COMPANY PROFILE

Amtex Limited is amongst the largest vertically integrated Textile setups in Pakistan having production
facilities in all sectors of Textile Industry from Spinning, Weaving, Processing, Printing, Finishing, Cut and Sewn
processes and provides employment opportunities to large number of families. After establishing strong
foothold in the Textile exports, Amtex successfully switched to Direct to Retail (“DTR”) business model that has
enabled it to focus on exporting high value added diversified Products directly to premier Retailers in the EU,
USA and across the globe. Amtex holds an iconic textile position in the Global textile industry, being the “One
Stop Shop” concept by offering largest variety and combination of products to its diversified customers.

With state of the art Textile manufacturing facility, internationally recognized R&D Department, Strong
outsourcing capabilities, Professional management, International display centers and warehouses for
facilitating procurement of orders and direct dealing with retailing giants, Amtex is marching towards
becoming a leader. Amtex has shown huge promise in value added Home Textile sector, where it has become
a leader in exporting high end quality Products. Amtex has maintained its focus and commitment in balancing,
modernization and value addition activities, as core business philosophy. Amtex aims at developing synergies
by keeping abreast with their strong vendor base and establishing partnerships with them so as to increase
the Product portfolio as well as to have the flexibility to react to the dynamics of ever demanding growing
parameters of market and global business.
Company Information
Board of Directors
Mr. Muhammad Ahsan Chairman
Mr. Khurram Iftikhar Chief Executive Officer
Mr. Shahzad Iftikhar
Mr. Nadeem Iftikhar
Mr. Suhail Maqsood Ahmed
Mr. Gul Muhammad Naz
Mrs. Jawaria Ahsan
Chief Financial Officer
Mr. Waheed Aslam
Company Secretary
Mr. Muhammad Raza Farooq
Audit Committee
Mr. Suhail Maqsood Ahmed Chairman
Mr. Muhammad Ahsan
Mr. Usman Ghani
Human Resource & Remuneration Committee
Mr. Gul Muhammad Naz Chairman
Mr. Suhail Maqsood Ahmed
Shahzad Iftikhar
Auditors
Zahid Jamil & Co.
Chartered Accountants
Legal Advisor
Mr. Aamir Nawaz Bhatti
Advocate High Court
Share Registrar Office
Vision Consulting Limited
3-C, LDA Flats, Lawrance Road, Lahore
Registered Office
P-225 Tikka Gali # 2 Montgomery Bazar, Faisalabad
Projects Locations
30-k.m. Shaiekhupura Road Faisalabad Spinning Unit
Punj Pullian Daewoo Road Faisalabad Processing & Stitching Unit
Website
www.amtextile.com
Vision Statement
Our vision is to provide our customers all their required goods and services from one plat form.

Mission Statement
Our mission is to become the buyer's first choice all around the world and to achieve this target we
make sure that we stay true to the highest standards of excellence and customer's satisfaction.
FINANCIAL HIGHLIGHTS
YEAR ENDED JUNE 30,
2021 2020 2019 2018 2017 2016
Rupees in million
Operating performance

Sales-net 1,075 545 630 843 1,698 2,154

Cost of Sales 1,065 786 791 1,335 2,328 2,777

Gross profit / (loss) 10 (241) (161) (493) (630) (623)

Operating (loss) (35) (439) (70) (3,088) (1,321) (1,359)
(Loss) before taxation (132) (641) (253) (3,253) (1,468) (1,514)
(Loss) after taxation (148) (671) (263) (3,270) (1,486) (1,526)

YEAR ENDED JUNE 30,

2021 2020 2019 2018 2017 2016
Rupees in million
Financial position

Property, plant and quipment-net

(excl.capital work in progress) 1,202 1,237 1,623 1,751 3,388 4,079
Investment property 1,189 1,161 1,102 1,014 -
Capital work in progress - -
Fixed assets 2,391 2,398 2,725 2,765 3,388 4,079

Total assets 3,577 3,724 4,378 4,783 8,683 10,462

Current assets

Store,spare parts, loose tools and stock in trade 651 706 928 1,345 1,920 2,462
Other current assets 335 394 511 472 3,126 3,713
Cash and cash equivalents 150 175 163 144 192 146
1,136 1,275 1,602 1,961 5,238 6,321
Current liabilities

Short term bank borrowings 6,015 6,063 6,093 6,178 7,495 7,371
Current portion of long term financing/ murabaha 2,284 2,119 1,707 1,249 884 740
Other current liabilities 2,916 2,938 2,948 2,978 2,975 2,985
11,216 11,120 10,748 10,405 11,354 11,096

Net Working Capital (10,080) (9,845) (9,146) (8,444) (6,116) (4,775)

Long term fianancing/ murahaba 236 414 875 1,498 1,260 1,581
Share capital and reserves (10,027) (9,883) (9,221) (8,967) (5,950) (4,633)
 YEAR ENDED JUNE 30,
2021 2020 2019 2018 2017 2016

Profitability analysis

Gross (loss) to sales (%) 0.9 (44.3) (25.6) (58.4) (37.1) (28.9)
(Loss) before tax to sales (%) (12.3) (117.7) (40.1) (386.0) (86.5) (70.3)
(Loss) after tax to sales (%) (13.8) (123.1) (41.7) (388.0) (87.5) (70.8)
Loss per share (Rupees) 0.6 (2.6) (1.0) (12.6) (5.7) (5.9)

YEAR ENDED JUNE 30,

2021 2020 2019 2018 2017 2016
Financial analysis

Current Ratio (times) 0.1 0.1 0.1 0.2 0.5 0.6

Debt to equity (times) (0.2) (0.2) (0.2) (0.3) (0.4) (0.5)
Break up value per share (Rupees) (38.7) (38.1) (35.5) (34.6) (22.9) (17.9)
Inventory turnover ratio (times) 2.1 1.3 1.0 1.2 1.5 1.4
Debtors turnover ratio (times) 12.8 3.5 3.5 0.6 0.6 0.6
Fixed assets turnover ratio (times) 0.9 0.4 0.4 0.5 0.5 0.5
Total assets turnover (times) 0.3 0.1 0.1 0.2 0.2 0.2
Notice of Annual General Meeting
Notice is hereby given that Annual General Meeting of the members of Amtex Limited (the Company)
will be held on October 28, 2021 at 11:00 A.M. at Company’s registered office P-225 Tikka Gali # 2
Montgomery Bazar Faisalabad to transact the following business:

ORDINARY BUSINESS

1. To confirm minutes of the Annual General Meeting held on October 28, 2020.
2. To receive and adopt the Audited Accounts of the Company for the year ended June 30, 2021
together with Directors’ and Auditors’ reports thereon.
3. To approve re-appointment of M/s. Zahid Jamil & Company, Chartered Accountants, as
external auditors of the Company for the year 2021-22 and fix their remuneration, as
recommended by the Audit Committee and Board of Directors.
4. To transact any other business with the permission of the chair.

By Order of the Board

Faisalabad Muhammad Raza Farooq

October 07, 2021 Company Secretary

NOTES: -

1. The Share Transfer Books of the Company will remain closed from 20-10-2021 to 28-10-2021
(both days inclusive). Transfers received at Vision Consulting Ltd, 3-C Lawrance Road, LDA Flats
Lahore at the close of the business on 19-10-2021 will be treated in time.

2. A member entitled to attend and vote at the Annual General Meeting is entitled to appoint
another person as proxy to attend and vote instead of him. The proxy forms, in order to be
effective, must be received at Company’s registered office P-225, Tikka Gali # 2 Montgomery
Bazar Faisalabad, not less than 48 hours before the meeting.

3. Members can avail video conference facility for attending the meeting at places other than the
town in which general meeting is taking place. In this regard, please fill the enclosed consent
for video conference facility and submit to registered address of the company, ten (10) before
holding of the general meeting. If Company receives consent from members holding in
aggregate 10% or more shareholding residing at a geographical location, to participate in the
 meeting through video conference ten (10) days prior to the date of the meeting, Company will
arrange a video conference facility in the city subject to availability of such facility in that city.
The Company will intimate to members regarding venue of video conference facility at least
five (5) days before the date of the meeting along with all the information necessary to enable
them to access the facility.

4. Members are requested to notify immediately changes, if any, in their registered address.

5. CDC Account Holders will further have to follow the under mentioned guidelines as laid down
by the Securities and Exchange Commission of Pakistan.

6. The shareholders who intends to receive the annual report including the notice of meeting
through e-mail are requested to provide their written consent on the Standard Request Form
provided in the annual report and also available on the Company's website.

7. The audited financial statements of the Company for the year ended 30 June 2021 have been
made available on the Company’s website (www.amtextile.com) in addition to annual and
quarterly financial statements for the current and prior periods.

8. As per section 72 of the Companies Act, 2017, every existing company shall be required to
replace its physical shares with book-entry form in a manner as may be specified and from the
date notified by the Commission, within a period not exceeding four year from the commence
of this Act i.e., May 30, 2017. The Shareholders having physical shareholding may open CDC
Sub-account with any of the broker or investor account directly with CDC to place their physical
share into scripless form.

For Attending the Meeting:

i. In case of individuals, the account holder or sub-account holder and / or the person
whose securities are in group account and their registration details are uploaded as per
the Regulation, shall authenticate his identity by showing his original Computerized
National Identity Card (CNIC) or original passport at the time of attending the Meeting.

ii. In case of corporate entity, the Board of Directors’ resolution / power of attorney with
specimen signature of the nominee shall be produced (unless it has been provided
earlier) at the time of the Meeting.
For Appointing Proxies:

i. In case of individuals, the account holder or sub-account holder and / or the person
whose securities are in group account and their registration details are uploaded as per
the Regulations, shall submit the proxy form as per the above requirements.

ii. The proxy form shall be witnessed by two persons whose names, addresses and CNIC
numbers shall be mentioned on the form.

iii. Attested copies of the CNIC or the passport of the beneficial owners and the proxy shall
be furnished with the proxy form.

iv. The proxy shall produce his original CNIC or original passport at the time of the Meeting.
In case of corporate entity, the Board of Directors’ resolution / power of attorney with
specimen signature shall be submitted (unless it has been provided earlier) along with
proxy form to the Company.
 Review Report by the Chairman

The Board of Directors (the Board) of Amtex Limited has performed their duties diligently in upholding
the best interest of shareholders' of the Company and has managed the affairs of the company in an
effective and efficient manner. The Board has exercised its powers and has performed its duties as stated
in the Companies Act 2017 and the Listed Companies (Code of Corporate Governance) Regulations.

Under review financial year 2021, despite the impact of the COVID-19 pandemic and an uncertain global
economic environment, we remained focused on executing our business strategies and achieved solid
growth. We were successful in achieving sales targets and there were significant increase in turnover of
the company as compared to previous year.

The Board has actively participated in strategic planning process, enterprise risk management system,
policy development, and financial structure, monitoring and approval. All Directors including independent
directors fully participated and contributed in the decision making process of the Board. The Board also
played an important role in overseeing the management’s performance and focusing on major risk area.
The Board is fully involved in all types of budgeting and strategic planning process. The company has an
independent internal audit department and internal audit reports are presented before the audit
committee on quarterly basis.

On behalf of the board, I would like to thank our management, staff and workers for their hard work. I
would like to appreciate all our valued customers for their continued confidence in the company. Not to
forget, all credit to the financial institutions for their cooperation and support.

Muhammad Ahsan
Chairman

Faisalabad
October 06, 2021
Directors’ Report
The Directors of your Company present before you the annual report with audited financial
statements for the year ended June 30, 2021.

Operating & Financial Results

The financial year 2021 witnessed rising cost of doing business due to devaluation of Pak rupees,
increased prices of fuel and Pandemic situation of COVID-19.

The financial results for the year under review with comparative figures of previous year are
presented hereunder:

2021 2020
Rupees Rupees
Revenue from contract with customers-Net 1,074,982,950 544,873,389
Cost of sales 1,065,217,611 786,021,749
Gross Profit/(loss) 9,765,339 (241,148,360)
Other Income 58,767,827 115,644,968
68,533,166 (125,503,392)
Selling and distribution expenses 37,356,877 12,811,634
Administrative expenses 65,896,581 301,059,289
Finance cost 96,477,312 201,839,880
Workers' welfare fund 720,506 -
200,451,276 515,710,803
Loss before taxation (131,918,110) (641,214,195)

Taxation 15,990,633 29,751,791

Net loss for the year (147,908,743) (670,965,986)

Loss per share - Basic and diluted (0.57) (2.59)

During financial year ended June 30, 2021, company earned gross profit of Rupees 9.76 million on
sales of Rupees 1,074.98 million as compared to Rupees 241.18 million gross loss on sales of Rupees
544.83 million for the previous financial year. During the FY 2021 Company incurred net loss after
tax of Rupees 147.90 million as compared to net loss after tax of Rupees 670.96 million during the
previous financial year. The company received fresh export orders from across the globe due to
which sales volume doubled in the financial year under review but overall increase in input cost,
adverse economic factors, under-utilization of manufacturing capacities and increasing fuel and
energy prices culminated in after tax loss of rupees 147.90 million .

The COVID 19 global pandemic had significant effects on world economy resulting into negative GDP
growth rate of many countries. However the government has made consistent efforts not only to
deal with the effects of pandemic by providing free vaccination on one hand but also kept the
industry running by giving incentives on the second hand. The government stressed on implementing
SOPs and by vaccinating the people above the age of 18 years. Unlike the last year, the government
avoided complete locked down and dealt with the situation by adopting smart locked down strategy.
These measures helped the economy to achieve the growth rate of 3.94 % in the year ended June
2021 as compared to a negative growth rate in the year 2020. The government has set a target of
achieving growth rate of 4.80 % in the year 2021-22 and tax revenue collection of 5.829 trillion as
compared to 4.691 trillion in 2020-21.

Auditors’ Observations

The auditors in paragraph (a) of audit report has provided observation regarding company’s ability
to continue as going concern due to accumulated losses, liquidity issue, curtailed operational
activities, pending litigations, closed operations of spinning division, curtailment of employees and
lease of its certain properties (land and buildings) situated at addresses provided in the audit report.
Directors of the company explain that the management is making all efforts to continue operations
and to run the entity as a going concern. Company’s continuity of operations since last couple of
years and increased sales volume despite global pandemic of Covid-19 clearly indicate that
management’s efforts and plans are effective. Moreover, the company is in process of selling certain
properties and machinery, mortgaged with the banks, the entire such sale proceeds will be paid to
relevant charge holder banks to reduce the debt burden and to settle the litigation with these banks.
The management of the company has already taken steps for extension and restructuring of loans
from certain banks and negotiations with other banks of the company are in process. In view of steps
mentioned above, the management is confident that it will be successful in its efforts and hence the
company will be able to continue as a going concern.

The auditors in paragraph (c) of audit report have provided observation that markup expense has
not been fully charged. In this regard it is explained that certain banks / financial institutions have
filed suit against the company for recovery of their financing and mark up so company has not
provided any markup / cost of funds on the outstanding amount as stated in notes to the accounts.
Based on the legal opinion, the company feels that, after institution of the suit, bank/financial
institution is only entitled to cost of funds if so awarded by the Court in case the suit is awarded
against the company. The levy of cost of funds and the quantum thereof shall be contingent on
passing of the decree and rate prescribed by the State Bank of Pakistan during the period of
pendency of the claim and discharge of decree, if passed by the Court.

Market Review and Future Prospects

The world is still struggling against COVID-19 pandemic although situation is fairly under control in
Pakistan. Though government has its policy measures in place along with vaccination for Covid-19
and to meet the losses to industry, government needs to stress upon reduction in compliance costs.
These compliance costs include borrowing from banks, border compliance and tax related
compliance. For this purpose, there is need to have integration between all the authorities and
institutions involved with monitoring framework in place.

The cost of doing business especially fuel and energy prices have continued to show a rising trend in
year under review. Although State Bank of Pakistan has kept the policy rate stable but pressure on
Pak rupee vis-à-vis other currencies owing to huge trade deficit remains a major obstacles for foreign
direct investment in the country. However Pakistan’s exports of textile and clothing rebounded in
last couple of years mainly due to value-added sectors and posted a robust growth. The government
has already abolished duty and taxes on industrial raw materials and is paying off pending refunds
to exporters. Management is well aware of the situation and endeavors to continue efforts to
increase sales / exports volume and to settle litigations with banks in quite favorable manner. Overall
textile exports reached 15.40 billion US dollars in the year 2020-21. The Textile Policy 2020-25 has
set an ambitious textile export target of 25.3 billion US dollars by 2025 which will not only support
the government in managing balance of payment but will also create job opportunities in the
country.

Dividend

In view of the adverse results in the current year, cash flows of the company do not permit dividend
payout therefore the directors have not recommended any dividend for the year.

Auditors

The present auditors M/s Zahid Jamil & Company, Chartered Accountants, retire and being eligible,
offer themselves for re-appointment. The Board of Directors has been suggested by the audit
committee, the re-appointment of M/s Zahid Jamil & Company, Chartered Accountants, as auditors
for the financial year ending June 30, 2022.
Internal Financial Controls

An effective and sound internal control has established and implemented throughout the year at all
levels of the company by the Board of Directors. Internal control system is designed to achieve overall
Company’s objectives, reliable financial reporting and compliance with laws, regulations and policies.

Related Parties

All related party transactions during the financial year ended June 30, 2021 were reviewed by the
Audit Committee and approved by the Board of Directors.

Pattern of Shareholding

The pattern of Shareholding along with categories of shareholders of the company as at June 30,
2021 is annexed with this report.

Corporate Governance

The Statement of Compliance with the best practices of Code of Corporate Governance is annexed.

Corporate and Financial Frame Work

In compliance of the Code of Corporate Governance, we give below statements on Corporate and
Financial Reporting frame work:

1. The financial statements together with the notes thereon prepared by the management of
the Company, present fairly its state of affairs, the results of its operations, cash flows and
changes in equity.

2. Proper books of accounts of the Company have been maintained.

3. Appropriate accounting policies have been consistently applied in preparation of financial

statements and accounting estimates are based upon reasonable and prudent judgment.

4. International Accounting / Financial Reporting Standards, as applicable in Pakistan, have been

followed in preparation of financial statements and there is no any departure there from.
 5. The system of internal control is sound in design and has been effectively implemented and
monitored.

6. There has been no material departure from the best practices of Corporate Governance as
detailed in the Listing Regulations of the stock exchange where the company is listed.

7. Going concern is explained separately.

8. Information about taxes and levies is given in the notes to the accounts.

9. Financial highlights of the last six years are annexed.

10. There are no statutory payments on account of taxes, duties, levies and charges that are
outstanding as on June 30, 2021 except for those disclosed in financial statements.

Composition of Board

Total Number of Directors:

a) Male 6 (Six)

b) Female 1 (One)

Composition:

Sr # Category Name
Suhail Maqsood Ahmed
1 Independent Directors
Gul Muhammad Naz
Nadeem Iftikhar
2 Non Executive Directors Muhammad Ahsan
Jawaria Ahsan
Shahzad Iftikhar
3 Executive Directors
Khurram Iftikhar
Meetings of the Board of Directors
During financial year 2020-21 attendance of directors in meetings of BOD is provided as under:

Sr # Name No.of meetings attended

1 Suhail Maqsood Ahmed 05
2 Gul Muhammad Naz 05
3 Nadeem Iftikhar 05
4 Muhammad Ahsan 04
5 Jawaria Ahsan 04
6 Shahzad Iftikhar 05
7 Khurram Iftikhar 05

No trading in Company’s shares was carried out by its Directors, CFO, and Company Secretary; Head
of Internal Audit other Executives and their spouse(s) and minor children during the year.

Directors Remuneration

The Board of Directors has devised a directive for determination of remuneration of executive and
non-executive directors depending upon their responsibility in affairs of the Company. The
remuneration is commensurate with their level of responsibility and expertise.

Non-executive directors including the independent director are entitled only for fee for attending
the Board and its committees' meetings. Remuneration of executive and non-executive directors
shall be approved by the Board, as recommended by the Human Resource and Remuneration
Committee. For information on remuneration of Directors and CEO in 2020-21, please refer notes to
the Financial Statements.

