Company a FS 2018-To Edit

COMPANY A
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2018
Registered address and principal place of business
Sultan Qaboos Street

Azaiba
P.O. Box 620
Postal Code 113
Sultanate of Oman
COMPANY A
FINANCIAL STATEMENTS
Contents Page
Independent auditor’s report 1-2
Statement of comprehensive income 3
Statement of financial position 4
Statement of changes in equity 5
Statement of cash flows 6
Notes to the financial statements 7 - 23

1
Independent auditor’s report to the shareholders of

COMPANY A
Report on the audit of the financial statements
Our opinion
In our opinion, the financial statements present fairly, in all material respects the financial position of
COMPANY A (the “Company”) as at 31 December 2018, and its financial performance and its cash flows for
the year then ended in accordance with International Financial Reporting Standards.
What we have audited
The Company’s financial statements comprise:

 the statement of financial position as at 31 December 2018;
 the statement of comprehensive income for the year then ended;
 the statement of changes in equity for the year then ended;
 the statement of cash flows for the year then ended; and
 the notes to the financial statements, which include a summary of significant accounting policies.
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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Independence
We are independent of the Company in accordance with the International Ethics Standards Board for
Accountants’ Code of Ethics for Professional Accountants (IESBA Code) and the ethical requirements that are
relevant to our audit of the financial statements in the Sultanate of Oman. We have fulfilled our other ethical
responsibilities in accordance with these requirements and the IESBA Code.
Responsibilities of management and those charged with governance for the financial statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance
with International Financial Reporting Standards and for such internal control as management determines 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, management is 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 management either intends to liquidate the Company or to cease operations,
or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
PricewaterhouseCoopers LLC, Salam Square - South, 4th Floor, Suites 402-404, Madinat Al Sultan Qaboos, P.O. Box 3075, Ruwi, Postal
Code 112, Muscat, Sultanate of Oman, T: +968 2 455 9110, F: +968 2 456 4408, www.pwc.com/me
Chartered Accountants Licence No. L1065369, Management Consultants Licence No. L1065290, Commercial Register No. 1230865
2
Independent auditor’s report to the shareholders of

COMPANY A (continued)
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.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism 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 our
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 legal and regulatory requirements
Further, we report that the financial statements comply, in all material respects, with the relevant requirements
of the Commercial Companies Law of 1974, as amended.
PricewaterhouseCoopers LLC
[Date]
Muscat, Sultanate of Oman
3
COMPANY A
STATEMENT OF COMPREHENSIVE INCOME

2018 2017
Notes RO RO
INCOME
Revenue 6 8,946,979 8,060,684
Direct costs 8 (10,815,332) (8,783,277)
Gross loss (1,868,353) (722,593)

Other Income 7 796,668 910,306
Administration and General expenses 9 (5,067,923) (4,314,958)
Depreciation and amortization 13 (2,701,839) (2,135,426)
Operating profit (8,841,447) (6,262,671)
Finance (expense)/income-net 11 (165,284) 138,717

Subsidies 12 7,866,428 6,123,954
Profit before tax (1,140,303) --
Tax -- --
Profit for the period (1,140,303) --
The notes and other explanatory information on pages 7 to 23 form an integral part of these financial statement
Independent auditor’s report – pages 1 - 2.
4
COMPANY A
STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2018
2018 2017
Notes RO RO
ASSETS
Non-current assets
Property, plant and equipment 13 20,508,302 9,550,971
Current assets
Inventories 14 144,484 126,735
Trade receivables 15 5,184,536 4,000,300
Other current assets 16 1,696,346 241,242
Other financial assets at amortised cost 17 203,858 165,455
Cash and cash equivalents 18 2,406,224 5,857,033
9,635,448 10,390,765
Total assets 30,143,750 19,941,736
EQUITY AND LIABILITIES

EQUITY
Share capital 19 28,044,209 6,000,000
Amounts contributed towards increase in share capital - 22,044,209
Legal Reserve 20 103,913 103,913
Accumulated losses (14,728,642) (13,373,770)
Net equity 13,419,480 14,774,352
LIABILITIES
Non-current liabilities
Deferred Government grant 12(c) - 49,986
Interest-bearing loans and borrowings 21 11,480,769 1,150,305
End of service benefits 25 173,835 141,306
11,654,604 1,341,597
Current liabilities
Current portion of deferred government grant 12(c) 49,986 579,659
Current portion of interest-bearing loans and borrowings 21 533,990 418,725
Trade and other payables 26 4,485,690 2,827,403
5,069,666 3,825,787
Total liabilities 16,724,270 5,167,384
Total equity and liabilities 30,143,750 19,941,736
These financial statements set out on pages 3 to 23 were approved and authorised for issue by the Board of
Directors on [Date] and signed on their behalf by:
Nabil Al Baimani Ahmed Ali Al Bulushi Ahmed Abdullah Al Busaidi

Chairman Chief Executive Office Finance Manager
Independent auditor’s report - pages 1 - 2.

5
COMPANY A
STATEMENT OF CHANGES IN EQUITY

Amounts
contributed
towards
Share increase in Legal Accumulated
capital share capital reserve losses Total
RO RO RO RO RO
At 1 January 2017 and 31

December 2017 6,000,000 22,044,209 103,913 (13,373,770) 14,774,352
At 1 January 2018 -as

originally presented 6,000,000 22,044,209 103,913 (13,373,770) 14,774,352
Change in accounting policy - - - (214,569) (214,569)
At 1 January 2018 - restated 6,000,000 22,044,209 103,913 (13,588,339) 14,559,783
Profit / (loss) for the year - - - (1,140,303) (1,140,303)
Share capital registered during the year 22,044,209 (22,044,209) - - -
31 December 2018 28,044,209 - 103,913 (14,728,642) 13,419,480
The notes and other explanatory information on pages 7 to 23 form an integral part of these financial statements.
2
6
COMPANY A
STATEMENT OF CASH FLOWS

2018 2017
Notes RO RO
Cash flow from operating activities
Net loss for the year (1,140,303) -
Adjustment for:
Depreciation 2,701,839 2,135,426
Impairment loss 73,892 -
(Gain)/ loss on disposal of property, plant and equipment (3,069) 15,023
Finance cost 280,213 53,300
Finance income (114,929) (192,017)
Government subsidy and deferred government grant (7,866,428) (6,123,954)
End of service benefits 34,913 47,378
Operating cash flows before payment of end of service
benefits and changes in working capital (6,033,872) (4,064,844)
Payment of end of service benefits (2,384) (14,059)
Changes in working capital:

Inventories (17,749) 15,839
Trade and other receivables (1,480,932) 713,315
Trade and other payables 1,837,377 186,065
Net cash used in operating activities (5,697,560) (3,163,684)
Cash flow from investment activities

Purchase of property, plant and equipment (13,659,170) (993,845)
Proceeds from disposal of property, plant and equipment 3,069 117,577
Interest received 114,929 192,017
Fixed term cash deposits (6 months) 3,664,882 (5,713,665)
Net cash used in investment activities (9,876,290) (6,397,916)
Cash flow from financing activities

Term loan received/ (repaid) 10,445,729 (406,269)
Interest paid (251,826) (53,300)
Amounts received towards Government subsidies 5,594,020 -
Net cash used in financing activities 15,787,923 (459,569)
Increase/ (decrease) in cash and cash equivalents 214,073 (10,021,169)

Cash and cash equivalents at the beginning of the year 143,368 10,164,537
Cash and cash equivalents at the end of the year 18 357,441 143,368
The notes and other explanatory information on pages 7 to 23 form an integral part of these financial statements.
Independent auditor’s report – pages 1 - 2.

