~ Ny, Naveed Muthtar & Go, Chartered Accountants | | UNITED AUTO INDUSTRIES (PRIVATE) LIMITED ia” FINANCIAL STATEMENTS | * FOR THE YEAR ENDED 30TH JUNE, 2020 { | LAHORE “TEL: 492 42) 96947433-4 FAX: +92 (42) 35047435Naveed Mukhtar & Co. Chartered Accountants INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF UNITED AUTO INDUSTRIES (PRIVATE) LIMITED REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS ‘Quatified Opinion Ct the annexed fhancial statements of United Auto industries (Prv=te) Limited (the Company), which wre srrte of statement of nancial postion as at 20th June, 2020, ene the statement of profit or loss account, the saeser of comprehensive income, the statement of changes in eat. Mo ‘statement of cash flows for the year then caterer oe wo the fhancll statements, ncusing @ summary of Serica accounting policies and other ences y information, ang we state thet except ror the eficts of ee tiscussed in the Basis for Qualified SySkion secon of our report, we have obtained al the information and sxplanations which, tothe best of our knowledge er polis, were necessary for the purposes of the aut Jn our opinion and tothe best of our Information and avcorcing fo fe ‘explanations given to us, except for the effects of (roan Sher clecussed in the Basis for Qualified Opinion section of Sut Teport, the statement of financial position, the are rrcant of profit or loss account, the statement of comprehensive income, the statement of changes in equity and the Setement of cash flows together with the notes forming Part thereof conform with the accounting and reporting ae errete ae applicable in Pakistan and glve th Information requires PY ‘the Companies Act, 2017 (XIX of 2017), in the ere oo required and respectively give a trie and ft view of he “state of the Company's affairs as at 30th June, 2020 rey tne prof, ether comprehensive income, the changes in equity ‘and its cash flows for the year then ended. Basis for Qualified Opinion aes a vempoyee Benefits’ of the {atemaional Financial Reporing Standards (IFRS Standards) Issued by the Ae ve fonal Accounting Standards Board (/ASB), as rotied under ie ‘Companies Act, as not been adopted by ee ampany (note 2-1). Consequenty, nether the selected accountg poliey of the Company in respect of "Employees ane ope Benes (note 2.11) s content wih the apecable epo°S framework nor the Company has carried out Retort valuation, as required under the aforesaid IAS, of staf ral ‘employee benefit obligations) amounting to RS. ae ap.e58)-, payable on 30th June, 2020 (note 47). inthe absence ‘ frelated information, we have not been able to Serine te impact of such valuation, on these Financial Statements. We conducted our ausit in accordance with international standards on Auditing (\SAs) es applicable in Pekistan. Our Wee efiies under those standards aro further descited it the Aucitor’s Responsibilities for the Audit ofthe Financial tesronsis sealon of our report. We are independent of the Campa ‘accordance with the International Ethics Se reregg Board for Accountants’ Code of Ethics for Professional ‘necountents as adopted by the Insitute of Chartered aarwintants of Pakistan and we have fuifiled cur other ethical Tesponsibiies in accordance with the Code. We believe ere aut evidence we have obtained Is sufficient and eppropriste to provide a basis for our qualified opinion. information Other than the Financial Statements and Autor s Report Thereon tanagement is responsible forthe other information. The olor information comprises of Directors’ Report included In aaa aera reper, but does not include the fnanciel statements and our ‘auditor's report thereon. our opinion on the financial statoments does not cover the ‘other information and we do not express any form of assurance conclusion thereon, tn connection with our aust of the financial statements, OFF responsiiliy isto read the other Information an In doing wa °onsider whether the other information is materially core ent wih the financial statements or our Knowledge SPiained in the auelt or otherwise appears to bo material restated. If, based on the work we have performed, We ceratyde that there is a material misstatement of this other Information, We are required to report that fact. We have eye to report in this regard.Nyy Navaed Mukhtar & Co- Chartered Accountants i Rosponsiaiites of Management and Board of Directors for the Financial Statements Management Is responsible for the preparation and fal presenta, Of the financial statements in accordance with the erasing and reporting standards a8 applicable in Pakistan anc the requirements of Companies Act, 2017 (XIX of |, 2517) and for such internal contol as management determines is necessary 10 enable the preparation of financiat ao renants tnt are fee from material misstatement, whether due to fraud oF error in preparing the financial staternents, management is responsible for assessing the Company's abiity to continue 2s @ i TJaing concern, discosing, 28 applicable, matters related to going Caer ‘and using the going concern basis of \ gene acing unless, management ether intends to liquidate the Company oF ‘to cease operations, or has no realistic t alternative but to do so. | aoard ofcrectors are responsible fr overseeing the Company's financial reporting process, ‘Auditor's Responsibilities for the Audit ofthe Financial Statements aerejectves are to oblain reasonable assurance about whether te financial statements as @ whole are free from 1 oer et misstatement, whether due to fraud or error, and to inset ‘auditor's report that includes our opinion : mater ie aseurance is a high level of assurance, puts not @ quaranics that an audit conducted in accordance with Reasonable fable in Pakistan wil avays detect @ material misstatement ‘when it exists Misstatements can arise from Has e Sror and ore considered material ft inéividualy orm the ‘aggregate, they could reasonably be expected to trivence the economic decisions of users taken on the basie of these ‘nancial statements. | ‘hs part of an audit in accordance with ISAs as applicable in Pokistan, we exercise professional judgment and maintain eI professional skepticism throughout the audit We also «ently and assess the sks of material misstatement ofthe nancial Sorte wether due to fraud or error, seer er perrin aud procedures responsive to tase fsks, Gnd SST ‘audit evidence thet is sufficient and 1 ‘appropriate to provide a basis for our opinion. The ek of not detecting 2 material misstatement resulting from fraud ‘ seroP te pen for one resulting from error 28 fraud may ive clusion fergery, intentional omissions, i ssrepresentations, or the override of intemal contrl. | + obiain an understanding of internal contol relevant to the aud order to design audit procedures that are | Spproprate in the cifeumstances, but not for the purpose ‘of expressing an opinion on the effectiveness of the [ ‘Company's internal control. ' «= Eveluate the appropriateness of accountng policies used er the reasonableness of accounting estimates and related disciosures mada by management. «conclude onthe appropiteness of managements use f the going concer” Pas s2ccounting and, based on the Conclude on Ie soeisea, whether «materiel uncertainty ests related ie VOT ot ‘conditions that may cast aun een ubt on tne Company's avy to continue a= @ going concer ‘conclude that a material uncertainty | significant dove chved to draw atfonton in our audorsrepor tote rated Smee in the financial staternents ors ielosutes are inadequate, to modify our opinion, Ou concen ‘based on the aucit evidence OF Such ete date of our ators repor. However future events or condiion® may cause the Company 10 ‘cease fo continue 2s a going concer. «e Evaluate the overall presentation, structure and content of he financial statements, including the disclosures, and | Evaite fnancil staiements represent the urderying transactions ‘and events in a manner that achieves falr ‘ presentation. We communicate wth the board of directors regarding, among other matters, the planned scope and timing of the aucit We coficant audit ndings. iaducing any signcent deficiencies ir intemal control that we identify during our audi[S Ne Naveed Mukhtar & Co. Chartered Accountants Report on Other Legal and Regulatory Requirements Based on our audit, we further report that in our opinion: 2) ») ° d) ev ‘engagement partner on the audit resulting in th vebat forthe effects of the matter discussed in the Basis for Qualified Opinion section of our report, proper Se aceount have been Keptby the Company as required by the Companies Act 2017 (XIX of 2017); except forthe effects of the matter ciscussad in the Basis for Gualiieg Opinion section of our report, the orc IO of nancial pesto, the statement of prof or css account the statemett of ‘comprehensive income, sete rneerent of changes in equly and the statement of cash flows together wih Me notes thereon have bear hewn up in conformity with the Companies Act, 2017 (KIX of 2017) and the same are in agreement with the books of account; and except for the effects of the matter discussed in the Basis, for Qualls Opinion section of our report, ener s made, expensdture incurred and guarantees extended during the year were ‘or the purpose of the ‘Company's business; and mo zekat was deductible at source under te Zakat and Ush Ordinance, 1980 {XMlll of 4980). independent ausitor's report is Naveed Mukhtar Rana. Nowead Mut bn. Chere Redoutante Lahore Sth October, 2020| | UNITED AUTO INDUSTRIES (PRIVATE) LIMITED STATEMENT OF FINANCIAL POSITION AS AT 30TH JUNE, 2020 ASSETS NON-CURRENT ASSETS Proper, Plant and Equipment Rightotuse Assets Intangible Assets Long Term Deposits Deferred Tax Asset CURRENT ASSETS ‘Slock in Trade ‘Trade and Other Receivables ‘Short Term investments Prepayments and Advances Income Tax Refundable Cash and Bank Balances EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES ‘Authorized Share Capital: {6,000,000 (2018: 6,000,000) Ordinary Shares of Rs.10 each Issued, Subsoribed and Paid up Capital Revenue Reserve (Un-appropriated Profit) NON-CURRENT LIABILITIES. Long Term Financing Lease Liability Employee Benefit Obtigations (CURRENT LIABILITIES ‘Trade and Other Payables