Audit Committee

The Audit Committee of the Company is in place and comprises of the following members as required
under the Code of Corporate Governance:
Suhail Maqsood Ahmed Chairman
(Independent Director)
Muhammad Ahsan Member
(Non-Executive Director)
Jawaria Ahsan Member
(Non-Executive Director)
Meetings of Audit Committee were held during the year ended June 30, 2021 as required by the
Code of Corporate Governance for review of quarterly accounts, annual accounts and other related
matters. The meetings were also attended by the CFO, Head of Internal Audit and External Auditors
as and when required.

Human Resource & Remuneration Committee

During the year one meeting of the Human Resource & Remuneration Committee was convened.
The attendance record of each member is as follows:

Sr # Name No.of meeting attended

1 Gul Muhammad Naz 01
2 Suhail Maqsood Ahmed 01
3 Shahzad Iftikhar 01

Acknowledgment

The Directors of your company would like to place on record their deep appreciation for the support
of the banks, financial institutions, regulators and shareholders and hope for the same in future.

The directors of your company also wish to place on record appreciation for the dedication,
perseverance and diligence of the staff and workers of the company.

Khurram Iftikhar Shahzad Iftikhar

Chief Executive Officer Director

Faisalabad
October 06, 2021
 Statement of Compliance with Listed Companies (Code of Corporate
Governance) Regulations, 2019

Name of company: Amtex Limited

Year ended: June 30, 2021

The company has complied with the requirements of the Regulations in the following
manner:-

1. The total number of directors are seven as per the following,-

a. Male: Six
b. Female: One

2. The composition of the Board is as follows:

Category Names
Suhail Maqsood Ahmed
Independent
Gul Muhammad Naz
Nadeem Iftikhar
Other Non-executive Directors Muhammad Ahsan
Mrs. Jawaria Ahsan
Khurram Iftikhar
Executive Director
Shahzad Iftikhar

3. The directors have confirmed that none of them is serving as a director on more than seven
listed companies, including this company;

4. The company has prepared a code of conduct and has ensured that appropriate steps have
been taken to disseminate it throughout the company along with its supporting policies and
procedures;

5. The Board has developed a vision/mission statement, overall corporate strategy and
significant policies of the company. The Board has ensured that complete record of
particulars of the significant policies along with their date of approval or updating is
maintained by the company;

6. All the powers of the Board have been duly exercised and decisions on relevant matters
have been taken by the Board/ shareholders as empowered by the relevant provisions of
the Companies Act, 2017 (the act) and these Regulations;

7. The meetings of the Board were presided over by the Chairman and, in his absence, by a
director elected by the Board for this purpose. The Board has complied with the
requirements of Act and the Regulations with respect to frequency, recording and
circulating minutes of meeting of the Board;
8. The Board of directors have a formal policy and transparent procedures for remuneration
of directors in accordance with the Act and these Regulations;

9. The Board of directors did not participate in any orientation course / training program.

10. There were no new appointments of Chief Financial Officer, Company Secretary and Head
of Internal Audit during the year, however, all such appointments including their
remuneration and terms and conditions of employment are duly approved by the Board;

11. Chief financial officer and chief executive officer duly endorsed the financial statements
before approval of the Board;

12. The Board has formed committees comprising of members given below.-

a) Audit Committee
Mr. Suhail Maqsood Ahmed Chairman
Mr. Muhammad Ahsan
Mrs.Jawaria Ahsan

b) HR and Remuneration Committee

Mr. Gul Muhammad Naz Chairman
Mr. Suhail Maqsood Ahmed
Mr. Shahzad Iftikhar

13. The terms of reference of the aforesaid committees have been formed, documented and
advised to the committee for compliance;

14. The frequency of meetings quarterly of the committee were as per following,-

a) Audit Committee=4
b) HR and Remuneration Committee = 1

15. The Board has set up an effective internal audit function which is considered suitably
qualified and experienced for the purpose and conversant with the policies and
procedures of the company;

16. The statutory auditors of the Company have confirmed that they have been given a
satisfactory rating under the Quality Control Review program of the Institute of Chartered
Accountants of Pakistan and registered with Audit Oversight Board of Pakistan, that they
and all their partners are in compliance with International Federation of Accountants
(IFAC) guidelines on code of ethics as adopted by the Institute of Chartered Accountants
of Pakistan and that they and the partners of the firm involved in the audit are not a close
relative (spouse, parent, dependent and non-dependent children) of the Chief Executive,
Chief Financial Officer, Head of Internal Audit, Company Secretary or Directors of the
Company;
17. The statutory auditors or the persons associated with them have not been appointed to
provide other services except in accordance with the Act, these Regulations or any other
regulatory requirement and the auditors have confirmed that they have observed IFAC
guidelines in this regard;
18. We confirm that all requirements of regulations 3, 6, 7, 8, 27, 32, 33 and 36 of the
Regulations have been complied with except for the following towards which reasonable
progress is being made by the company to seek compliance.

 Company is planning to arrange training program for their directors as provided

by the code.

On behalf of the Board

Khurram Iftikhar Shahzad Iftikhar

Chief Executive Officer Director

Faisalabad
October 06, 2021
 Independent Auditor’s Review Report to the Members of Amtex Limited

Review Report to the Members on the Statement of Compliance contained in Listed Companies (Code of
Corporate Governance) Regulations, 2019

We have reviewed the enclosed Statement of Compliance with the Listed Companies (Code of Corporate
Governance) Regulations, 2019 (the Regulations) prepared by the Board of Directors of Amtex Limited (the
Company) for the year ended June 30, 2021 in accordance with the requirements of regulation 36 of the
Regulations.

The responsibility for compliance with the Regulations is that of the Board of Directors of the Company. Our
responsibility is to review whether the Statement of Compliance reflects the status of the Company's
compliance with the provisions of the Regulations and report if it does not and to highlight any non-
compliance with the requirements of the Regulations. A review is limited primarily to inquiries of the
Company's personnel and review of various documents prepared by the Company to comply with the
Regulations.

As a part of our audit of the financial statements we are required to obtain an understanding of the
accounting and internal control systems sufficient to plan the audit and develop an effective audit approach.
We are not required to consider whether the Board of Directors' statement on internal control covers all
risks and controls or to form an opinion on the effectiveness of such internal controls, the Company's
corporate governance procedures and risks.

The Regulations requires the Company to place before the Audit Committee, and upon recommendation
of the Audit Committee, place before the Board of Directors for their review and approval, its related
party transactions. We are only required and have ensured compliance of this requirement to the extent
of the approval of the related party transactions by the Board of Directors upon recommendation of the
Audit Committee.

Following instance of non-compliance with the requirement of the Regulations was observed which is not
stated in the Statement of Compliance:

i) Directors did not attend any training program / orientation course required by SECP
(Regulation 18 of Listed Companies (Code of Corporate Governance) Regulations, 2019).

Based on our review, except for the above instance of non-compliance, nothing has come to our attention
which causes us to believe that the Statement of Compliance does not appropriately reflect the Company’s
compliance, in all material respects, with the requirements contained in the Regulations as applicable to the
Company for the year ended 30 June 2021.

ZAHID JAMIL & Co.

FAISALABAD: CHARTERED ACCOUNTANTS
Date: October 06, 2021
(Engagement Partner: Adeel Anwar, ACA)
INDEPENDENT AUDITOR’S REPORT

To the members of Amtex Limited

Report on the Audit of the Financial Statements

Adverse Opinion

We have audited the annexed financial statements of Amtex Limited (the Company), which comprise the
statement of financial position as at June 30, 2021, and the statement of profit or loss, the statement of
comprehensive income, the statement of changes in equity, the statement of cash flows for the year then
ended, and notes to the 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, were necessary for the purposes of the audit.
In our opinion and to the best of our information and according to explanations given to us, because of the
significance of the matters discussed in paragraphs (a) and (b) of “Basis for Adverse Opinion” section of
our report, the statement of financial position, statement of profit or loss, the statement of comprehensive
income, the statement of changes in equity and the statement of cash flows together with the notes forming
part thereof, do not conform with the accounting and reporting standards as applicable in Pakistan and do
not give the information required by the Companies Act, 2017 (XIX of 2017), in the manner so required
and respectively do not give a true and fair view of the state of the Company's affairs as at June 30, 2021
and of the loss, and total comprehensive loss, the changes in equity and its cash flows for the year then
ended.

Basis for Adverse Opinion

(a) The Company has incurred net loss of Rs. 147.908 million (2020: Rs. 670.965 million) during the
year ended June 30, 2021 and as at that date, its accumulated loss is Rs. 13,152.591 million (2020:
Rs. 13,008.387 million) and company’s current liabilities exceeded its current assets by Rs.
10,080.144 million (2020: Rs. 9,845.162 million). Further the company deferred the markup on long
term financing instead of accruing it amounting to Rs. 1,304.671 million (2020: Rs. 1,225.762) till
reporting date. During the year the Company’s spinning unit remain closed and had leased out its
land and building of processing division as mentioned in note 6 to the financial statements. The
Company has curtailed the significant number of employees and is facing operational and financial
crisis and is not taking any legal action to recover the past due balances. Moreover, the company is
defendant / petitioner in various law suits as mentioned in note 26 to the financial statements and
due to pending litigations certain long and short term liabilities remained unconfirmed / un-
reconciled in the absence of balance confirmations from related banks and financial institutions as
mentioned in note 19.1.5, 20 and 24.6 to the financial statements. Further, there is no sufficient
appropriate audit evidence that the management’s plans are feasible and ultimate outcome will
improve the company’s current situation. These factors, along with matters mentioned in paragraphs
(b) below, lead us to believe that going concern assumption used in preparation of financial
statements is inappropriate; consequently, the assets and liabilities should have been stated at their
realizable and settlement amounts respectively;
 (b) mark up expense has not been fully charged in these financial statements on redeemable capital,
lease liabilities and on long and short term financing due to pending litigations with various banks.
Had the mark up been fully charged, net loss for the year would have been increased by Rs 728.857
million (2020: Rs. 766.965 million), mark up payable and accumulated loss would have been
increased by Rs. 5,992.988 million (2020: Rs. 5,264.131 million);

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 Auditors’ Responsibilities
for the Audit of the Financial Statements section of our report. We are independent of the Company 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 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 adverse opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements of the current year. These matters were addressed in the context of our
audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters. In addition to the matters referred in paragraphs (a) and (b) of “Basis of
Adverse Opinion” section of our report, we have determined the matters below to be the key audit matters
to be communicated in our report.

Following are the key audit matters:

Key audit matter How the matter was addressed in our audit

Pending litigations
As referred in note no. 26 to the accompanying Our audit procedures included the following:
financial statements.
The Company faces a number of pending
- circularized confirmations to relevant third
litigations. There is a high level of judgment
party legal representatives;
required in estimating the level of provisioning
and/or the level of disclosure required.
- as part of our audit procedures we have
Where the impact of possible and present assessed management’s processes to
obligations is not probable or not reliably identify new possible obligations and
measurable, and thus no provision is recorded, changes in existing obligations for
failure to adequately disclose the nature of these compliance with Company policy and IAS
circumstances within the financial statements may 37 requirements;
distort the reader’s view as to the potential risks
faced by the Company. - we have analyzed significant changes from
prior periods and obtain a detailed
understanding of these items and
assumptions applied and
Key audit matter How the matter was addressed in our audit
Given the nature and amounts involved in such
cases and the appellate forums at which these are - assessed the adequacy of disclosure in note
pending, the ultimate outcome and the resultant no. 26 to the financial statements.
accounting in the financial statements is subject to
significant judgment, which can change over time
as new facts emerge and each legal case
progresses, and therefore, we have identified this
as key audit matter.

Valuation of investment property

As referred in note no. 6 to the accompanying Our audit procedures included the following:
financial statements.
- obtained valuation reports and evaluated
We considered the valuation of the investment the qualification, experience and
properties to be significant to the audit because the competence of the external property valuer
determination of fair value involves significant engaged by management and holding
judgment and the use of external valuation expert. discussions with the external property
valuer, without the presence of
We identified the valuation of investment management, to understand their valuation
properties as a key audit matter as it covers 33.23% methods and the assumptions applied;
of total assets of company.
- obtained rental agreements signed between
the Company and lessees;

- Obtained EOGM’s resolution for

approving the lease of properties and

- Assessed the adequacy of disclosures

related to investment properties in notes
no. 6 and 29 to the financial statements.

Valuation of stocks Our audit procedures included the following:

As referred in Note. 9 to the accompanying - Assessing the compliance of company’s

Financial statements, the stock in trade constitutes accounting policies over inventory with
13.70% of total assets of the Company as at 30 applicable accounting standards.
June 2021. - Assessing the inventory valuation
processes and practices. On major
Inventories were considered as a key audit matter locations we tested the effectiveness of the
due to the size of the balance and because key controls and performed physical
inventory valuation involves management verification of inventory at year end.
judgment. According to the financial statements’ - Assessing the analyses and assessment
made by management with respect to slow
accounting principles inventories are measured at moving and obsolete stock.
the lower of cost or net realizable value. The
company has specific procedures for identifying
 risk for obsolescence and measuring inventories at - We have obtained the Independent valuer
the lower of cost or net realizable value. report for determining the valuation of
inventory.

Key audit matter How the matter was addressed in our audit

- We tested the calculations of per unit

cost of finished goods and assessed the
appropriateness of management’s basis for
the allocation of cost and production
overheads.
- We also assessed the adequacy of the
disclosures made in respect of the
accounting policies and the details of
inventory balances held by the Company at
the year end.

Information other than the Financial Statements and Auditor's Report Thereon

Management is responsible for the other information. The other information comprises the information
included in the Annual report, but does not include the financial statements and our auditor's report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any
form of assurance opinion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based
on the work we have performed, we conclude that there is a material misstatement of this other information;
we are required to report that fact. As described in the “Basis for Adverse Opinion” section of our report,
we have concluded that the other information is materially misstated for the same reason.

Responsibilities of Management and Board of Directors for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance
with the accounting and reporting standards as applicable in Pakistan and the requirements of Companies
Act, 2017(XIX of 2017) 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.

Board of directors is responsible for overseeing the Company’s financial reporting process.
Auditors’ 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 as applicable in Pakistan 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 as applicable in Pakistan, we exercise professional judgment
and maintain professional skepticism 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
auditors’ 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 auditors’ 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 the board of directors 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.

We also provide the board of directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the board of directors, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

Based on our audit, we further report that in our opinion, except for the effects, if any, of the matters referred
to in paragraph (a) and (b) of “Basis of Adverse Opinion” of our report above:

a) proper books of account have been kept by the Company as required by the Companies Act, 2017
(XIX of 2017);

b) the statement of financial position, the statement of profit or loss, the statement comprehensive
income, the statement of changes in equity and the statement of cash flows together with the notes
thereon have been drawn up in conformity with the Companies Act, 2017 (XIX of 2017) and are
in agreement with the books of account and returns;

c) investments made, expenditure incurred and guarantees extended during the period were for the
purpose of the Company’s business; and

d) no Zakat was deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980).

The engagement partner on the audit resulting in this independent auditors’ report is Adeel Anwar
(ACA)

ZAHID JAMIL & Co.

FAISALABAD: CHARTERED ACCOUNTANTS
Date: October 06, 2021

AMTEX LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2021
2021 2020
NOTE RUPEES RUPEES
ASSETS
NON CURRENT ASSETS
Property, plant and equipment 5. 1,201,872,170 1,236,847,371
Investment property- fair value 6. 1,188,639,649 1,161,401,391
Long term deposits 7. 50,719,526 50,719,526
2,441,231,345 2,448,968,288
CURRENT ASSETS
Stores, spares and loose tools 8. 160,872,094 167,030,937
Stock in trade 9. 489,990,439 538,829,362
Trade debts 10. 58,871,206 109,100,262
Loans and advances 11. 12,895,364 4,962,100
Deposits and prepayments 12. 4,799,126 4,799,126
Other receivables 13. 80,161,086 99,880,325
Tax refunds due from the Government 14. 178,445,595 175,739,525
Cash and bank balances 15. 149,640,033 174,851,830
1,135,674,943 1,275,193,467
3,576,906,288 3,724,161,755
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorised capital
260,000,000 (2020: 260,000,000)
ordinary shares of Rs.10/- each 2,600,000,000 2,600,000,000

Issued, subscribed and paid up capital 16. 2,594,301,340 2,594,301,340

Reserves 17. 531,039,330 531,039,330
Accumulated loss (13,152,591,765) (13,008,387,481)
Surplus on revaluation of property, plant and equipment
829,180,098 832,923,049
(9,198,070,997) (9,050,123,762)
NON CURRENT LIABILITIES
Redeemable capital 18. - -
Long term financing 19. 236,376,127 414,127,318
Lease liabilities / Ijarah 20. - -
Deferred liabilities 21. 1,322,782,108 1,239,802,189
1,559,158,235 1,653,929,507
CURRENT LIABILITIES
Trade and other payables 22. 163,324,256 191,536,088
Contract liabilities 22,726,189 26,492,932
Interest / markup payable 23. 2,729,859,122 2,719,967,363
Short term borrowings 24. 6,015,444,052 6,063,442,444
Current portion of non current liabilities 25. 2,284,465,431 2,118,917,183
11,215,819,050 11,120,356,010
Contingencies and commitments 26. - -
3,576,906,288 3,724,161,755
The annexed notes from 1 to 41 form an integral part of these financial statements.

Khurram Iftikhar Shahzad Iftikhar Waheed Aslam

Chief Executive Officer CFO
AMTEX LIMITED
STATEMENT OF PROFIT OR LOSS
FOR THE YEAR ENDED JUNE 30, 2021
2021 2020
Note Rupees Rupees

Revenue from contract with customers-Net 27. 1,074,982,950 544,873,389

Cost of sales 28. 1,065,217,611 786,021,749
Gross Profit/(loss) 9,765,339 (241,148,360)

Other Income 29. 58,767,827 115,644,968

68,533,166 (125,503,392)

Selling and distribution expenses 30. 37,356,877 12,811,634

Administrative expenses 31. 65,896,581 301,059,289
Finance cost 32. 96,477,312 201,839,880
Workers' welfare fund 720,506 -
200,451,276 515,710,803
Loss before taxation (131,918,110) (641,214,195)

Taxation 33. 15,990,633 29,751,791

Net loss for the year (147,908,743) (670,965,986)

Loss per share - Basic and diluted 34. (0.57) (2.59)

The annexed notes from 1 to 41 form an integral part of these financial statements.

Khurram Iftikhar Shahzad Iftikhar Waheed Aslam

Chief Executive Officer Director Chief Financial
Officer
AMTEX LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED JUNE 30, 2021
2021 2020
Note Rupees Rupees

Net loss for the year (147,908,743) (670,965,986)

Other comprehensive income

Items that will not be subsequently reclassified to profit or loss:
Remeasurement of defined benefit obligation 21.1.3. (38,492) 2,990,116
Reversal of surplus in respect of revaluation deficit - (29,192,528)
(38,492) (26,202,412)

Total comprehensive loss for the year (147,947,235) (697,168,398)

The annexed notes from 1 to 41 form an integral part of these financial statements.

