SAOS GENERAL CONTRACTORS LIMITED

FINANCIAL STATEMENTS

31 DECEMBER 2021
SAOS GENERAL CONTRACTORS LIMITED

FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

CONTENTS PAGES

Company Information 2

Report of the Directors 3

Statement of Directors’ Responsibilities 4

Report of the Independent Auditors 5-6

Statement of Comprehensive Income 7

Statement of Financial Position 8

Statement of Changes in Equity 9

Statement of Cash Flows 10

Notes to the Financial Statements 11 - 15

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SAOS GENERAL CONTRACTORS LIMITED

COMPANY INFORMATION

BOARD OF DIRECTORS Robert Kirui

REGISTERED OFFICE Cedar Road off Lantana Road,

P.O. Box 10624-00100
Nairobi

AUDITORS Mararia Kamau & Co

Certified Public Accountants
P. O. Box 52518-00100 GPO
Nairobi

BANKERS Family Bank Ltd

Nairobi

Access Bank Ltd

Nairobi

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SAOS GENERAL CONTRACTORS LIMITED

REPORT OF THE DIRECTORS

The directors submit their report together with the audited financial statements for the year ended 31st December
2021.

INCORPORATION

The Company is domiciled in Kenya where it is incorporated as a private company limited by shares under the
Kenyan Companies Act, 2015. The address of the registered office is set out on page 2.

DIRECTORATE
The directors who held office during the year and to the date of this report are set out on page 2.

PRINCIPAL ACTIVITIES

The principal activities of the Company is to act general Contractors.

RESULTS

The results for the year ended 31 December 2021 are disclosed on page 7.

DIVIDEND

The directors do not recommend payment of a dividend.

STATEMENT AS TO DISCLOSURE TO THE COMPANY'S AUDITORS

With respect to each Director at the time this report was approved:
a) There is, so far as each Director is aware, no relevant audit information of which the company's auditor is
unaware; and
b) The Director has taken all the steps that ought to have been taken as a Director so as to be aware of any
relevant audit information and to establish that the company's auditor is aware of that information

AUDITORS

Mararia Kamau & Co , Certified Public Accountants, were appointed as the independent auditors and have expressed
their willingness to continue in office in accordance with the provisions of section 719 (2) of the Kenyan Companies
Act 2015.

BY ORDER OF THE BOARD

Director

Date ........................................................... 2022

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SAOS GENERAL CONTRACTORS LIMITED

STATEMENT OF DIRECTORS RESPONSIBILITIES

The Kenyan Companies Act, 2015 requires the directors to prepare financial statements for each financial year that
give a true and fair view of the financial position of the Company as at the end of the financial year and its profit or
loss for that year. It also requires the directors to ensure that the Company keeps proper accounting records that: (a)
show and explain the transactions of the Company; (b) disclose, with reasonable accuracy, the financial position of
the Company; and (c) enable the directors to ensure that every financial statement required to be prepared complies
with the requirements of the Companies Act, 2015.

The directors accept responsibility for the preparation and presentation of these financial statements accordance with
International Financial Reporting Standards and in the manner required by the Kenyan Companies Act, 2015. They
also accept responsibility for:
i. designing, implementing and maintaining such internal control as they determine necessary to enable the
presentation of financial statements that are free from material misstatement, whether due to fraud or error
ii. selecting suitable accounting policies and applying them consistently; and making accounting estimates and
judgements that are reasonable in the circumstances.

Having made an assessment of the Company’s ability to continue as a going concern, the directors are not aware of
any material uncertainties related to events or conditions that may cast doubt upon the Company’s ability to continue
as a going concern.

The directors acknowledge that the independent audit of the financial statements does not relieve them of their
responsibilities.

Approved by the board of directors on..................................................... 2022 and signed on its behalf by:

……………………………………………… …………………………………………...
Director Director

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REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF SAOS GENERAL CONTRACTORS
LIMITED

Opinion

We have audited the accompanying financial statements of Saos General Contractors Limited, set out on pages 7 to 14 which
comprise the balance sheet as at 31st December 2021, the profit and loss account and statements of comprehensive income,
changes in equity and cash flows for the year then ended, and notes, including a summary of significant accounting policies.

