Financial Statements Format

XYZ Ltd
Report and financial statements as at and

for the year ended 31 December 2014
bKash Limited
Notes to the Financial Statements
as at and for the period ended 31st December 2014
1. Reporting entity
1.1 Company profile
bKash Limited (hereinafter referred to as " the Company"), a subsidiary of BRAC Bank, started as a joint venture between BRAC Bank
Limited, Bangladesh and Money in Motion LLC, USA. Subsequently in April 2013 International Finance Corporation (IFC), a member
of the World Bank Group became an equity partner of the company. It has incorporated as a private company limited by shares under the
Companies Act, 1994 on 1 March 2010 having its registered office in Dhaka. The ultimate objective of bKash is to ensure access to a
broader range of financial services for the people of Bangladesh. It has a special focus to serve the low income masses of the country to
achieve broader financial inclusion by providing services that are convenient, affordable and reliable.
1.2 Nature of business
bKash provides financial services via mobile phones to the customers under a payment systems operator license approved by the
Bangladesh Bank. The bKash mobile wallet will be the customer account into which money can be deposited and out of which money
can be withdrawn or used for various services.
2. Basis of preparation
2.1 Statement of compliance
The financial statements have been prepared in accordance with Bangladesh Financial Reporting Standards (BFRSs) and as per the
requirements of the Companies Act 1994.
The title and format of financial statements follow the requirements of BFRS which are to some extent different from the requirement of
Companies Act 1994; however, such differences are not material and in the view of management, BFRS format gives a better
presentation to its intended users. Additionally, wherever considered necessary, prior year's figures and phrases have been re-arranged to
conform with current year's presentation.
2.2 Basis of measurement
These financial statements have been prepared on going concern basis under the historical cost convention.
2.3 Changes in accounting policies
Except for the changes below, the Company has consistently applied the accounting policies set out in Note 3 to all periods presented in
these financial statements. The Company has adopted the following new standards and amendments to standards, including any
consequential amendments to other standards, with date of initial application of 1 July 2013.
(a) BFRS 13: Fair Value Measurement
BFRS 13 (effective from 1 January 2013) establishes a single framework for measuring fair value and making disclosures about fair
value measurements when such measurements are required or permitted by other BFRSs. It unifies the definition of fair value as the price
that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date. It replaces and expands the disclosure requirements about fair value measurements in other BFRSs, including BFRS
7. As a result the Company has included additional disclosures in this regard (see note...). The requirements of this BFRS has no
significant impact on the measurement of the Company's assets and liabilities.
(b) Disclosures - Offsetting Financial Assets and Financial Liabilities (Amendments to BFRS 7)
The Company has adopted these amendments to BFRS 7 however this has no impact on the financial statements.
(c) BFRS 10: Consolidated Financial Statements