Snort Term Financing CONTINGENCIES AND COMMITMENTS a Notes from 4 to 39 form an integral part of these Financial Statements, Sem tan DIRECTOR 2020 2019 NOTE RUPEES RUPEES 4 4,068,830.748 —1,115,190,878 5 58,954,901 ~ 6 6.219.445 6,035,119 7 16,555,449 21,185,949 8 31,698,344 _ 148,618,706 7,182,258,887 ~ 7,290,976.647 9 [664 e82, 562] [558617 152 40 | 662,600,508 | | 875,034,770 rT 4,305,209 4,471,940 42 | 240379,118| | 260,707,720 ‘492,796,682 | | 318,852,567 49 | 2,402,347,842 | |_4,517,758,283 4,454210,921 _9,572,386,432 ERE ATO, 4,005,515, 078 {60,000,000 60,000,000 14 55,798,810 55,798,810 4,877,490,087_ _1,401,368,330 71,933 288,897 1,457,167,140 18 [24,750,000 : 18 31,328,322 53,168,160 17 |__67,142,653, 54,250,150 723,216,975 107,425,310 48 [3434766930] [3.225,690,560 19 |_ 145,178,006 "75,087,069 F,579.964,936 —3,298,720.629 TERE AOS MOE FT TITS 20 : Jaa ron CHIEF EXECUTIVE ASOUNITED AUTO INDUSTRIES (PRIVATE) LIMITED. STATEMENT OF PROFIT OR LOSS ACCOUNT FOR THE YEAR ENDED 30TH JUNE 2020 85.38 ; 2020 2019 ] NOTE RUPEES RUPEES | SALES 21 12,650,928,579 14,056,109,268 COST OF SALES 22 14818250.400 12,002.190,676 GROSS PROFIT TIRE OTA TEST. 065,976.502- E MARKETING AND DISTRIBUTION EXPENSES 23 427,285,645 507,843,376 [ADMINISTRATIVE AND GENERAL EXPENSES za | s54140.965 || 158,096:737 Uy OTHER OPERATING EXPENSES 2s |__aag05e71 || 93076769 b cosatza71 700.454.8602 | OPERATING PROFIT before Other Income ETT STB OTHER INCOME 25 tea.g047a4 =, t,44 t “=. OPERATING PROFIT after Other Income TOT ST TER || Fiance cost a aosrsis 7.799.027 | * port FOR THE YEAR before Taxation EMT AST i INCOME TAX EXPENSE 28 496,405,192 196,968,420 NS] PROFIT FOR THE YEAR after Taxation Te. ST i EARNING PER SHARE - Basic and Disted 8538 se.38 | ‘The ganexed Notes rom 1 to 39 form an integral pat ofthese Financial ‘Statements. Sime hob. Lk hey DIRECTOR CHIEF EXECUTIVETEESE er UNITED AUTO INDUSTRIES (PRIVATE) LIMITED. STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30TH JUNE, 2020 2020 PARTICULARS, NOTE RUPEES Profit for the Year after Taxation 476,124,757 (Other Comprehensive income E ‘Total Comprehensive Income ae “The annexed Notes from 1 to 39 form an integral part of these Financial Statements. oe? Fi Ane. yen Ans, DIRECTOR CHIEF EXECUTIVE 2019 RUPEES 314,609,477UNITED AUTO INDUSTRIES (PRIVATE) LIMITED ‘STATEMENT OF GASH FLOWS, FOR THE YEAR ENDED 30TH JUNE 2020 (CASH FLOW FROM OPERATING ACTIVITIES Profit before Taxation ‘Agjustments for: ‘Depreciation of Operating Assets Depreciation of Right-of-use Assets ‘Amortization of Inlangible Asset Provision for Staff Gratuity Return on Bank Deposits Dividend income Loss / (Gain) on Re-measurement of Investment Gain on Disposal of Operating Assets Allocation for Workers (Proft) Participation Fund Provision for Workers' Welfare Fund Finance Cost (CASH GENERATED FROM OPERATIONS (increase)/Decrease in Current Assets Stock in Trade Trade and other Receivables Prepayments and Advances Increase/(Decrease) in Current Liabiltios ‘Trade and Other Payables Finance Cost Pald Staff Gratuity Peid Workers (Profi) Participation Fund Paid Income Tax Paid NET CASH INFLOW FROM OPERATING ACTIVITIES (CASH FLOW FROM INVESTING ACTIVITIES Retum on Bank Deposits Dividend Income Payment for Acquisition of Operating Fixed Assets Payment for Acquisition of Right-of-use Assets Payment for Acquisition of intangible Assets Proceeds from Disposal of Oparating Fixed Assets Long Term Deposits Short Term Investments NET CASH INFLOW FROM INVESTING ACTIVITIES (CASH FLOW FROM FINANCING ACTIVITIES, Disbursement of Long Term Financing Finance Lease Liablity- net NET CASH INFLOW / (OUTFLOW) FROM FINANCING ACTIVITIES NET INCREASE IN CASH AND CASH EQUIVALENTS GASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR, CASH AND CASH EQUIVALENTS AT END OF THE YEAR 2020 2019 NOTE RUPEES RUPEES CBE SIESAD TESTI ET STH TES BOO. 42,638,743 7 2'308.584 4,807,602 26,282,903 11,463,120 (183,993,700) (67,373,307) (153.528) (151.2968) 2,770) 51,810 (9.754.745) (688,139) 37,571,846 28,686,290 43)889,483 9.444.818 8,037,513 7,738,027 6,768,048) 2712.88, 53,760,508 477,680,709 BEA] FBT DRL SE 212,936,262 59,907 463 20,328,602 248,958,523 186,588,534 (180,992,205) —359,380,985_| 7007, 147,888 Bsr. 513) (13,399,480) (26,636,290) (82,938,520) (233,431,946)| (a75.127,984)\| |) (287,565,208) (617,249,801) 725 576.500 562.1 TEE HB TON BrST8 a7 163,528 181,968 (75,478,139) (72,027.76) (19.479.401) 2.488,910) (3,081,588) 48,815,000 *,080,000, 4,630,500 2,018,107 (130,499), (429,172) 6,014,780 75,374,866 35,000,000, 5 (26,505,380) (2,699,947) 6,404,820 (2.508.947) wie 086,080 569,077.280~ 4,463,873,553 894,886,323 38 28196055 __1ASS.BTS SES “The ennexed Notes from 1 10 39 form an Integral part of these Financial Stateryents wf Berm yor— DIRECTOR on, CHIEF EXECUTIVE eSUNITED AUTO INDUSTRIES (PRIVATE) LIMITED, STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30TH JUNE, 2020 7 REVENUE fa * PAID-UP : CAPITAL | anaemnnnn | TOTAL ner PARTICULARS NOTE R P E s s | | Balance as at 30th June, 2018 - as restated 55,798,810 1,086,758,853 _1,142,587,663 i Profit forthe Year | ended 30th June, 2019 - 314,609,477 314,609,477 f Other Comprehensive Income - - 7 Total Comprehensive Income | for the Year ended 30th June, 2019 - 314,609,477 914,809,477 \ PEEPHEH Hero Peer ee ee eee ee eee eee t Balance as at 30th June, 2019 BE 798 810 — 1,407,368,930 1,457,167,140 ' bP ' Profit for he Year ( ‘ended 30th June, 2020 - 476,121,787 || 476,124,787 ion t ‘Other Comprehensive Income - - - [| 4 Total Comprehensive Income | for the Year ended 30th June, 2020 = 476,124,757 476,121,757 i 1 Balance as at 20th June, 2020 FETSE NO, TST ABO OHT_ 7.935.208 097 | a aes uy “The annexed Notes from 1 to 39 form an integral pert of these Financial Statements, ow Same ye det erty DIRECTOR CHIEF EXECUTIVEUNITED AUTO INDUSTRIES (PRIVATE) LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30TH JUNE 2020 1 CORPORATE AND GENERAL INFORMATIO} ‘1-1 LEGAL STATUS AND OPERATIONS (@) United Auto Industries (Private) Limited (“the Comy Private Limited Company under the provisions of Companies Act, 2017). pany") was incorporated on 46th May, 2007 as a the repealed Companies Ordinance, 1984 (now The principal activiy of the Company is AssemblingManut Tre pina acy pany mblnghManutacturing and Sale of Motorcycies and (®) In terms of classification for the companies under clause (a) of serial No.2 of table fer clause the third to the Companies Act, 2017, the Company Isa Yarge sized (LSC) Company! ne Hmre schedule, (©) The geographical locations and addresses of the Company's business unis, including plant are as lows: () Registered office at 75-E, Shoukat Ali Road, Johar Town, Lahore. (i) Plant at 1-KM OF, Multan Road, Kot Radha Kishan Road, Phool Nagar. 4.2. IMPACT OF COVID-19 ON THE FINANCIAL STATEMENTS he World Health Organization declared COVID-19 a global pandemic on 11th March 2020. Accordingly, on 20th March 2020, the Government of Pakistan announced temporary lock down as a measure to reduce the Spread of COVID-19. The outbreak of COVID-79 has had a distressing impact on oversll demand in the global economy with notable downgrade In growth forecasts, The Company's management is fully cognizant of the business challenges posed by the COVID-19 outbreak ‘and closely monitoring the possible impacts on the Company's operations and liquidlty positions and believes: that its current policies for managing credit, liquidity and market risk are adequate In response to current situation, ‘The management has assessed the impact of the COVID-19 on the financial statements and concluded that, there is no material financial impact of COVID-19 on the carrying amounts of assets, lablities and on income (oF expenses which required specific disclosures. 2 BASIS OF PREPARATION 24. STATEMENT OF COMPLIANCE ‘These finencial statements have been preps e applicable in Pakistan, except IAS-19 "Employess Benefis’. The ‘applicable in Pakistan comprise of: is International Accounting ‘Standards (IFRS Standards) issued by the sores notte 1¢ Companies Act, 2017; and ed in accordance with accountng and repeting standards 28 epoyeee Berk Accounting end reporting standards © International Financ n ‘Standards Board (IASB) as notified under th «Provisions of and directives issued under the Companies Act, 2017, in items, 2.2 BASIS OF MEASUREMENT neon prepared under the historcal oes convention, except fr certs tem financial state caete loved inthe relavant accounting polcies below as yrds as applicable in ATES A ee ith approved accounting standar eri Siatments fr coer rate and saaumptone tht effet he eppication of a ia ants bles, noame and exPeNSeS 2.3 USE OF ESTIN reperaten oi Freon reaures managere ‘ecounting ‘oles and the reported amoNotes to the Financial Statements United Auto Industries (Private) Limited fot the Year ended 30th June, 2020 24 25 2.8 ‘The estimates and associated assumptions are based on historical experience and various other factors that the resus of which form the basis of making the Jucgments about the carrying values of assets and lables that are not realy spparent from other sources. ‘Actual results may differ from these estimates. Estimetes end underying assumptions are reviewed on an “ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates is revised if the revision effects only that period, or in the period of the revision and future periods ifthe revision effects both current and future periods. Judgments made by the management in the application of approved accounting standards, as applicable in Pakistan that have signiticant effect on the financial statements, and estimates that have a significant risk of fsuting in 2 mate! agusimets in the suteequet yeas involve following areas of these financial statements, ~ Depreciation rates for useful ife of the operating fixed assets: (Note 42) = Staff Retirement Benefits (Note 17) = Revenue Recognition (Note 21) = Warranty Obligations (Note 18.2) ~ Texation (Note 28) STANDARDS, INTERPRETATIONS AND AMENDMENTS TO PUBLISHED APPROVED ACCOUNTING STANDARDS THAT ARE EFFECTIVE IN CURRENT YEAR AND ARE RELEVANT TO THE COMPANY Following standard, interpretation and amendments to