Khurram Iftikhar Shahzad Iftikhar Waheed Aslam

Chief Executive Officer Director Chief Financial
Officer
AMTEX LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2021
2021 2020
Rupees Rupees

a) CASH FLOWS FROM OPERATING ACTIVITIES

Loss before taxation (131,918,110) (641,214,195)

Adjustments for:
Depreciation of property, plant and equipment 52,913,029 73,823,382
Provision for staff retirement gratuity 4,136,936 2,518,272
Revaluation loss - 253,918,047
Write down of inventories to net realisable value 7,025,611 133,845,912
Unrealised gain on investment property carried at fair value (27,238,258) (85,372,935)
Gain on disposal of property, plant and equipment (6,608,627) (8,624,888)
Finance cost 96,477,312 201,839,880
Operating cash flows before working capital changes (5,212,107) (69,266,525)

Changes in working capital

(Increase) / decrease in current assets

Stores, spares and loose tools 6,158,843 67,811,980

Stock in trade 41,813,312 20,900,693
Trade debts 50,229,056 91,556,433
Loans and advances (7,933,264) (958,622)
Deposits and prepayments - 2,452,536
Other receivables 19,719,239 6,663,777
Tax refunds due from the Government (4,050,311) (15,290,417)
Increase / (decrease) in current liabilities
Trade and other payables (28,316,832) (74,098,867)
Contract Liabilities (3,766,743) 13,097,560

73,853,300 112,135,073
Cash generated from operations 68,641,193 42,868,548

Income tax paid (14,646,392) (7,584,734)

Income tax received - 9,687,664
Finance cost paid (7,676,062) (16,321,248)
Staff retirement gratuity paid - (2,500,180)

Net cash generated from operating activities 46,318,739 26,150,050

b) CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition of operating fixed assets (22,742,090) -

Proceeds from disposal of property, plant and equipment 24,168,500 64,097,350
Addition in Capital work in progress (12,755,611) -
Net cash (used in) / generated from investing activities (11,329,201) 64,097,350
 2021 2020
Rupees Rupees

c) CASH FLOWS FROM FINANCING ACTIVITIES

Long term financing (12,202,943) (47,516,510)

Short term borrowings (47,998,392) (29,645,000)
Lease liability paid - (922,177)

Net cash used in financing activities (60,201,335) (78,083,687)

Net (decrease)/ increase in cash and cash equivalents (a+b+c) (25,211,797) 12,163,713

Cash and cash equivalents at the beginning of the year 174,851,830 162,688,117

Cash and cash equivalents at the end of the year 149,640,033 174,851,830

The annexed notes from 1 to 41 form an integral part of these financial statements.

Khurram Iftikhar Shahzad Iftikhar Waheed Aslam

Chief Executive Officer Director Chief Financial
Officer
AMTEX LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED JUNE 30, 2021

Capital reserves Revenue reserves

Surplus on
Issued,
Merger Share revaluation of General Accumulated
subscribed and Total
reserve premium property, plant reserve loss
paid up capital
and equipment

---------------------------------------------------------------------------------------------------Rupees --------------------------------------------------------------------------------------------------

Balances as at July 01, 2019 2,594,301,340 98,039,330 183,000,000 867,699,951 250,000,000 (12,345,995,985) (8,352,955,364)

Loss for the year - - - - - (670,965,986) (670,965,986)

Other comprehensive income for the year
- Remeasurement of defined benefit obligation - - - - - 2,990,116 2,990,116
- Reversal of surplus in respect of revaluation deficit - - - (29,192,528) - - (29,192,528)
Total comprehensive loss for the year - - - (29,192,528) - (667,975,870) (697,168,398)

Incremental depreciation for the year - - - (5,584,374) - 5,584,374 -

Balances as at June 30, 2020 2,594,301,340 98,039,330 183,000,000 832,923,049 250,000,000 (13,008,387,481) (9,050,123,762)

Loss for the year - - - - - (147,908,743) (147,908,743)

Other comprehensive income for the year
- Remeasurement of defined benefit obligation - - - - - (38,492) (38,492)
- Reversal of surplus in respect of revaluation deficit - - - - - - -
Total comprehensive loss for the year - - - - - (147,947,235) (147,947,235)

Incremental depreciation for the year - - - (3,742,951) - 3,742,951 -

Balances as at June 30, 2021 2,594,301,340 98,039,330 183,000,000 829,180,098 250,000,000 (13,152,591,765) (9,198,070,997)

The annexed notes from 1 to 41 form an integral part of these financial statements.

Khurram Iftikhar Shahzad Iftikhar Waheed Aslam

Chief Executive Officer Director Chief Financial Officer
AMTEX LIMITED
NOTES TO THE FINANCIAL STATEMENTS

1. STATUS AND ACTIVITIES

1.1 Amtex Limited (the Company) is a public limited company incorporated in Punjab, Pakistan under the repealed
Companies Ordinance, 1984 (now the Companies Act, 2017) and listed on Pakistan Stock Exchange limited (formerly
Karachi Stock Exchange Limited) in Pakistan. The registered office of the Company is situated at P-225, Tikka Gali No.
2, Montgomery Bazar, Faisalabad. The principal business of the Company is export of all kinds of value added fabrics,
textile made-ups, casual and fashion garments duly processed. The Company is also engaged in the business of
manufacturing and sale of yarn and fabrics on its own & conversion basis. The cloth processing unit and stitching units
are located at Punj Pullian Daewoo Road, District Faisalabad and spinning unit is located at 30 KM Sheikhupura Road,
Khurrianwala, District Faisalabad, in the province of Punjab.
1.2 Pursuant to scheme of arrangement approved by the Honorable Lahore High Court, Lahore, assets, liabilities and
reserves of Amtex Spinning Limited were merged with the assets, liabilities and reserves of the Company with effect
from April 01, 2003.
1.3 The Company has incurred loss before taxation of Rs. 131,918,110/-. Loss is mainly due to significantly under / low
utilization of manufacturing capacities due to closure of spinning unit, temporary shutdown of processing unit and
increase in raw material prices for our value added business. Due to unfavorable textile market conditions in the
country the Company is facing tight cash flow situation and has not been able to comply with the terms of certain loan
agreements. The Company is in litigation with Sukuk unit holders and certain other banks / financial institutions have
also filed suits against the company for recovery of their outstanding debts.
The management is working hard, hopeful that with the improvement of textile market along with removal of gas
price differential in the Punjab Province bringing the gas price down up to the price in other provinces will reduce the
operating cost and the production and operating results will be improved. The management of the Company has
already taken steps for extension and restructuring of loans. The major bankers of the Company had restructured the
facilities (Refer Note 19.1.1 to 19.1.9) and negotiations with other banks are in process. There is material uncertainty
related to events or conditions which may cast significant doubt about the Company’s ability to continue as a going
concern, and therefore, it may be unable to realize its assets and discharge its liabilities in the normal course of
business. The management is confident that it will be successful in its efforts and hence the Company will be able to
continue as a going concern.
2. BASIS OF PREPARATION
2.1. Statement of compliance
These financial statements have been prepared in accordance with the approved 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; and
- Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as notified
under the Companies Act, 2017; and
- Provisions of and the 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.
2.2 Functional and presentation currency
These financial statements are presented in Pakistan Rupee which is functional and presentational currency of the
Company and figures are rounded off to the nearest rupee unless otherwise specified.
2.3 Basis of measurement
The financial statements have been prepared under the "historical cost convention" except: -
- certain property, plant and equipment items carried at revaluation.
- employee retirement benefits carried at present value.
- investment porperty measured at fair value.
2.4 Critical accounting estimates and judgments
The preparation of financial statements in conformity with the accounting and reporting standards requires the use of
certain critical accounting estimates. It also requires management to exercise judgement in the process of applying the
Company’s accounting policies. Estimates and judgements are continually evaluated and are based on historic
experience and other factors, including expectation of future events that are believed to be reasonable under the
circumstances. In process of applying the Company's accounting policies, the manangement has made following
estimates and judgements which are significant to financial statements:
 The preparation of financial statements in conformity with the accounting and reporting standards requires the use of
certain critical accounting estimates. It also requires management to exercise judgement in the process of applying the
Company’s accounting policies. Estimates and judgements are continually evaluated and are based on historic
experience and other factors, including expectation of future events that are believed to be reasonable under the
circumstances. In process of applying the Company's accounting policies, the manangement has made following
estimates and judgements which are significant to financial statements:

Useful lives, residual values and depreciation method of property, plant and equipment – Note 5.
Fair value of investment property - Note 6.
Provision for impairment of inventories - Note 9.
Provision for doubtful trade receivables – Note 10.
Obligation of defined benefit obligation - Note 21.1.
Estimation of contingent liabilities - Note 26.
Current income tax expense, provision for current tax -Note 14. and 33.
Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectation of future events that are believed to be reasonable under the circumstances.
3. Adoption of new and revised accounting standards
3.1. New accounting standards, amendments and IFRS interpretations that are effective for the year ended June 30,
2021.
3.1.1. The following standards,amendments and interpretations are only effective for accounting periods, begining or after
the date mentioned against each of them.These standards,amendments and interpretations are either not relevant to
the Companys operations or are not expected to have significant impact on Companys financial statements other than
certain additional disclosures.
Effective from
accounting period beginning
on or after:
Amendment to IFRS 16 - 'Leases' - Covid-19 related rent concessions June 01, 2022
Amendment to the conceptual framework for financial reporting, including
January 01, 2020
amendments to references to the conceptual framework in IFRS
Amendments to IFRS 3 - Business combinations -Definition of a business January 01, 2020
Amendments to IAS 1 - Presentation of Financial Statements and IAS 8 - Accounting
Polocies,Changes in Accounting Estimates and Errors-Definition of material January 01, 2020

Amendments to IFRS 9-Financial Instruments,IAS 39-Financial Instruments : Recognition

and measurement and IFRS 7-Financial Instruments : Disclosures-Interest rate January 01, 2020
benchmark reform.
(Certain annual improvements have also been made to a number of IFRSs)
3.1.2. New accounting standards, amendments and IFRS interpretations that are not yet effective
The following standards,amendments and interpretations are effective for the yearended June 30, 2021.These
standards,amendments and interpretations are either not relevant to the Companys operations or are not expected to
have significant impact on Companys financial statements other than certain additional disclosures.
Effective from
accounting period beginning
on or after:
 Interest Rate Benchmark Reform – Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS January 01, 2021
4 and IFRS 16)
IFRS 16 - 'Leases' - Covid-19 related rent concessions extended beyond June 30, 2021 April 01, 2021

IFRS 3 - Business combinations (Amendments) January 01, 2022

IAS 16 - Property, Plant and Equipment (Amendments) January 01, 2022
IAS 37- Provisions, Contingent Liabilities and Contingent Assets (Amendments) January 01, 2022
IAS 1 - Presentation of financial statements (Amendments)-- Classification of liabilities January 01, 2023
as current or non-current
IAS 1 - Presentation of financial statements (Amendments)- Disclosure of accounting January 01,2023
policies
IAS 8 - Accounting policies, changes in accounting estimates and errors (Amendments) January 01, 2023

IAS 12 - Income Taxes' - deferred tax related to assets and liabilities arising from a single January 01, 2023
transaction.
The management anticipates that adoption of above amendments in future periods, will have no material impact on
the financial statements other than in presentation / disclosures.
Further, the following new standards have been issued by the International Accounting Standards Board (IASB), which
are yet to be notified by the Securities and Exchange Commission of Pakistan (SECP), for the purpose of their
applicability in Pakistan;
IFRS 1 - First-time Adoption of International Financial Reporting Standards
IFRS 17 - Insurance contracts
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
4.1 Property, plant and equipment
Owned
Property, plant and equipment except freehold land and capital work in progress are stated at cost / revalued amount
less accumulated depreciation and impairment in value, if any. Freehold land is stated at revalued amount less
accumulated impairment in value, if any. Capital work-in-progress is stated at cost less accumulated impairment in
value, if any.
Depreciation is charged to income applying the reducing balance method at the rates specified in the property, plant
and equipment note. Assets' residual values, if significant and their useful lives are reviewed and adjusted, if
appropriate, at each balance sheet date.
In respect of additions and disposals during the year, depreciation is charged from the month of acquisition or
capitalisation and up to the month preceding the month of disposal respectively.
When parts of an item of property, plant and equipment have different useful lives, they are recognised as separate
items of property, plant and equipment.
Normal repairs and maintenance costs are charged to income during the period in which they are incurred. Major
renewals and improvements are capitalised.
Gains or losses on disposal of property, plant and equipment are included in current income.
All expenditure connected with specific assets incurred during installation and construction period are carried under
capital work in progress. These are transferred to specific assets as and when these assets are available for use.
Surplus arising on revaluation of property, plant and equipment is recognized, in other comprehensive income and
accumulated in reserves in shareholders' equity and is shown in equity. Revaluation is carried out with sufficient
regularity to ensure that the carrying amounts of the assets does not differ materially from the fair value.
Accumulated depreciation at the date of revaluation is eliminated against the cost of the asset and net amount is
restated to the revalued amount of the asset. The surplus on revaluation of property, plant and equipment to the
extent of incremental depreciation charged on the related property, plant and equipment during the year is part of
statement of changes in equity. A decrease as a result of revaluation is recognized in the statement of profit or loss
however, a decrease is recorded in statement of other comprehensive income to the extent of any credit balance in
revaluation surplus in respect of same assets. The revaluation reserve is not available for distribution to the
Company’s shareholders.
 Gains or losses on disposal of assets, if any, are recognized as and when incurred. Surplus arising on revaluation is
credited to surplus on revaluation of property, plant and equipment. The surplus on revaluation of property, plant and
equipment to the extent of incremental depreciation charged on the related assets is transferred by the Company to
its un-appropriated profit.
4.2. Right-of-use assets
Right of use assets are initially measured at cost being the present value of lease payments, initial direct costs, any
lease payments made at or before the commencement of the lease as reduced by any incentives
received.These are subsequently measured at cost less accumulated depreciation and accumulated impairment losses,
if any.
Depreciation is charged on straight line basis over the shorter of the lease term or the useful life of the asset. Where
the ownership of the asset transfers to the Company at the end of the lease term or if the cost of the asset reflects
that the Company will exercise the purchase option, depreciation is charged over the useful life of asset in the same
manner as charged for owned assets.
4.3. Asset held under Ijarah financing
Assets held under Ijarah financing are accounted for using the guidelines of Islamic Financial Accounting Standard-2
(IFAS 2), "Ijarah". The assets are not recognized on the Company's statement of financial position and payments made
under Ijarah financing are recognized in the statement of profit or loss on a straight line basis over the term of the
Ijarah.
4.4. Investment property
Investment properties are properties held to earn rentals and/ or for capital appreciation (including property under
construction for such purposes). Investment properties are measured initially at cost including transaction costs.
Subsequent to initial recognition, investment properties are measured at fair value. Gains and losses arising from the
change in the fair value of investment properties are included in profit or loss in the period in which they arise.
An investment property is de-recognised upon disposal or when the investment property is permanently withdrawn
from use and no future economic benefits are expected from disposal. Any gain or loss arising on de-recognition of
property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is
included in profit or loss in the period in which the property is derecognised.
Rental income
Rental income from investment property that is leased to a third party under an operating lease is recognised in the
statement of profit or loss over the lease term and is included in ‘other income’.
4.5 Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are
assets that necessarily take a substantial period of time to get ready for their intended use, are added to the cost of
those assets, until such time as the assets are substantially ready for their intended use.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on
qualifying assets is deducted from the borrowing costs eligible for capitalization.
All other borrowing costs are recognised in profit and loss account in the period in which these are incurred.
4.6 Earnings per share
The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated
by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number
of ordinary shares outstanding during the year. Diluted EPS is determined by adjusting the profit or loss attributable to
ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive
potential ordinary shares.
4.7 Stores, spares and loose tools
These are stated at lower of cost and net realizable value. Cost is determined using moving average method. Items in
transit are stated at invoice value plus other charges incurred thereon until the reporting date.
For items that are slow moving adequate provision is made, if necessary, for any excess carrying value over estimated
realizable value and charged to the statement of profit or loss.
4.8 Stock in trade
Stock in trade except waste are valued at lower of cost and net realisable value. Cost is determined as follows:

Raw material Weighted average cost except items in transit which are valued at cost
accumulated upto the balance sheet date
Work in process Average manufacturing cost
Finished goods Average manufacturing cost
 Wastes are valued at net realisable value.
Net realizable value represents the estimated selling price in the ordinary course of business less estimated cost of
completion and estimated cost to make the sales. Average manufacturing cost consists of direct materials, labor and a
proportion of manufacturing overheads.
4.9 Trade debts and other receivables
Trade debts and other receivables are recognized initially at fair value and subsequently measured at amortized cost
less loss allowance, if any. The Company always measures the loss allowance for trade debts at an amount equal
to lifetime expected credit losses (ECL). The expected credit losses on trade debts are estimated using a provision
matrix by reference to past default experience of the debtor and an analysis of the debtor’s current financial position,
adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors
operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date.
There has been no change in the estimation techniques or significant assumptions made during the current reporting
period.
Trade debts and other receivables considered irrecoverable are written off.
4.10. Cash and cash equivalents
Cash and cash equivalents are carried in the statement of financial position at cost. For the purpose of statement of
cash flow, cash and cash equivalents consist of cash in hand, balances with banks, books overdrawn, highly liquid short
term investments that are convertible to known amount of cash and are subject to insignificant risk of change in value.
4.11. Staff retirement benefits
The Company operates a defined benefit plan unfunded gratuity scheme covering all permanent employees. Provision
is made annually on the basis of acturial recommendation to cover the period of service completed by employees
using Projected Unit Credit Method. All remeasurement adjustments are recognized in other comprehensive income
as they occur.
The amount recognized in the statement of financial position represnts the present value of defined benefit obligation
as adjusted for remeasurement adjustments.
4.12. Trade and other payables
Trade and other payable are recorded initially at fair value and subsequently measured at amortized cost.Generally,
this results in their recognition at nominal value.
4.13. Borrowings
Borrowings are initially recognised at fair value plus directly attributable cost, if any, and are subsequently stated at
amortized cost.
4.14. Provisions
Provisions are recognised when the Company has a present, legal or constructive obligation as a result of past event
and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation
and a reliable estimate of the amount can be made. However, provisions are reviewed at each balance sheet date and
adjusted to reflect the current best estimate.
4.15. Provision for taxation
Current
Provision for current taxation is based on income taxable at the current tax rates after taking into account tax rebates
and tax credits available under the law.
Deferred
Deferred tax is provided using the liability method for all temporary differences at the balance sheet date between tax
bases of assets and liabilities and their carrying amounts for financial reporting purposes. In this regard, the effects on
deferred taxation of the portion of income subject to final tax regime is also considered in accordance with the
requirement of Technical Release – 27 of the Institute of Chartered Accountants of Pakistan.
Deferred tax asset is recognised for all deductible temporary differences and carry forward of unused tax losses, if any,
to the extent that it is probable that taxable profit will be available against which such temporary differences and tax
losses can be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled, based on tax rates that have been enacted or substantively enacted at the
balance sheet date.
Deferred tax charged or credited in the income statement, except in case of items credited or charged to equity in
which case it is included in equity.
4.16. Dividend and other appropriations
Dividend is recognised as a liability in the period in which it is approved. Appropriations of profits are reflected in the
statement of changes in equity in the period in which such appropriations are made.
4.17. Foreign currency translation
Transactions in currencies other than Pak Rupee are recorded at the rates of exchange prevailing on the dates of
transactions. At each statement of financial position date, monetary assets and liabilities that are denominated in

foreign currencies are retranslated at the rates prevailing on the statement of financial position except where forward
exchange contracts have been entered into for repayment of liabilities, in that case, the rates contracted for are used.
Exchange differences are included in profit or loss. All non-monetary items are translated into Pak Rupee at exchange
rates prevailing on the dates of transactions.
4.18. Financial instruments
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual
provisions of the instrument and de-recognised when the Company loses control of the contractual rights that
comprise the financial assets and in case of financial liabilities when the obligation specified in the contract is
discharged, cancelled or expired.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and
financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial
assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the
acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in
the statement of profit or loss.
4.18.1. Financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. Regular
way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame
established by regulation or convention in the marketplace. All recognized financial assets are measured subsequently
in their entirety at either amortized cost or fair value, depending on the classification of the financial assets.

Financial assets at amortized cost

Instruments that meet the following conditions are measured subsequently at amortized cost:
- the financial asset is held within a business model whose objective is to hold financial assets in order to collect
contractual cash flows; and
- the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
Financial assets at fair value through profit or loss (FVTPL)
Financial assets that do not meet the criteria for being measured at amortized cost or FVTOCI are measured at fair
value through the statement of profit or loss (FVTPL). Specifically:
Investments in equity instruments are classified as at FVTPL, unless the Company designates an equity investment that
is neither held for trading nor a contingent consideration arising from a business combination as at FVTOCI on initial
recognition.
- Debt instruments that do not meet the amortized cost criteria or the FVTOCI criteria are classified as at FVTPL. In
addition, debt instruments that meet either the amortized cost criteria or the FVTOCI criteria may be designated as at
FVTPL upon initial recognition. If such designation eliminates or significantly reduces a measurement or recognition
inconsistency (so called ‘accounting mismatch’) that would arise from measuring assets or liabilities or recognizing the
gains and losses on them on different bases. The Company has not designated any debt instruments as at FVTPL.