OMAN NATIONAL TRANSPORT COMPANY SAOC 7
NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2018 (continued)
1 Legal status and principal activities
COMPANY A (the ‘Company’) is a closely held joint stock Company registered in the Sultanate of Oman.
The principal activity of the Company is the provision of transportation services.
The Company is owned by Oman Global Logistics Group SAOC 99.98% shareholding (2017 - 99.98%
shareholding). The remaining shares are held equally by Oman Development Bank SAOG and Port Services
Corporation SAOG. The Company operates under the management of the Oman Global Logistics Group SAOC
and is consolidated in the books thereof.
2 Basis of preparation
The principal accounting policies are summarised below. These policies have been consistently applied to each
of the years presented, unless otherwise stated.
The financial statements are prepared on historical cost basis and in accordance with International Financial
Reporting Standards (IFRS).
The Company has accumulated losses of RO 14,728,642 (2017 - RO 13,373,770) as at 31 December 2018 and is
dependent on funding from the Oman Global Logistics Group SAOC to finance its operations and capital
requirements.
The Ministry of Finance has confirmed that Oman Global Logistics Group SAOC is a government Company
100% owned by the Government of the Sultanate of Oman and that the Ministry shall continue to provide
financial support to the group and its subsidiaries to enable the group to continue as a going concern for the
foreseeable future and to discharge its liabilities as they fall due. There have been no circumstances which
would indicate withdrawal of such support. Accordingly, it is considered appropriate by management for these
financial statements to be prepared on a going concern basis.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting
estimates. It also requires management to exercise its judgment in the process of applying the Company’s
accounting policies. The estimates and underlying assumptions are reviewed by the management on an ongoing
basis. Changes in assumptions may have a significant impact on the financial statements in the period the
assumptions changed. Management believes that the underlying assumptions are appropriate. The areas
involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant
to the financial statements are disclosed in note 5 to these financial statements.
(a) Standards and amendments effective for the year ended 31 December 2018 and relevant for the
Company’s operations:
For the year ended 31 December 2018, the Company has adopted all of the new and revised standards and
interpretations issued by the International Accounting Standards Board (IASB) and the IFRS Interpretations
Committee (IFRS IC) of the IASB that are relevant to its operations and effective for accounting periods
beginning on 1 January 2018.
The company changed its accounting policies and made retrospective adjustments with practical expedients as a
result of adopting the following standards:
• IFRS 9 Financial Instruments

• IFRS 15 Revenue from Contracts with Customers, and
In addition to the above standards, the company has also elected to early adopt IFRS 16 Leases, which was
originally effective from 1 January 2019.
The new accounting policies and the impact of the adoption of these standards and are disclosed in note 30.
3 Summary of significant accounting policies

OMAN NATIONAL TRANSPORT COMPANY SAOC

3.1 Revenue recognition
Revenue represents the standard fare and contract value of services provided by the Company.
Revenue from passenger transportation services is recognised when transportation services at the fixed routes
are utilised by the passengers. Revenue from contract transportation services is recognised in accordance with
the terms of the agreements, which amongst others includes fixed charges based on number of trips, number of
days services performed, etc.
3.1.a Disaggregation of revenue from contracts with customers
The Company derives revenue from the transfer of goods and services over time and at a point in time in
the following major product lines:
2018 2017
Charter Bus and Charter Bus and
hire service cargo service Total hire service cargo service Total
At 31 December RO RO RO RO RO RO
Time of revenue
At a point in time - 3,416,910 3,416,910 - 2,700,158 2,700,158
Overtime 55,451 5,474,618 5,530,069 28,848 5,331,678 5,360,526
55,451 8,891,528 8,946,979 28,848 8,031,836 8,060,684
3.1.b Assets and liabilities related to contracts with customers
The Company has recognised the following liabilities related to contracts with customers:
2018 2017
RO RO
Contract liabilities relating to:
Advertisement contracts 75,304 -
75,304 -
The Company has not recognised any assets related to contracts with customers.
3.1.c Significant changes in contract assets and liabilities
Contract assets have decreased as the Company has provided fewer services ahead of the agreed payment
schedules for fixed-price contracts. The Company also recognised a loss allowance for contract assets following
the adoption of IFRS 9, see note 30 for further information.
Contract liabilities for advertisement contracts have increased by RO 75,304 (2017: nil) following the adoption
of IFRS 15, see note24.
3.1.d Revenue recognised in relation to contract liabilities
The following table shows how much of the revenue recognised in the current reporting period relates to
performance obligations that were satisfied in a prior year.
Consideration from advertisement contract, not previously recognised. 4,284 -

4,284 -
The Company has not recognized any revenue that was included in the contract liability balance at the beginning
of the period.
3 Summary of significant accounting policies (continued)
8

3.2 Interest income and expense
Interest income and expense are accounted for on an accruals basis using the effective interest rate method.
3.3 Foreign currency transactions
Items included in the financial statements of the Company are measured using the currency of the primary
economic environment in which the entity operates (‘the functional currency’). The financial statements are
presented in Rial Omani, which is the Company’s functional and presentation currency.
Foreign currency transactions are translated into Rial Omani at the exchange rate prevailing on the transaction
date. Foreign currency assets and liabilities are translated into Rial Omani at the exchange rate prevailing at the
reporting date. Differences on exchange are dealt with in the statement of comprehensive income.
3.4 Taxation
Taxation on the results for the year comprises current tax calculated as per the fiscal regulations of the Sultanate
of Oman and deferred tax.
Current tax is recognised in the statement of comprehensive income as the expected tax payable on the taxable
income for the year, using tax rates enacted or substantially enacted at the reporting date, and any adjustment to
tax payable in respect of previous years.
Deferred income tax is provided, using the liability method, for all temporary differences arising between the tax
bases of assets and liabilities and their carrying values for financial reporting purposes. Currently enacted tax
rates are used to determine deferred tax. Deferred income tax assets and liabilities are offset as there is a legally
enforceable right to offset these in Oman.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available
against which the unused tax losses and credits can be utilised. Deferred tax assets are reduced to the extent that
it is no longer probable that the related tax benefit will be realised.
The principal temporary differences arise from depreciation on property, plant and equipment, provisions for
doubtful debts and slow moving inventories and accumulated tax losses.
3.5 Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation and any identified impairment loss.
The cost of property, plant and equipment is the purchase price together with any incidental expenses.
Subsequent costs are included in the assets’ carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the Company and
the cost of the item can be measured reliably. All other repairs and maintenance are charged to the statement of
comprehensive income during the financial period in which they are incurred.
The cost of property, plant and equipment is written down to residual value in equal instalments over the
estimated useful lives of the assets. The estimated useful lives are:
Buildings and porta cabins 5-13 years

Vehicles 5-10 years
Plant and machinery 3-10 years
Office equipment 5 years
Furniture and fixtures 5 years
The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at the end of each
reporting period.
9

