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INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF INTERLOOP

LIMITED

Report on the Audit of Consolidated Financial Statements

Opinion

We have audited the annexed consolidated financial statements of Interloop Limited and its subsidiary (the Group), which
comprise the consolidated statement of financial position as at June 30, 2020, the consolidated statement of profit or loss,
the consolidated statement of comprehensive income, the consolidated statement of changes in equity, the consolidated
statement of cash flows for the year then ended and notes to the consolidated financial statements including a summary of
significant accounting policies and other explanatory information, and we state that we have obtained all the information and
explanations which, to the best of our knowledge and belief, were necessary for the purpose of the audit.

In our opinion and to the best of our information and according to the explanations given to us, the consolidated statement
of financial position, the consolidated statement of profit or loss, the consolidated statement of comprehensive income, the
consolidated statement of changes in equity and the consolidated statement of cash flows together with the notes forming
part thereof conform with the International Financial Reporting Standards as applicable in Pakistan, and, give the information
required by the Companies Act, 2017 (XIX of 2017), in the manner so required and respectively give a true and fair view of the
state of the Group’s affairs as at June 30, 2020 and of the profit, total comprehensive income, the changes in equity and its
cash flows for the year then ended.

Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Pakistan. 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 Group in accordance with the International Ethics Standards
Board for Accountants’ Code of Ethics for Professional Accountants as adopted by the Institute of Chartered Accountants of
Pakistan (the Code) and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated
financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Following are the Key Audit Matter(s):
S. No Key Audit Matter(s) How the Matter was addressed in audit
1. Adoption of IFRS 16 “Leases”: (Refer notes 4.1, 8, 9.3 and 27 to the consolidated financial statements)
The Group has changed its accounting policy due to the Our audit procedures to review the application of IFRS
adoption of IFRS 16 ‘Leases’. Under the requirement 16 ‘Leases’ included review of managements’ impact
of IFRS 16, the Group recognized right of use assets assessment of all operating lease contracts with
and lease liabilities for certain lease payments - i.e. lessor(s) in light of application of the new standard. Our
these leases are on the statement of financial position. assessment included:
The application of this standard requires management
to make judgments, estimates and assumptions with • Inspecting terms for a sample of operating lease
regard to lease term and discount rate for calculation of contracts to determine whether the same are in
lease liabilities and consequently, considered as a key scope of IFRS 16 and are also subject to recognition
audit matter. exemption under IFRS 16 for short-term and low
value leases. We also reviewed contracts to identify
whether it is a lease contract, and if so its various
component, lease term, extended period, Group
historical experience, rental amount, payment
terms, lease modifications terms, etc.

• Reviewed discount rate used by the Group to
determine the present value of lease liabilities and
right of use assets.

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