In our opinion the accompanying financial statements give a true and fair view of the financial position of the company as at 31st
December 2021 and of its financial performance and cash flows for the year then ended in accordance with International Financial
Reporting Standards and the requirements of the Kenyan Companies Act, 2015.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards
are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are
independent of the company in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for
Professional Accountants (IESBA Code) together with the ethical requirements that are relevant to our audit of the financial
statements in Kenya, and we have fulfilled our ethical responsibilities in accordance with these requirements and the IESBA
Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion

Other information
The directors are responsible for the other information. Other information comprises the information included in the Annual
Report, but does not include the financial statements and our auditor's report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in
the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a
material misstatement of this other information; we are required to report that fact. We have nothing to report in this regard

Directors’ Responsibility for the Financial Statements

The directors are responsible for the preparation and fair presentation of the financial statements that give a true and fair
view in accordance with International Financial Reporting Standards and the requirements of the Kenyan Companies
Act, 2015, and for such internal control as the directors determine is necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless
the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.

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Auditor's responsibilities for the audit of the financial statements (continued)

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism
throughout the audit. We also:
 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations or the override of internal control.
 obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control.
 evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by management.
 conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on
the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required
to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of the
auditor's report. However, future events or conditions may cause the company to cease to continue as a going concern.
 evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and
whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Report on other matters prescribed by the Kenyan Companies Act, 2015

In our opinion the information given in the report of the directors on page 3 is consistent with the financial statements.

The engagement partner responsible for the audit resulting in this independent auditor's report was CPA Andrew Kamau Mararia,
Practising Certificate No.1871.

For and on Behalf of Mararia Kamau & Co

Certified Public Accountants

Date ....................................................................... 2022

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SAOS GENERAL CONTRACTORS LIMITED

STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2021

2021
Notes Kshs
INCOME
Turnover 3 9,205,706
Cost of sales 4 (7,180,998)

Gross profit 2,024,708

EXPENDITURE
Operating expenses 5 834,233

834,233

Profit before tax 6 1,190,474

Tax 7(a) (297,619)

Profit/(loss) after tax 892,855

========

Report of the independent Auditors – page 5-6

The notes on pages 11 to 14 form part of these financial statements.

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SAOS GENERAL CONTRACTORS LIMITED

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2021
2021
Notes Ksh
ASSETS
NON – CURRENT ASSETS
Property, plant and equipment 8 103,500

103,500

CURRENT ASSETS
Cash and cash equivalents 9 1,122,082
Trade & other receivables 10 545,774

1,667,855

TOTAL ASSETS 1,771,355

========

EQUITY AND LIABILITIES

EQUITY
Share capital 11 100,000
Revenue Reserves 892,855

992,855

CURRENT LIABILITIES
Trade and other payables 12 480,881
Tax payable 7(b) 297,619

778,500

TOTAL EQUITY AND LIABILITIES 1,771,355

========

The financial statements on pages 7 to 14 were approved by the Board of directors on ………………………………
2023 and were signed on behalf of the Board by:

Director Director

Report of the independent Auditors – page 5-6

The notes on pages 11 to 14 form part of these financial statements.

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SAOS GENERAL CONTRACTORS LIMITED

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2021

Share Capital Revenue Total

Reserve
Kshs Kshs Kshs
YEAR 2021
At 1 January 2021 100,000 - 100,000

Profit for the year - 892,855 892,855

At 31 December 2021 100,000 892,855 992,855

====== ======= ========

The notes on pages 11 to 14 form part of these financial statements.

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SAOS GENERAL CONTRACTORS LIMITED

STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2021

Note 2021
Kshs

OPERATING ACTIVITIES
CASH FLOW FROM OPERATING ACTIVITIES
Profit before taxation 1,190,474

Adjustments for non-cash income and expenses:

Depreciation of property and equipment 8 11,500
Changes in operating assets and liabilities
Decrease(increase)in trade & other receivables (545,774)
Decrease(increase)in inventories -
Increase(decrease) in trade and other payables 480,881

Net cash from operating activities 1,137,082

Income taxes paid -
-------------
Net cash from operating activities 1,137,082

INVESTING ACTIVITIES
Acquisition of Plant & Equipment (115,000)

Net cash used in investing activities (115,000)

FINANCING ACTIVITIES
Share Capital 100,000

Net cash used in investing activities 100,000

Net increase(decrease) in cash and cash equivalents 1,122,082

Cash and cash equivalents at the beginning of the year 9 -
-------------
Cash and cash equivalents at the end of the year 9 1,122,082
=======

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SAOS GENERAL CONTRACTORS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2021

1. ACCOUNTING POLICIES
The significant accounting policies adopted in the preparation of these general purpose financial statements
are set out below:

a) Basis of measurement
The financial statements have been prepared in accordance with and comply with International Financial
Reporting Standards (IFRS) and the requirements of the companies act of Kenya.