This Company does not have any subsidiary, as such this standard does not have any impact on the financial statements.
(d) BFRS 11: Joint Arrangements
This Company does not have any such arrangement, as such this standard does not have any impact on the financial statements.
(e) BFRS 12: Disclosure of Interests in Other Entities
This Company does not have any such interests in other entities, as such this standard does not have any impact on the financial
statements.
(f) Presentation of items of Other Comprehensive Income (Amendments to BAS 1)
As a result of the amendments to BAS 1, the Company adopted the policy to separately present items that would be reclassified to profit
or loss from those that would never be. However this requirements do not have any material impact on the financial statements.
(g) Recoverable Amount Disclosures for Non-Financial Assets
The Company has adopted the amendments to BAS 36 (2013). However this has no impact on the financial statements.
2.4 Functional and presentational currency
These financial statements are presented in Bangladesh Taka (Taka/Tk/BDT) which is both the functional currency and presentation
currency of the Company. The figures of the financial statements have been rounded off to the nearest Taka, unless otherwise indicated.
2.5 Use of judgments and estimates
The preparation of the financial statements in conformity with BFRS requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual
results may differ from these estimates.
The preparation of the financial statements in conformity with BFRS requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual
results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period
in which the estimates are revised and in any future periods affected.
2.6 Statement of cash flows
Statement of cash flows has been prepared in accordance with the BAS 7: Statement of cash flows under the direct method.
2.7 Reporting period
The financial period of the company covers one year from 1 January to 31 December and is followed consistently.
2.8 Comparative information
Comparative information has been disclosed in respect of the year ended 31 December 2013 for all numerical information in the financial
statements and also the narrative and descriptive information where it is relevant for understanding of the current year's financial
statements.
3. Significant accounting policies
The accounting policies, set out below, have been applied consistently to the periods presented in these financial statements.
3.1 Property, plant and equipment
(a) Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses, if any. Property, plant
and equipment are recognised when all the conditions for recognition as per BAS 16: Property, Plant and Equipment are met.
The cost of an item of property, plant and equipment is recognized as an assets if, and only if is probable that future economic benefits
associated with the item will flow to the entity, and the cost of the item can be measured reliably. Fixed assets have been accounted for
at cost less accumulated depreciation. Cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent
costs of enhancement of an existing assets are recognized as a separate asset, only when it is probable that future economic benefits
associated with the item will flow to the company and the cost of the item can be measured reliably. All other repairs and maintenance
are charged to the statement of comprehensive income during the financial period in which they are incurred.
(b) Subsequent costs

The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable
that the future economic benefits embodied within the part will flow to the company and its cost can be measured reliably. The costs of
the day-to-day servicing of property, plant and equipment are recognised in the statement of comprehensive income as incurred.
(c) Derecognition
Property, plant and equipment is derecognized on disposal or when no future economic benefits are expected from its continued use.
Gain or loss on disposal are determined by comparing the disposal proceeds with the carrying amounts and recognised in the statement
of comprehensive income as per provisions of BAS 16: Property, Plant and Equipment.
(d) Depreciation
Depreciation on property, plant and equipment is recognised in the profit and loss account on straight line method over the estimated
useful lives of the property, plant and equipment.
Depreciation on addition is provided from the month of purchase if purchase made before 15th day of the month otherwise depreciation
will provided from the 1st day of the next month. Depreciation is allocated if disposal made before 15th day of month otherwise no
depreciation is allocated in the month of disposal.
The depreciation rates and useful lives applicable for items of property, plant and equipment are as follows:
Items Rate Useful life
Office furniture 10%

Office equipment 20%
IT equipment 20%
Motor vehicles 20%
3.2 Intangible assets
(a) Recognition and measurement

Items of intangible assets acquired by the Company with finite useful lives are measured at cost less accumulated amortisation and
impairment losses, if any. Intangible assets are recognised when all the conditions for recognition as per BAS 38: Intangible Assets are
met.
The cost of an intangible asset comprises its purchase price, import duties and non-refundable taxes and any directly attributable cost of
preparing the asset for its intended use.
(b) Subsequent costs

Subsequent costs are capitalised only when they increase the future economic benefits embodied in the specific asset to which they
relate. All other costs are recognised in the statement of comprehensive income as incurred.
(c) Derecognition
An intangible asset is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of
the asset. Gain or loss on disposal are determined by comparing the disposal proceeds with the carrying amounts and recognised in the
statement of comprehensive income as per provisions of BAS 38: Intangible Assets.
(d) Amortisation
Amortisation on intangible asset is recognised in the statement of comprehensive income on straight line method over the estimated
useful lives of the intangible assets. Amortisation on additions is provided from the date of purchase. The amortisation rate applicable for
software is 50%.
3.3 Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of
another entity. Non-derivative financial instruments of the company comprise cash and cash equivalents, trade receivables, intercompany
receivables, deposits and accounts payables.
3.3.1 Financial assets
The Company initially recognises trade and other receivables and deposits on the date that they are originated. All other financial assets
are recognised initially on the date at which the Company becomes a party to the contractual provisions of the transaction.
The Company derecognises a financial asset when the contractual rights or probabilities of receiving the cash flows from the asset expire,
or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and
rewards of ownership of the financial asset are transferred. Any interest in such transferred financial assets that is created or retained by
the Company is recognised as a separate financial asset or liability.
Financial assets and liabilities are offset and the net amount is presented in the statement of financial position when, and only when, the
Company has a legal right to offset the amounts and intends either to settle them on a net basis or to realize the asset and settle the
liability simultaneously.
(a) Trade and other receivables