published approved accounting standards are mandatory for the Company's accounting periods beginning on or after 01 July 2018: © IFRS 16 ‘Leases’ @ IFRSQ (Amendments) ‘Financial Instruments’ fe IFRIC 23 ‘Uncertainty over Income Tax Treatments! @IASB's Annual Improvements to IFRSs: 2016 - 2017 Cycie ‘The Compeny had to change its accounting policies and meke certain amendments without restating prior Year result, flowing the adoption of IFRS 16. These are stated in note 31 in these financial Staremenlts yee ver ihe other amendments and interpretation sted above do not have any impact on the amounts cewgnisod in prior periods and are nat expected to significantly affect the current o future penogs, STANDARDS, INTERPRETATIONS AND AMENDMENTS TO PUBLISHED APPROVED ACCOUNTING STANDARDS THAT ARE EFFECTIVE IN CURRENT YEAR BUT NOT RELEVANT TO THE: COMPANY Seana iiher stangara and amendments to publshed standards that are mandatoy fo" ‘accounting period pogining on oF afer C1 July 2019 but are considered not tbe relevant or do ho neve AO significant impact aa Compari’® francial statements and are therefore not detailed in these nancial statements. Following amendments to existing standards have been published and are mandatory for the Company's .riods beginning on or: after 01 July 2020 or later periods: zi H eee ‘Accounting Estimates and Errors’ (effective for annual periods ae caes or = a nti o = al in easier to ur ‘The amendments are intended to make the definition of material ea of iter the underlying concept of | ‘materiality in IFRS. Jn addition, rekindle goer wen oases mere mots geamgn on wea= Notes to the Financial Statements United Auto Industries (Private) Limited | forthe Year ended 30th Juno, 2020 pe «On 28 March 2048, the International Accounting Standards Board (the IASB) has issued @ revised 1. one Framework, The new Framework: reitoduces the terme siowardship and prudence: firodvens 2 new asset definition that focuses on rights and a nev jabilty definition that is tkely to Be troader than the definition it replaces, but does not change the distinction between a labllty and an aul instrument: removes from the asset and labity defnitons references to the expected flow Sf coer enie bonefts-this lowers the hurdle for identifying the existence of an asset or fabilty end puts j seo cmphesis on reflecting uncertainty In measurement; discusses historical cost and current value i reueures, and provides some guidance on how the ASB would go about selecting a measurement i Tle or a oarticular asset or labity; states that the primary measure of financial performance is profit procs, and that only in exceptional circumstances wil the IASB use other comprehensive income and f ny for income or expenses that arise from @ change inthe current value of an asset or liability: an Seevseoe uncertainty, derecognition, unit of ecoount, the reporting entty and combined fnanciet sects. The Framework ls not an IFRS standard and does net override eny standard, so nothing wi Srakre in the short form, The revised Framework will be used in future standard-setting decisions, but | sreaRenges wil be rade to current IFRS. Preparers might also use the Framework to assist them 10 i Jeveloping accounting policies where an issue Is not addressed by an IFRS. It is effective for annual senece beginning on oF after 4 January 2020 for preparers that develop an accounting policy based on the Fremework. > Interest Rate Benchmark Reform which amended IFRS @ ‘Financial Instruments’, IAS 39 Financia) reereetents, Recognition and Measurement and IFRS 7 ‘Financial Instruments: Disclosures’ is eeieabie for annual financial periods beginning on or after 1 January 2020. The G20 asked the Saewcae Stebity Board (FSB) to undertake 2 fundamental review of major interest rate Denchmars. Fotowing the reviow, the FSB published a report setting out Its recommended reforms of some malor interest sate bonchmarks such a8 IBORs. Public authorties in many Jurisdictions have since taken stops crestmmont those recommendations, This hes In tur lad to uncertainty about the fong-term viability of | er isoreat rate Benchmarks, In these emendments, the term interest rate benchmark reform relers Tor ereetwige reform of an interest rate benchmark including its replacement with an altematve eer mrk rate, such as that resuting ‘rom the FSB's recommendations set out in its July 2074 report aetounig Major Interest Rate Benchmarks’ (he reform). The amencments made provide relief or the potential effects ofthe uncertainty caused by the reform. A company shall apply the exceptions 0 ail hedging relationships directly affected by interest rate benchmark reform. «¢ Classifcation of liablities as current or non-current {Amendments to IAS 1 ‘Presentation of Financia eects) tteotive for the annul period beginning on ot after 4 January 2022. These amendments Betelodards have deen added to further ciarty when a lability fs Gaseiied as current. The stendavd oe eerie the aspect of classiiction of lability 2s non-current by requiring the assessment of the anny right at the end of the reporting peried to defer the settement of labily for et least Naive arene aftr the reporting pariod. An entity shall apply those amendments retrospectively in accordance vith IAS 8 ‘Accounting Policies, Changes in Accounting Estimates and Errors. e Onerous Contracts — Cost of Fuliing a Contract (Amendments to IAS 37 ‘Provsions, Contingon oreo cod Gentingent Asbote) effective for the anal period beginning on or after 1 January 2022, aaaane IAS 1 "Presentation of Financial Statements’ by mainly adding paragraphs which clarifies what f aMmprise the costo ulin a contract. Cost of fufllng a contracts relevant when determising whether Seerrset ie onerous. An entity is required to apply the amendments to contracts for which it has not Yet i are ct its obligations at the beginning of the annual reporting period in which it frst apoies the sai aot ihe date of inilal application). Restatement of comparatwe information is not requred, arrend| the wmendmente require an entiy to recognize the cumulative effect of intialy appiying the ie ee eGo an adjustment to the opening balance of retained eamings or other component of ‘equity, 28 appropriate, at the date of intial application. . wwNotes to the Financial Statements United Auto Industries (Private) Limited for the Year ended 30th June, 2020 ‘+ Property, Plant and Equipment: Proceeds before Intended Use (Amenciments to IAS 16 ‘Property. Plant ‘and Equipment) effective for the annual period beginning on or after 1 January 2022. Clarifies that sales i proceeds and cost of tems produced while bringing an item of property, piant and equipment to the focation and concition necessary for it to be capable of operating in the manner intended by management e.g. when testing ete, are recognized in profit or loss in accordance with applicable I Standards, The entity messures the cost of those items applying the measurement requirements of IAS 2 inventories. The standard also removes the requirement of deducting the net sales proceeds from by ost of testing. An entity shall apply those amendments retrospectively, but only to items of property, plant and equipment that are brought tothe location and condition necessary for them to be capable of Sperating in the manner intended by management on oF after the beginning of the earlest period presented in the financial statements in which the entiy frst apples the amendments, The entity shall Fecognize the cumulative effect of intially applying the amendments 88 an adjustment to the opering balance of retained earnings (or other component of equity, as appropriate) at the beginning of thet WW eartiest period presented, “The following annual improvements to IFRS standards 2018-2020 are effective for annual reporting periods beginning on or after 1 January 2022. SIFRS 9 ‘Financial Instruments’ - The amendment clarifies that an entity includes only fees paid or Teosived between the entity (the Borrower) and the lender, including fees paid or received by either the | tently oF the lender on the other's behaif, when it applies the "10 per cent test in paragraph B3.3.6 of || IFRS 9 in assessing whether to derecognize a financial liability i i © IFRS 16 ‘Leases’ - The amendment partially amends illustrative Example 13 accompanying IFRS 18 | ‘Leases’ by exeluding the ilustration of reimbursement of leasehold improvements by the lessor. The objective ofthe amendment is to resolve any potential confusion that might arse in lease incentives “The above amendments and improvements do not have @ material Impact on the financial statements. t 2:7 STANDARDS AND AMENDMENTS TO APPROVED PUBLISHED STANDARDS THAT ARE NOT YET EFFECTIVE AND NOT CONSIDERED RELEVANT TO THE COMPANY . ‘There are other standards and amendments to published standards thet are mandatory for accounting periods beginning on or after 01 July 2020 but are considered not to be relevent or do not have any significant Impact on the Company's financial statements and are therefore not detailed in these financial statements. | 2.8 FUNCTIONAL AND PRESENTATION CURRENCY ‘These Financial Statements are presented in Pakistani Rupees which is the Company's functional and presentation currency. 2.9 FIGURES ‘Amounts presented in the financial statements have been rounded off to the nearest of Rupee, unless atherwise stated. Figures of the previous year, are rearranged and reclassified, wherever necessary to reflect more appropriate presentation of events and transactions for the purpose of comparison. 