3.5 Property, plant and equipment(continued)
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying
amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by reference to their carrying amounts and are taken into account
in determining operating results of the year.
Capital work-in-progress is stated at cost. When ready for use, capital work-in-progress is transferred to the
appropriate property, plant and equipment category and depreciated in accordance with the Company’s policy.
Right-of-use assets are measured at cost comprising the following:
 the amount of the initial measurement of lease liability

 any lease payments made at or before the commencement date less any lease incentives received
 any initial direct costs, and
 restoration costs.
3.6 Finance lease
Effective 1 January 2018, leases are recognised as a right-of-use asset and a corresponding liability at the date at
which the leased asset is available for use by the Company. Each lease payment is allocated between the liability
and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant
periodic rate of interest on the remaining balance of the liability for each period. The right-of-use asset is
depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include
the net present value of the following lease payments:
 fixed payments (including in-substance fixed payments), less any lease incentives receivable
 variable lease payment that are based on an index or a rate
 amounts expected to be payable by the lessee under residual value guarantees
 the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
 payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that
option.
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined, or
the Company’s incremental borrowing rate.
Right-of-use assets are measured at cost comprising the following:
 the amount of the initial measurement of lease liability

 any lease payments made at or before the commencement date less any lease incentives received
 any initial direct costs, and
 restoration costs.
Payments associated with short-term leases and leases of low-value assets are recognised on a straight-line basis
as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less.
3.7 Inventories
Inventories are stated at lower of cost and net realisable value. Net realisable value is the estimated selling price
in the ordinary course of business, less the estimated costs of completion and selling expenses. The cost of
inventories is based on weighted average basis and includes expenditure incurred in acquiring the inventories
and bringing them to their existing location and condition.
10

3.8 Financial assets
Financial assets are recognised in the Company’s statement of financial position when the Company becomes a
party to the contractual provisions of the instrument. The Company classifies its financial assets as loans and
receivables. The classification depends on the purpose for which the financial assets were acquired.
Management determines the classification of its financial assets at initial recognition.
Financial assets are recognised in the Company’s statement of financial position when the Company becomes a
party to the contractual provisions of the instrument. The Company classifies its financial assets as loans and
receivables. The classification depends on the purpose for which the financial assets were acquired.
Management determines the classification of its financial assets at initial recognition.
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. They are included in current assets, except for maturities greater than 12 months
after the end of the reporting period. These are classified as non-current assets. The Company’s loans and
receivables comprise trade and other receivables, short-term deposits and cash and cash equivalents in the
statement of financial position.
3.9 Other financial assets
Other financial assets are assets measured at fair value, gains and losses will either be recorded in profit or loss
or OCI.
Trade receivables
Trade receivables are recognised initially at fair value, less provision for impairment. A provision for
impairment of trade receivables is established when there is objective evidence that the Company will not be
able to collect all amounts due according to the original terms of receivables. Significant financial difficulties of
the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or
delinquency in payments are considered indicators that the trade receivable is impaired. An estimate is made for
doubtful debts based on a review of all outstanding amounts at the year end.
The amount of the provision is recognised in the statement of comprehensive income within ‘general and
administration expenses’. When a trade receivable is uncollectible, it is written off against the allowance
account for trade receivables. Subsequent recoveries of amounts previously written off are credited against
‘general and administration expenses’ in the statement of comprehensive income.
Cash and cash equivalents
For the purpose of the statement of cash flows, cash and cash equivalents comprises bank balances, cash and
short term deposits with a maturity of three months or less from the date of placement.
Other financial assets at amortised cost
The Group classifies its financial assets as at amortised cost only if both of the following criteria are met:
• the asset is held within a business model whose objective is to collect the contractual cash flows, and
• the contractual terms give rise to cash flows that are solely payments of principal and interest.
11

3.10 Impairment
(a) Financial assets
At the end of each reporting period, the management assesses if there is any objective evidence indicating
impairment of financial assets carried at cost or non-collectability of receivables. An impairment loss, if any,
arrived at as the difference between the carrying amount and the recoverable amount, is recognised in the
statement of comprehensive income. The recoverable amount represents the present value of expected future
cash flows discounted at the original effective interest rate. Cash flows relating to short term receivables are not
discounted.
(b) Non financial assets
At the end of each reporting period, the management assesses if there is any indication of impairment of non-
financial assets. If an indication exists, the management estimates the recoverable amount of the asset and
recognises an impairment loss in the statement of comprehensive income. The management also assesses if there
is any indication that an impairment loss recognised in prior years no longer exists or has reduced. The resultant
impairment loss or reversals (except for goodwill) are recognised immediately in the statement of
comprehensive income.
(c) Other financial assets
Effective 1 January 2018, the Company assesses on a forward-looking basis the expected credit loss associated
with its debt instruments carried at amortised cost and FVOCI. The impairment methodology applied depends
on whether there has been a significant increase in credit risk.
The Company applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime
expected loss allowance for all trade receivables and contract assets.
Trade receivables and contract assets are written off when there is no reasonable expectation of recovery.
Indicators that there is no reasonable expectation of recovery include, amongst others, the failure of a debtor to
engage in a repayment plan with the group, and a failure to make contractual payments for a period of greater
than 120 days past due.
Impairment losses on trade receivables and contract assets are presented as net impairment losses within
operating profit. Subsequent recoveries of amounts previously written off are credited against the same line
item.
3.11 End of service benefits and leave entitlements
End of service benefits are accrued in accordance with the terms of employment of the Company's employees at
the reporting date, having regard to the requirements of the Oman Labour Law 2003 and its amendments and
IAS 19. Employee entitlements to annual leave and leave passage are recognised when they accrue to employees
and an accrual is made for the estimated liability arising as a result of services rendered by employees up to the
reporting date. These accruals are included in current liabilities, while that relating to end of service benefits is
disclosed as a non-current liability.
Contributions to a defined contribution retirement plan and occupational hazard insurance for Omani employees
in accordance with the Omani Social Insurances Law of 1991 are recognised as an expense in the statement of
comprehensive income as incurred.
In accordance with the provisions of IAS 19, Employee benefits, management carries an exercise to assess the
present value of the Company’s obligations as of reporting date, using the actuarial techniques, in respect of
employees’ end of service benefits payable under the Oman aforesaid Labor Law. Under this method, an
assessment is made of an employee’s expected service life with the Company and the expected basic salary at
the date of leaving the service.
12

3.12 Trade and other payables
Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost
using the effective interest rate method. Liabilities are recognised for amounts to be paid for goods and services
received, whether or not billed to the Company.
3.13 Provisions
A provision is recognised in the statement of financial position when the Company has a legal or constructive
obligation as a result of a past event and it is probable that an outflow of economic benefits will be required to
settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash
flows at the rate that reflects current market assessments of the time value of money and, where appropriate, the
risks specific to the liability.
3.14 Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are classified as
current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least
twelve months after the reporting date.
3.15 Government subsidy and deferred Government grant
Government subsidy is the amount of subsidy claimed by the Company and accepted by the grantor
(Oman Global Logistics Group SAOC) as a reimbursement of costs already incurred or as a compensation for
the losses incurred and is recognised in the statement of comprehensive income for the period it becomes
receivable. Any excess over the loss for the year is recognised in the balance sheet as “Government subsidy
received in advance” within ‘Trade and other payables’.
Where the grant relates to an asset, the fair value is credited to a deferred income account and is released to the
statement of comprehensive income over the expected useful life of the relevant asset by equal annual
instalments.
3.16 Other income

Other income is accounted for on an accruals basis, unless collectability is in doubt.
4 Financial risk and capital risk management

4.1 Financial risk factors
The Company’s activities expose it to a variety of financial risks including the effects of changes in market risk
(including foreign exchange and interest rate risk), credit risk and liquidity risk. The Company’s overall risk
management programme focuses on the unpredictability of financial markets and seeks to minimize potential
adverse effects on the financial performance of the Company. Risk management is carried out by the
management under policies approved by the Board of Directors.
(a) Market risk
(i) Foreign exchange risk