Financial assets at FVTPL are measured at fair value at the end of each reporting period, with any fair value gains or
losses recognized in the statement of profit or loss.
4.18.2. Impairment of financial assets
The Company recognizes a loss allowance for Expected Credit Loss on trade debts. The amount of ECL is updated at
each reporting date to reflect changes in credit risk since initial recognition of the respective financial assets.
The Company always recognizes lifetime ECL for trade debts. The ECL on these financial assets are estimated using a
provision matrix based on the Company’s historical credit loss experience, adjusted for factors that are specific to the
debtors, general economic conditions and an assessment of both the current as well as the forecast direction of
conditions at the reporting date, including time value of money where appropriate.
For all other financial assets, the Company recognizes lifetime ECL when there has been a significant increase in credit
risk since initial recognition. However, if the credit risk on the financial instrument has not increased significantly since
initial recognition, the Company measures the loss allowance for that financial instrument at an amount equal to 12-
month ECL. The assessment of whether lifetime ECL should be recognized is based on significant increases in the
likelihood or risk of a default occurring since initial recognition instead of on evidence of a financial asset being credit-
impaired at the reporting date.
Lifetime ECL represents the ECL that will result from all possible default events over the expected life of a financial
instrument. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default
events on a financial instrument that are possible within 12 months after the reporting date.

(i) Significant increase in credit risk

In assessing whether the credit risk on a financial instrument has increased significantly since initial recognition, the
Company compares the risk of a default occurring on the financial instrument as at the reporting date with the risk of
a default occurring on the financial instrument as at the date of initial recognition. In making this assessment, the
Company considers both quantitative and qualitative information that is reasonable and supportable, including
historical experience and forward-looking information that is available without undue cost or effort.

For financial guarantee contracts, the date that the Company becomes a party to the irrevocable commitment is
considered to be the date of initial recognition for the purposes of assessing the financial instrument for
impairment. In assessing whether there has been a significant increase in the credit risk since initial recognition of a
financial guarantee contracts, the Company considers the changes in the risk that the specified debtor will default on
the contract.

The Company regularly monitors the effectiveness of the criteria used to identify whether there has been a significant
increase in credit risk and revises them as appropriate to ensure that the criteria are capable of identifying significant
increase in credit risk before the amount becomes past due.
The Company assumes that the credit risk on a financial instrument has not increased significantly since initial
recognition if the financial instrument is determined to have low credit risk at the reporting date. A financial
instrument is determined to have low credit risk if:
(a) The financial instrument has a low risk of default,
(b) The borrower has a strong capacity to meet its contractual cash flow obligations in the near term, and
(c) Adverse changes in economic and business conditions in the longer term may, but will not necessarily,reducethe
ability of the borrower to fulfil its contractual cash flow obligations.
(ii) Definition of default
The Company employs statistical models to analyse the data collected and generate estimates of probability of default
(“PD”) of exposures with the passage of time. This analysis includes the identification for any changes in default rates
and changes in key macro-economic factors across various geographies of the Company.
 (iii) Credit-impaired financial assets
A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future
cash flows of that financial asset have occurred. Evidence that a financial asset is credit-impaired includes observable
data about the following events:
(a) significant financial difficulty of the issuer or the borrower;
(b) a breach of contract, such as a default or past due event (see (ii) above);
(c) the lender(s) of the borrower, for economic or contractual reasons relating to the borrower’s financial
difficulty having granted to the borrower a concession(s) that the lender(s) would not otherwise consider;
(d) it is becoming probable that the borrower will enter bankruptcy or other financial reorganisation; or
(e) the disappearance of an active market for that financial asset because of financial difficulties.

(iv) Write-off policy

The Company writes off a financial asset when there is information indicating that the counterparty is in severe
financial difficulty and there is no realistic prospect of recovery.
(v) Measurement and recognition of ECL
The measurement of ECL is a function of the probability of default, loss given default (i.e. the magnitude of the loss if
there is a default) and the exposure at default. The assessment of the probability of default and loss given default is
based on historical data adjusted by forward-looking information as described above. As for the exposure at default,
for financial assets, this is represented by the assets’ gross carrying amount at the reporting date; for financial
guarantee contracts, the exposure includes the amount drawn down as at the reporting date, together with any
additional amounts expected to be drawn down in the future by default date determined based on historical trend,
the Company’s understanding of the specific future financing needs of the debtors, and other relevant forward-
looking information.
For financial assets, the expected credit loss is estimated as the difference between all contractual cash flows that are
due to the Company in accordance with the contract and all the cash flows that the Company expects to receive,
discounted at the original effective interest rate.
Non-financial assets
The Company assesses at each reporting date whether there is any indication that assets except inventories, biological
assets and deferred tax asset may be impaired. If such indication exists, the carrying amounts of such assets are
reviewed to assess whether they are recorded in excess of their recoverable amount. Where carrying values exceed
the respective recoverable amount, assets are written down to their recoverable amounts and the resulting
impairment loss is recognized in the statement of profit or loss. The recoverable amount is the higher of an asset's 'fair
value less costs to sell' and 'value in use'.
Where impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised
recoverable amount but limited to the extent of the carrying amount that would have been determined (net of
amortization or depreciation) had no impairment loss been recognized. Reversal of impairment loss is recognized as
income.
4.18.3. Financial liabilities
All financial liabilities are measured subsequently at amortized cost using the effective interest method or at FVTPL.
Financial liabilities at FVTPL are stated at fair value, with any gains or losses arising on changes in fair value recognized
in the statement of profit or loss to the extent that they are not part of a designated hedging relationship. The net gain
or loss recognized in the statement of profit or loss incorporates any interest paid on the financial liability.

However, for financial liabilities that are designated as at FVTPL, the amount of change in the fair value of the financial
liability that is attributable to changes in the credit risk of that liability is recognized in statement of other
comprehensive income, unless the recognition of the effects of changes in the liability’s credit risk in other
comprehensive income would create or enlarge an accounting mismatch statement of in the profit or loss. The
remaining amount of change in the fair value of liability is recognized in the statement of profit or loss. Changes in fair
value attributable to a financial liability’s credit risk that are recognized in statement of other comprehensive income
are not subsequently reclassified of the statement of profit or loss; instead, they are transferred to retained earnings
upon derecognition of the financial liability.
Gains or losses on financial guarantee contracts issued by the Company that are designated by the Company as at
FVTPL are recognized in the statement of profit or loss.

Financial liabilities measured subsequently at amortized cost

 Financial liabilities that are not designated as FVTPL, are measured subsequently at amortized cost using the effective
interest method. The effective interest method is a method of calculating the amortized cost
of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate
that exactly discounts estimated future cash payments (including all fees and points paid or received that form an
integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected
life of the financial liability, or (where appropriate) a shorter period, to the amortized cost of a financial liability.

Derecognition of financial liabilities

The Company derecognises financial liabilities when, and only when, the Company’s obligations are discharged,
cancelled or have expired. The difference between the carrying amount of the financial liability derecognized and the
consideration paid and payable is recognized in the statement of profit or loss.
4.18.4. Offsetting of financial assets and financial liabilities
Financial assets and financial liabilities are offset and the net amount is reported in the financial statements only when
there is legally enforceable right to set-off the recognized amounts and the Company intends either to settle on a net
basis or to realize the assets and to settle the liabilities simultaneously.
4.19. Revenue recognition
Revenue from contracts with customers for sale of yarn, fabric and madeups:
The Company recognizes revenue from contracts with customers based on a five step model as set out in IFRS-15:
Step-1: Identify contract(s) with a customer: A contract is defined as an agreement between two or more parties that
creates enforceable rights and obligations and sets out the criteria for every contract that must be met.
Step-2: Identify performance obligations in the contract: A performance obligation is a promise in a contract with a
customer to transfer a good or service to the customer.
Step-3: Determine the transaction price: The transaction price is the amount of consideration to which the Company
expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts
collected on behalf of third parties.
Step-4: Allocate the transaction price to the performance obligations in the contract: For a contract that has more
than one performance obligation, the Company allocates the transaction price to each performance obligation in an
amount that depicts the amount of consideration to which the Company expects to be entitled in exchange for
satisfying each performance obligation.
Step-5: Recognize revenue when (or as) the Company satisfies a performance obligation.
Mentioned below are different revenue streams of the Company and their terms of recognition of revenue after
satisfying all the five steps of revenue recognition in accordance with IFRS 15.
a) Sale of goods
The Company's contracts with customers for the sale of goods generally include one performance obligation
and recognized at a point of time. Revenue is recognized when goods are dispatched to customers and bill of
lading is prepared for local sales and exports sales respectively. It is the time when control (significant risk and
rewards) relating to ownership of goods and control over these goods has been transferred to the buyer.
b) Interest income
Interest income is recognized using effective interest rate method.
Presentation and disclosure requirements
As required for the financial statements, the Company disaggregated revenue recognized from contracts with
customers into categories that depict how the nature, amount, timing and uncertainty of revenue and cash
flows are affected by economic factors. The Company has also disclosed information about the relationship
between the disclosure of disaggregated revenue and revenue information disclosed for each reportable
segment.
4.20. Related party transactions
Transactions with related parties are priced on arm’s length basis. Prices for these transactions are determined on the
basis of comparable uncontrolled price method, which sets the price by reference to comparable goods and services
sold in an economically comparable market to a buyer unrelated to the seller.
4.21. Lease Liabilities
Lease liabilities are initially measured at the present value of the lease payments discounted using the
 interest rate implicit in the lease. If the implicit rate cannot be readily determined, the Company’s incremental
borrowing rate is used. Subsequently these are increased by interest, reduced by lease payments and remeasured for
lease modifications, if any.
Liabilities in respect of short term and low value leases are not recognized and payments against such leases are
recognized as expense in statement of profit or loss.
4.22. Contingent liabilities
Contingent liability is disclosed when:
- there is a possible obligation that arises from past events and whose existence will be confirmed only by
the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the
Company; or
- there is present obligation that arises from past events but it is not probable that an outflow of resources embodying
economic benefits will be required to settle the obligation or the amount of the obligation cannot be measured with
sufficient reliability.
4.23. Contingent assets
Contingent assets are disclosed when there is a possible asset that arises from past events and whose existence will be
confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the
control of the Company. Contingent assets are not recognised until their realisation become virtually certain.
 2021 2020
Note Rupees Rupees

5. Property, plant and equipment

Tangible
Operating fixed assets 5.1. 1,189,116,559 1,236,847,371
Capital work in process 5.7. 12,755,611 -
1,201,872,170 1,236,847,371

5.1. Operating fixed assets

Company owned
Right of use
assets
Building on Plant and Electric Factory Furniture and Laboratory Total
Freehold land Office equipment Vehicles Sub total
freehold land machinery installations equipment fixtures equipment Plant and
machinery
As At July 01, 2019
Cost/ valuation 542,073,300 417,551,150 715,684,001 47,180,000 3,250,000 7,520,074 18,921,126 3,000,000 56,741,726 1,811,921,377 86,636,000 1,898,557,377
Accumulated depreciation - 43,155,940 135,979,960 8,964,200 617,500 5,469,399 14,230,619 570,000 50,150,256 259,137,874 16,460,840 275,598,714
542,073,300 374,395,210 579,704,041 38,215,800 2,632,500 2,050,675 4,690,507 2,430,000 6,591,470 1,552,783,503 70,175,160 1,622,958,663

Opening net book value 542,073,300 374,395,210 579,704,041 38,215,800 2,632,500 2,050,675 4,690,507 2,430,000 6,591,470 1,552,783,503 70,175,160 1,622,958,663

Transferred from investment property

Cost/ valuation 14,250,000 12,045,127 - - - - - - - 26,295,127 - 26,295,127
Accumulated depreciation - - - - - - - - - - - -

14,250,000 12,045,127 - - - - - - - 26,295,127 - 26,295,127

Depriciation
From 01-07-19 to 31-12-19 - 10,196,200 28,985,202 1,910,790 131,626 102,534 234,525 121,500 657,839 42,340,216 3,508,758 45,848,974
As At December 31, 2019
Before revaluation
Cost/ valuation 556,323,300 429,596,277 715,684,001 47,180,000 3,250,000 7,520,074 18,921,126 3,000,000 56,741,726 1,838,216,504 86,636,000 1,924,852,504
Accumulated depreciation - 53,352,140 164,965,162 10,874,990 749,126 5,571,933 14,465,144 691,500 50,808,095 301,478,090 19,969,598 321,447,688
556,323,300 376,244,137 550,718,839 36,305,010 2,500,874 1,948,141 4,455,982 2,308,500 5,933,631 1,536,738,414 66,666,402 1,603,404,816

Revaluation Deficit - - (3,361,892) (305,010) (350,875) - - (708,500) - (4,726,277) (24,466,251) (29,192,528)

Revaluation Loss - - (253,629,396) - - - - - - (253,629,396) (288,651) (253,918,047)

As At January 01, 2020
After revaluation
Cost/ valuation 556,323,300 429,596,277 293,727,551 36,000,000 2,149,999 7,520,074 18,921,126 1,600,000 56,741,726 1,402,580,053 41,911,500 1,444,491,553
Accumulated depreciation - 53,352,140 - - - 5,571,933 14,465,144 - 50,808,095 124,197,312 - 124,197,312
556,323,300 376,244,137 293,727,551 36,000,000 2,149,999 1,948,141 4,455,982 1,600,000 5,933,631 1,278,382,741 41,911,500 1,320,294,241
Disposals:
Cost/ valuation - - (56,257,001) - - - - - (1,416,000) (57,673,001) - (57,673,001)
Accumulated depreciation - - (829,470) - - - - - (1,371,069) (2,200,539) - (2,200,539)
- - (55,427,531) - - - - - (44,931) (59,873,540) - (59,873,540)

Transfer from right of use assets to

company owned assets
Cost/ Valuation - - 10,000,000 - - - - - - - (10,000,000) (10,000,000)
Accumulated depreciation - - - - - - - - - - - -
- - 10,000,000 - - - - - - - (10,000,000) (10,000,000)

Depreciation charge - 10,196,200 13,202,997 1,800,000 107,500 102,534 234,525 80,000 655,077 26,378,833 1,595,575 27,974,408
At June 30,2020
Cost/ valuation 556,323,300 429,596,277 247,470,550 36,000,000 2,149,999 7,520,074 18,921,126 1,600,000 55,325,726 1,354,907,052 31,911,500 1,386,818,552
Accumulated depreciation - 63,548,340 12,373,527 1,800,000 107,500 5,674,467 14,699,670 80,000 50,092,103 148,375,606 1,595,575 149,971,180

Total book value at June 30, 2020 556,323,300 366,047,937 235,097,023 34,200,000 2,042,499 1,845,607 4,221,456 1,520,000 5,233,623 1,206,531,446 30,315,925 1,236,847,371

As At July 01, 2020

Cost/ valuation 556,323,300 429,596,277 247,470,550 36,000,000 2,149,999 7,520,074 18,921,126 1,600,000 55,325,726 1,354,907,052 31,911,500 1,386,818,552
Accumulated depreciation - 63,548,340 12,373,527 1,800,000 107,500 5,674,467 14,699,670 80,000 50,092,103 148,375,606 1,595,575 149,971,181

Opening net book value 556,323,300 366,047,937 235,097,023 34,200,000 2,042,499 1,845,608 4,221,456 1,520,000 5,233,623 1,206,531,446 30,315,925 1,236,847,371

Addition:
Total book value at June 30, 2020 556,323,300 366,047,937 235,097,023 34,200,000 2,042,499 1,845,607 4,221,456 1,520,000 5,233,623 1,206,531,446 30,315,925 1,236,847,371

As At July 01, 2020

Cost/ valuation 556,323,300 429,596,277 247,470,550 36,000,000 2,149,999 7,520,074 18,921,126 1,600,000 55,325,726 1,354,907,052 31,911,500 1,386,818,552
Accumulated depreciation - 63,548,340 12,373,527 1,800,000 107,500 5,674,467 14,699,670 80,000 50,092,103 148,375,606 1,595,575 149,971,181

Opening net book value 556,323,300 366,047,937 235,097,023 34,200,000 2,042,499 1,845,608 4,221,456 1,520,000 5,233,623 1,206,531,446 30,315,925 1,236,847,371

Addition:
Cost - - 3,769,088 - - - - - 18,973,002 22,742,090 - 22,742,090
Disposals:
Cost/ valuation - - 12,825,410 - - - - - 8,221,223 21,046,633 - 21,046,633
Accumulated depreciation - - 1,267,153 - - - - - 2,219,607 3,486,760 - 3,486,760
- - 11,558,257 - - - - - 6,001,616 17,559,873 - 17,559,873

Depreciation charge - 19,265,742 23,054,055 3,420,000 204,250 184,561 422,146 152,000 3,178,682 49,881,436 3,031,593 52,913,029
At June 30, 2021
Cost/ valuation 556,323,300 429,596,277 238,414,228 36,000,000 2,149,999 7,520,074 18,921,126 1,600,000 66,077,505 1,356,602,509 31,911,500 1,388,514,009
Accumulated depreciation - 82,814,082 34,160,429 5,220,000 311,750 5,859,028 15,121,816 232,000 51,051,178 194,770,282 4,627,168 199,397,450

Total book value at June 30, 2021 556,323,300 346,782,195 204,253,799 30,780,000 1,838,249 1,661,046 3,799,310 1,368,000 15,026,327 1,161,832,227 27,284,332 1,189,116,559
Annual rate of depreciation (%) - 5-10 10 10 10 10 10 10 20 10

5.1.2. Particulars of immovable property (i.e land and building) in the name of the Company are as follows:
Usage of immovable Covered Area Total Area
Location
property (Square yards) (Square yards)

a) Chak No. 120/J.B, District Faisalabad, Manufacturing unit 1,778 6,670

Punjab.
b) Chak No. 204/R.B, Raza Garden, District Guest house 1,647 6,128
Faisalabad, Punjab.
c) Chak No. 70/R.B, Spinning Unit, District Manufacturing unit 45,911 144,202
Faisalabad, Punjab.
d) Montgomery Bazar, Amtex Office, District Admin office 1,060 272
Faisalabad, Punjab.
e) Chak No. 67/J.B, Tehsil Saddar Distt. Warehouse
2,555 5,748
Faisalabad.
2021 2020
Note Rupees Rupees
5.2. Depreciation for the year has been allocated as under:

Cost of sales 28.1 51,662,841 72,079,141

Administrative expenses 31 1,250,188 1,744,241
52,913,029 73,823,382

5.3. The company had revalued its freehold land, building on freehold land, plant and machinery, electric installations,
factory equipment, laboratory equipment and assets subject to finance lease. Revaluation of freehold land on market
value basis and building on freehold land, plant and machinery, electric installations, factory equipment laboratory
equipment and assets subject to finance lease on depreciated replacement values basis was carried out by
independent
June valuers
03, 2004, by M/SM/SBFA
Observers
(Private)(Private)
Limited Limited as at30, 2009 ,by M/S Empire Enterprises (Private) Limited as at
as at June
December 31, 2012, by M/S Gulf Consultants as at June 30, 2017 and latest revaluation was carried out of Plant &
Machinery, Factory equipments, Electric Installation and Laboratory equipments by independent valuers M/S Gulf
Consultants as at January 01, 2020 on depreciated replacement values basis.
5.4. Forced sales value (FSV) of land and buildings is Rs. 682.05 and Rs. 443.972 Million respectively as at June 30, 2017.
Forced sales value (FSV) of machinery and equipments is Rs.97.235 Million respectively as at January 01, 2020.
 5.5. Detail of disposal of property, plant and equipment
Cost /
Accumulated Written
Revaluated Sale proceeds Profit/(loss) Mode of
Description depreciation down value Particulars
amount Disposal
A B C=A+B D E=D-C
------------------------------------------Rupees------------------------------------------------------
3,400,000 (257,267) 3,142,733 2,750,000 (392,733) ZAITOON TEXTILE MILLS Negotiation
801,000 (79,433) 721,568 2,750,000 2,028,433 ZAITOON TEXTILE MILLS Negotiation
1,500,000 (148,750) 1,351,250 2,000,000 648,750 WAQAS RAFIQUE INTERNATIONAL Negotiation
Machinery
1,520,000 (150,733) 1,369,267 1,520,000 150,733 WAQAS RAFIQUE INTERNATIONAL Negotiation
2,404,410 (238,437) 2,165,973 4,000,000 1,834,027 FANZ SPINNING MILLS Negotiation
3,200,000 (392,533) 2,807,467 3,330,000 522,533 MUBASHAR BROTHERS Negotiation
1,964,223 (1,173,086) 791,137 2,136,500 1,345,363 SYED MUMTAZ ALI SHAH Negotiation
Vehicles
5,432,000 (271,600) 5,160,400 5,432,000 271,600 HABIB BANK LIMITED Negotiation
Other items having net having
net book value of less than
Rs. 500,000/- each.
Vehicles 825,000 (774,921) 50,079 250,000 199,921 MUHAMMAD HAFEEZ Negotiation