3. SIGNIFICANT ACCOUNTING POLICIES \ ‘The significant accounting policies set cut below have been consistantly applied to all periods presented in these financial statements, except as disclosed In note 3.1 we | :E 7 | | Notes to the Financial Statements for the Year ended 30th June, 2020 3.1 CHANGES IN ACCOUNTING POLICIES The Company has adopted IFRS 16 from Ot July 2019, The standard replaces IAS 17 ‘Leases’ and for lessees eliminates the classifications of operating leases and finance leases. Except for short-term leases and leases of low-value assets, rightof-use assels and corresponding lease labilties are recognized in the Statement of financial postion, Straight-line operating lease expense recognition is replaced with a ‘depreciation charge for the rightof-use assets (Included in operating costs) and an interest expense on the recognized lease fiabilties (icluded in finance costs). In the earller periods of the lease, the expenses ‘associated with the lease under IFRS 16 willbe higher when compared to lease expenses under IAS 17, a8 the operating expense is now replaced by interest expense and depreciation in the statement of profit or loss. For classification within the statement of cash flows, the interest portion is disclosed in operating activities and the principal portion of the lease payments are separately cisclosed in financing activites. For lessor ‘accounting, the standard does not substantially change how a lessor accounts for leases. The Company has adopted IFRS 16 without restating prior period resuts. Key changes in accounting policies resulting from adoption of IFRSS 16 are as follows: Rightof-use Assets A rightof.use asset is recognized at the commencement date of a lease. The right-of-use asset is measured ‘at cost, which comprises the Initial amount of the lease liablity, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any intial direct Costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset. Right-cf-use assets are depreciated on a straightline basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is shorter. Where the Company expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is charged over its estimated useful life. Right- of use assets are subject to impairment or adjusted for any re-measurement of lease liabilities. “The Company has elected not to recognize @ rightot-use asset and corresponding lease lablity for short- term leases with terms of 12 months or lass and leases of low-value assets, Lease payments on these assets are charged to income as incurred, Lease Liabilites Alease lably is recognized at the commencement date of a lease. The lease liabily is initially ecognized at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate impli in the lease of, if that rate cannot be readily determined, the Company's incremental borrowing fate, Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penaities, The variable lease payments that do not depend on an Index or a rate are ‘expensed inthe period in which they are incurred, Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are re-measured if there is @ change in the following: future lease payments arising from a change in an index Of a rate used; residual guarantee; lease term, certainty of a purchase option and termination penalties. When a lease liabilty is re-measured, an adjustment is made to the corresponding right-of-use asset, oF to statement of proft or oss if the carrying amount of the right-of-use asset Is fully written down, Impact on adoption of IFRS 46 on these financial statements as on 1st July, 2019 IFRS 16 has been adopted using the modified retrospective approach and as such the comparatives have not been restated. The impact of adoption as at 1st July, 2019 are as follows: AMOUNT PARTICULARS: RUPEES Property, Plant and Equipment decreased by 68,984,901 Right-of-use Assets increased by 58,954,001 wy United Aute Industrles (Private) Limited HNotes to the Financial Statements for the Year onded 30th June, 2020 3.2 PROPERTY AND EQUIPMENT (a) Operating fixed assets Initial Recognition Propety, plant and equipment (except freehold land, buildings on freehold land, plant and machinery and electric installations) are Initially recorded at cost. Cost ineludes purchase price and all incidental expenses incurred up to the date of operation. ‘Subsequent measurement Subsequently, the items of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses, if any. Freehold land, buildings on freehold tand, plant and machinery and electric installations are stated at revalued amounts less accurnuiated depreciation and impairment losses, if any. Normal repairs and maintenance costs ere charged to statement of profit or loss as and when incurred. ‘Major renewals and improvements are capitalized. Gains and losses on disposal of property, piant and ‘equipment are taken to statement of profit or loss. Depreciation Depreciation on fixed assets is charged to the statement of profit or loss on reducing batance method so 2s to write off the depreciable amount of an asset over its estimated remaining usefu! life at the rates siven in Note 4.2, Depreciation commences from the month in which the asset is available for use and is ceased at the ‘end of month, preceding the month in which asset is disposed off or de-recognized. Residual values and the useful lives of assets are reviewed at each financial year end and if expectations differ from previous estimates, the change Is accounted for as change in accounting ‘stimate in accordance with IAS 8 - Accounting Policies, Changes in Accounting Estimates and Errors. Disposal ‘an Kem of property, plant and equipment is derecognized upon disposal or when no future economic ‘penefis are expected from its use or disposal, Any gain or loss arising on derecognition of the asset (calouleted es the difference between the net disposal proceeds and carrying amount of the asset) 1s included in the statement of profit or loss in the year in which the assets derecognized. Judgment and Estimates ‘The useful lives and depreciation rates are reviewed on a reguiar basis. The effect of any changes in estimate is accounted for on a prospective basis. {b) Capital work-in-progress ‘These are siated at cost less identified impairment in value, if any, and consist of expenditure incurred in respect of tangible fixed assets in the course of their construction and installafon. These are transferred to relevant eategory of operating fixed assets when asset is available for use. Capital work in progress Is stated at cost less identified impairment losses, if any. 3.3. INTANGIBLE ASSETS Measurement Intangible assets, other than goodwill, are measured at cost less accumulated amortization and accumulated impairment losses. Amortization Is cherged s0 as to allocate the cost of assets over thelr estimated useful tives, using the straightline mathod at the rates specified in note 6.1 to the financial statements, Research and development expenditure is charged to ‘administrative expenses’ in the statement of profit or loss, as and when incurred. Judgment and estimates ‘The useful lives, residual values and amortization method are reviewed on a regular basis. The effect of any ‘changes in estimate accounted for on a prospective basis. wh LS United Auto Industries (Private) Limited qNotes to the Financlal Statements for the Year ended 30th June, 2020 3.4 STORES AND SPARES \ These are stated at lower of moving average cost and estimated net realizable value. Provision is made for Obsolete items, if any, and is based on their condition as at the financial position date depending upon the management's judgment. Items in transit ere valued at cost comprising invoice value plus otner charges Incurred thereon. Loose tools are recognised es expense as and when purchased as their inventory is generally not significant. Not realisable value specifies the estimated seling price in the ordinary course of business less the estimated cost of completion and cost necessarily to be incurred to make the sale. iy 38 STOCKS INTRADE iQ Sooo ermal at ine lower of cost and net realizable value except waste, which is valued at net resizable | value determined on the basis of contract price. Cost is determined as under. | Raw materials ~ Weighted average ' Work-in-progress and finished goods “At average manufacturing cost including @ proportion i | of production overheads j stock in transit is valued at cost comprising invoica value plus other charges Incurred thereon, eRaS [Average manufacturing cost in relation to worksn-process and fished goods consist ofthe dlract materais \ ‘costs and labour costs and an appropriate proportion of manufacturing overheads based on normal capacity. L 1 Net Realzable Value signifies the Seling Price In the ordinary course of business less cost necessary to be | incurred to effect such Sale. 3.6. TRADE DEBTS ‘Trade recelvables arise when the Company performs its performance | ‘obligations by the transferring goods to a customer and the Company has an un-conditional right to receive the consideration. A tight to consideration Foe re ioing stage oe is required befor peyment of thet conseration is due, These ate || sco acainal voice amount fess an estimated allowance made for doubt receivables based on fevew || Carre ae pans the yer end. A provision for impatent of wade receivables is established when } there is objective evidence that the Company will not be able to collect ali amounts due according to ‘the i sree aoe of tne receivable. Cigeant Srancal felts ofthe debtor, probaity tat the debtor wi | Shier bankruptey or financial reorganization, and default or delinquency in payments are considered indicators | I 1 ae ee ade receivables implted. Debs, considered recoverable, are writen of, es and when Kieniieg, 3,7. CASH AND GASH EQUIVALENTS i Cae nt cosh equivalents are catied in the statement of financial postion at cost. For the purposes of he | statement of cash flows, cash end cash equivalents consist of cash end bank balances, cheques in hand, Saposts hels at cal wih barks, other short term highly gud Investments wit original matures of three months of less. t 3.8 METHOD OF PREPARATION OF CASH FLOW STATEMENT | ‘The cash flow statement Is prepared using indirect method. | 3.9 FINANCIAL INSTRUMENTS (A). Financial Instruments: Assots i) Classification and measurement Ciaeetcthstuments are Inilally recognised when an entity becomes a party to the contractvot vacursione of the instrument and are classed ino verous categories depending upon the type of iz fastument, which then determines the subsequent measurement of the instrument. IFRS 9 states thet classification is based on two aspects; the business model within which the seSet is held (the business model tet) and the contractual cash flows of the asset which meet the | Ff wry payments of principal and interest (‘SPI’) test. |Notes to the Financial Statements United Auto industries (Private) Limited for the Year ended 30th June, 2020 JERS © includes three principal classification categories for financial aosels: measured at TF ced cost, fair value through other comprehensive Income (FVTOCI) and fair value through profit or lose (FVTPL), The Company determines the ciasscation at intial recognition. a) ») ° Financial assets at amortized cost RMmnancial asset i measured at amortized cost if it meets kth of the following conditions and is not designated as at FVTPL: ‘The asset is held within the business model whose objective Is to hold assets to collect contractual cash flows; and “The contractual terms of the financial asset give rise on specified dates to cash tows hat are solely payments of principal and interest on the principal amount outstanding ‘The Company has long term deposits, trade debts, and other receivable classified as financial assets at amortised cost. Financial assets at FVTOCI debt instrument is moasured at FVTOCI only if t meets both of the folowing conditions and is not designated as at FVTPL: ‘The asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and ‘The contractual terms of the financial asset give rise on specified dates to ash flows thot ae solely payments of principal and Interest on the principal amount outstanding, ‘On intial recognition of an equity investment that is not held for trading, the Company Sey imevocably elect to present subsequent changes In fair value in, other Be rehensive Income, This election Is made on an investment by Investment bass In addition, on iat recognition, the Company may irevocably designate a financial in aa hat ‘ofnemise moals the requirements to be measured at amortized cost or at a eeol as at FVIPL if doing so eliminates or significantly reduces en accounting mismatch that would otherwise arise. “The Company does not have any financisl asset under this category. Financial assete at fair value through profit or loss Hoan dar asset is mandatoily classified In this category If tie acquired principally for fhe purpose of seling in the short term, of it fais the SPPI test. Dervaves are classified as FVTPL as they do not meet the SPPI criteria, ‘A financial asset can be classified in this category by cholce if so designated by 2 rersment at inception This designation is because the relevant assets and lables ralaung derivatives) are managed together and intemal reporing Is evaluated on @ fair value basis. “The Company defines fair value as the price, as at the measurement date, that would Be wre vad to sell an asset 0° paid to transfer liability In an orderly transaction between market participants, nancial asset measured at FVTPL comprise of short term investments a detalled In wr “11 of these financial statements,Notes to the Financial Statements for the Year ended 30th June, 2020 ii) Initial recognition ‘A initial recognition, the Company measures a financial asset at its fair value plus, in the case of financial asset not at fair value through profit or loss, transaction cost that are directly attributable to the acquisition of financial assets. Ill) Subsequent valuation Gains and losses arising from changes in the fair value of assets classified as fair value through profit or oss are included in the statement of profit or loss in the period in which they arise Gains ang losses arising from changes in the fair value of debt instruments classified as falr value through other comprehensive Income are recognised as olher comprehensive income until the financial acset is derecognised or impaired, at which time the cumulative gain or loss previously recognised as other comprehensive income is recognised in the statement of proft or loss. Any premium or discount paid on the purchase of securities held at amortized costis amortized though tne statement of profit or loss using the effective interest rate method Wy) Derecognition The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets expire or when it transfers the financial essets end substantially all the associated risks and rewards of ownership to another entity. On derecognition of a financial asset fmeasured at amortized cost, the difference between the asset's carrying value and the sum of the ‘consideration received and receivable is recognized in statement of prof or loss. In addition, on derecognition of an investment in a debt instrument classified as FVTOC!, the cumviative gain of {oss previously accumulated in the lnvestment’s revaluation reserve is reciassified to statement of prof 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 reclassified to equity. v)_ Impairment of financial assets The Company assesses Impaltment on all of the following financia instruments that are not measured at FVTPL: financial assets that are debt instruments measured at amortized cost or FVTOCI; and loans and receivables commitments and financial guarantee contracts issued. [No impairment loss is recognised on equity investments classified as FVOCI. The Company: fecognaes allowance for ECL at an amount equal to either 12 month Expected Crecit Loss (ECL) orlifetime ECLs. Lifetime ECLs are the ECLs that result from all possible default events aver the expected life ofa financial Inctrument, whereas 12 month ECLs are the portion of ECL that result ftom default events that are possible within the 12 months after the reporting date. For trade receivables , the Company applies a simplified approach in calculating ECLs. Therefore, the Company does not track changes in eredit risk, but instead recognizes a loss allowance based on lifetime ECLe at each reporting date, The Company has established a provision matrix that Is based on its historical credit loss experiance, adjusted for forward-locking factors specific to the debtors and the economic environment, ‘The gross carrying amount of a financial asset is writon off when the Company has no reasonable wre ‘of recovering a financial asset in its entirety or @ portion thereat. United Auto Industries (Private) LimitedNotes to the Financial Statements United Auto Industries (Private) Limited for the Year ended 30th June, 2020 (B) Derivative Financlal Asset “The Company designates derivative financial instruments as cash fow hedge. “The effective portion of the gain or loss on the hedging instrument is recognized in OC! in the cash flow hedge reserve, while any ineffective portion is recognized immediately in the statement of profit or loss. ‘The cach flow hedge reserve is adjusted to the lower of the cumulative gain or foss on the hedging instrument and the cumulative change in fait value of the hedged item. ‘The Company designates only the spot element of forward contracts es a hedging instrument, The i forward elements recognized in OCI and accumulated in @ separate component of equity under cost of { ‘capital reserve. ‘The amounts accumulated in OCI are accounted for, depending on the nature of the underlying hedged {ransaction. If the hedged transaction subsequently results in the recognition of a non-financial item, the amount accumulated in equity is removed from the separate component of equity and included in the inital ‘cost or other camying amount of the hedged asset or lablity. This is not a reclassification ul ‘adjustment and will not be recognized In OCI for the period, This also applies where the hedged forecast transaction of a non-financial asset or non-financial liability subsequently becomes a firm commitment for which fair value hedge accounting is applies, i For any other cash flow hedges, the amount accumulated In OCI is reciassified to profit or loss as a reclassification adjustment in the same period or periods during which the hedged cash flows affect profit or loss. t (C) Financial Instruments: Liabilities wl i) Classification of financial labllities | He Gompany cassis ts nancial lle in the folowing categories: | I Eafalr vale trough pot and lose CFVTPL’), or | * dtamontized coet | \ financial lables are measured at amorized cost, unless they are required to be measured at 1 FVTPL (such as instruments held for treding or derivatives) or the Company has opted to measure ao. them at FVTPL | Financial liabilities are measured at amortized cost, unless they ere required to be measured at | | cepl ouch as inatuments held fo trading or derivatives) or the Company has opted to measure them at FVTPL f | Initia} recognition and measurement ‘Al financial labilties are recognised initially at fair value and, in the case of financial liabities measured at amortized cost, net of directly attributable transaction costs ‘The Company's financial liabillies include trade and other payables, short term borrowings, long term financing and accrued markup, | t | it) Subsequent measurement ' Finsrelll iabilies et amortized cost are subsoquently measured at amortised cost. Whereas, francial labilties carried at EVTPL ere initially recorded at fair value and transaction costs are expensed in the siatoment of profit or loss. Realized and unrealized gains and losses arising from Ghenges in the fair value of the financial lablifes held at FVTPL are included in the statement of profit or ioss in the period in which they arise, Where management has opted to recognize a financial fablity at FVTPL, any changes associated ‘with the Company's own credit risk will be recognized in statement of comprehensive income. gyre there are no financial liabilties designated at FVTPL.Notes to the Financial Statements United Auto Industries (Private) Limited for the Year ended 30th June, 2020 iv) Derecognition ‘A financial liability is derecognised when the obligation under the liabilly is discharged or cancelled or expires. When an existing financial liabity is replaced by another from the same lender on substantially different terms, or the terms of an existing liabilty are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition ‘of a new liablity. The difference in the respective carrying amounts is recognised in the statement ‘of profit or loss. 3.10 OFF-SETTING OF FINANCIAL INSTRUMENTS Financial assets and liabilties are off-set end the net amount is reported in the statement of financial position when there is @ legally enforceabie right to set-off the recognized amounts and there is an intention to settle ‘ona net basis, or realize the asset and settle the liabilty simultaneously. 