The financial statements are prepared under the historical cost convention.

b) Income recognition
The Company recognises revenue as and when it satisfies a performance obligation by transferring control of a
product or service to a customer. The amount of revenue recognised is the amount the Company expects to
receive in accordance with the terms of the contract, and excludes amounts collected on behalf of third parties,
such as Value Added Tax.
c) Borrowing costs
Borrowing costs, net of any temporary investment income on those borrowings, that are attributable to
acquisition, construction or production of a qualifying asset are capitalised as part of the asset. The net borrowing
cost capitalised is either the actual borrowing cost incurred on the amount borrowed specifically to finance the
asset; or in the case of general borrowings, the borrowing cost is determined using the overall weighted average
cost of the borrowings on all outstanding borrowings during the year less any specific borrowings directly
attributable to the asset and applying this rate to the borrowing attributable to the asset. Capitalisation of
borrowing costs ceases when all activities necessary to prepare the qualifying asset for its intended use or sale are
complete. All other borrowing costs are recognised in the profit and loss account in the year in which they are
incurred.

d) Taxation
Tax on the profit or loss for the year comprises current tax. Current tax is provided on the results in the year as
shown in the accounts adjusted in accordance with tax legislation.

e) Property, plant and equipment

Property, plant and equipment are stated at their historical cost amount less accumulated depreciation and any
impairment losses.

Depreciation is charged so as to write off the cost or valuation of the property, plant and equipment in equal
annual instalments over their estimated useful lives, at the following annual rates:

The rates used are as follows: -

Computers 25.0%
Furniture Fittings & Equipment 10.0%
Motor Vehicles 25.0%

The useful life of property, plant and equipment and the pattern of utilization of economic benefits arising from
the use of the assets are reviewed at each statement of financial position to take into account any changes in the
market, economic and industry trends.

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SAOS GENERAL CONTRACTORS LIMITED

NOTES TO THE FINANCIAL STATEMENTS (...continued)

FOR THE YEAR ENDED 31 DECEMBER 2021

f) Financial instruments
Financial assets and liabilities are recognized in the company’s statement of financial position when the
company has become party to the contractual provisions of the instruments.

Trade receivables
Trade receivables are carried at anticipated realizable value. An estimate is made for doubtful receivables based
on a review of all outstanding amounts at the end of the year. Bad debts are written off in the year in which they
are identified as uncollectible.

Trade payables
Trade payables are stated at their nominal value.

g) Cash and cash equivalents

For purposes of presentation in the statement cash flows cash and cash equivalents is comprised of cash and
net balances from the banking institutions.

h) Impairment
At each statement of financial position date, the company reviews the carrying amounts of its financial assets,
tangible and intangible assets to determine whether there is any indication that those assets have suffered an
impairment loss. If any such indication exists, the asset’s recoverable amount is estimated and an impairment
loss is recognized in the income statement whenever the carrying amount of the asset exceeds its recoverable
amount.

i) Comparatives
Wherever necessary, comparative figures have been adjusted to conform to changes in presentation in current
year.