2021 Rupees 21,046,633 (3,486,760) 17,559,873 24,168,500 6,608,627

2020 Rupees 57,673,001 (2,200,539) 55,472,462 64,097,350 8,624,888
5.6. Had there been no revaluation, the related figures of freehold land, building on freehold land, plant and machinery,
electric installations, factory equipment and laboratory equipment as at June 30, 2021 would have been as follows:

2021

Accumulated Written down

Cost
depreciation value

--------------------------------Rupees-----------------------------

Company owned
Freehold land 329,718,333 - 329,718,333
Building on freehold land 974,943,769 26,932,413 948,011,356
Electric installations 32,087,323 14,448,033 17,639,290
Factory equipment 5,882,262 4,981,158 901,104
Laboratory equipment 844,749 563,538 281,211
1,343,476,436 46,925,142 1,296,551,294

2021 2020
Note Rupees Rupees
5.7. Capital Work in progress
Electric Installation 5.7.1. 4,894,455 -
Building 5.7.2. 7,861,156 -
12,755,611 -
5.7.1. Electric Installation
Balances as at July 1, - -
Capital expenditure incurred during the year 4,894,455 -
Balances as at June 30, 4,894,455 -

5.7.2. Building
Balances as at July 1, - -
Capital expenditure incurred during the year 7,861,156 -
Balances as at June 30, 7,861,156 -
 2021 2020
Note Rupees Rupees
6. Investment property - at fair value
Land 6.1. 555,424,000 520,710,000
Building 6.2. 633,215,649 640,691,391
1,188,639,649 1,161,401,391
6.1. Land
Carrying amount as at July 1, 520,710,000 448,175,000
Transfers to owner-occupied property - (14,250,000)
Net gain from fair value adjustment 34,714,000 86,785,000
Carrying amount as at June 30, 555,424,000 520,710,000
6.2. Building
Carrying amount as at July 1, 640,691,391 654,148,583
Transfers to owner-occupied property - (12,045,127)
Net loss from fair value adjustment (7,475,742) (1,412,065)
Carrying amount as at June 30, 633,215,649 640,691,391
6.3. The fair value of investment property was carried out by independent valuers M/S Gulf Consultants as at June 30,
2021 on depreciated replacement values basis.
6.4. Investment property with a carrying amount of Rs. 1,138.98 million are subject to first charge against loan of Rs.
1217.721 million (2020: Rs. 1,217.721 million) from United Bank Ltd, Rs.399.568 million (2020: Rs. 399.568 million)
from Askari Bank Ltd, Rs. 122.683 million (2020: Rs. 122.683 million) from Bank Islami Ltd ( Formerly KASB Bank
Limited and now merged into Bank Islami). This charge existed as at June 30, 2021.
6.5. Forced sales value (FSV) of land and buildings is Rs. 472.11 million, Rs. 538.23 million respectively as at June 30, 2021.

6.6. It includes land and building rented to Abwa Knowledge Village (Pvt) Ltd, an associated undertaking.
6.7. It represents freehold land and building located at 1 K.M. Jararnwala Road chak No. 76/R.B, Khurrianwala, District
Faisalabad, Province Punjab, with area of 105,149 square yards respectively.
2021 2020
Note Rupees Rupees
7. Long term deposits
Against utilities 41,345,029 41,345,029
Against TFC 9,374,497 9,374,497
50,719,526 50,719,526
8. Stores, spares and loose tools
Stores 159,082,667 157,180,636
Spares 1,789,427 9,850,301
160,872,094 167,030,937
8.1. Stores include items that may result in fixed capital expenditure but are not distinguishable.
2021 2020
Note Rupees Rupees
9. Stock in trade
Raw material 314,125,009 307,165,459
Work in process 8,205,611 9,415,254
Finished goods 166,135,880 221,048,122
Waste 1,523,939 1,200,527
489,990,439 538,829,362
9.1. Stock in trade amounting to Rs. 220.598 million (2020:Rs. 220.598 million) was pledged as security with the banks.
Due to pending litigation with NBP latest pledged stock sheets are not provided / made available by the bank. Out of
total pledged stock the part of NBP amounts to Rs. 102.231 million.
9.2. Stock in trade amounting to Rs. 18.70 million (2020: Rs. 538.829 million) is at net realisable value as per valuation
report given by an independent valuer.
 2021 2020
Note Rupees Rupees
10. Trade debts
Considered good
Unsecured
Foreign 41,921,978 47,880,225
Local 16,949,228 61,220,037
58,871,206 109,100,262
Considered doubtful
Unsecured
Foreign 7,041,998,879 7,041,998,879
Local - -
Less: Provision for doubtful debts 10.1. (7,041,998,879) (7,041,998,879)
- -
58,871,206 109,100,262
10.1. Provision for doubtful debts
Opening balance 7,041,998,879 7,041,998,879
Created during the year - -
Closing balance 7,041,998,879 7,041,998,879

10.2. The aging of trade debts as at statement of financial position date is as under:
Not past due 58,871,206 65,454,793
Past due within one year - 43,645,469
Past due more than one year 7,041,998,879 7,041,998,879
7,041,998,879 7,085,644,348
7,100,870,085 7,151,099,141
10.3. Following are the details of debtors in relation to export sales:
Jurisdiction
USA - 47,880,225
Europe 41,921,978 -
41,921,978 47,880,225
11. Loans and advances
Considered good
Advances
Suppliers and others 11.1. 12,895,364 4,962,100
11.1. It includes an amount of Rs. 2,625,000/- ( 2020 : 2,625,000/- which has been deposited as demand draft in the name
of Judge Banking Court Lahore. (Refer # 26.1.i)

2021 2020
Note Rupees Rupees
12. Deposits and prepayments
Deposits
Lease deposits 4,799,126 4,799,126
13. Other receivables
Export rebate / duty drawback 78,607,281 75,060,325
Others 13.1. 1,553,805 24,820,000
80,161,086 99,880,325

13.1. It represents rent receivables from related party from Abwa Knowledge Village (Pvt) Limited amounts to Rs. 1.374
million (2020: Rs. 24.840 million).
Upto 1 month 1,373,500 1,680,000
1 to 6 months - 8,400,000
More than 6 months - 14,740,000
1,373,500 24,820,000
13.2. The maximum aggregate amount of receivable due from related party at the end of any month during the year was Rs.
28.860 million (2020: Rs. 24.820 million).
 2021 2020
Note Rupees Rupees
14. Tax refunds due from the Government
Income tax 37,499,724 38,843,965
Sales tax 140,945,871 136,895,560
178,445,595 175,739,525
15. Cash and bank balances
Cash in hand 109,479,941 144,149,270
Cash at banks;
In current accounts 40,147,116 30,689,584
In PLS accounts 15.1. 12,976 12,976
149,640,033 174,851,830
15.1. It carries mark up rate Nil (2020: Nil) under prevailing market rate.
16. Issued, subscribed and paid up capital
2021 2020 2021 2020
---------No. of shares-------- Note Rupees Rupees

237,444,067 237,444,067 Ordinary shares of Rs. 10/- each fully 2,374,440,670 2,374,440,670
paid in cash.
Ordinary shares of Rs.10/- each issued
as fully paid shares as per scheme of
4,046,067 4,046,067 40,460,670 40,460,670
arrangement for amalgamation
sanctioned by the Court.
Ordinary shares of Rs. 10/- each issued
17,940,000 17,940,000 as fully paid bonus shares. 179,400,000 179,400,000
259,430,134 259,430,134 2,594,301,340 2,594,301,340

17. Reserves
Capital reserves
Merger reserve 98,039,330 98,039,330
Share premium 17.1. 183,000,000 183,000,000
281,039,330 281,039,330
Surplus on revaluation of property, plant and equipment 17.2. 829,180,098 832,923,049
1,110,219,428 1,113,962,379
Revenue reserves
General reserve 17.3. 250,000,000 250,000,000
1,360,219,428 1,363,962,379
17.1. This reserve can be utilized by the Company only for the purposes specified in section 81 of the Companies Act, 2017.

17.2. The revaluation surplus on property, plant and equipment is a capital reserve, and is not available for distribution to
the shareholders in accordance with section 241 of the Companies Act, 2017.
17.3. This reserve can be utilized by the Company for various purposes including issue of bonus shares to shareholders,
payment of dividend when profits are insufficient and further to meet sudden losses due to natural calamities.

2021 2020
Note Rupees Rupees
18. Redeemable capital
Secured
Sukuk certificates 18.1. & 18.2. - -
18.1. These represent balance out of 130,000 sukuk certificates of Rs. 5,000/- each privately placed with a banking
company.
During the musharika, the legal title to the musharika assets will remain with the Company, however, a trustee will
hold the beneficial title on behalf of the investors.
In addition, these are secured against second charge on all the present and future fixed assets excluding freehold land
and building on freehold land of the Company, bank guarantee of Rs. 740 million issued in favour of the trustee and by
personal guarantee of two directors of the Company. Bank guarantee of Rs. 740 million is also secured. Securities are
disclosed in Note 19.1.
Sukuk certificates are redeemable in twelve equal quarterly installments commenced from January 10, 2010 and
ending on October 10, 2012.
The certificate holders will be entitled to rental payments for use of musharika assets. Rental payments shall be
calculated to provide return equal to the base rate plus incremental rental plus service agency charges incurred by the
trustee during the previous quarter.
Base rate is defined as three months KIBOR and incremental rental is defined as margin of 2% per annum.
The effective yield rate of rental is Nil (2020: Nil).
18.2. The Company has filed suit under Financial Institutions (Recovery of Finances) Ordinance, 2001 against the sukuk unit
holders in the Honorable Lahore High Court, Lahore and prayed for declaration of undertaking to purchase the sukuk
units at a pre-agreed price as void, unlawful and satisfaction of obligations against the existing amounts paid. The
Company has also sought relief of suspension of operation of the undertaking and the bank guarantee issued there
under till the final decision of the suit.
As per two different interim orders of The Honorable Lahore High Court, Lahore guarantor has deposited the amount
of guarantee against all overdue rentals, as claimed by the sukuk unit holders amounting Rs. 529,734,801/-(refer Note
No.24.4) in an escrow account opened by the Deputy Registrar (Judicial) to secure the payments due under sukuk
arrangement. The payable sukuk rentals, as claimed by the sukuk holders, have been adjusted in these financial
statements against the amounts paid by the guarantor, however, due to pending litigation, sukuk unit holders have
not received these payments and sukuk unit holders have not acknowledged the adjustment of sukuk rentals.
Further, in its final order The Honorable Lahore High Court, Lahore has dismissed the above referred suit, with no
findings on the issue and prayer of the Company, stating that this Court lacks jurisdiction under Financial Institutions
(Recovery of Finances) Ordinance, 2001 and the plaint is returned to the plaintiff (Company) to be presented to the
court in which the suit should have been instituted. Being aggrieved Company has filed first appeal against this order
before Division Bench of Honorable Lahore High Court, Lahore and same is pending for adjudication and in its interim
order Division Bench has passed stay order that no amount will be withdrawn, paid by the guarantor, from escrow
account opened by the Deputy Registrar (Judicial) up till further orders in this matter.
2021 2020
Note Rupees Rupees
19. Long term financing

Secured
From banking companies and financial institutions 19.1.
Under mark up arrangements
Demand finance 2,166,037,235 2,166,037,235
Term finance - -
Long term finances under SBP 19,176,163 19,176,163
Syndicated term finance 10,500,000 10,500,000
Morabaha finance 9,594,052 13,399,072
Morabaha finance II 104,000,000 104,000,000
Not subject to markup
Demand finance 144,208,000 152,605,923
2,453,515,450 2,465,718,393
Less: Current portion
Installments overdue (2,039,468,511) (1,540,234,779)
Payable within one year (177,670,812) (511,356,296)
(2,217,139,323) (2,051,591,075)
236,376,127 414,127,318
19.1. Terms of finances are as under:
Number of Payment Commencem
Nature of finance Notes Balance Rupees Ending date Mark up rate
installment rests ent date

Under mark up arrangements:

Demand finances
DFI 19.1.5 & 19.1.1 1,077,124,310 38 Quarterly 30-Jun-12 30-Sep-21 5% p.a.
DFI 19.1.2 311,730,000 28 Quarterly 1-Sep-16 1-Jun-23 6% p.a.
DF 19.1.5 & 19.1.3 377,614,556 7 Bi-annually 25-Sep-17 25-Sep-20 Bank cost of fund
DF 19.1.5 & 19.1.4 399,568,369 15 Quarterly 31-Mar-18 30-Sep-21 Bank cost of fund
2,166,037,235

Long term finances under State

Bank of Pakistan Scheme
II 19.1.5 4,243,913 12 Quarterly 27-Jan-07 27-Oct-09 SBP rate + 2.00% p.a
III 19.1.5 14,932,250 17 Quarterly 31-Mar-07 31-Mar-12 SBP rate +3.65% p.a
19,176,163

Syndicated term finance 19.1.5 10,500,000 20 Quarterly 7-Mar-04 7-Dec-10 6 Month KIBOR +
3.00% p.a with a
floor of 5% p.a
19.1.5
Morabaha finance & 9,594,052 8 Quarterly 27-Aug-19 27-Aug-21 11.00% p.a
19.1.6
Morabaha finance II 19.1.7 104,000,000 36 Quarterly 31-Dec-13 31-Dec-22
1 year kibor-3% with
&
cap at 7 % p.a.
19.1.5
Not subject to mark up:
Demand finances
DFII 19.1.8 134,835,000 6 Quarterly 1-Sep-23 30-Dec-24 -
DF 19.1.9 9,373,000 13 Quarterly 22-Mar-19 15-Feb-22 -

These are secured against specific charges on fixed assets, first charge over fixed and current assets ranking pari passu
with the charges created in respect of short term borrowings (Refer Note 24), ranking charge over fixed assets and
equitable and registered mortgage of properties of the Company and its associates. These are further secured against
ranking charge over current assets, pledge of sponsor's 45 million shares in the Company, counter bank guarantee of
Rs. 340 million and person al guarantee of all directors of the Company. Bank guarantee is secured against first charge
over current assets of the Company.
The effective rate of mark up ranges from 5% to 6.00% per annum (2020: 5% to 7.00% per annum).

19.1.1. It represents loans transferred from short term borrowings due to restructuring agreement with a bank. Current
unpaid mark up amounting to Rs.230.394 million till August 31, 2011 (Refer Note 24) alongwith IRS transaction cost
amounting to Rs.18.033 million would be paid by the company after complete adjustment of principal liability
alongwith future mark up.
Any deviation in the restructured arrangement with regards to mark up / principal servicing would revert the facilities
back to its previously approved arrangements and all types of concessions (pricing & tenor) shall be withdrawn.

19.1.2. The company has entered in to restructuring and rescheduling agreement with Soneri bank limited for 2nd time of
existing finance facilities along with fresh facilities. The repayment schedule and mark up rate of previous outstanding
DF-I have been re-negotiated and will be paid in 28 quarterly installments as mentioned below:

Principal
Installments From Till
Recovery
04 Quarterly installments of Rs. 7.000M each 1-Sep-16 1-Jun-17 28,000,000
16 Quarterly installments of Rs. 13.125M each 1-Sep-17 1-Jun-21 210,000,000
07 Quarterly installments of Rs. 21.233M each 1-Sep-21 1-Mar-23 148,631,000
Last installments of DF-I 1-Jun-23 1-Jun-23 24,969,000
The DF-II amount will be Rs. 134.835 M i.e previous DF-II (mark up) Rs. 33.216 M and markup of Rs. 101.619M on the
outstanding DF-I from 26-06-2012 till 30-06-2016. It will be paid in 06 equal quarterly installments of Rs. 22.473 M
each starting from 01.09.2023 and ending on 01.12.2024. Further bank will waive off the differential markup of Rs.
73.747 M after full receipt of new DF-I, DF-II and accrued markup of DF-I.
Markup on DF-I for the period from 01-07-2016 till date of final adjustment will be deferred and kept in memorandum
account and then new DF-III shall be created and paid in 6 equal quarterly installments starting from 01-03-2025 and
ending on 01-03-2026.
19.1.3. It represents principal amount of restructured outstanding loans from Habib Bank Ltd as Company has negotiated the
settlement terms and entered into Settlement Agreement (“Agreement”) in respect of outstanding Principal Liability
and Markup Liability. As per terms of the Agreement, Company shall pay a settlement amount of Rs 921 million
(including an amount of future markup of rupee 59 million) as full and final settlement of liabilities i.e. principal and
markup. Further, as per terms of the Agreement principal amounting to rupees 740 million is payable within three
years and mark up amounting to rupees 122 million is payable in third year and future markup amounting Rs. 59
million is payable in fourth year from the date of execution of Agreement. The balance markup amount between
outstanding markup and agreed payable markup shall be waived off by the Bank, at the end on payment of settlement
amount, as prompt payment bonus. Markup on outstanding rescheduled principal liability would be accrued at
prevailing "Cost of Fund" of the Bank from the date of implementation of settlement arrangement. The cost of funds
shall be reset as and when advised by State Bank of Pakistan. In case of any default under any terms of Settlement
Agreement all waiver / concessions will be withdrawn. An amount of rupees 362 million paid till statement of financial
position date.Entire settlement amount rupees 921 million is payable as per following schedule:

Period Amount Nature Payment Terms

Rs. 125 Million Principal Upon Execution of settellment agreement.

Year-I Rs. 65 Million Principal Within 90 days from the date of execution of settelment agreement.
Rs. 140 Million Principal Before expiry of 1st year from date of execution of settelment agreement.
Year-II Rs. 250 Million Principal Before expiry of 2nd year from date of execution of settelment agreement.
Rs. 160 Million Principal Before expiry of 3rd year from date of execution of settelment agreement.
Year-III
Rs. 122 Million Mark up Before expiry of 3rd year from date of execution of settelment agreement.
Year-IV Rs. 59 Million *Future Mark up Before expiry of 4th year from date of execution of settelment agreement.
*( Future mark up is tentative amount calculated on prevailing COF of the bank.)

