Page 152 - InterloopAnnualReport2020

NOTES TO THE UNCONSOLIDATED

FINANCIAL STATEMENTS

For the year ended June 30, 2020

1. LEGAL STATUS AND OPERATIONS
Interloop Limited (the Company) was incorporated in Pakistan on 25th April, 1992 as a private limited company
under Repealed Companies Ordinance, 1984 (now Companies Act, 2017). On 18th July 2008, the Company was
converted into public limited company and subsequently, on 5th April 2018, it was publicly listed on Pakistan Stock
Exchange. The Company is engaged in the business of manufacturing and sale of socks, leggies, denim and yarn,
and generating electricity for its own use.

The geographical locations and addresses of the Company’s business units, including production facilities are as
under:

– Registered office: Al–Sadiq Plaza, P–157, Railway Road, Faisalabad–Pakistan.
– Corporate office & Plant 1: 1–KM, Khurrianwala – Jaranwala Road, Khurrianwala, Faisalabad–Pakistan.
– Plant 2, Plant 4 & Spinning: 7–KM, Khurrianwala – Jaranwala Road, Khurrianwala, Faisalabad–Pakistan.
– Plant 5: 6–KM, Khurrianwala – Jaranwala Road, Khurrianwala, Faisalabad–Pakistan.
– Plant 3 & Denim: 8–KM, Manga– Raiwind Road, Raiwind, Dist. Kasur, Lahore–Pakistan.

2. Impact of Covid–19 on the financial statements
Global outbreak has adversely impacted the Company’s performance and resultantly sales witnessed sharp decline
by 15% of total hosiery sales. Likewise, the Denim unit of the Company which was made operational during the year
was forced to bear cancelation of orders due to this pandemic. Consequently, the Company bears a loss of Rs.
365.693 million during the last quarter of the financial year. Other impacts are disclosed in relevant notes of these
unconsolidated financial statements.
3. BASIS OF PREPARATION
3.1 Statement of compliance
These unconsolidated financial statements have been prepared in accordance with the accounting and
reporting standards as applicable in Pakistan. The accounting and reporting standards applicable in
Pakistan comprise of:

– International Financial Reporting Standards (IFRS Standards) issued by the International Accounting
Standards Board (IASB) as notified under the Companies Act, 2017,

– Provisions of and directives issued under the Companies Act, 2017.

Where the provisions of and directives issued under the Companies Act, 2017 differ from the IFRS Standards,
the provisions of and directives issued under the Companies Act, 2017 have been followed.

3.2 Basis of measurement
These unconsolidated financial statements have been prepared under the historical cost convention except
as otherwise stated in respective policy notes.

3.3 Functional and presentation currency
These unconsolidated financial statements are presented in Pakistani Rupee which is also the Company’s
functional currency.

4. NEW AND REVISED STANDARDS, INTERPRETATIONS AND PRONOUNCEMENTS
4.1 Standards, interpretations and amendments to approved accounting standards which became
effective during the year
– Amendment to IAS 19 ‘Employee Benefits, – Plan Amendment, Curtailment or Settlement’:
The amendment to IAS 19 specify that an entity must;

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