Foreign exchange risks arise when future commercial transactions or recognised assets or liabilities are
denominated in a currency that is not the entity’s functional currency. The Company is exposed to foreign
exchange risk arising from US Dollars exposures. Since the foreign currency transactions are in US Dollars
(USD) which is pegged to Rial Omani, management believes should the currency weaken or strengthen against
Rial Omani there would be an insignificant or no impact on the pre-tax profits.
(ii) Interest rates

Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market
interest rates. The Company borrows at interest rates on commercial terms.
13

4 Financial risk and capital risk management (continued)

4.1 Financial risk factors (continued)
Borrowings issued at variable rates expose the Company to cash flow interest rate risk. Borrowings issued at
fixed rates expose the Company to fair value interest rate risk. During the year, the Company’s borrowings were
denominated in Rial Omani and US Dollar. The Company analyses its interest rate exposure on a regular basis
and reassesses the source of borrowings and renegotiates interest rates at terms favourable to the Company.
(b) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument
fails to meet its contractual obligation and arises principally from Company’s receivables and finance lease.
The Company seeks to limit its credit risk with respect to its finance lease and trade receivables by monitoring
outstanding receivable balances. The Company has a policy to deal only with high credit worthy counter parties.
Credit risk arises from cash and cash equivalents, and deposits with banks and financial institutions, as well as
credit exposures to outstanding receivables.
With respect to credit risk arising from the other financial assets of the Company, including cash and cash
equivalents, the Company’s exposure to credit risk arises from default of the counterparty, with a maximum
exposure equal to the carrying amount of these instruments. The Company limits its credit risk with regard to
bank deposits by only dealing with banks with high credit rating.
Concentration of credit risk arises when a number of counter-parties are engaged in similar business activities,
or activities in the same geographic region, or have similar economic features that would cause their ability to
meet contractual obligations to be similarly affected by changes in economic political or other conditions.
Concentrations of credit risk indicate the relative sensitivity of the Company’s performance to developments
affecting a particular industry or geographical location. The Company has significant concentrations of credit
risk with related parties finance lease receivables, details of which are provided in the note below.
The Company evaluates the credit worthiness and business outlook of its customers and specifically those with
significant finance lease receivable on periodic basis and makes appropriate provisions, where necessary.
Major classification of financial assets as at 31 December is as follows:
2018 2017
RO RO
Trade receivables 5,235,303 3,859,166

Other financial assets at amortised cost 203,858 165,455
Bank balances and cash 2,406,224 5,857,033
7,845,384 9,881,654
The Company has significant concentrations of credit risk details of which are provided in note 28. The
Company manages concentration of its credit risk by monitoring collections within the credit period.
c) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The
Company’s approach to manage liquidity is to ensure, as far as possible, that it will always have sufficient
liquidity to meet its financial obligations when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Company’s reputation.
The Company also maintains sufficient bank balances and credit facilities to meet its obligations as they fall due
for payment and is therefore not subject to significant liquidity risk. At the end of the reporting period, the entire
accounts and other payables had contractual maturities of less than one year.
The Company is dependent on the funding from the Oman Global Logistics Group SAOC for annual funding in
order to discharge its financial obligations.

4.1 Financial risk factors (continued)
Contractual cash flows

More
Carrying Less than 1 to 5
than 5 Total
Amount 1 year years
years
RO RO RO RO RO
At 31 December 2018
Non- derivative financial liabilities
Accounts payables and accruals
3,869,9 3,8 3,869
(excluding unearned charter hire
84 69,984 - - ,984
income)
11,661,3 4 7,1 4,032,06 11,661
Term loans
76 31,432 97,878 6 ,376
36, 3
Interest payable
767 36,767 - - 6,767
353, 1 2 35
Right of use assets lease liabilities
383 02,558 50,825 - 3,383
15,921,5 4,4 7,4 4,032,06 15,921
10 40,741 48,703 6 ,510
Contractual cash flows

Carrying Less than 1 to 5 More than
Total
Amount 1 year years 5 years
RO RO RO RO RO
At 31 December 2017
Non- derivative financial liabilities
Accounts payables and accruals
1,948,3 1,9 1,948
(excluding unearned charter hire - -
35 48,335 ,335
income)
1,569,0 4 1,1 1,569
Term loans -
30 18,725 50,305 ,030
8,
Interest payable - -
380 8,380 8,380
3,525,7 2,3 1,1 3,525
45 75,440 50,305 - ,745
15

4.2 Capital risk management
Consistent with others in the industry, the Company monitors capital on the basis of the gearing ratio (debt to
total equity)
2018 2017
RO RO
Debt* 12,014,759 1,569,030

Total equity 28,044,209 28,044,209
Debt to equity ratio (times) 43% 6%
*Debt includes term loans, the loan from Ministry of Finance, loans from commercial banks, obligations under
finance lease, bank overdrafts and excludes the deferred finance cost.
5 Critical accounting estimates and judgements
The preparation of financial statements requires management to make estimates and assumptions that affect the
reported amount of financial assets and liabilities at the reporting date and the resultant provisions and changes
in fair value for the year. Such estimates are necessarily based on assumptions about several factors involving
varying, and possibly different degrees of judgement and uncertainty and actual results may differ from
management’s estimates resulting in future changes in estimated assets and liabilities.
Estimates are regularly evaluated and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances. The estimates and
assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are set out below:
(a) Provision for impairment of trade receivables and other financial assets
The Company applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime
expected loss allowance for all trade receivables and contract assets.
To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared
credit risk characteristics and the days past due. The contract assets relate to unbilled work in progress and have
substantially the same risk characteristics as the trade receivables for the same types of contracts. The Company
has therefore concluded that the expected loss rates for trade receivables are a reasonable approximation of the
loss rates for the contract assets.
The expected loss rates are based on the payment profiles of sales over a period of 36 month before 31
December 2018 or 1 January 2018 respectively and the corresponding historical credit losses experienced within
this period. The historical loss rates are adjusted to reflect current and forward-looking information on
macroeconomic factors affecting the ability of the customers to settle the receivables. The Company has
identified the GDP and the unemployment rate of the countries in which it sells its goods and services to be the
most relevant factors, and accordingly adjusts the historical loss rates based on expected changes in these
factors.

5 Critical accounting estimates and judgements (continued)
On that basis, the loss allowance as at 31 December 2018 and 1 January 2018 (on adoption of IFRS 9) was
determined as follows for both trade receivables and contract assets:
More than More than More than More than

30 days 60 days 90 days 120 days
Current past due past due past due past due
At 31 December 2018
Gross carrying amount (RO) 770,602 564,690 645,468 503,200 3,036,819
Expected loss rate (%) 0.0% 0.7% 0.8% 1.8% 8.8%
Loss allowance - 4,015 5,050 8,950 267,461
More than More than More than More than

30 days 60 days 90 days 120 days
Current past due past due past due past due
At 31 December 2017
Gross carrying amount (RO) 553,510 723,775 728,148 237,408 1,827,909
Expected loss rate (%) 0.0% 0.7% 0.9% 3.8% 10.5%
Loss allowance - 4,837 6,660 8,980 191,107
The closing loss allowances for trade receivables as at 31 December 2018 reconcile to the opening loss
allowances as follows:
2018 2017
RO RO
31 December - calculated under IAS 39 (53,539) -