19.1.4. It represents principal amount of restructured outstanding loans from Askari Bank Ltd as Company has negotiated the
settlement terms and entered into Settlement Agreement (“Agreement”) in respect of outstanding Principal Liability
and Markup Liability. As per terms of the Agreement, Company shall pay a settlement amount of Rs 524.322 million
(Principal amount of rupees 429.57 million plus 50% of previous outstanding mark up rupees 94.75 million) along with
future markup (at cost of fund) of rupees 28.211 million as full and final settlement of liabilities i.e. principal and
markup. Further, as per terms of the Agreement principal amounting to rupees 429.569 million is payable within three
and half years and mark up will be paid at tail end in four equal quarterly installments after entire adjustment of
prinicipal. Markup on outstanding rescheduled principal liability would be accrued at prevailing "Cost of Fund" of the
Bank from the date of implementation of settlement arrangement. The cost of funds shall be reset as and when
advised by State Bank of Pakistan. In case of any default under any terms of Settlement Agreement all waiver /
concessions will be withdrawn. Entire settlement amount rupees 552.533 million is payable as per following schedule:

Period Installment Amount Nature Payment Terms

Down payment Rs.30 Million Principal Down Payment upon Execution of settellment agreement.
1st Q Installment Rs.50 Million Principal Within 90 days from the date of execution of settellment agreement.
Year-I 2nd Q Installment Rs.3 Million Principal Within 90 days of 1st Quarterly Installment.
3rd Q Installment Rs.4 Million Principal Within 90 days of 2nd Quarterly Installment.
4th Q Installment Rs.130 Million Principal Within 90 days of 3rd Quarterly Installment.
5th Q Installment Rs.15 Million Principal Within 90 days of 4th Quarterly Installment.
6th Q Installment Rs.100 Million Principal Within 90 days of 5th Quarterly Installment.
Year-II
7th Q Installment Rs.15 Million Principal Within 90 days of 6th Quarterly Installment.
8th Q Installment Rs.22 Million Principal Within 90 days of 7th Quarterly Installment.
9th Q Installment Rs.15 Million Principal Within 90 days of 8th Quarterly Installment.
10th Q Installment Rs.12 Million Principal Within 90 days of 9th Quarterly Installment.
Year-III
11th Q Installment Rs.10 Million Principal Within 90 days of 10th Quarterly Installment.
12th Q Installment Rs.10 Million Principal Within 90 days of 11th Quarterly Installment.
13th Q Installment Rs.10 Million Principal Within 90 days of 12th Quarterly Installment.
14th Q Installment Rs.3.57 Million Principal Within 90 days of 13th Quarterly Installment.
Year-IV Rs.122.964 million Mark up In four equal quarterly installments after entire adjustment of principal
*(RS 122.964 million also included future tentative mark up calculated on
prevailing COF of the bank.)
19.1.5. Information / records were not made available by the banking companies to confirm the year end balances amounting
to Rs.1,997.58 million out of total outstanding amount due to pending litigation.
19.1.6. It represents principal amount of restructured outstanding loans from First National Bank Modaraba as
Company has negotiated the settlement terms and entered into Settlement Agreement (“Agreement”)
during the period, in respect of outstanding Principal Liability and Markup Liability. As per terms of the
Agreement, Company shall pay a settlement amount of Rs 34.43 million as full and final settlement of
liabilities i.e. principal, outstanding contractual markup, future cost of funds and cost of suit. As per
terms of the Agreement outstanding principal liability amounting to rupees 19.22 million is payable
within two years in eight equal quarterly installments of rupees 1,902,510 after making an immediate
down payment of rupees 4 million. Outstanding contractual markup along with future cost of funds at
the rate of 11% and expenses of suit in aggregate amounting to rupees 15.210 million shall payable in six
equal quarterly installments of rupees 2,535,109 at tail end after adjustment of entire principal liability.
Period Nature Installment Date Amount (PKR)
Principal Down Payment 27.08.2019 4,000,000
Principal 1st Q 27.11.2019 1,902,510
Year I Principal 2nd Q 27.02.2020 1,902,510
Principal 3rd Q 27.05.2020 1,902,510
Principal 4th Q 27.08.2020 1,902,510
Principal 5th Q 27.11.2020 1,902,510
Principal 6th Q 27.02.2021 1,902,510
Year II
Principal 7th Q 27.05.2021 1,902,510
Principal 8th Q 27.08.2021 1,902,510
In six equal quarterly Installments of
Year III Markup+ COF 15,210,652
rupees 2,535,109 each

19.1.7. It represents short term export Morabaha finance restructured into long term Morabaha finance II and short term
Morabaha Finance I as on December 06, 2013. Further total Mark up till date mentioned amounting to Rs.
45,491,684/- has been deferred (refer note no. 21) and will be recovered on quarterly basis in 3 years after complete
adjustment of long term Morabaha Finance II in 9 years. These are secured against JPP charge on Current Assets
valuing Rs.750 million, ranking charge over Fixed Assets valuing Rs. 200 million with 25% margin for all lines,Title of
export documents and personal guarantees of main sponsoring directors of the company.

19.1.8. It represents outstanding mark up on principal liabilities restructured as mentioned in note 19.1.2 above, converted in
the demand finance and no mark up shall be charged on it.
19.1.9. It represents principal amount of restructured outstanding loans from MCB Bank Ltd as Company has negotiated the
settlement terms and entered into Settlement Agreement (“Agreement”) during the period, in respect of outstanding
principal liability and markup liability. As per terms of the Agreement, Company shall pay a settlement amount of Rs
26.052 million as full and final settlement of liabilities i.e. principal and markup against admitted liability of Rs.33.709
million.As per terms of the Agreement outstanding liability amounting to rupees 26.052 million is payable within three
years.Outstanding balance as at 30 june,2021 is Rs. 9,373,000/- after payment of Rs. 16,679,150/-.In case of any
default the entire admitted outstanding liability i.e Rs.33.709 million along with future mark-up / COF and other
charges admissible under the law shall immediately become due for payment and Bank shall have all the rights to avail
remedies available under law to recover stuck-up finance etc. Entire settlement amount rupees 26.052 million is
payable as per following schedule:

Installments On or Before Amount

1st Down Payment 2,655,104
2nd 15-05-2019 1,875,000
3rd 15-08-2019 1,875,000
4th 15-11-2019 1,875,000
5th 15-02-2020 1,875,000
6th 15-05-2020 1,875,000
7th 15-08-2020 1,875,000
8th 15-11-2020 1,875,000
9th 15-02-2021 1,875,000
10th 15-05-2021 1,875,000
11th 15-08-2021 1,875,000
12th 15-11-2021 1,875,000
13th 15-02-2022 2,772,046
26,052,150
19.2. As per terms of agreement with a bank, the recommendation, declaration and payment of dividend is subject to prior
written approval of the bank.

19.3. Reconciliation of liabilities arising from long term financing activities

Availed / transfer Repaid / transfer during
At July 01, 2020 At June 30, 2021
during the year the year

-------------------------------------------Rupees-------------------------------------------

Long term financing 2,465,718,393 - (12,202,943) 2,453,515,450

 2021 2020
Note Rupees Rupees
20. Lease Liabilities / Ijarah

Opening balance 67,326,108 68,248,285

Paid / adjusted during the year - (922,177)
67,326,108 67,326,108
Current portion
Installments overdue (67,326,108) (67,326,108)
Payable within one year - -
(67,326,108) (67,326,108)
- -
These represent plant and machinery acquired under separate lease agreements.
The purchase option is available to the Company on payment of last installment and surrender of deposit at the end of
the lease period.
The principal plus financial charges are payable over the lease period in 16, 24 and 16 quarterly installments. The
liability represents the total minimum lease payments. Furthermore, information / records were not made available
by the financial institution to confirm the year end balance of the outstanding amount due to pending litigation.

Reconciliation of lease liabilities is given below:

2021 2020
Present value Present value
Finance cost Minimum Finance cost
Minimum of minimum of minimum
for future lease for future
lease payments lease lease
periods payments periods
payments payments
----------------------------------------Rupees----------------------------------
Due within one year 86,945,214 19,619,106 67,326,108 86,945,214 19,619,106 67,326,108
Due after one year but
not later than five years - - - - - -
86,945,214 19,619,106 67,326,108 86,945,214 19,619,106 67,326,108
2021 2020
Note Rupees Rupees
21. Deferred liabilities
Deferred markup on:
Demand finance 19.1.1.-19.1.4. & 19.1.9. 1,220,381,241 1,140,716,522
Morabaha finance 19.1.7. 84,290,601 85,045,829
1,304,671,842 1,225,762,351
Staff retirement gratuity 21.1. 18,110,266 14,039,838
1,322,782,108 1,239,802,189
21.1. Staff retirement gratuity
21.1.1. General description
The Company operates an unfunded gratuity scheme for all its employees at mills who have completed the minimum
qualifying period of service as defined under the scheme. The most recent valuation was carried out as at June 30,
2021 using the "Projected Unit Credit Method".

2021 2020
Note Rupees Rupees
21.1.2. Statement of financial position reconciliation as at June 30,
Present value of defined benefit obligation 18,110,266 14,039,838
21.1.3. Movement in net liability recognised
Opening balance as at July 01, 14,039,838 17,011,862
Expenses recognised in statement of profit and loss 21.1.4. 4,136,936 2,518,272
Benefits due but not paid (105,000) -
Benefits paid during the year - (2,500,180)
Remeasurement loss/(gain) on obligation 38,492 (2,990,116)
Closing balance as at June 30, 18,110,266 14,039,838
 2021 2020
Note Rupees Rupees

21.1.4. Expenses recognised in statement of profit and loss

Current service cost 2,999,407 1,671,437
Interest cost 1,137,529 846,835
4,136,936 2,518,272

21.1.5. Principal actuarial assumptions

Discount factor used 10.00% per annum 8.50% per annum
Expected rate of increase in salaries 10.00% per annum 10.00% per annum
Expected average remaining working lives of participating employees 5 years 5 years
21.1.6. Year end sensitivity analysis of the defined benefit obligation is as follows:
Reworked defined benefit obligation
Change in assumptions Increase in Decrease in
Increase Decrease assumptions assumptions
Discount rate 11.00% 9.00% 17,459,735 19,013,155
Salary increase rate 11.00% 9.00% 19,005,770 17,452,992
21.1.7. Expected Maturity Profile
Followings are the expected distribution and timing of benefit payments at year end:
Description 2021
Year (Rupees)
2022 373,413
2023 355,198
2024 327,875
2025 316,946
2026 300,552
2027 to 2031 1,384,360
2032 onward 15,156,922
Comparison of present value of defined benefit obligation is as follows:

Rupees 2021 2020 2019 2018 2017

As at June 30,
Present value of defined benefits obligation 18,110,266 14,039,838 17,011,862 14,481,897 50,963,593

Experience adjustment on obligation -9% -21% -4% 14% 5%

2021 2020
Note Rupees Rupees
22. Trade and other payables
Creditors 140,217,010 168,454,069
Accrued liabilities 22.1. 22,386,740 23,082,019
Workers' welfare fund 720,506 -
163,324,256 191,536,088
22.1. It includes amount of Rs.105,000/- relating to gratuity due but not paid till statement of financial position date.

2021 2020
Note Rupees Rupees
23. Interest / markup payable
Redeemable capital 88,882,946 88,882,946
Long term financing 104,406,524 104,406,524
Lease Liabilities 19,619,106 19,619,106
Short term borrowings 2,516,950,546 2,507,058,787
2,729,859,122 2,719,967,363
 2021 2020
Note Rupees Rupees
24. Short term borrowings
Secured
From banking companies and financial institutions
Under mark up arrangements 24.2.
Export finances 4,409,565,694 4,449,565,694
Running finance 185,231,589 185,231,589
Morabaha finances 24.3. 327,001,675 327,001,675
Cash finances 161,663,818 164,327,910
Forced demand finance 24.4. 560,607,601 565,941,901
Payment against documents 99,968,675 99,968,675
Not subject to markup
Demand finance 24.5. 271,405,000 271,405,000
6,015,444,052 6,063,442,444
24.1. The aggregate unavailed short term borrowing facilities available to the Company is Rs.Nil at the year end. (2020:
Rs.Nil)
24.2. Short term borrowings, excluding cash finances are secured against lien on export documents, hypothecation of
current assets, first charge over current assets ranking pari passu with the charges created in respect of long term
financing (Refer Note 19.1), and ranking charge over current assets of the Company. These are further secured against
first charge over fixed assets ranking pari passu with the charges created in respect of long term financing (Refer Note
19.1), ranking charge over fixed assets and by personal guarantee of directors of the Company. Cash finances are
secured against pledge of stocks and personal guarantee of directors / sponsor directors of the Company.
The effective rate of mark up charged during the year ranges from 8.45% to 9.38% per annum (2020: 12.08% to
15.40% per annum).

24.3. Morabaha finances include Morabaha finance I and also include morabaha facilities availed. These finances are to be
repaid from export proceeds realized or from own source and are for purchase of cotton, PSF, yarn, cloth, chemical,
spares and other raw material. Collateral securities are same as detailed in Note 19.1.7.
24.4. It represents loan created against all overdue rentals of redeemable capital paid by the guarantor as claimed by sukuk
unit holders (Refer Note 18.2) and loan created of an amount Rs. 36,207,100 against guarantee amount of SNGPL paid
by UBL and SBL on behalf of company. Securities are disclosed in Note 19.1.
24.5. Total amount of demand finance was Rs. 367.722 million. The securities are disclosed in Note 19.1. Rs.74.989 million
was payable on June 29, 2010 as down payment, Rs. 127.876 million was payable till July 31, 2010 out of proceeds of
sales tax refunds and remaining mark up balance of Rs. 164.857 million was payable in 10 equal monthly installments
commenced from June 30, 2010 and ending on March 31, 2011.
24.6. Information / records were not made available by the banking companies to confirm the year end balances amounting
to Rs. 5,968.108 million (2020: 3,294.454 million) out of total outstanding amount due to pending litigation.

24.7. Reconciliation of liabilities arising from short term borrowings

Availed / transfer Repaid / transfer during

At July 01, 2020 At June 30, 2021
during the year the year

-------------------------------------------Rupees-------------------------------------------

Short term borrowings 6,063,442,444 - (53,748,392) 6,009,694,052

2021 2020
Note Rupees Rupees
25. Current portion of non current liabilities
Long term financing 19. 2,217,139,323 2,051,591,075
Lease liabilities 20. 67,326,108 67,326,108
2,284,465,431 2,118,917,183
26. Contingencies and commitments

26.1. Contingencies

a. M/S Bank Islami (Formerly KASB Bank Limited and now merged in to Bank Islami) instituted a suit for recovery
of Rs.149,802,970/- under Financial institutions (Recovery of Finances) Ordinance, 2001 in the Honorable
Lahore High Court, Lahore against the Company. The Bank restructured the outstanding finances as it claimed
in referred suit for recovery and also offered to provide fresh export refinance working capital limits vide its
offer letter. Based on such offer letter Company entered in to a compromise agreement with the Bank and
Honorable Lahore High Court, Lahore passed the consent decree. Now, the Bank is not fulfilling its contractual
obligations and not providing the agreed fresh export refinance working capital limits and has filed Execution
Petition for recovery of Rs.192,528,719/- The company is filing its legal reply to Execution Petition filed by the
Bank in the said matter which is pending adjudication.
b. Amtex Limited filed suit in the court of Honorable Senior Civil Judge Faisalabad against M/S. Pakistan Cargo
Services Private Limited for recovery of Rs.12,019,087/-. The case has been dismissed for want of evidence.
Being aggrieved, company has filed appeal which is pending for adjudication before Honorable Additional
Session Judge, Faisalabad.
c. M/S Zephyre Textile Limited has filed a suit for recovery of Rs. 2,916,762/- against the company before the
Honorable District Judge Lahore. The company has duly filed its reply in the said matter and the same is
pending adjudication.
d. M/S. Pak Kuwait Investment Company Private Limited has instituted suit under Financial Institutions (Recovery
of Finances) Ordinance, 2001 for recovery of Rs. 97,903,568/- along with future markup in the Honorable High
Court Sindh at Karachi against the company. Court has passed the decree in favour of Bank. Being aggrieved,
Company has filed appeal in the said matter and the same is pending adjudication.
e. Bank Islami Pakistan Limited has instituted suit against the company in the Honorable Lahore High Court,
Lahore under financial institutions (Recovery of Finance) Ordinance, 2001 for recovery of Rs. 660,473,859/-. The
Company has duly filed its petition for leave to defend in the said matter and the same is pending adjudication.

f. M/S National Bank of Pakistan (Islamic Banking Division) has instituted a suit for recovery of Rs. 106,924,484/-
under Financial Institutions (Recovery of finances) Ordinance, 2001 in the Honorable Lahore High Court, Lahore
against the company. The company has duly filed its petition for leave to defend in the said matter and the
same is pending adjudication.
g. M/S National Bank of Pakistan has instituted a suit for recovery of Rs. 1,487,663,500/- under Financial
Institutions (Recovery of finances) Ordinance, 2001 in the Honorable Lahore High Court, Lahore against the
company. The company has duly filed its petition for leave to defend in the said matter and the same is pending
adjudication.
h. M/S Faysal Bank Ltd has instituted a suit for recovery of Rs. 6,061,867/- under Financial Institutions (Recovery
of finances) Ordinance, 2001 in the Honorable Banking Court No. II, Faisalabad against the company. The
company has filed its petition for leave to defend in the said matter and same is pending adjudication.
i. M/S Saudi Pak Industrial & Agricultural Investment Company Ltd has instituted a suit for recovery of Rs.
19,122,367/- under Financial Institutions (Recovery of finances) Ordinance, 2001 in the Honorable Banking
Court No. II, Lahore against the company. Court has passed the decree against the company and the company
filed an appeal against the court order and Honorable Lahore High Court, Lahore in its order has set aside the
decree earlier passed by the Honorable Banking Court No. II, Lahore. The Company has deposited demand draft
amounting to Rs. 2,625,000/- (Refer Note no. 11) as at 12-Feb-2016 in the name of Judge Banking Court Lahore
and now have applied for the refund of this amount as decree has been set aside, the application for refund is
pending for decision before
Honorable Lahore High Court. Now, M/S Saudi Pak Industrial & Agricultural Investment Company Ltd has
instituted a fresh suit for recovery of Rs. 19,122,367 under Financial Institutions(Recovery of finances)
Ordinance, 2001 before the Honorable Judge Banking Court No. II, Faisalabad, the Company has filed its
petition for leave to defend in the said matter and same is pending adjudication.
j. M/S Habib Bank Ltd has instituted a suit for recovery of Rs. 946,312,769/- under Financial Institutions (Recovery
of finances) Ordinance, 2001 in the Honorable High Court Lahore against the company. Court has passed the
decree in favor of Bank. The Company has entered in to a settlement agreement as explained in note 19.1.3 of
these financial statements and under the terms of settlement agreement decree execution has been sine die
adjourned in the Honorable Lahore High Court, Lahore.
k. The Bank of Punjab has instituted a suit for recovery of Rs. 6,373,121,000/- under Financial Institutions
(Recovery of finances) Ordinance, 2001 in the Honorable High Court Lahore against the company. Court has
passed the decree in favor of the company. Being aggrieved, Company has filed appeal in the said matter and
the same is pending adjudication.
l. Askari Bank Ltd has instituted a suit for recovery of Rs. 619,486,166/- under Financial Institutions (Recovery of
finances) Ordinance, 2001 in the Honorable High Court Lahore against the company. Court has passed the
decree in favor of Bank for an amount of rupese 490.671 million. Being aggrieved, Company has filed appeal in
the said matter and the same is pending adjudication. Subsequently, Company entered into a settlement
agreement as explained in note 19.1.4 of these financial statements. Under the terms of settlement agreement
Company paid Rs. 30 million and required NOC from Bank to relaese the charge on machinery proportionate to
the payment received and to proceed further as per agreement.
m. The Company has filed writ petition in the Honorable Lahore High Court, Lahore against Federation of Pakistan
and others, in the case of investigation of affairs of the Company. The case is pending adjudication.
n. Cases are pending before foreign exchange adjudication officer, State Bank of Pakistan, for non-repatriation of
export proceeds within prescribed times. The default may attract penalties. The financial impact cannot be
determined at this stage.
o. A recovery demand of Rs. 9.4 million has been raised as a result of an order passed by Additional Commissioner
Inland Revenue u/s 122 (5A) of the Income Tax Ordinance 2001 regarding Tax Year 2012. Department has
deducted Rs. 9 million from Company’s income tax and sales tax refunds. Said recovery deductions has not yet
accounted for due to an appeal filed before Appellate Tribunal Inland Revenue (ATIR), Lahore.