3.11 EMPLOYEES’ RETIREMENT BENEFITS The Company operates an unfunded gratuity scheme covering all eligible employees of the Company who have completed the minimum qualifying period of service as defined under the respective scheme. Provision ig made annually, on the basis of last drawn salary assuming thet such benefits are payable at the end of accounting period, to cover the obligation and is charged to income currently. 3.42 TRADE AND OTHER PAYABLES: ‘These are stated at cost which is the fair value of the consideration to be paid in the future for goods and services receives, whether or not billed to the Company. 3.43 BORROWING COSTS Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowing costs are recognized as an expense in the petiod in which these are incurrad except tothe extent of borrowing cost that fre directly attributable to the acquisition, construction of production of a qualifying asset. Such borrowing costs, if any, are capitalized 28 part ofthe cost of thal asset. 3.14 PROVISIONS Provisions ate recognized when the Company has a present legal or constructive obligation as @ result of past events and itis probable that an outflow of resources embodying economic benefits wil be required to Eettie the obligation and a reliabie estimate of the obligation can be made. However, provisions are reviewed at each statement of financial position date and adjusted to reflect current best estimate, 3.18 WARRANTY OBLIGATIONS The Company recognises the estimated liabilly, on an accrual basis, to repair or replace products under “warranty at fhe reporting date, and recognises the estimated product warranty costs In the statement of profit of loss when the sale is recognised. 3.16 CONTINGENCIES AND COMMITMENTS Contingent Llabilities are disclosed when there is ‘A possible obligation that arises from pest events and whose existence will be confirmed only by the ooourtence of non occurrence of one or more uncertain future events not wholly within the control of the Company; or present obligation that arses from past events but itis not probable that an outflow of resources embodying economic benefits wil be required to setle the obligation or the amount ofthe obligation cannot be measured with sufficient elabilty Contingent Assets Contingent essets are disclosed when there Is possible asset that arises from past events and whose ‘existence will be confirmed only by the occurrence or non-cceurrence of one or more uncertain future events rot wholly within the contro! of the Company. Contingent assets are not recognised unl thelr realisation become virtualy certain. eeNotes to the Financial Statements United Auto Industries (Private) Limited for the Year ended 30th June, 2020 3.47 DIVIDEND AND OTHER APPROPRIATIONS Dividend is recognised as a fabilty in the period in which it is declared. Appropriations of proft are refiected in the statement of changes in equity in the period in which such appropriations are approved. 3.18 REVENUE RECOGNITION The Comany reeognass revenue tom contacts ‘with customers based on a five step model as set out in IFRS 18: step-t Identity contract(s) with 2 customer: A contract is defined es an agreement between two of more parties that creates enforceable rights and obligations and sets out the criteria for every contract that must be met, step-2 Determine the transaction price: The transaction price is the amount of consideration to which the Company expects to be entiled in exchange for transferring promised goods or services to @ customer, ‘excluding amounts collected on behalf of third parties, Steps Identity performance obligations in the contract: A performance obligation is a promise in @ contract with a customer to transfer a good or service to the customer. Stop+ ‘hilegate the transaction price to the performance obligations in the contract: Fer @ contract that has more than one performancs obligation, the Company allocates the transaction price to each performance obligation in an amount that depicts the amount of consideration to which the Company expects to be entitled in exchange for satisfying each performance obligation. Steps Recognize revenue when (oF as) the Company satisfies a performance obligation. “The Company satisfies a performance obligation and recognizes revenue overtime, If one of the following criteria is mat: G) The Company's performance does not create an asset with an alternate use to the Company end the Company has as an enforceabe right to payment for performance completed to date, b) The Company's performance creates or enhances an asset thatthe customer controls as the asset is created or enhanced ) The customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs. For performance obligations where one af the above conditions are not met, revenue is recognized at the pointin time at which the performance obligation is satisfied. ‘When the Company satisfies a performance obligation by delivering the promised goods or services it creates vac aes faved ssset on tho amount of consideration eamed by the performance. Where the amount of a peeration received from a customer exceeds the amount of revenue recognized this gives rise fo & contract liability Revenue is measured at the fair value of the consideration received or recelvable, taking into account Peractualy defined terms of payment and excluding taxes and duties. The Company assesses its revenue arrangements against specific criteria to determine if its acting as principal or agent. Sale of Goods The Company's contracts with customers for the sale of goods generally include one performance obligaton for both local and export sales i.e. provision of goods to the customers.Notes to the Financial Statements United ee Inited Auto Industries (Private) Limited 1) Local Sales Sale of goods are recognized at the point in time when control is transferred to the customer, generally ‘upon delivery of goods. ii) Export Sales Sale of goods are recognized at the point in time when control is transferred to the customer, dependent ‘on the related inco-terms generally on date of good declaration form being issued by customs authorities oF delivery of the product to the port of destination. Revenue is recognized to the extent itis probable that the economic benefits wil flow to the Company and the revenue and costs, If applicable, can be measured reliably. 3.19 CONTRACT LIABILITIES A contract labiity Is the obligation of the Company 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 @ customer pays consideration before the Company transters goods or services to the customer, a contract liabilty is recognized when the payments made or the payment is due (whichever is eater), Contrect liabillies are recognized as revenue when the Company performs under the contract. It also ineludes refund labilties arising out of customers’ right to olzim amounts from the Company on account of contractual delays in delivery of performance obligations and Incentive on terget achievernents. 3.20 CONTRACT ASSETS Contract assets arise when the Company performs its performance obligations by transferring goods to @ customer before the customer pays its consideration or before payment is pending to be due for payment for want of some performance of obligation on part of the Company. Contract assets are treated as financial assets for impairment purposes. Revenue represents the fair value of the consideration received or receivable forsale of goods, net of returns, Diowances, trade discounts, rebates and sales tax. Revenue is recognized when or a8 performance Sbiigations are satisfied by transferring control of @ promised goods or services to a customer, and control either transfers over time or point in time. 3.21 TAXATION Income tax expense comprises current tax and deferred tax. It Is recognized in statement of profit or loss ‘except to the extent that it relates to items recognized direct In other comprehensive Income, In whlch case itis recognized in equity. Current: Provision for current taxation is the emount computed on taxable income at the current rates of taxation or ‘alternative corporate tax computed on accounting income or minimum tax on turnover, whichever Is higher, dnd taxes peid / payable on final tax basis, after taking Into account tax crecit available, if any. The charge for the current tax also includes adjustments where necessary, relating to prior years which arise from the assessments made / finalised during the year. Doforredi: Deferred tax is recognised using the statement of financial position liability method on all temporary ‘ferences between the carrying amount ofthe assets and fables and ther tax bases. Deferred tax Tebifties are recognised for all major taxabie temporary differences. Deferred tax assets are recognised for all major deductible temporary differencas to the extent that it Is probable that taxeble profit will be vellable against which the deductible temporary differences can be utilised.eee ES Notes to the Financial Statements for the Year ended 30th June, 2020 United Auto Industries (Private) Limited ‘The caryying amount of the deferred tax asset is reviewed at each date of statement of financial position and is recognised only to the extent that itis probable thet future taxable profits wil be available against which the assets may be utlised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised unrecognised deferred tax assets are reassessed at each date of statement of financial position and are recognised he extent te ecomes probate ta future erale profit wil allow deferred tax asset to be recove Deferred tax assets and liabilties are measured at the tax rate that are expected to apply to the year when the asset is ullised or the liabilly Is settied, based on the tax rates that have been enacted or substantially enacted at the financial position date. 3.22. RELATED PARTY TRANSACTIONS Transactions and contracts with the related parties are based on the policy that all transactions between the Company and related parties are carried out at an arm's length except forthe transactions as disclosed in the relevant notes. 