Page 213 - Interloop Annual Report 2018-2019

NOTES TO THE CONSOLIDATED NOTES TO THE CONSOLIDATED

FINANCIAL STATEMENTS FINANCIAL STATEMENTS

FOR THE YEAR ENDED JUNE 30, 2019 FOR THE YEAR ENDED JUNE 30, 2019

2019 2018 27.1 It includes an amount of Rs. 209.855 million (2018: Rs. 188.219 million) relating to infrastructure cess payable.
Note Rupees in ‘000
Honourable Sindh High Court in its decision dated 17 September, 2008 declared the imposition of infrastructure cess before December 28, 2006 as
void and invalid. However, the Excise and Taxation Department filed an appeal before the Honourable Supreme Court of Pakistan. The Honourable
26.1.5 Total remeasurement chargeable to other comprehensive income Supreme court of Pakistan had disposed off the appeal with a joint statement of the parties that during the pendency of the appeal, another law i.e. fifth
version came into existence which was not the subject matter of the appeal hence the case was referred back to High Court of Sindh with right to appeal
Remeasurement of plan obligation: to Supreme Court. On May 31, 2011, the High Court of Sindh had granted an interim relief on an application of petitioners on certain terms including
Actuarial gain from changes in demographic assumptions - (75,521) discharge and return of bank guarantees / security furnished on consignment released up to December 27, 2006 and any bank guarantee / security
Actuarial losses from changes in financial assumptions 97,569 67,823 furnished on consignment released after December 27, 2006 shall be encashed to extent of 50% of the guaranteed or secured amount only with balance
Experience adjustments 95,256 99,417
kept intact till the disposal of petition. In case the High Court upholds the applicability fifth version of law and its retrospective application, the authorities
192,825 91,719 are entitled to claim the amounts due under the said law with the right to appeal available to petitioner. In the light of interim relief the Company has paid
50% of the amount of Infrastructure cess. Imports of the Company are being released against 50% payment of Infrastructure cess to Excise and Taxation
Department and furnishing of bank guarantee of balance amount.
2019 2018
26.1.6 Principal actuarial assumptions used
The Government of Punjab imposed Punjab Infrastructure Development Levy in terms of the Punjab Infrastructure Development Cess Act, 2015 (the
Discount rate used for profit and loss charge 10.00% 7.75% Act) read with PRA Notification No.PRA/IDC/2015 dated 16.05.2016 and PRA order No.PRA/Orders.08/2015 dated 23.05.2016. The Company being
Discount rate for year end obligation 14.50% 10.00% aggrieved filed writ petition vide WP No.24536 of 2016 before Honorable Lahore High Court challenging the constitutionality of the Act . The Lahore
High Court on 28.07.2016 granted interim relief for clearance of goods subject to payment of 50% of the disputed amount and upon furnishing of a bank
Salary increase used for year end obligation guarantee for the balance of 50% of the amount.
Salary increase for FY 2019 N/A 9.25%
Salary increase for FY 2020 14.00% 9.25% Both the above referred cases are pending litigation before respective Honorable High Courts. The case of Sindh High Court is pending adjudication,
Salary increase for FY 2021 14.00% 9.25% whereas case preferred before Honorable Lahore High Court has been fixed for 24.09.2019.
Salary increase for FY 2022 14.00% 9.25%
Salary increase for FY 2023 14.00% 9.25% However the full amount of Infrastructure Cess forms component of cost of imported items and provision recorded in books. Bank guarantees furnished
Salary increase for FY 2024 14.00% 9.25% ragarding imposition of infrastructure cess have been disclosed in note - 31.1 to these financial statements.
Salary increase for FY 2025 onward 14.00% 9.25%
27.2 This includes amount of Rs. 337,814/- payable to ESOS Management Trust for payments received against issuance of shares to employees under
ESOS.
Demographic assumption
Mortality rates (for deaths in service) SLIC SLIC 2019 2018
2001-2005 2001-2005
Setback 1 year Setback 1 year Note Rupees in ‘000
Retirement assumption 60 years 60 years
27.3 Workers’ profit participation fund
26.1.7 The expected contribution to defined benefit obligation for the year ending June 30, 2020 will be Rs. 746.576 million.
Opening Balance 210,828 168,111
26.1.8 Sensitivity analysis Interest on funds utilized in the Company's business 21,425 7,403
232,253 175,514
The calculation of the defined benefit obligation is sensitive to assumptions set out above. The following table summarizes how the impact on the Less: paid during the year (232,068) (163,041)
defined benefit obligation at the end of the reporting period would have increased / (decreased) as a result of a change in respective assumptions by
100 bps. 185 12,473
Add: allocation for the year 285,315 215,040
2019 2018 Less: Disposal of Interloop Dairies Limited 285,500 227,513
Note Rupees in ‘000 - (16,685)
285,500 210,828
Discount rate + 100 bps (2,246,150) (1,728,390)
Discount rate - 100 bps 2,799,035 2,165,469
Salary change + 100 bps 2,802,607 2,169,128 28. ACCRUED MARK UP
Salary change - 100 bps (2,238,597) (1,721,659)
Mark up on:
The sensitivity analysis of the defined benefit obligation to the significant actuarial assumptions has been performed using the same calculation Long term financing 46,259 36,228
techniques as applied for calculation of defined benefit obligation reported in the balance sheet. Short term borrowings 67,683 101,628
113,942 137,856
26.1.9 The average duration of defined benefit obligation for the year ended 2019 is 11 years (2018: 11 years).
29. SHORT TERM BORROWINGS
27. TRADE AND OTHER PAYABLES
From banking companies - Secured
Trade creditors 27.1 848,521 889,974 Under mark up arrangements
Accrued liabilities 2,240,530 1,464,173 ERF - II 11,726,000 11,021,000
-
Advances from customers 27.2 7,397 13,510 FAPC - own source 29.1 129,742 2,750,000
1,263,364
Running finance
Other payables 154,457 127,403 From related parties - Unsecured
Employees provident fund trust 5,059 4,315 Chief executive and directors - 146,573
Withholding tax payable 27.3 84,180 20,286 11,855,742 15,180,937
Workers' profit participation fund 3,625,644 2,730,489 2018 - 19
210,828
285,500
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