p. SNGPL in July 2014 has changed the Sui gas Tariff from Rs. 488.23 per MMBTU to Rs. 573.28 per MMBTU by
transferring the category of our unit from General Industrial to Captive Power. Company has filed writ petition
before the Honorable Lahore High Court, Lahore against the said illegal / unlawful captive power tariff
application by taking plea that we are producing / generating electricity only for own consumption / use,
moreover, we do not hold license which is pre-requisite for sale of electricity. Honorable Lahore High Court,
Lahore has granted stay in favor of the company restraining the SNGPL from charging captive power tariff
instead of general industrial tariff. The company is confident of a favorable outcome of the suit, therefore, no
provision has been made in these financial statements.
q. Sui Northern Gas Pipelines Ltd has incorporated a suit against the company's Spinning Division situated at 30
KM Sheikhupura Road Faisalabad, in the honourable Court of District Judge / Judge Gas Utility Court,
Faisalabad for recovery of Rs. 57,713,100/- under Section 6 of The Gas (Theft Control & Recovery) Act 2016 on
account of Consumption, Gas Infrastruture Development Cess, General Sales Tax, Violation of Gas Sales
Agreement alongwith sum due, Arrears & Late Payment Surcharge. Petitioner prayed for decree of recoverable
amount along with attachment of immovable properties of the Company before judgment or direcrtion to
furnish equal amount of security till the final decesion of the court. The company has duly filed its reply in the
said matter and the same is pending adjudication.
r. Sui Northern Gas Pipelines Ltd has incorporated a suit against the company's Processing Division situated at 1
KM Khurrianwala Jaranwala Road Faisalabad, in the honourable Court of District Judge / Judge Gas Utility Court,
Faisalabad for recovery of Rs. 485,424,500/- under Section 6 of The Gas (Theft Control & Recovery) Act 2016 on
account of Consumption, Gas Infrastruture Development Cess, General Sales Tax, Violation of Gas Sales
Agreement alongwith sum due, Arrears & Late Payment Surcharge. Petitioner prayed for decree of recoverable
amount along with attachment of immovable properties of the Company before judgment or direcrtion to
furnish equal amount of security till the final desicion of court. The company has duly filed its
reply in the said matter and the same is pending adjudication.
s. The Honorable Supreme Court of Pakistan ('SCP') in its decision dated August 13, 2020 held that Gas
Infrastructure Development Cess ('GIDC'), as initially levied through Gas Infrastructure Development Cess Act,
2011 and modified via different notifications issued from time to time and thereafter re-levied through the Gas
Infrastructure Development Cess Ordinance, 2014, stands payable to SNGPL in twenty four (24) equal monthly
installments with immediate effect.Pursuant to the order of the SCP, Sui Northern Gas Pipelines Limited raised
a demand for the collection of the GIDC arrears. The company filed a writ petition under article 199 of the
Constitution of Islamic Republic of Pakistan,1973 in the Honorable Lahore High Court ('HLHC') against the
demand raised, pleading that demanding arrears of GIDC are illegal, unlawful and ultra vires to the first proviso
to section 8 (2) of the Gas Infrastructure Development Cess Act, 2015. The writ petition was decided in favor of
the Company by HLHC vide its order dated June 17, 2021.Further judgment of the Honorable Supreme Court of
Pakistan does not apply to arrears under the Gas Infrastructure Development Cess Act, 2011 and Gas
Infrastructure Development Ordinance 2014 that are, in terms of first proviso of section 8 (2) of the Gas
Infrastructure Development Cess Act, 2015, not to be collected. The applicability of first proviso of section 8 (2)
is subject to the determination by High Level Committee ('Committee') of Sui Northern Gas Pipelines Limited.
The decision has not been made by the Committee on the applicability of arrears to the Company.

t. The Company has filed reference against order passed by Commissioner Punjab Revenue Authority in
Honorable Lahore High Court Lahore challenging the imposition of Punjab Services on sales tax amounting to to
rupees 3.1 million on foreign commission paid. Honorable Court after initial hearing
has granted stay order and suspend the recovery notice issued in respect of said impugned demand and same is
pending adjudication.
 u. The Company has filed writ petition in Honorable Lahore High Court, Lahore against Commissioner Inland
Revenue Regional Tax Office Faisalabad, Revenue Officer Faisalabad, Faisalabad Electric Supply Company and
others regarding illegal and un-lawful levy of General Sales Tax on newly acquired electric connection / bill of
spinning division. The court has granted interim relief and further ordered the respondents to decide the issue
within a period of one month.
v. The Company has filed civil suit, against illegal demand by SNGPL to increase the security deposit / guarantee
amount worked out on the basis of higher Captive Power Tariff, before Honorable Civil Judge Faisalabad.
Honorable Court of Civil Judge Faisalabad has granted stay order against said impugned revision of security
deposit / guarantee demand.
w. The Company has filed petition and challenged the imposition of various surcharges on the consumption of
electricity and obtained stay order from Honorable Lahore High Court, Lahore. No provision is made in these
financial statements based on the opinion of the legal council that there is not likelihood of unfavorable
outcome or any potential loss.
x. The Company is defendant in various legal proceedings initiated by ex-employees in labor / civil courts.The
Company expects decisions in its favor based on grounds of case and legal opinion Hence, no provision has
been made.
y. Company has filed writ petition before Honorable Islamabad High Court praying to set aside the order, issued
by Executive Director (Corporate and Supervision Department) Securities and Exchange Commission of
Pakistan (SECP), for appointment of inspectors to carry out investigation in to the affairs of the Company, the
writ petition filed and matter is sub-judice and Honorable Islamabad High Court through its interim order has
suspended the operation of order for appointment of inspectors.
z. M/S. First National Bank Modaraba has instituted a suit under Financial Institutions (Recovery of Finances)
Ordinance, 2001 for recovery of Rs. 36,013,341/- along with markup before the Honorable Judge Banking Court,
Lahore against the company. Court has passed the decree in favor of bank and being aggrieved, Company has
filed appeal in the said matter and the same is pending adjudication. Further, Company has entered into a
settlement agreement and under the terms of settlement agreement company has paid rupees 4 million as
down payment and remaining amount will be paid in 8 equal installments.
aa. The Company has filed writ petition in Honorable Lahore High Court, Lahore against Pakistan Central Cotton
Committee and others regarding illegal and un-lawful increased demand / levy of cotton cess. Honorable
Lahore High Court, Lahore has granted interim relief and suspends the said increased demand / levy of cotton
cess and the case is pending adjudication. Further in separate Writ Petition, Court has also granted relief
regarding membership of Ministry of industry, Research & Development Advisory Cell without payment of
cotton cess.
ab. Amtex Limited has filed suit in the Honorable Civil Court at Faisalabad against M/s S.A Rehmat Private Limited
for recovery of Rs.28,230,026/- and rendition of account and cancellation of documents. same is pending
adjudication.
ac. M/S Albaraka Bank Pakistan Limited has instituted a suit for recovery of Rs. 929,221,858/- under Financial
Institutions (Recovery of finances) Ordinance, 2001 in the Honorable Lahore High Court, Lahore against the
company in September 2020. The company has filed its petition for leave to defend in the said matter and same
is pending adjudication.
ad. M/S United Bank Limited has instituted a suit for recovery of Rs. 2,069,996,910/- under Financial Institutions
(Recovery of finances) Ordinance, 2001 in Honorable Lahore High Court, Lahore against the company in
December 2020. The company has filed its petition for leave to defend in the said matter and same is pending
adjudication.
ae. The company has not fully recognised mark up on redeemable capital, long term & short term financing and
lease liability due to aforementioned litigations and also due to settlements with other banks. Had the mark up
been fully charged, net loss for the year would have been increased by Rs.728.857 million (2020: 766.965
million) and accumulated loss and interest / markup payable would have been increased by Rs.5,992.988
million (2020: 5,264.131 million).
af. Financial impact, if any, of the above (a to ae) has not been acknowledged in these financial statements
because of pending litigations.
2021 2020
Note Rupees Rupees
26.2. Commitments
Collector of custom 142,946,569 1,345,890
27. Revenue from contract with customers-Net
Export Sales
Fabrics / made ups / garments 27.1. 894,042,486 417,620,589
Indirect export
Processing 27.2. 126,874,461 97,858,930
1,020,916,947 515,479,519
Local Sales
Made ups 17,343,696 -
Cloth 27.2. 23,535,456 9,126,596
Waste and left over 27.2. & 27.3. 543,962 360,000
Stitching 27.2. 3,973,210 5,653,577
1,066,313,271 530,619,692
Add: Export rebate / duty drawback 8,669,679 14,253,697
1,074,982,950 544,873,389
27.1. Exchange gain due to currency rate fluctuation amounting to Rs. 1,953,133/- (2020: Rs. 1,871,304/- ) has been
included in export sales.
2021 2020
Note Rupees Rupees
27.2. Gross sales
Indirect export
Processing 148,443,119 114,494,948
Local
Made ups 20,292,124
Cloth 27,536,484 10,678,117
Waste and left over 27.3. 636,436 421,200
Stitching 4,648,656 6,614,690
201,556,819 132,208,955
Less: Sales tax (29,286,034) (19,209,853)
172,270,785 112,999,102
27.3. It represents sale of left over / waste material out of goods manufactured.
27.4. Set out below the disaggregation of the Company's Sales.
2021 2020
Note Rupees Rupees
Geographic markets:
Pakistan 172,270,785 112,999,103
UK 562,797,361 15,981,733
USA 177,924,716 394,773,404
Canada 388,405 -
Italy 9,263,060 -
Saudia Arabia 104,570,080 -
Netherland 419,620 -
Denmark 15,706,962 -
Sweden 22,972,282 6,865,452
1,066,313,271 530,619,692
28. Cost of sales
Cost of goods manufactured 28.1. 1,010,628,781 690,139,254
Finished goods
Opening stock 222,248,649 318,131,144
Closing stock (167,659,819) (222,248,649)
54,588,830 95,882,495
1,065,217,611 786,021,749
 2021 2020
Note Rupees Rupees
28.1. Cost of goods manufactured
Raw material consumed 28.1.1. & 28.1.2. 494,529,765 315,840,379
Salaries, wages and benefits 92,811,596 66,317,595
Staff retirement benefits 4,136,936 2,518,272
Stores and spares 16,012,715 22,689,124
Dyes and chemicals 93,522,784 90,570,574
Packing material 62,603,932 28,174,592
Conversion processing and stitching charges 159,188,367 63,949,113
Repairs and maintenance 3,342,860 1,565,854
Fuel and power 30,011,999 17,863,233
Depreciation 5.2. 51,662,841 72,079,141
Other 1,595,343 1,771,891
1,009,419,138 683,339,768
Work in process
Opening stock 9,415,254 16,214,740
Closing stock (8,205,611) (9,415,254)
1,209,643 6,799,486
1,010,628,781 690,139,254
28.1.1. Raw material consumed
Opening stock 307,165,459 359,230,083
Purchases including direct expenses 501,489,315 263,775,755
808,654,774 623,005,838
Closing stock (314,125,009) (307,165,459)
494,529,765 315,840,379
28.1.2. It includes an amount of Rs. 7.026 million (2020: Rs. 133.846 million) in respect of write down of inventories to net
realisable value as per valuation report given by an independent valuer.
2021 2020
Note Rupees Rupees
29. Other Income
Income from financial assets:
Exchange gain on restatement of debtors 631,866 1,217,145
Income from assets other than financial assets:
Gain on disposal of property, plant and equipment 6,608,627 8,624,888
Rental income 29.1. 23,124,000 20,430,000
Exchange gain on Imports 1,165,076 -
Unrealised gain on investment property carried at fair value 27,238,258 85,372,935
58,767,827 115,644,968

29.1. It includes rental income from related parties as follows:

Abwa Knowledge Village (Pvt) Ltd 22,554,000 20,160,000
Shama Exports (Pvt) Ltd 90,000 90,000
I.A Textiles 90,000 90,000
Cotton Passion Textile Mills (Pvt) Limited 300,000 -
Amfort (Pvt) Ltd 90,000 90,000
23,124,000 20,430,000
30. Selling and distribution expenses
Steamer freight 19,101,113 4,292,112
Freight and octroi 7,282,375 3,005,373
Clearing and forwarding 6,901,366 3,448,282
Export development surcharge 2,251,582 1,095,066
Other expenses 1,820,441 970,801
37,356,877 12,811,634
 2021 2020
Note Rupees Rupees
31. Administrative expenses
Directors' remuneration 35. 2,400,000 2,400,000
Salaries and benefits 23,747,529 19,503,477
Utilities 776,145 934,726
Postage and telecommunication 6,438,917 3,766,269
Vehicles running and maintenance 1,950,478 1,823,906
Traveling and conveyance 2,955,205 3,261,328
Printing and stationery 971,043 645,648
Entertainment 3,970,669 2,179,066
Fees and subscriptions 1,105,522 119,500
Legal and professional 17,732,220 768,506
Auditor's remuneration 31.1 1,500,000 1,500,000
Repairs and maintenance 294,901 225,530
Depreciation 5.2. 1,250,188 1,744,241
Federal excise duty written off - 6,677,360
Revaluation loss 5.1. - 253,918,047
Other 803,764 1,591,685
65,896,581 301,059,289
31.1. Auditor's remuneration
Audit fee 1,000,000 1,000,000
Half yearly review 500,000 500,000
1,500,000 1,500,000
32. Finance cost
Interest / mark up on:
Long term financing 78,909,491 132,122,231
Short term borrowings 9,891,759 61,119,708
Bank charges and commission 7,676,062 8,597,941
96,477,312 201,839,880
33. Taxation
Current
For the year 33.1. 15,679,571 10,340,133
Prior year 311,062 19,411,658
Deferred 33.2. - -
15,990,633 29,751,791
33.1. Provision of taxation has been provided by charging minimum tax on local sales due to gross loss sustained by the
taxpayer in current year under section 113 & 153(2) of income tax ordinamce 2008, when and where applicable,
and export proceeds realized under final tax regime as per section 154 & 169 of the Income Tax Ordinance, 2001.
33.2. Deferred taxation
Deferred tax asset is not recognised for all deductible temporary differences and carry forward of unused tax
losses due to uncertainty regarding non availability of taxable profits in foreseeable future against which such
temporary differences and tax losses can be utilised.
33.3. Relationship between tax expense and accounting profit
The relationship between tax expenses and accounting profit has not been presented in these financial
statements as the company's current year's taxation includes tax based on 1st part of first schedule and
provisions of section 169, 154, 153(2) and 113 of the Income Tax Ordinance, 2001.
2021 2020
34. Loss per share - Basic and diluted
Net loss for the year (Rupees) (147,908,743) (67,965,986)
Weighted average number of ordinary shares 259,430,134 259,430,134
Loss per share -Basic and diluted (Rs.) (0.57) (2.59)
34.1. There is no dilutive effect on basic earnings per share of the Company.
35. REMUNERATION TO CHIEF EXECUTIVE OFFICER, DIRECTORS AND EXECUTIVES

2021 2020
Chief Executive Chief Executive
Director Executives Director Executives
Officer Officer
------------------------------------------------------Rupees-------------------------------------------------------------

Remuneration 800,000 800,000 4,751,640 800,000 800,000 3,497,600

House rent allowance 320,000 320,000 1,914,840 320,000 320,000 1,475,550

Utility allowance 80,000 80,000 425,520 80,000 80,000 327,900

1,200,000 1,200,000 7,092,000 1,200,000 1,200,000 5,301,050
Number of persons 1 1 5 1 1 4

35.1. The Directors are entitled to free use of Company maintained vehicles. The running and maintenance expenses of
these vehicles are Rs. 998,524/- (2020: Rs.845,149/-). The Directors have waived off their meeting fee.

35.2. Executive means an employee, other than chief executive and directors, whose basic salary exceeds twelve
hundred thousand rupees in a financial year.
Unit (FIGURES IN THOUSAND)
36. INSTALLED CAPACITY AND ACTUAL PRODUCTION
Spinning
100 % plant capacity converted to 20s count based on 3
shifts per day for 1095 shifts (2020: 1095 shifts) Kgs. 18,162 18,162
Actual production converted to 20s count based on 3
shifts per day for Nil (2020: Nil) Kgs. - -
Dyeing and finishing
Production capacity for 3 shifts per day for 1095 shifts
(2020: 1095 shifts) Mt. 32,850 32,850
Actual production for 3 shifts per day for 269 shifts (2020:
247 shifts) Mt. 3,718 3,015
Processing, Stitching and Apparel
The production capacity and its comparison with actual production of Processing, Home Textile and
Apparel segments is impracticable to determine due to varying manufacturing processes, run length of
order lots and various other factors.
Reasons for shortfall
- Due to disposal of weaving unit no any activity in weaving during the year. Further due to closure of
spinning unit no any activity in spinning during the year.
 37. NUMBER OF EMPLOYEES 2021 2020

Average number of employees during the year 72 65

Average number of factory employees during the year 188 152

Number of employees as at June 30, 40 22

Number of factory employees as at June 30, 106 80

38. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company finances its operations through the mix of equity, debt and working capital management with a
view to maintain an appropriate mix between various sources of finance to minimize risk. The overall risk
management is carried out by the finance department under the oversight of Board of Directors in line with the
policies approved by the Board.
2021 2020
Rupees Rupees
38.1. FINANCIAL INSTRUMENTS BY CATEGORY
Financial assets:
At amortized cost
Loans and advances 2,625,000 2,625,000
Trade debts 58,871,206 109,100,262
Other receivables 80,161,086 99,880,325
Deposits 55,518,652 55,518,652
Accrued rentals 1,373,500 24,820,000
Cash and bank balances 149,640,033 174,851,830
348,189,477 466,796,069
Financial liabilities:
At amortized cost
Redeemable capital - -
Long term financing 2,453,515,450 2,465,718,393
Lease Liabilities / Ijarah 67,326,108 67,326,108
Deffered mark up 1,304,671,842 1,225,762,351
Trade and other payables 162,603,750 191,536,088
Interest / markup payable 2,729,859,122 2,719,967,363
Short term borrowings 6,015,444,052 6,063,442,444
12,733,420,324 12,733,752,747
38.2. FINANCIAL RISK MANAGEMENT
The Board of Directors has overall responsibility for the establishment and oversight of the Company's financial
risk management.The responsibility includes developing and monitoring the Company's risk management policies.
To assist the Board in discharging its oversight responsibility, management has been made responsible for
identifying, monitoring and managing the Company's financial risk exposures. The Company's exposure to the
risks associated with the financial instruments and the risk management policies and procedures are summarized
as follows:

38.2.1. Credit risk and concentration of credit risk

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the
other party to incur a financial loss, without taking into account the fair value of any collateral. Concentration of
credit risk arises when a number of counter parties are engaged in similar business activities 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. The Company does not have any
significant exposure to customers from any single country or single customer.
 Credit risk of the Company arises principally from trade debts, loans and advances and bank balances. The
carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit
risk at the reporting date is as follows:
2021 2020
Rupees Rupees
Trade debts 58,871,206 109,100,262
Loans and advances 2,625,000 2,625,000
Deposits 55,518,652 55,518,652
Accrued rentals 1,373,500 24,820,000
Bank balances 40,160,092 30,702,560
158,548,450 222,766,474
Due to the Company’s long standing relations with counter parties and after giving due consideration to their
financial standing, the management do not expect non performance by these counter parties on their obligations
to the company.
For trade debts credit quality of the customer is assessed, taking into consideration its financial position and
previous dealings. Individual credit limits are set. The management regularly monitor and review customers
credit exposure. The majority of export sales debtors of the Company are situated at USA and Europe.
The Company’s most significant customers are foreign departmental stores and trading houses. The aging of trade
debts as at statement of financial position date is as under:
2021 2020
Rupees Rupees
Not past due 58,871,206 65,454,793
Past due within one year - 43,645,469
Past due more than one year 7,041,998,879 7,041,998,879
7,041,998,879 7,085,644,348
7,100,870,085 7,151,099,141
Out of Rs. 7,100,870,085/- ( 2020: Rs. 7,151,099,179/-), the Company has provided Rs. 7,041,998,879 (2020: Rs.
7,041,998,879) as the amount being doubtful to be recovered from certain customers 99.17% of the past due
balances has been provided.
38.2.2. Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial
liabilities. The Company’s approach to manage liquidity is to maintain sufficient level of liquidity of the Company
on the basis of expected cash flows, requirements of holding highly liquid assets and maintaining adequate
reserve borrowing facilities to cover liquidity risk. This includes maintenance of balance sheet liquidity ratios
through working capital management. Following are the contractual maturities of financial liabilities including
interest payments as at June 30, 2021 and 2020;

2021
----------------------------------------Rupees in thousand--------------------------------------

Carrying Contractual Six months or Six to twelve Two to five Above five
amounts cash flows less months years years
Financial liabilities:
Redeemable capital - 88,883 88,883 - - -
Long term financing 2,453,515 3,862,594 398,504 60,278 3,403,812 -
Lease Liabilities / Ijarah 67,326 86,945 86,945 - - -
Trade and other payables 163,324 163,324 163,324 - - -
Short term borrowings 6,015,444 8,532,395 8,532,395 - - -

8,699,610 12,734,140 9,270,051 60,278 3,403,812 -

2020
 2020
----------------------------------------Rupees in thousand--------------------------------------

Carrying Contractual Six months or Six to twelve Two to five Above five
amounts cash flows less months years years
Financial liabilities:
Redeemable capital - 88,883 88,883 - - -
Long term financing 2,465,718 3,795,887 1,675,878 149,140 1,970,869 -
Lease Liabilities / Ijarah 67,326 86,945 86,945 - - -
Trade and other payables 191,536 191,536 191,536 - - -
Short term borrowings 6,063,442 8,570,501 8,570,501

8,788,022 12,733,752 10,613,743 149,140 1,970,869 -

The contractual cash flows relating to mark up have been determined on the basis of weighted average mark up
rates on long term and short term borrowings. The Company is exposed to liquidity risk which will be managed by
the Company as explained in detail in Note 1.3.
38.2.3. Credit quality of major financial assets
The credit quality of company's bank balances can be assessed by reference to external credit ratings (if available)
or to historical information about counterparty default rate.