3.23 FOREIGN CURRENCY TRANSLATION ‘Transactions in foreign currencies are transtated in Pakistan rupees (functional and presentation currency) at the exchange raie prevailing on the date of transaction. Monetary assets and liabillies in foreign currencies Gre translated into Pakistan rupees at the rates of exchange approximating those prevalent at the date of Statement of fiaancial position. Foreign exchenge gains and losses resulting from the settlement of such transactions and from the transiations of monetary assets and liabilities denominated In foreign currencies are recognised in the profit or loss. 3.24 EARNINGS PER SHARE (‘EPS’) Eosie EPS ls calculated by dividing the proft or loss attributable fo ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the year. Diluted EPS is calculated by adjusting basic EPS by the weighted average number of ordinary shares that asie be iogued on conversion of all diluive potential ordinary sheres into ordinary eheres and posttax effect Srenanges in proft and loss attributable to ordinary shareholders of the Company that would result from ‘conversion of ll dlutive potential ordinary shares into ordinary sheres. eeUnited Auto Industries (Private) Limited amma aeeUMUCA ED DEFRFETETIS fa 72 | anaat jmarens| erovoro| 72, | “som. ae “ar (pn | ane | he | eee “eon _feesucs son yan nae ot S cnoasasts goes ewaure sean exsnee Sins etensstne Stipa as aecicoa Sti ; Rem, “tees ‘enaiia : creme tana : ; = nse neo. 0s tis sae ast SS sseoasecrs eee aes stanse : cunmoasters eae oxome on Soerretrenaitn aaa mete * pete Sas 3 ftncnas: "Sane ae Scenvenare ao : ; a" Be DT FORTHE | ENDOF OPERATING rooperatinel ene | % on: wo | “wear” | tHevear | TEND OF ‘ASSETS ASSETS = ny ‘THE YEAR PARTICULARS overarine | Assets. " -— 30TH JUNE, 2020. — | Vehicies 428663343 10.479.401 (46,360,658) 92,702.05 15 42,900789 13367) 12590,743 33,827,185 58,954,901 TESTS TOMA. CS RGO ESA), 2, THE OE TOIL STA EROS, HSS SIH GT 30TH JUNE, 2019 —- 162 As on tst July, 2019 the Company hes adopted IFRS 18, hence, leased atsats have been re-ciassfed as "Right ofuse Asset. 453 DEPRECIATION ALLOWANCE provided forthe year has been alocated to Admiistatve and General Expenses. we (Wote24.1)Notes to the Financial Statements. United Auto Industri for the Year ended 30th June, 2020 6 INTANGIBLE ASSET 6:1 Ths is made up as folows. co st T TRCCUNUCATED AMORTIZATION CARRYING an a a CHARGE an VALUE PARTICULARS BEGINNING | ponmions eno |RATE| BEGINNING | FoR THE END | «TEND OF OF THE OFTHE | % | OFTHE a OFTHE | The ycaR YEAR YEAR YEAR YEAR — 30TH JUNE, 2020 SAP ERP System 9036.09 -2489,010 «11,527,919 20 «3,002,800 2.905.584 5,808,474 219.445 3058008 2485,510 T1827, 919 007,890 205.584 5,908,474 __ 6219445 — oe STH JUNE, 2018 ——— SAP ERP System 5976441 3,061,568 «9,098,009 201,195,288 © 1,807,602 3,002,680 6,095,119 E97Aa 3,067,568. __ 2,088,008, TiS5 268, 1,807 602_ _5.007,890, 6,036,118 62. At {stMarch, 2016, the Company purchased SAP ERP Computer Software system and have a total useful life of five years. 6.3. Amortization for the year has been allocated to Administrative and General Expenses. (Note 24.1) we| © Notes to the Financial Statements United Auto Industries (Private) Limited for the Year ended 30th June, 2020 7 2020 RUPEES: 7 LONG TERM DEPOSITS 7A These comprise of: security Deposit Sui Northern Gas Pipelines Limited 1,303,648 Cantonment Board Rawalpinc +00,000 ; ‘Multan Waste Management Company - | a Parks and Horticulture Authority, Lahore 60,000 Lahore Electric Supply Company 2,561,100 \ Rent Premises 387,000 ‘ 401.649 Lease Key Money (te 7.2) 12,163,800, k 16,555,449. i 12. LEASE KEY MONEY Bank afalah Limited 8,437,000 Sank Al Habib Limited 4,653,250 73,000,250 | Less: Metury within noxt 12 months shown under Current Assets 996,450 I | 12,153,800. 8 DEFERRED TAX ASSET ‘8.1 This arises in respect of timing differences relating to: Accelerated Tax Depreciation (22,166,840) \ ‘Obligation under Lease (6.704713) } Provision for Staff Gratuity 19,471,369 } ‘Turnover Tax 40,098,528, : ELIS EN 8.2. ANALYSIS OF CHANGE IN DEFERRED TAX ASSET Se rer ACCELERATED: OBLIGATION FOR | TN “moon sare panrewans oernecianos EASE ature GARTICUMS oth June, 2018 (84,015,788) (6,454,825) 42,018,717 | Recognised in Profit or Loss 2,030,330 (834,605) 2.815.511 \ Recognised in ‘Other Comprehensive Income - a cS i Balance as at 30th June, 2019 (28,986,468) (6,989,430) 15,734,228 Recognised in Profit or Loss 6,818,628 4,284,717 3,737,144 Recognised in Other Comprehensive income : - : pale cant goth Sune, 2020 RISE SO, EOS TIS. __ABATL SES 2020 RUPEES 3. The expiry datos of un-expred turnover tax avaliable for scjustment are 98 flows | ‘30th June, 2020 - | oth June, 2021 i \ 30th June, 2022 | ‘30th June, 2023 - 30th June, 2024 40,098,528. . sd 40,098,628 2019 RUPEES 4,162,549 190,000 697,000 80,000 2,851,100 2,880,000, 7,450,640 13,735,300 NETRA 14,684,600 4,738,060 79,403,450 5,868,150 73,735,300 (28,985,468) (6,989,430) 18,734,228 168,866,376 448,615,706 ‘TURNOVER, Tax 430,046,365 38,810,011 788 56,57 (428,787,848) 40,998.528 2019 RUPEES 12,679,594 24,486,359 142,618,854 49,003,241 40,098,528 768,856,376- + Notes to the Financial Statements United Auto Industries (Private) Limited Motes stoned 30th Juno, 2020 a7 2020 2018 ie RUPEES RUPEES «STOCK IN-TRADE compe of: Raw Material (Note 22.3) 473,128,192 617,587,967 : fone Nee 223) Tteners§— “aganoEse Finished Goods. (Note 22.1) 158,551,394 46,094,650. —eeiegsss ener | )| + 49 TRADE. AND OTHER RECEIVBALES | TRADE AND OTHER ECENENES i | Trade Receivables 282,869,566 611,277,682, | Other Receivables (Note 10.2) 379,829,942 263,757,088. i ee 02 OTHER RECEIVABLES pertain: k United Motors (Private) Limited (Note 10.3) 369,629,942 243,567,088 ‘United Auto Parts (Note 10.4) 20,200,000 20,200,000 (Nol 104) ee Laer, 40.8 This mado up a8 ows: Tre tee og ct ine Year users 058007 Sar eS ng be oor eee eaesora || 437,929,942 273,557,088 | Less: Recovered during the Year 78,300,000 30,000,000. sees ratte oar EE ees | soa thesis no mevementn bis lane dung cent and prevOUS Ear : 40.5 These unsecured and interest free amounts have been provided to related parties (Le. associated These unsecured en ret 0 Sr ator) for ie pone pare of i ttm k m1 liabilities. These are receivable on ‘demand, however, none of them js either past due or impaired. | 0.8 Maximum aggregate amount outstanding st endo month ae United Motors (Private) Limited 369,629,942 243,587,088 | nies nat Pare Sacre “ooaoecnn | Be Boe. | «+ SHORT-TERM NESTHENT Pe | SE EN ah Prt or Loss Ae eee opporunty Fund nent 4 Fair Value at beginning of the Year 409,218 97,184 4,474,040 41,094,678 j Add: Invested Units 12,444, 42,087. Re 129,172, Hy 421,358 09,218 1,302,439 1,223,750 | usted Picea Year End Sat Fair Value Adjustment 2,770 61,810) | ae ee rte Yor ae ai k 42 PREPAYMEN" ID ADVANCES comprise of: ‘Advances to Employees against: Salaries 2,615,000 4,954,000 eaponees BStsoee|[__ arrest ] 6,580,620 7,871,051 Advances to Supls of Goods and Sences eee ee asn aoa ‘Security Deposits 2,171,980 1,928,610 reese oy teney see Baseat0 - Margin against Letters of Guarentee 296,100 295,100 ‘Advance income Tax 75,000,000 400,000,000 | General Sales Tax-net 79,918,014 85,446,241 | Coeaieree free Sreaes \ x mos arene | iNotes to the Financial Statements for the Year ended 30th June, 2020 United Auto Industries (Private) Limited 2020 2018 RUPEES RUPEES 43 CASH AND BANK BALANCE: 43.1 These comprise of. Cash in Hand 3,420,585 aAt7972 Cash at Banks in: ‘Current Accounts 7,509,525, 488 (656,686 688 Saving Accounts (Note 13.2) {889,401,769 855 853,623, 7,308,027.267, __1,514,340,311 2.402,347,842 __1,617,758,283_ 43.2. These are subject to rotum at rates ranging from 3 % to 8 % (2018: 3 % to 8.6 94) per annum. 414 ISSUED, SUBSCRIBED AND PAID UP SHARE CAP! Se This represents ordinary shares of Rs, 10 each which have been alloted for consideration: 2020 2019 300 300 Fully patd in Gash 3,000 3,000 5,579,581_ _§,579,581_Otherthan in (Note 14.2) 55,795.810 55,795,810 5,579,881. __ 6,579,061 156,798,610 —55,798,810_ 442 These represent shares issued againt net sscots of United Sales (Proprietorship) as of 1st October, 2007 taken over as @ running business, on its ‘conversion in to the Company. 45 LONG TERM FINANGING “5.1. This is made up as follows: Disbursed during the year 33,000,000 - Lees: Current portion shown under current labilties (Note 19.2) 8,260,000 - (Note 15.2) 24,760,000. 45.2 This represents Term Finance facily from Bank af Habib Limited with @ sanctioned (mit amounting to Rs. 54.784 milion (2019: Rs. aftermath of corona virus (COVID-19). “Tas is repayable in 8 equal quarterty instalments, commencing from 1st January, 2021, “This facity carries mark up @ SBP Refinance Rate + 3% Spread, per annum. ‘This facility is secured against 100% amount under fen in currant / T-Calljlnt account and personal ‘guarantee of the directors of the Company. 46 LEASE LIABILITY “16.1 These relate to the year ended: ‘2020 - 24,560,579 2024 19,158,195 20,036,716 2022 13,472,687 42,909,876 2023 4,781,718 3,899,862 2024 4:184,476 "222,620, 2025 "708,392, - Gross Minimum Lease Payments 30,283,478 67,655,663 Less: Financial Charges allocated to Future Period 4,610,609 7,440,643, Present Value of Minimum Lease Payments 34,772,869 $4,219,040. Less: Shown under Current Liability (Note 19.3) 46,539,797 20/621,830 18,233,072 33,697,410 ‘Add: Residual Value retained as Security Deposits 43,080,250 19,568,750 731,923,322. 