2. CRITICAL JUDGEMENTS AND USE OF ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with International Financial Reporting Standards requires
the use of certain critical accounting estimates. It also requires directors to exercise their judgement in the process
of applying the company’s accounting policies. The areas involving a higher degree of judgement or complexity,
or areas where assumptions and estimates are significant to the financial statements are disclosed in the relevant
sections of the financial statements. Although these estimates are based on directors’ best knowledge of current
events and actions they may undertake in the future, actual results ultimately may differ from those estimates.
These are dealt with below:

Critical estimates are made by the directors in determining the useful lives of property, plant and equipment.
Where applicable, the directors consulted experts to determine accounting estimates that require special or
technical knowledge and experience.
2021
Kshs
3. TURNOVER
Sales 9,205,706

9,205,706
========

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SAOS GENERAL CONTRACTORS LIMITED

NOTES TO THE FINANCIAL STATEMENTS (...continued)

FOR THE YEAR ENDED 31 DECEMBER 2021
2021
Kshs
4. COST OF SALES
Direct Costs 7,180,998

7,180,998
========
5. OPERATING EXPENSES
Bank Service Charges 29,702
Electricity 1,000
Fuel 29,700
Mpesa Charges 2,027
Office Expense 37,016
Postage and Delivery 400
Printing & Stationery 19,570
Rent & Rates 20,000
Repairs and Maintenance 26,575
Salaries & Wages 352,000
Telephone 36,878
Travel 177,865
Wages 10,000
Audit Fees 80,000
Depreciation 11,500

834,233
========
6. PROFIT / (LOSS) BEFORE TAX
Is stated
after charging:
Audit fees - Current year 80,000
Depreciation -

7. TAXATION
Statement of comprehensive income
Income statement charge – current -
Deferred tax -

(b)Statement of Financial Position

At 1 January -
Charge for the year 297,619
Paid during the year -

At 31 December 297,619
========

(c) DEFERRED TAXATION

At 01 January -
Prior year adjustment -
Deferred tax charge -
. -----------
At 31 December -
======
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SAOS GENERAL CONTRACTORS LIMITED

NOTES TO THE FINANCIAL STATEMENTS (...continued)

FOR THE YEAR ENDED 31 DECEMBER 2021

8. PROPERTY, PLANT AND EQUIPMENT

Furniture/Fittings Totals
YEAR 2021
COST/VALUATION
At 1 Jan 2021 115,000 115,000
Additions - -
------- -------
At 31 December 2021 115,000 115,000
===== =====
DEPRECIATION
At 1 Jan 2021 - -
Charge for the year 11,500 11,500

At 31 December 2021 11,500 11,500

===== =====
NET BOOK VALUE
At 31 December 2021 103,500 103,500
===== =====

2021
Kshs
9. CASH AND CASH EQUIVALENTS
Cash at Bank 1,122,082
Cash at Hand -

1,122,082
========
10. TRADE & OTHER RECEIVABLES
Trade receivables -
Other receivables 545,774

545,774
======
11. SHARE CAPITAL
Authorised
1,000 Ordinary Shares of Kshs 100 each 100,000
=====
Issued and fully paid
1,000 Ordinary Shares of Kshs 100 each 100,000
=====

12. TRADE AND OTHER PAYABLES

Trade payables -
VAT Payable 400,881
Accruals 80,000

480,881
=======

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SAOS GENERAL CONTRACTORS LIMITED

NOTES TO THE FINANCIAL STATEMENTS (...continued)

FOR THE YEAR ENDED 31 DECEMBER 2021

13. CURRENCY
These financial statements are presented in Kenya Shillings (Kshs).

14. SUBSEQUENT EVENTS

There were no subsequent events occurring in period after the report date that have come to our attention with a
material effect on the financial statements as at 31 December 2021.

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SAOS GENERAL CONTRACTORS LIMITED
PIN: P051240626Z

2021 INCOME TAX COMPUTATION

Business Interest Total

Kshs Kshs Kshs
Profit as per accounts 1,190,474 - 1,190,474
-
Add: Depreciation 11,500 - 11,500

1,201,974 - 1,201,974
Less:- Wear & Tear charge (11,500) - (11,500)

Adjusted taxable profit/(Loss) for the year 1,190,474 - 1,190,474

Adjusted taxable profit 1,190,474 - 1,190,474

Loss brought forward - - -
---------- ---------- ----------
1,190,474 - 1,190,474
Tax thereon @ 25 % 297,619 - 297,619
======== ======== ========

WEAR & TEAR SCHEDULE

CLASS IV CLASS IV TOTAL

25.00% 10.00%
KSHS KSHS KSHS
W.D.V AT 01/01/2021 115,000 115,000
Additions - - -

- 115,000 115,000
Wear & Tear charge - (11,500) (11,500)

W.D.V AT 31/12/2021 - 103,500 103,500

===== ===== ======

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