RATING
BANKS SHORT LONG 2021 2020
AGENCY
TERM TERM
--------- Rupees --------
Allied Bank Limited A-1+ AAA PACRA 14,567 13,447
Askari Bank Limited A-1+ AA+ PACRA 73,520 73,520
A-1+ AA+ PACRA
Bank Alfalah Limited 7,178,520 7,021,045
A-1+ AA+ VIS
Bank Al-Habib Limited A-1+ AAA PACRA 206,957 219,561
The Bank of Punjab A-1+ AA PACRA 2,591,727 2,591,578
Habib Bank Limited A-1+ AAA VIS 239,874 237,508
Habib Metropolitan Bank Limited A-1+ AA+ PACRA 1,004,438 2,748,717
MCB Bank Limited A-1+ AAA PACRA 24,595 24,945
Meezan Bank Limited A-1+ AA+ VIS 3,964 34,770
A-1+ AAA PACRA
National Bank of Pakistan 2,814,430 2,809,527
A-1+ AAA VIS
United Bank Limited A-1+ AAA VIS 25,515 25,368
Soneri Bank Limited A-1+ AA- PACRA 1,736,489 453,527
SilkBank Limited A-2 A- VIS 4,622 4,622
Summit Bank Limited Suspended 10,095,595 299,157
The Bank of Khyber A-1 A VIS 27,950 27,950
BankIslami Pakistan Limited A-1 A+ PACRA 14,110,675 14,110,673

Al Baraka Bank (Pakistan) Limited A-1 A VIS 6,654 6,645

TOTAL 40,160,092 30,702,560

38.2.4. Market risk
Market risk is the risk that changes in market prices, such as interest rates, foreign exchange rates and equity
prices will affect the Company’s income or the value of its holdings of financial instruments. The objective of
market risk management is to manage and control market risk exposures within acceptable parameters while
optimizing returns.

i) Price risk
Price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because
of changes in market prices (other than those arising from interest rate risk or currency risk), whether
those changes are caused by factors specific to the individual financial instrument or its issuer, or factors
affecting all similar financial instruments traded in the market. As at June 30, 2021 the Company is not
exposed to price risk.

ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates.
Majority of interest rate risk arises from redeemable capital, long and short term borrowings from banks.
The interest rate profile of the Company’s interest bearing financial instruments is presented in relevant
notes to the financial statements.
Sensitivity analysis
Sensitivity to interest rate risk arises from mismatches of financial assets and financial liabilities that
mature or reprice in a given period. The Company manages these mismatches through risk management
strategies where significant changes in gap position can be adjusted.
Fair value sensitivity analysis for fixed rate instruments
The Company does not account for any fixed rate financial assets and liabilities at fair value through
statement of profit and loss, therefore a change in interest rates at the reporting date would not effect
statement of profit and loss .
Cash flow sensitivity analysis for variable rate instruments
Had the interest rate been increased / decreased by 1% at the reporting date with all other variables held
constant, loss for the period and equity would have been Rs. 14.73 million (2020 : Rs. 27.17 million) lower /
higher.
iii) Currency risk
Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. Foreign currency risk arises mainly where receivables and
payables exist due to transactions with foreign undertakings. The Company is exposed to currency risk on
foreign debtors. The total foreign currency risk exposure on reporting date amounted to Rs. 41.92 million
(2020: Rs. 47.88 million).
At June 30, 2021, had the currency been weakened / strengthened by 10 % against the foreign currency
with all other variables held constant, profit for the year and equity would have been Rs. 4.192 million
(2020: Rs.4.788 million) higher / lower, mainly as a result of foreign exchange gains / losses on translation
of foreign currency denominated trade debts (based on debtors not yet past due).
iv) Equity price risk
Trading and investing in equity securities give rise to equity price risk. The Company is not exposed to
equity price risk.
38.2.5. Operational Risk
Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with
the processes, technology and infrastructure supporting the Company's activities, either internally within the
Company or externally at the Company's service providers, and from external factors other than credit, market
and liquidity risks such as those arising from legal and regulatory requirements and generally accepted standards
of operation behaviour. Operational risks arise from all of the Company's activities.
The Company’s objective is to manage operational risk so as to balance limiting of financial losses and damage to
its reputation while achieving its business objective and generating returns for investors.
 Primary responsibility for the development and implementation of controls over operational risk rests with
the management of the company. This responsibility encompasses the controls in the following areas:
- requirements for appropriate segregation of duties between various functions, roles and
responsibilities;
- requirements for the reconciliation and monitoring of transactions;
- compliance with regulatory and other legal requirements;
- documentation of controls and procedures;
- periodic assessment of operational risks faced, and the adequacy of controls and procedures to
address the risks identified;
- ethical and business standards;
- risk mitigation, including insurance where this is effective.
- operational and qualitative track record of the plant and equipment suppliers and related service
providers.
38.3. Determination of fair value
38.3.1. Fair value of financial instruments

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
in the principal (or most advantageous) market at the measurement date under current market conditions (i.e. an
exit price) regardless of whether that price is directly observable or estimated using another valuation technique.
The carrying values of all the financial assets and financial liabilities reported in the financial statements
approximate their fair values.

38.3.2. Fair value of non financial instruments

Fair value hierarchy
The different levels have been defined as follows.
Level 1 Quoted prices (unadjusted) in active markets for individual assets or liabilities
Level 2 Inputs other than quoted prices included within level 1 that are observable for assets or
liabilities, either directly (i.e as prices) or indirectly (i.e derived from prices)
Level 3 Inputs for the assets or liabilities that are not based on observable market data (unobservable
inputs)
Details of the Company's revalued assets and information about fair value hierarchy as at June 30, 2021 are as
folllows:

Level 1 Level 2 Level 3 Total

--------------------------------------------Rupees-------------------------------------------
Operating fixed assets
Freehold

Land - 556,323,300 - 556,323,300

Building - 346,782,195 - 346,782,195
Plant and Machinery 204,253,799 - 204,253,799
Electric installation - 30,780,000 - 30,780,000
Factory equipment - 1,838,249 - 1,838,249
Laboratory equipments - 1,368,000 - 1,368,000
Right to use assets

Plant and Machinery - 27,284,332 - 27,284,332

Investment property

Land - 555,424,000 - 555,424,000

Building - 633,215,649 - 633,215,649
- 2,357,269,525 - 2,357,269,525

There were no transfers between the levels during ther year

Details of the Company's revalued assets and information about fair value hierarchy as at June 30, 2020 are as
folllows:
 Level 1 Level 2 Level 3 Total
--------------------------------------------Rupees-------------------------------------------
Operating fixed assets
Freehold

Land - 556,323,300 - 556,323,300

Building - 366,047,937 - 366,047,937
Plant and Machinery - 235,097,023 - 235,097,023
Electric installation - 34,200,000 - 34,200,000
Factory equipment - 2,042,499 - 2,042,499
Laboratory equipments - 1,520,000 - 1,520,000
Right to use assets

Plant and Machinery - 30,315,925 - 30,315,925

Investment property

Land - 520,710,000 520,710,000

Building - 640,691,391 640,691,391
- 2,386,948,075 - 2,386,948,075

There were no transfers between the levels during the year.

38.4. Capital risk management
The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going
concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders and to
maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital
structure, the Company may adjust the amount of dividends paid to shareholders, issue new shares or obtain /
repay long term financing from / to financial institutions.
The Company manages its capital risk by monitoring its debt levels and liquid assets and keeping in view future
investment requirements and expectation of the shareholders. Debt is calculated as total borrowings
('redeemable capital', 'long term financing', ' liabilities against assets subject to finance lease' and 'short term
borrowings' as shown in the statement of financial position). Equity comprises of shareholders’ equity as shown in
the statement of financial position under 'share capital and reserves'.

The salient information relating to capital risk management of the Company as of June 30, 2021 and 2020 were as
follows:
2021 2020
Note Rupees Rupees
Total debt 18,19,20 & 24. 8,536,285,610 8,596,486,945
Less: Cash and bank balances 15. 149,640,033 174,851,830
Net debt 8,386,645,577 8,421,635,115
Total equity (9,198,070,997) (9,050,123,762)
Total capital employed (811,425,420) (628,488,647)
Gearing ratio -1033.57% -1339.98%
38.5. Overdue loans
On the reporting date the installments of long term finances amounting to Rs. 2,039.469 million along with mark
up of Rs. 104.426 million, lease finance amounting to Rs. 67.326 million along with mark up of Rs. 19.619 million
and short term borrowings amounting to Rs. 6,015.444 million along with mark up of Rs. 2,516.951 million were
over due.
On reporting date, the carrying amount of loans relevant to above overdue were long term finances Rs.
2,453.515` million, lease finance Rs. 67.326 million and short term borrowings Rs. 6,015.444 million.
Overdue installment of long term loans amounting to Rs. Nil (2020: 1.9 Million) was subsequently paid.

39. TRANSACTIONS WITH RELATED PARTIES

The related parties comprise associated undertakings, directors of the company and key management personnel.
The company in the normal course of business carries out transaction with related parties. The transactions with
related parties other than those disclosed in relevant notes are as follows;
39.1. Name and nature of relationship
39.1.1. Associated Companies due to common directorship
Shama Exports (Pvt) Limited Abwa Knowledge Village (Pvt) Limited
Sirtex (Pvt) Limited Amfort (Pvt) Limited
Iftikhar Akbar Weavings (Pvt) Limited I.A Textiles- AOP
Cotton Passion (Pvt) Limited

39.2. Transaction with related parties

Relationship with Nature of 2021 2020
the Company transactions (Rupees) (Rupees)
Associated undertakings - Sales 17,343,696 -
- Rentals 23,124,000 20,430,000
- Rent Receivable 1,373,500 24,820,000
- Receivable 10,349,556 -
Key management personnel - Remuneration to 2,400,000 2,400,000
Directors
39.2.1. Following are the related parties with whom the Company has entered into transactions or have
arrangement/agreement in place:
Company name Basis of associated
Shama Exports (Pvt) Ltd Common directorship
Abwa Knowledge Village (Pvt) Ltd Common directorship
I.A Textiles- AOP Common directorship
Amfort (Pvt) Limited Common directorship
Cotton passion (Pvt) Limited Common directorship
39.2.2. The Company does not hold any shares in the above mentioned companies.
40. Non Adjusting Event after the statement of Financial Position Date
There are no significant activities since June 30, 2021 causing any adjustment or disclosure in the financial
statements.
41. GENERAL
41.1. Nomenclature of following account head changed for better presentation.
Previous nomenclature Current nomenclature
Impairment loss Revaluation loss
Sales Revenue from contract with customers
41.2. DATE OF AUTHORISATION FOR ISSUE
These financial statements were authorised for issue on October 06, 2021 by the Board of Directors of the
Company.
41.3. Figures have been rounded off to the nearest rupees.

Khurram Iftikhar Shahzad Iftikhar Waheed Aslam

Chief Executive Officer Director Chief Financial Officer
Pattern of Shareholding
As on June 30, 2021

Number of Shareholding Total Number of Percentage of

Shareholders From To Shares Held Total Capital

99 1 - 100 2,621 0.00

258 101 - 500 109,876 0.04
371 501 - 1000 323,074 0.12
782 1001 - 5000 2,394,230 0.92
322 5001 - 10000 2,639,375 1.02
139 10001 - 15000 1,810,536 0.70
116 15001 - 20000 2,159,883 0.83
74 20001 - 25000 1,741,353 0.67
44 25001 - 30000 1,261,709 0.49
30 30001 - 35000 993,973 0.38
27 35001 - 40000 1,042,000 0.40
19 40001 - 45000 817,545 0.32
44 45001 - 50000 2,177,000 0.84
13 50001 - 55000 696,355 0.27
14 55001 - 60000 817,001 0.31
10 60001 - 65000 623,000 0.24
10 65001 - 70000 682,500 0.26
8 70001 - 75000 589,000 0.23
7 75001 - 80000 553,500 0.21
6 80001 - 85000 501,500 0.19
5 85001 - 90000 438,500 0.17
5 90001 - 95000 470,500 0.18
23 95001 - 100000 2,293,500 0.88
6 100001 - 105000 620,000 0.24
5 105001 - 110000 539,500 0.21
1 110001 - 115000 114,000 0.04
4 115001 - 120000 472,500 0.18
7 120001 - 125000 863,000 0.33
1 125001 - 130000 128,500 0.05
3 135001 - 140000 414,022 0.16
2 140001 - 145000 290,000 0.11
5 145001 - 150000 747,500 0.29
1 150001 - 155000 155,000 0.06
5 155001 - 160000 796,000 0.31
1 160001 - 165000 165,000 0.06
1 165001 - 170000 170,000 0.07
1 175001 - 180000 178,131 0.07
1 180001 - 185000 180,500 0.07
14 195001 - 200000 2,794,500 1.08
3 200001 - 205000 608,500 0.23
1 205001 - 210000 210,000 0.08
 Number of Shareholding Total Number of Percentage of
Shareholders From To Shares Held Total Capital

2 210001 - 215000 424,500 0.16

1 215001 - 220000 217,500 0.08
2 220001 - 225000 450,000 0.17
1 225001 - 230000 227,200 0.09
1 230001 - 235000 235,000 0.09
1 235001 - 240000 239,561 0.09
3 245001 - 250000 748,000 0.29
1 250001 - 255000 251,000 0.10
1 280001 - 285000 282,500 0.11
1 290001 - 295000 293,000 0.11
5 295001 - 300000 1,499,080 0.58
1 300001 - 305000 300,500 0.12
1 305001 - 310000 308,000 0.12
1 310001 - 315000 311,000 0.12
1 320001 - 325000 322,943 0.12
1 325001 - 330000 326,500 0.13
1 330001 - 335000 334,500 0.13
1 335001 - 340000 340,000 0.13
1 345001 - 350000 350,000 0.13
2 360001 - 365000 726,023 0.28
1 385001 - 390000 389,121 0.15
1 390001 - 395000 392,000 0.15
1 405001 - 410000 410,000 0.16
1 420001 - 425000 425,000 0.16
1 435001 - 440000 437,000 0.17
1 440001 - 445000 442,202 0.17
1 450001 - 455000 454,000 0.17
1 490001 - 495000 495,000 0.19
1 495001 - 500000 500,000 0.19
1 535001 - 540000 540,000 0.21
1 620001 - 625000 625,000 0.24
1 745001 - 750000 750,000 0.29
1 795001 - 800000 800,000 0.31
1 1000001 - 1005000 1,005,000 0.39
1 1070001 - 1075000 1,070,500 0.41
1 1155001 - 1160000 1,157,000 0.45
1 1380001 - 1385000 1,384,000 0.53
1 1400001 - 1405000 1,402,000 0.54
1 1595001 - 1600000 1,600,000 0.62
1 1705001 - 1710000 1,709,500 0.66
1 22550001 - 22555000 22,555,000 8.69
1 23170001 - 23175000 23,172,472 8.93
1 48255001 - 48260000 48,255,780 18.60
1 51590001 - 51595000 51,594,656 19.89
1 55090001 - 55095000 55,092,912 21.24

2,542 259,430,134 100.00

Categories of Shareholding
As At June 30, 2021

No. of No. of Shares Percentage

Categories of Members
Shareholders Held
Directors, Chief Executive Officer, and their spouse
and minor children 7 154,945,148 59.73
Associated Companies, undertakings and
related parties - -
NIT / Funds 2 752,644 0.29
Banks Development Financial Institutions, Non
banking Financial institutions 1 23,172,472 8.93
Insurance Companies - -
Modarabas and Mutual Funds - -
Share holders holding 10% 3 154,943,348 59.72
General Public
Local 2515 56,579,394 21.81
Foreign -
Joint stock companies 16 1,425,476 0.55
Others (Government Institution) 1 22,555,000 8.69

Total (Excluding Shareholders holding 10% or more) 2542 259,430,134

Pattern of Shareholding
As at June 30, 2021
Other Information
Categories of Shareholders Number Shares Held Percentage
Associated Companies, Undertakings and Related Parties - -

NIT & ICP / FUNDS

NIT 2 752,644 0.29

Directors, CEO their Spouses & Minor Children

Mr. Khurram Iftikhar 1 51,594,656 19.89
Mr. Shahzad Iftikhar 1 55,092,912 21.24
Mr. Nadeem Iftikhar 1 48,255,780 18.60
Mr. Suhail Maqsood Ahmad 1 500 0.00
Mr. Muhammad Ahsan 1 650 0.00
Mr. Gul Muhammad Naz 1 500 0.00
Mrs. Jawaria Ahsan 1 150 0.00

Executives - -

Public Sector Companies & Corporations

Joint Stock companies 16 1,425,476 0.55

Banks, Development Finance Institutions, Non Banking

Finance Institutions, Insurance Companies, Takaful, 1 23,172,472 8.93
Modarabas & Pension Funds

Shareholders Holding Five Percent or More Voting Intrest in the

Listed Company
Mr. Khurram Iftikhar Chief Executive 51,594,656 19.89
Mr. Shahzad Iftikhar Director 55,092,912 21.24
Mr. Nadeem Iftikhar Director 48,255,780 18.60
EMPLOYEES OLD-AGE BENEFITS INSTITUTION 22,555,000 8.69
NATIONAL BANK OF PAKISTAN 23,172,472 8.93

None of the Directors , Executives and their spouses and minor children has traded in the
shares of the company during the year.
 FORM OF PROXY
Annual General Meeting
I / We

of

being a member of Amtex Ltd, hereby appoint

of

or failing him/her

of

member (s) of the Company, as my / our proxy in my / our absence to attend and vote for me / us and on my /our behalf at
the Annual General Meeting of the Company to be held on October 28, 2021 at 11:00 A.M. at Company’s registered
office P-225 Tikka Gali # 2 Montgomery Bazar Faisalabad.

as witness my / our hand seal this day of 2021

Please
Please
affixe
affix
Signed by the said member revenue
Revenue
stamp
in presence of Stamp
Rs.5Rs.5

Signature(s) of Member(s)
Witness 1 Witness 2

Signature of witness Signature of witness

Name Name

Address Address

CNIC # CNIC #

Please Quote:

Folio No Shares Held CDC A/C No.

IMPORTANT: Proxies in order to be effective, must be received at the Registered Office of the company at P-225,
Tikka Gali # 2 Montgomery Bazar Faisalabad, not later than 48 hours before the time for holding the Annual
General Meeting and must be duly stamped, signed and witnessed.

Consent for video conference facility

Annual General Meeting

I/We of being a member (s) of Amtex Limited, holder of ordinary

share (s) as per registered Folio/CDS Account No. hereby opt for video conference facility at .

CDS Account No.

Revenue Stamp
of Appropriate
Value
 AFFIX
CORRECT
POSTAGE

The Company Secretary

amtex LIMITED
P-225, Tikka Gali # 2 Montgomery
Bazar,Faisalabad - Pakistan
 AFFIX
CORRECT
POSTAGE

The Company Secretary

amtex LIMITED
P-225, Tikka Gali # 2 Montgomery
Bazar,Faisalabad - Pakistan
73