Amounts restated through opening retained earnings (158,045) -
Opening loss allowance as at 1 January 2018 - calculated under IFRS 9 (211,584) -
Increase in loan loss allowance recognised in profit or loss

during the year (73,892) -
(285,476) -
The loss allowance for other financial assets at amortised cost as at 31 December 2017 and 31 December 2018
was not considered to be material and therefore not recognised in the consolidated financial statements at the
reporting date.
The loss allowances increased by a further RO 73,892 to RO 285,476 for trade receivables during year. The
increase would have been RO 71,813 lower under the incurred loss model of IAS 39.
Trade receivables are written off when there is no reasonable expectation of recovery. Indicators that there is no
reasonable expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment
plan with the Company, and a failure to make contractual payments for a period of greater than 180 days past
due.
(b) Impairment of property, plant and equipment
Management assesses the impairment of property, plant and equipment whenever events or changes in
circumstances indicate that the carrying value may not be recoverable. Factors that are considered important
which could trigger an impairment review include evidence that no profits or cash flows will be generated from
the related asset.
(c) Useful lives and residual values of property, plant and equipment
Management estimates the useful lives and residual value of assets based on best estimates of the expected
period for which the Company will derive economic benefits and the expected price for which the asset will
fetch in the market when the asset is sold. The calculation of useful lives and residual values is based on

management’s assessment of various factors such as the maintenance programs and normal wear and tear based
on industry practice. These estimates are reviewed by the management at each financial year end.
6 Revenue
2018 2017
RO RO
City bus services 1,505,202 1,123,834

Intercity bus service 1,643,379 1,187,724
Long term contracts 5,239,093 5,045,029
Casual charters and courier services 323,780 417,448
Periodic contracts 235,525 286,649
8,946,979 8,060,684
7 Other income
Advertising income 379,180 740,039

Taxi operation revenue 210,729 --
Insurance claims 152,306 86,267
Tender fees 19,800 26,676
Rental income 4,360 6,000
Profit/(loss) on disposal of property, plant and equipment 3,069 (15,023)
Miscellaneous 27,224 5,603
Sponsorship fees -- 60,744
796,668 910,306
8 Direct costs
Direct staff cost (Note 10) 6,489,526 5,310,464

Fuel 2,063,688 1,395,353
Repairs and maintenance of vehicles 1,560,257 1,248,805
Spare parts and consumables 429,936 620,557
Vehicle Insurance and registration 271,925 208,098
10,815,332 8,783,277
9 Administration and general expenses
Indirect staff cost (Note 10) 3,811,309 3,118,844

Utilities 193,105 173,333
Taxi operations expenses 151,685 18,807
Cleaning 137,279 108,783
Training 81,463 128,887
Advertising expenses 76,839 46,722
Travelling and conveyance 74,352 32,512
Bad Debts 73,892 -
Building and equipment maintenance 70,191 102,143
Short term leases 65,555 140,669
Professional charges 35,313 187,539
Bank charges 48,240 8,450
Printing and stationery 40,223 68,151
Uniforms 37,487 22,270
Subscriptions and Periodicals 31,914 24,653
Catering 5,631 18,111
Miscellaneous 133,445 110,084
Directors’ remuneration [note 26(a)] - 5,000
5,067,923 4,314,958
16

10 Staff costs
2018 2017
RO RO
Salaries, wages and allowances 9,141,593 7,122,388

Social security contribution 817,064 600,998
End of service benefits (note 20) 34,913 47,378
Other employee related costs 307,266 658,544
10,300,835 8,429,308
10,300,836
11 Finance (expense)/income - net
Finance income 114,929 192,017

Finance expense (280,213) (53,300)
Finance (expense)/ income - net (165,284) 138,717
12 Government subsidy and deferred Government grant
(a) The Government subsidy and deferred Government grant recognised in the statement of comprehensive
income comprise the following:
Government subsidy 7,286,769 5,218,119

Deferred Government grant transferred to income 579,659 905,835
7,866,428 6,123,954
(b) The movements in deferred Government grant as shown in the statement of financial position are as
follows:
At 1 January 629,645 1,535,480

Amortisation for the year (579,659) (905,835)
At 31 December 49,986 629,645
(c) The current and non- current portion of the deferred Government grant are as follows:
Non-current portion deferred government grant - 49,986

Current portion of deferred government grant 49,986 579,659
49,986 629,645
(d) The movements in Government subsidy received in advance as shown in the statement of financial
position are as follows:
At the beginning of the year 264,000 5,482,119

Received during the year 5,594,020 -
Government subsidy for the year (7,286,769) (5,218,119)
Government subsidies (receivable)/received in advance (1,428,749) 264,000
(e) The operational expenses during the year were partly funded by Government subsidy and grant; and partly
by revenue generated during the year:
Government subsidy and grant 7,866,428 6,123,954

Revenue for the year 9,743,647 8,970,990
Total expenses for the year 17,610,075 15,094,944
17

13 Property, plant and equipment

(a) The movement in property, plant and equipment during the year is set out on pages 21 and 22.
(b) The Company has been granted free of charge leasehold rights by the Government of the Sultanate of
Oman for the use of land, on which the buildings are constructed, over the life of the Company.
14 Inventories
2018 2017
RO RO
Tyres and vehicle spares 124,681 142,422

Fuel and lubricants 19,803 11,223
144,484 153,645
Provision for slow moving inventories - (26,910)
144,484 126,735
Movement in the provision for slow moving and obsolete inventories is as follows:
2018 2017
RO RO
At 1 January 26,910 26,910
Provision made during the year - -
Written off during the year (26,910) -
At 31 December - 26,910
15 Trade receivables
2018 2017
RO RO
Trade receivable 5,470,012 4,053,839

Less: Provision for impairment of trade receivables (285,476) (53,539)
5,184,536 4,000,300
(a) At the reporting date, 94% of trade debtors are receivable from 5 parties (2017 - 92% from 5 parties) in the
Sultanate of Oman.
(b) Details of gross exposure of trade receivables are:
2018 2017
RO RO
Not due 1,284,525 1,259,524

Past due not impaired 3,900,011 2,740,776
Past due and impaired 285,476 53,539
5,470,012 4,070,750
4,053,839
(c) At 31 December 2018, trade receivables of RO 3,900,011 (2017 - RO 2,740,776) were past due but not
impaired. These relate to a number of independent customers for whom there is no recent history of default.
(d) At 31 December 2018, trade receivables of RO 285,476 (2017 - RO 53,539) were past due and impaired.
These relate to balances specifically identified by the Company considering the past history of repayment and
their current repayment capabilities, against which a provision is deemed necessary.
(e) Due to the short-term nature of the current receivables, their carrying amount is considered to be the same
as their fair value.