53,166,160, & sunder State Bank of Pakistan (SBP) refinance Scheme to partally finance the va reant of Wuoges and Saates te Workers and Empoyees ofthe Company and 9 evel he avons intheNotes to the Financial Statements for the Year ended 30th June, 2020 46.2. The reconctiaton between Gross Minimum Lease Payments, future Financial Charges and present value of Minimum Lease Payments is as follows: GROSS MINIMUM LEASE PAYMENTS Not later than one Year Later than one Year but not later then five Years. Later than five Years. PRESENT VALUE OF MINIMUM LEASE PAYMENTS: Not later than one Year Later than one Year but not later than five Years Later than five Years 46.3 The Company has entered In to repayable in equal monthly installments. These are secured against eoemel quatentees of al the Directors of the Company. The rate used to ciscourt minimum ease payments anges from 6.00% to 15.16% (2019: 8% to 12,76%) per annum. reneged ascets at the end of respective lease terms. Owing to the replacement of iAS=T7 IFRS-16 "Leases", the line lem for such leases disclosed as replaced with "Lease Liabilities” 47 EMPLOY! Balance at the beginning of the Year ‘Add: Provision for the Year Less: Payments made during the Year Balance at end of the Year 48 TRADE AND OTHER PAYABLES 418.1 These comprise of: Trade Creditors Accrued Liabilities Contract Labilities - unsecured ‘Advance from Employees against Disposel of Vehicles income Tax Withnald at Source Sales Tax Withheld at Source General Sales Tax Payable Sales Tax Payable on PRA Warranty Obigations (Note 18.2) Workers! (Profit) Participation Fund (Note 18.3) ‘Workers’ Welfere Fund (ote 18.4) 148.2 WARRANTY OBLIGATIONS is made up as follows: Balance at beginning of the Year ‘Add: Provision during the Year Less. Payment during the Year Balance at end of the Year Lease Agreements with various Banks to acquire Vehicles. These are 1 BENEFIT OBLIGATION represents provision for staff gratuity and is made up 28 follows: a United Auto Industries (Private) Limited 2020 RUPEES 2019 RUPEES 19,188,195 24,560,879 20,125,288 37,099,074 THATS ES / i 16,599,707 20,621,630 48,239,072 33,697,410 TET, BAIR OO the Title of the Leased Assets and ‘The Company avail the opt to purchase sases” with “Finance Lease Liabilites" has now been 154,289,150 44,647,900 | 28,282,263, 14,153,120, 80,542,113, 5,700,420 19,399,460 4,441,270 67,142,653. __ 64,250,150" | 3,106,918,938 _3,040,051.618 25,221,518 18,478,476 160,714,014 54,415,814 20,962,163, 44051.212 5,980,782 2,598,847 4,006,588 43696452 | 28,286,102 26,902,123 238,680 - 24,786,782 45,487,912 237,571/845, 26,696,290 23,134,209, 9.444.816 FAG4, 768930_ __9,223,633,560 15,487,912 seazaaes | 24,788,792, 16,457,912, —wzaa Tor Sens | 15,487,912 163323.488 24,786,732 15,487,912 tee — bseNotes tothe Financlal Statements United Auto Industries (Private) Limited for the Year onded 30th June, 2020 . 2020 2019 7 RUPEES RUPEES 48.3 WORKERS’ (PROFIT) PARTICIPATION FUND is made up 28 follows: Balance at beginning of the Year 26,696,290 32,995,820 Less: Payment during the Year 26,606,200 32,935,520 | Add: ll Interest for the Year (Note 27) —T846,005 2516147 4 Aliocation for the Year (Note 26) 35,625,641 24,180,143 a 37,571,648. 76,696,290 i Balance at end of the Year a7 STH BAS, 28.696.290" \ 18-4 WORKERS' WELFARE FUND is made up 28 flows: i Balance at beginning of the Year 9,444,816 7 ‘Add: Allocation for the Year (Note 26) 13,689,483 9,444,916 Balance at end of the Year P3134 208 9.444.816 49 SHORT TERM FINANCING 49.4 These comprise of. Current Portion of Long Term Financing {Note 19.2) (24,789,797 21,202,339 Chuo -overdat Nea} __van.gep0o __ 3.04730 eesecee. 76087289 | 10:2 CURRENT PORTION OF LONG TERM FINANCING eee rece ‘Current Portion of Lease (Note 19.3) 16,639,797 21,202,339 ‘Current Portion of Term Finance (Note 15.4) 8,250,000 24,789,797 __ 24,202,338 | 49.3 CURRENT PORTION OF LEASE is made up as follows: t Balance at beginning of the Year 21,202,339 18,094,404 @. Less: Payments during the Year 21,202,339 47,453,695, ‘Over Due Balance - 580,709 ‘Add: Transferred from Long Term Portion (Note 16.1) 16,599,797 20,621,630 2 Balance at end of the Year 76,599,797, ____21,202,338 ‘ted This represents the cheques issued in excess of the aveilable balances in the Banks ‘of the Company, which have been presented for payment subsequent to the year end, 20 CONTINGENCIES AND COMMITMENTS. 20.1 CONTINGENCIES (2) Guarantee issued in favour of Collector of Customs, Lahore 2,951,000 2,951,000, I (©) Tumover Tax available for adjustment against Normal Taxation __40, 098,528 168,856,375. (©) Acase of the Company is pending for decision before the Appeiate ‘Tribunal Punjab Revenue Authority, Aisese Ol ganst the imposition af a Punjab Sales Tax by the Commissioner (APRoatS) Punjab Revenue wathoriys Lahore, amounting to Rs. 28,055,185) and 40,917,709, fr tax Yeas 2018 and 2017, Specialy, waich have not been recogrized in the financial statemens of the ‘Company. {@) The offciels of LTO, Lahore intiated proceedings for amendment unde! section 122(5A) of the Orsinance trough notice for tax year 2019. The Company submitted lts response through its legal ‘council and is unable to determine the outcome of this case. (e) The officials of LTO, Lahore inated proceedings for Further Tax uncer section (1A) of the Sales Tax pre “Tap through notice for period from July, 2018 to March 2018. The, Company ‘submitted its Hoe Ae nse trough is legal council and is unable to determine the outcome of tis case: esed on the opinion of the Companys leg cauneel the management is confident of fevourable outcome in all aforesaid matters. 20.2 COMMITMENTS: | ie Nil (2018: Rs. Ni)= Notes to the Financial Staterionts United Auto industries (Private) Limited for the Year ended 30th Juno, 2020 2920 2019 RUPEES RUPEES 21 SALES ‘21.4 These represent revenue from contracts ‘with customers and is made up as follows: Local Sales Gross Sales TERT AAOIT| | TESTARTI.TOO Less: General Sales Tax including Further Tax 2,261,933,259 2,521,242,832_ 73.905,166,762 14, 053,620,008 Lese: Trade Discount 956,214,308 7 12,648,972,354 44,053,628 ,868 Export Sales 356,225 2,480,400 22 00.400 73,660,328,579_ _14,056,108,268 24.2. These include revenue amounting to Re. 64,418,814h (2018: Rs, 51,095,013), recognised that was Included in the contract liablitias balance at the beginning of the Year. 24.3 TIMING OF REVENUE RECOGNITION Goods transferred at a point in time 42,650,328,679_, __14,056,109,268 PERFORMANCE OBLIGATION ‘The performance obligation is satisfied upon delvery of goods and payment is generally due -within 30 to 120 days from delivery. 24.4 CONTRACT BALANCES: Trade Receivables 282,869,568 614,277,682 Contract Liabilities 160,714,014 BAAS 814 21.8 The decrease in trade recelvables is due to recovery made during the Year 216 The increase in contract labiltios pertains to adfon in advance due fo increase in contracis, 24.7 GEOGRAPHIC MARKET - Asia 42,650,328,579_ __14,056,109,268 COST OF SALES. 22.1 This is made up as follows: Finished Goods at beginning of the Year 48,094,650 80,148,005 Cost of Goods Manufactured (Note 22.2) _11,630,719,234 _12,968,080,621 71,676,607,884 ~ 15,098,225,526 Finished Goods at end of the Year 158,551,994 46,094,850 TH518,256,400 _12,902,130,876 22.2. COST OF GOODS MANUFACTURED is made up as follows: Work in Process at beginning of the Year 35,128,636 81,326,484 Material and Components Consumed (Note22.3) 11,352,806,30812,622,129,407 Salaries, Wages and Benefits (Note 22.4) 144,405,552 148,624,007 Power and Fuel Consumed 38,482,835 84,716,417 Stores and Spares Consumed 44,077,287 417,502,664 Rent, Rate and Taxes (Note 22.5) 3,910,658 3,838,856 “Travelling and Conveyance 11,494,400 15,169,361 Repair and Maintenance 25,154,750 32,480,509 Insurance 2,471,602, 2,503,706 Depreciation (Note 4.2) 39,084,195 37,826,754 TT 663,716,210 — 12,098,208,056 ‘Work in Process at end of the Year 33,002,976 35,128,535, 71630,743.284_ _12,968,080,821_ 223 MATERIAL AND COMPONENTS CONSUMED is mede up as follows: Balance at beginning of the Year 517,887,967 988,981,218 ‘Add: Purchases Including Expenses 44,308,346,623_ _12,251,356,156. 77,825 924,590 — 13,198,717.974 Balance at end of the Year "473,128,192 617,587,967 ol 77,352,606.398_ _12,622,129,4077 Notes to the Financial Statements United Auto Industries (Private) Limited \\ forthe oar ended 30th June, 2020 . 22.8 This include staff gratuily amounting to Rs. 12,164,583" (2048: Re, 4,985,600/) . 225 This includes an amount of Re. 3,600,000 (2019: Rs, 3,600,000/+) to Mr. Sana Ullah Chaudhary, chet executive / dector of the Company. 2020 2019 | RUPEES RUPEES 23 MARKETING AND DISTRIBUTION EXPENSES i. 23.1 These comprises of: | Salaries and Benefits (Note 23.2) 59,986,228 42,326,188 | | | Early Payment Discount 40,621,177 35,630,498 | Warranty Claims 62,671,998 68,262,049 | Traveling and Conveyance 10,183,612 14,727,728 i Communication Expenses 2,675,175 9,338,968 i Renlals for Specialized Delivery Vehicles 89,856,705 482,278,371 Vehicle Running and Maintenance 181,584,773 481,296,437 4 Rent, Rates and Taxes (Note 23.3) 3:942,836 4,834,370 Entertainment 784,281 981.449 i sity Bills 84,102 262,047 | Printing and Stationery 3,263,408 4,655,782 u Repair and Maintenance 1,034,048 sens | Export Sales Expenses - 567.450, | | i aA ZeE ES oo7es.376 | | 2322 This include staff gratuly amounting to Re. 11,190,960)- (2018: Rs, 9,921,260). ) | 22:3 This includes an amounting of Rs. 2,400,000 (2019: Rs 2,400,0001+) to Mr. Sana Ullah Chaudhary, chief executiveldirector of the Company. ' 24 ADMINISTRATIVE AND GENERAL EXPENS! A These coms a. Directors Remuneration 20,928,000 48,000,000 | Salaries and Benefits (Note 24.2) 58,279,084 49,902,868 | Traveling ané Conveyance 8,882,850 49,337,975 ioe Communication 4,698,330 6497,907 | | Power and Fuel 3.828.517 246162 || ul Printing and Stationery 4,195,220 s7ea77s | | ° Vehicle Running and Meintenance 827,022 659,625, ul Rent, Rates and Taxes (Note 24.3) 3,381,600 5,102,388 | Repair and Maintenance 4,890,682 5,564,108 ) Entertainment 4874317 8,713,261 Auditors’ Remuneration (Note 24.4) 1,875,000 4,575,000 ( Charity and Donation 8,836,776 4311,260 | Legal and Professional Charges 2,057,400 11228,000 i Fees and Subscriptions 5,082,068, 7,158,500 Insurance 6,827,589 4,834,897 Gardening and Plantation 14,402 20,700 ‘Amortization of Intangible Asset (Note 6.1) 2,305,584 4,807,602 Depreciation - Owned Assets (ote 43) 9.627.571 21,186,890 Depreciation - Right-of-use Assets (Note 5.3) 42,530,743 - 154,140,855, _ 168804757 242 This include staff gratuity amounting to Rs. 2,928,050/- (2019: Rs. 2,246,2701-). | ‘24: This includes an amourting to Re. 2,400,0001- (2018: Rs. 2,400,000/,) to Mr. Gene Ulah Chaudhary, chief | executiveldiractor of the Company. | 24,4 This relates to the annual statutory audit of the Company.