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NOTES TO THE CONSOLIDATED

FINANCIAL STATEMENTS

For the year ended June 30, 2020

1. THE GROUP AND ITS OPERATIONS
The Group comprises of:
1.1 Interloop Limited– The Holding Company
1.1.1 Interloop Limited (the Holding Company) was incorporated in Pakistan on 25th April, 1992 as a private
limited company and subsequently it was converted into public limited company on 18th July, 2008. The
Company was listed on Pakistan Stock Exchange on 5th April, 2019. The Company is engaged in the
business of manufacturing and selling of socks, leggies, denim and yarn, providing yarn dyeing services
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.

1.2 IL Apparel (Private) Limited – The Subsidiary (Holding– 100% (2019: 100%)
IL Apparel (Private) Limited was incorporated in Pakistan on 28th March, 2018 under the Companies Act,
2017. The registered office of the company is situated at Al–Sadiq Plaza, P–157, Railway Road, Faisalabad.
The principal business activity of the company is manufacturing and sale of garments and allied products.

1.3 IL Bangla Limited – The Associate (Holding– 31.61% (2019: 31.61%)
IL Bangla Ltd. is a private limited company incorporated under the Companies Act 1994 as applicable in
Bangladesh vide Registration No. C–77561/09 dated 21 May 2009 floated by foreign investors (Pakistan
and West Indies) having its registered Office at House # 267, Road # 19, New DOHS Mohakhali, Dhaka,
Bangladesh and factory at Dakkhin kongshadi Vatpara, Narsingdi Sadar, Narsingdi, Bangladesh. The
company’s main objective is to carry on the business of manufacturing and sale/export of socks and
hosieries.

2. IMPACT OF COVID-19 ON THE FINANCIAL STATEMENTS
Global outbreak has adversely impacted the Group’s performance and resultantly sales witnessed sharp decline by
15% of total hosiery sales. Likewise, the Denim unit of the Group which was made operational during the year and
Apparel unit were forced to bear cancelation of orders due to this pandemic. Consequently, the Group bears a loss of
Rs. 538.571 million during the last quarter of the financial year. Other impacts are disclosed in relevant notes of these
consolidated financial statements.

3. BASIS OF PREPARATION
3.1 Statement of compliance
These consolidated 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.

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