15 Trade receivables (continued)
(f) Movement in the provision for impairment of trade receivables is as follows:
2018 2017
RO RO
At 1 January 53,539 189,303

Increase in provision- impact of adoption of IFRS 9 (Note 24) 158,045 -
Charge for the year 73,892 -
Written off during the year - (135,764)
At 31 December 285,476 53,539
16 Other current assets
2018 2017
RO RO
Subsidy receivable 1,428,749 -

Prepayments and advances 267,598 241,242
1,696,347 241,242
17 Other financial assets at amortised cost
2018 2017
RO RO
Other receivables 144,560 148,544

Receivables due from related parties 50,767 16,911
Contract assets (accrued income) 8,531 -
203,858 165,455
18 Cash and cash equivalents

2018 2017
RO RO
Cash and Bank balances

- Fixed term cash deposits (6 months) 2,048,783 5,713,665
- Current and other accounts 324,572 104,482
- Cash in hand 32,869 38,886
Total cash and bank balances 2,406,224 5,857,033
Less: Fixed term cash deposits (6 months) (2,048,783) (5,713,665)
Total Cash and cash equivalents 357,441 143,368
19 Share capital
The Company has authorised share capital of 35 million shares (2017 - 35 million shares) of RO 1 each. The
paid-up share capital comprises of 28,044,209 (2017 - 6,000,000) fully paid ordinary shares of RO 1 each.
19

20 Legal reserve
Article 106 of the Commercial Companies Law of the Sultanate of Oman, 1974, as amended requires 10% of a
Company’s net profit for the year be transferred to a non-distributable legal reserve until the amount of the legal
reserve equals to one third of the Company's issued share capital. This reserve is not available for distribution.
21 Interest bearing loans and borrowings

2018 2017
RO RO
At 1 January 1,569,030 1,975,299
New loan during the year 10,510,985 -
Principal repaid during the year (418,639) (406,269)
Lease liabilities under right of use assets- on adoption of IFRS 16(note 22) 353,383
At 31 December 12,014,759 1,569,030
Less: Current portion of term loans (431,432) (418,725)
Lease liabilities under right of use assets – on adoption of IFRS 16
(note 22) (102,558) -
Total current portion of interest-bearing loans and borrowings (533,990) (418,725)
Total non-current portion of interest-bearing loans and borrowings 11,480,769 1,150,305
(a) The term loan is obtained from a commercial bank at an interest rate of 3% per annum. The interest
rate may be re-negotiated by the bank on renewal of the bank facilities which generally takes place
annually. The facility extended by a commercial bank is secured by way of an irrevocable undertaking
to assign the entire contract revenue derived from Sultan Qaboos University and Azzan Bin Qais
School to the Company’s account with the bank. The loan is repayable in 20 equal quarterly
installments which started from 31 March 2016.
(b) The new loan taken during the year is a US Dollar Senior Term Loan for purchases of new buses, 68
buses from MAN and 30 buses from VDL. The interest rate is 3-month LIBOR plus 2.45% per
annum, payable at the end of each 3-month interest period. The loan is repayable in 36 equal quarterly
instalments commencing on 31 December 2019.
(c) On adoption of IFRS 16, the Company recognised lease liabilities in relation to leases which had
previously been classified as ‘operating leases’ under the principles of IAS 17 Leases. These liabilities
were measured at the present value of the remaining lease payments, discounted using the lessee’s
incremental borrowing rate as of 1 January 2018.
(d) All the borrowings of the Company are denominated in Rial Omani and US Dollar.
22 Obligations under finance lease
2018 2017
Minimum PV of Minimum PV of
lease Payments lease payment Payments
payment
RO RO RO RO
Within one year 113,400 108,000 - -
After one year to five years 264,082 245,383 - -
More than five years - - - -
Total minimum lease payments 377,482 353,383 - -
Less: Amount representing finance charges (24,099) - - -
Present value of minimum lease payment 353,383 353,383 - -
Less: current portion of finance lease liability (102,558) (102,558) - -
Non-current portion of finance lease liability 250,825 250,825 - -
20

23 Reconciliation of liabilities arising from financing activities
Cash in Cash out Non-cash

2017 2018
flows flows item
RO RO RO RO RO
1,569 10,510 (41 35
Interest bearing loans and borrowings
,030 ,985 8,638) 3,382 12,014,759
Deferred finance cost
- - - - -
1,569 10,510 (41 35
Liabilities arising from financing activities
,030 ,985 8,638) 3,382 12,014,759
24 Net debt reconciliation
This section sets out an analysis of net debt and the movements in net debt for each of the periods presented.
2018 2017
Net Debt RO RO
5,8
Cash & cash equivalents 2,406,224 57,033
Borrowings - repaybale within one year (431,432) (418,725)
Current portion of lease liabilities under right of use assets (102,558) -
Borrowings - repaybale after one year (11,229,944) (1,150,305)
Non-current portion of lease liabilities under right of use assets (250,825) -
4,288
Net Debt (9,608,535) ,003
Cash & cash equivalents 2,406,224 5,857,033

Gross debt - Fixed interest rates (1,503,774) (418,725)
Gross debt - variable interest rates (10,510,985) (1,150,305)
Net Debt (9,608,535) 4,288,003
Other assets Liabilities from financing activities

Finance
Finance Borrow
Leases
Cash/bank Leases due Borrow due
due Total
overdraft due after within 1 after 1 year
within 1
1 year year
year
RO RO RO RO RO RO
10,16 8,189,2
Net debt as at 1st January 2017 4,537 - - (406,269) (1,569,030) 38
418,7
Cash flows (4,307,504) - - (12,456) 25 (3,901,235)
Acquisitions - finance leases and
lease incentives - - - - - -
Foreign exchange adjustments - - - - - -
Other changes - - - - - -
5,85 4,288,0
Net debt as at 31st December 2017 7,033 - - (418,725) (1,150,305) 03
21

24 Net debt reconciliation (continued)
Other assets Liabilities from financing activities

Finance
Finance Borrow
Leases
Cash/bank Leases due Borrow due
due Total
overdraft due after within 1 after 1 year
within 1
1 year year
year
RO RO RO RO RO RO
5,85 4,288,0
Net debt as at 1st January 2018 7,033 - - (418,725) (1,150,305) 03
Cash flows (2,997,921) (102,558) (250,825) (12,707) (10,079,639) (13,443,650)
Acquisitions - finance leases and
lease incentives (452,888) - - - - (452,888)
Foreign exchange adjustments - - - - - -
Other changes - - - - - -
2,40
Net debt as at 31st December 2018 6,224 (102,558) (250,825) (431,432) (11,229,944) (9,608,535)
25 End of service benefits
2018 2017
RO RO
At the beginning of the year 141,306 107,987

Charge for the year (note 9) 34,913 47,378
Paid during the year (2,384) (14,059)
At the end of the year 173,835 141,306
26 Trade and other payables
Trade payable 2,694,458 874,373

Accruals 1,416,114 1,498,032
Government subsidy received in advance [note 12(d)] - 264,000
Advance from customers 89,237 15,477
Other payables 285,881 175,521
4,485,690 2,827,403
27 Capital commitments
The following table provides details of Company’s obligation under capital commitments:
31-Dec-18 31-Dec-17
RO RO
Property, plant and equipment 1,693,036 35,690
22

28 Taxation
(a) No provision for taxation has been made in the current year in view of carried forward tax losses from
prior years. Tax losses are available for set off against future profits earned within a period of five years from
the respective year in which the loss was incurred. At the reporting date, the Company had tax losses amounting
to RO [xxx] (2017 - RO 8,284,729) available for such carry forward.
(b) The Company's tax assessments for the years 2014 to 2016 are pending finalisation by the Secretariat
General for Taxation. The Management believes that any additional tax liability likely to arise on the completion
of the assessments for the above years, would not be material to the financial position of the Company as at
31 December 2018.
(c) Net deferred tax asset amounting to RO [xxx] (2017 - RO 307,062) on the temporary differences or tax
loss has not been recognised in these financial statements due to uncertainty regarding the timing of availability
of adequate future taxable profits.
29 Related parties
Related parties comprise the shareholders, directors, key management personnel and business entities in which
they have the ability to control or exercise significant influence in financial and operating decisions (other
related parties).
The Company maintains balances with these related parties which arise in the normal course of business from
the commercial transactions, and are entered into at terms and conditions which the management consider to be
comparable with those adopted for arm’s length transactions with third parties.
During the year, the Company entered into transactions with related parties in the normal course of business.
The nature of significant related party transactions and the amounts involved were as follows:
(a) Transactions during the year are as follows:

2018 2017
RO RO
Transactions with share holders

Government subsidies received during the year [note 12(d)] 5,594,020 -
Key management remuneration

Short term employment benefits 360,420 344,086
Director’s remunerations - 5,000
At 31 December 2018 the related party balances are as follows:
Trade and other receivables Trade payables

2018 2017 2018 2017
RO RO RO RO
Other related parties 50,767 16,911 440 597

Shareholder [note 12(d)] 1,428,749 - - -
1,479,516 16,911 440 597
23

30 Effect of changes in accounting policies

This note explains the impact of the adoption of IFRS 9 ‘Financial Instruments’ and IFRS 15 ‘Revenue from
Contracts with Customers’ and IFRS 16 ‘Leases’ on the Company’s financial statements.
30.1 Impact on the financial statements
As explained in note below, IFRS 9, IFRS 15 and IFRS 16 were adopted without restating comparative
information. The reclassifications and the adjustments arising from the new impairment, revenue recognition
and right of use assets rules are therefore not reflected in the statement of financial position as at 31 December
2017 but are recognised in the opening statement of financial position on 1 January 2018.
The following tables show the adjustments recognised for each individual line item. Line items that were not
affected by the changes have not been included. As a result, the sub-totals and totals disclosed cannot be
recalculated from the numbers provided. The adjustments are explained in more detail by standard below.
Statement of financial position 31 December 2017

as originally I January
presented IFRS 9 IFRS 15 2018
RO RO RO RO
Current liabilities
Provision for trade receivables and contract
assets 53,539 158,045 - 211,584
Contract liabilities - - 56,524 56,524
Total liabilities 5,167,384 158,045 56,524 5,381,953
Net assets 14,774,352 (158,045) (56,524) 14,559,783
Accumulated losses (13,373,770) (158,045) (56,524) (13,588,339)

Total equity 14,774,352 (158,045) (56,524) 14,559,783
30.2 IFRS 9 ‘Financial Instruments’ – Impact of adoption

IFRS 9 replaces the provisions of IAS 39 that relate to the recognition, classification and measurement of
financial assets and financial liabilities, derecognition of financial instruments, impairment of financial assets
and hedge accounting.
The adoption of IFRS 9 ‘Financial Instruments’ from 1 January 2018 resulted in changes in accounting policies
and adjustments to the amounts recognised in the financial statements. The new accounting policies are set out
in note 3.9. In accordance with the transitional provisions in IFRS 9, comparative figures have not been restated.
The total impact on the Company’s retained earnings as at 1 January 2018 is as follows:
RO
Closing Accumulated losses at 31 December 2017 - IAS 39/IAS 18 (13,373,770)
Increase in provision for trade receivables and contract assets (158,045)
Opening retained earnings 1 January 2018 - IFRS 9 (13,531,815)
Impairment of financial assets

The Company has three types of financial assets that are subject to IFRS 9’s new expected credit loss model:
 trade receivables
 contract assets, and
 financial assets carried at amortised cost
24

30 Effect of changes in accounting policies (continued)
30.2 IFRS 9 ‘Financial Instruments’ – Impact of adoption (continued)
The Company was required to revise its impairment methodology under IFRS 9 for each of these classes of
assets. The impact of the change in impairment methodology on the Company’s retained earnings is disclosed in
the table in note 13(f) above.
While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the identified
impairment loss was immaterial.
Other financial assets at amortised cost
Other financial assets at amortised cost include receivables under finance lease arrangements, loans receivable,
loans due from related parties and other receivables. All other financial assets at amortised cost are considered to
have low credit risk, and the loss allowance recognised during the period was therefore limited to 12 months
expected losses.
Instruments are considered to be low credit risk when they have a low risk of default and the issuer has a strong
capacity to meet its contractual cash flow obligations in the near term.
Applying the expected credit risk model resulted in the recognition of a loss allowance of RO 21,808 on 1
January 2018 (previous loss allowance was nil) and a further increase in the allowance by RO 7,009 during the
year.
30.3 IFRS 15 'Revenue from Contracts with Customers' – Impact of adoption
The Company has adopted IFRS 15 ‘Revenue from Contracts with Customers’ from 1 January 2018 which
resulted in changes in accounting policies and adjustments to the amounts recognised in the financial statements.
In accordance with the transition provisions in IFRS 15, the Company has adopted the new revenue recognition
rules without restating comparative information. The reclassifications and the adjustments arising from the new
rules are therefore not reflected in the statement of financial position as at 31 December 2017 but are recognised
in the opening statement of financial position on 1 January 2018.
In summary, the following adjustments were made to the amounts recognised in the statement of financial
position at the date of initial application (1 January 2018):
IAS 18 carrying Re- IFRS 15

amount measurements carrying amount
31 December 2017 01 January 2018
RO RO RO
Deferred revenue - 56,524 56,524
The impact on the Company’s retained earnings as at 1 January 2018 is as follows:
Closing retained earnings 31 December - IAS39/IAS 18 (13,373,770)

Adjustment to retained earnings from adoption of IFRS 15 (56,524)
Opening retained earnings 1 January - IFRS 9 and IFRS 15 (13,430,294)
25

30 Effect of changes in accounting policies (continued)
30.3 IFRS 15 'Revenue from Contracts with Customers' – Impact of adoption(continued)
Presentation of contract assets and contract liabilities
The Company has also voluntarily changed the presentation of certain amounts in the balance sheet to reflect the
terminology of IFRS 15 and IFRS 9:
 Accrued rental income recognised in relation to rental income recognised on straight line basis was
previously presented separately on the face of the statement of financial position but is now presented
under other assets, to reflect its different nature.
 Other current receivables and receivables due from related parties were previously presented together
with trade receivables but are now presented as other financial assets at amortised cost in the statement
of financial position, to reflect their different nature.
 Subsidy receivable, prepayments and advances were previously presented together with trade
receivables but are now presented as other current assets in the statement of financial position, to
reflect their different nature.
30.4 IFRS 16 ‘Leases’ – Impact of adoption
The Company has adopted IFRS 16 ‘Leases’ retrospectively from 1 January 2018 but has not restated
comparatives for the 2017 reporting period as permitted under the specific transition provisions in the standard.
On adoption of IFRS 16, the Company recognised lease liabilities in relation to leases which had previously
been classified as ‘operating leases’ under the principles of IAS 17 ‘Leases’. These liabilities were measured at
the present value of the remaining lease payments, discounted using the lessee’s incremental borrowing as at 1
January 2018.
The associated right-of-use assets were measured at the amount equal to the lease liability, adjusted by the
amount of any prepaid or accrued lease payments relating to that lease recognised in the statement of financial
position as at 31 December 2018.
In applying IFRS 16 for the first time, the Company has used the following practical expedients permitted by the
standard:
 the use of a single discount rate to a portfolio of leases with reasonably similar characteristics
 the accounting for operating leases with a remaining lease term of less than 12 months as at 1 January
2018 as short-term leases
 the exclusion of initial direct costs for the measurement of the right-of-use asset at the date of initial
application, and
 the use of hindsight in determining the lease term where the contract contains options to extend or
terminate the lease.
The Company has also elected not to apply IFRS 16 to contracts that were not identified as containing a lease
under IAS 17 and IFRIC 4 Determining whether an arrangement contains a Lease.
26

