te 108,500
: 30001 To :
: 35,001, To e
i 40.001, To 43000
2 45.001 To 5
7 50001 To 4
‘55.001 To 3
60.001 To c
1 65,001 To 163.000
70,001 To
" 75.001 To 5
: 80,001 To é
85,001 To %
1 90,001 To 92,500
1 95.001 To 100,000
100,001 To
E 105,001 To i
: 115001 To
zs 120,001 To
= 130,001 Te
‘ 135001 To 140000
é 140,001 “10
: 145,001 To é
1 150,001 To 180.300
= 155.01 To :
: 160,001 To :
z 165,001 To 5
x 179,001 To
175,001 To 2
i 180,001 To i
: 185,001 To :
: 190,001 To :
a 195,001 To 3
i 200,001 To 213,100
: 20.901, i
: 300.01 To :
350,001 To y
2 400.201 To
: 420.001 To =
: 500.001 To :
1.000.001 To .
1500.00 To 2
4 2.000.001 Te 2,021,500,
7,950,000, (CATEGORY WISE SUMMARY OF SHAREHOLDERS
Categoy Not Share
Name Shareholders Wold
Travdues cy Te58 155 2588
Joint Stock Companies 7 2.191.801 sz
Grand Total == ==