31 Contingent liabilities
At 31 December 2018, the Company had no contingent liabilities (2017 - RO 138,587 in respect of bank
guarantees given in the normal course of business).
32 Financial instruments by category
(a) The accounting policies for financial instruments have been applied to the line items below:
Loans and receivables

2018 2017
RO RO
Assets as per statement of financial position

Trade and other receivables (excluding prepayments) 6,823,571 4,165,755
Cash and bank 2,406,224 5,857,033
Total 9,229,795 10,022,788
Financial liabilities
2018 2017
More
Less than Between one than 5 Less than Between one
one year and five years years Total one year and five years Total
At 31 December RO RO RO RO RO RO RO
Trade payables 2,694,458 - - 2,694,458 874,373 - 874,373

Bank borrowing 431,432 7,197,878 4,032,066 11,661,376 418,725 1,569,030 1,987,755
Lease Liabilities 102,558 250,825 - 353,383 - - -
Other payable 1,701,995 - - 1,701,995 1,673,553 - 1,673,553
4,930,443 7,448,703 4,032,066 16,411,212 2,966,651 1,569,030 4,535,681
(b) Credit quality of financial assets
As per the credit policy of the Company, customers are extended a credit period of 90 days. The credit quality of
financial assets is determined by the customers’ history of meeting commitments, market intelligence related
information and management’s trade experience. External ratings generally are not available in the environment
in which the Company is operating.
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to
external credit ratings (if available) or to historical information about counterparty default rates:
Trade receivables
2018 2017
RO RO
Counterparties without external credit rating
Not due 1,277,047 1,259,524
Due up to 6 months 1,398,551 1,213,613
Due above 6 months 2,794,414 1,580,702
5,470,012 4,053,839
27

32 Financial instruments by category (continued)
Cash at bank
2018 2017
Moody’s rating RO RO
P-2 4,363
150,208
P-3 75,367 118
Unrated 2,147,780 5,813,664
Total 2,373,355 5,818,145
The rest of the statement of financial position item ‘cash and bank balances’ represents cash in hand.
33 Corresponding figures
Certain corresponding figures for the previous year have been reclassified, where necessary, in order to conform to
the current year’s presentation. Such reclassifications did not result in changes to previously reported total assets,
total liabilities, total equity, total comprehensive income and retained earnings.
28

Movement in property, plant and equipment (note 13) (continued)
Buildings and porta Plant and Office Furniture and Capital Work
cabins Vehicles machinery equipment fixtures in progress Total
RO RO RO RO RO RO RO
Cost
At 1 January 2018 945,110 16,436,961 1,098,646 597,653 566,031 1,239,121 20,883,522
Additions 483,938* 11,788,200 23,048 129,206 34,079 1,200,700 13,659,171
Transfer from WIP 1,121,727 130,323 331,478 175,465 (1,758,993) -
Disposals - (63,875) (1,862) (19,740) (37,814) (123,291)
At 31 December 2018 2,550,775 28,161,286 1,250,155 1,038,597 737,761 680,827 34,419,401
Accumulated depreciation
At 1 January 2018 880,711 8,653,136 860,101 427,305 511,298 - 11,332,551
Charge for the year 126,825 2,380,261 80,294 63,571 50,888 - 2,701,839
Depreciation on disposals - (63,875) (1,862) (19,740) (37,814) - (123,291)
At 31 December 2018 1,007,536 10,969,522 938,533 471,137 524,372 - 13,911,099
Net book value

At 31 December 2018 1,543,239 17,191,764 311,622 567,461 213,389 680,827 20,508,302
567460
*Includes Right of use assets.
22

Buildings and Plant and Office Furniture and Capital Work

porta cabins Vehicles machinery equipment fixtures in progress Total
RO RO RO RO RO RO RO
Cost
At 1 January 2017 911,590 16,585,961 916,159 522,299 543,026 559,642 20,038,677
Additions 33,520 - 182,487 75,354 23,005 679,479 993,845
Disposals - (149,000) - - - - (149,000)
At 31 December 2017 945,110 16,436,961 1,098,646 597,653 566,031 1,239,121 20,883,522
Accumulated depreciation
At 1 January 2017 860,741 6,678,198 802,205 378,705 493,676 - 9,213,525
Charge for the year 19,970 1,991,338 57,896 48,600 17,622 - 2,135,426
Depreciation on disposals - (16,400) - - - - (16,400)
At 31 December 2017 880,711 8,653,136 860,101 427,305 511,298 - 11,332,551
Net book value

At 31 December 2017 64,399 7,783,825 238,545 170,348 54,733 1,239,121 9,550,971
23

The statements of financial position and profit or loss shows the following amounts relating to lease of right of use assets:
Carrying value Depreciation

2018 2017 2018 2017
RO RO RO RO
Land
- - - -
104
Properties
452,888 - ,689 -
Vessels
- - - -
Cars
- - - -
Others
- - - -
452,88 104
8 - ,689 -
23

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COMPANY A

Registered address and principal place of business

Sultan Qaboos Street

Independent auditor’s report 1-2

Statement of comprehensive income 3

Statement of financial position 4

Statement of changes in equity 5

Statement of cash flows 6

Notes to the financial statements 7 - 23

Independent auditor’s report to the shareholders of

Report on the audit of the financial statements

What we have audited

The Company’s financial statements comprise:

Basis for opinion

Independent auditor’s report to the shareholders of

Report on other legal and regulatory requirements

STATEMENT OF COMPREHENSIVE INCOME

Gross loss (1,868,353) (722,593)

Operating profit (8,841,447) (6,262,671)

Finance (expense)/income-net 11 (165,284) 138,717

Profit before tax (1,140,303) --

Profit for the period (1,140,303) --

STATEMENT OF FINANCIAL POSITION

EQUITY AND LIABILITIES

Nabil Al Baimani Ahmed Ali Al Bulushi Ahmed Abdullah Al Busaidi

Independent auditor’s report - pages 1 - 2.

STATEMENT OF CHANGES IN EQUITY

At 1 January 2017 and 31

At 1 January 2018 -as

Independent auditor’s report - pages 1 - 2.

STATEMENT OF CASH FLOWS

Changes in working capital:

Cash flow from investment activities

Cash flow from financing activities

Increase/ (decrease) in cash and cash equivalents 214,073 (10,021,169)

Independent auditor’s report – pages 1 - 2.

NOTES TO THE FINANCIAL STATEMENTS

1 Legal status and principal activities

• IFRS 9 Financial Instruments

3 Summary of significant accounting policies

NOTES TO THE FINANCIAL STATEMENTS

3.1 Revenue recognition

3.1.a Disaggregation of revenue from contracts with customers

3.1.b Assets and liabilities related to contracts with customers

3.1.c Significant changes in contract assets and liabilities

3.1.d Revenue recognised in relation to contract liabilities

Consideration from advertisement contract, not previously recognised. 4,284 -

3 Summary of significant accounting policies (continued)

NOTES TO THE FINANCIAL STATEMENTS

3.2 Interest income and expense

3.3 Foreign currency transactions

3.5 Property, plant and equipment

Buildings and porta cabins 5-13 years

3 Summary of significant accounting policies (continued)

NOTES TO THE FINANCIAL STATEMENTS

3.5 Property, plant and equipment(continued)

Right-of-use assets are measured at cost comprising the following:

 the amount of the initial measurement of lease liability

3.6 Finance lease