Trade and other receivables represents unpaid bills receivable from customers. Trade and other receivables with no stated interest rate
are measured at the original invoice amount and are stated net of allowance for doubtful debts.
(b) Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits with maturity of three months or less from the date of acquisition that
are subject to an insignificant risk of changes in their fair value, and are used by the Company in the management of its short term
commitments.
Cash and cash equivalents comprise cash balances and call deposits with maturity of three months or less from the date of acquisition that
are subject to an insignificant risk of changes in their fair value, and are used by the Company in the management of its short term
commitments.
3.3.2 Financial liabilities
The Company initially recognises financial liabilities on the transaction date at which the Company becomes a party to the contractual
provisions of the liability.
The Company derecognises a financial liability when its contractual obligations are discharged or cancelled or expired.
Financial liabilities are recognised initially at fair value less any directly attributable transaction costs. Subsequent to initial recognition,
these financial liabilities are measured at amortized cost using the effective interest method. Financial liabilities include accounts
payables, withholding vat payables and withholding tax payables.
Accounts payables
The company recognises a financial liability when its contractual obligations arising from past events are certain and the settlement of
which is expected to result in an outflow from the entity of resources embodying economic benefits.
3.4 Impairment
(a) Financial assets

Financial assets are assessed at each reporting date to determine whether there is any objective evidence of impairment. Financial assets
are impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event
has a negative effect on the estimated future cash flows of that asset that can be estimated reliably. Objective evidence that financial
assets are impaired can include default by a debtor, indications that a debtor or issuer will enter bankruptcy etc.
(b) Non-financial assets

An asset is impaired when its carrying amount exceeds its recoverable amount. The company assesses yearly whether there is any
indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. The
recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. Carrying amount of the asset is reduced
to its recoverable amount by recognising an impairment loss, if and only. The recoverable amount of the asset is less than its carrying
amount. Impairment loss is recognised immediately in the statement of comprehensive income.
3.5 Inventories
Inventories are measured at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary
course of business, less the estimated costs of completion and selling expenses. Cost of inventories is calculated using the standard cost
method with periodic adjustments of cost variance to arrive at the actual cost, which approximates actual cost on weighted average basis
and includes expenditure for acquiring the inventories and bringing them to their existing location and condition.
When inventories are sold, the carrying amount of those inventories is recognised as an expense in the period in which the related
revenue is recognised. The amount of any write-down of inventories to net realisable value and all losses of inventories are recognised as
an expense in the period the write-down or loss occurs. The amount of any reversal of any write-down of inventories is recognised as a
reduction in the amount of inventories recognised as an expense in the period in which the reversal occurs.
3.6 Employee benefits
3.6.1 Short-term employee benefits
Short term employee benefits i.e. salary and perquisites payable within one year are measured on an undiscounted basis and are expensed
as the related service is provided as per BAS 19: Employee Benefits.
Short term employee benefits i.e. salary and perquisites payable within one year are measured on an undiscounted basis and are expensed
as the related service is provided as per BAS 19: Employee Benefits.
3.6.2 Long-term employee benefits
The Company operates two types of post-employment schemes, including defined benefit plan and defined contribution plan.
(a) Defined contribution plan (provident fund)

The Company contributes to a provident fund scheme for employees of the Company eligible to be members of the fund. All permanent
employees contribute 8% of their basic salary to the provident fund and the Company also makes equal contribution.
(b) Defined benefit plan (gratuity)

The Company operates an unfunded gratuity scheme, provision in respect of which is made annually covering all its permanent eligible
employees. This scheme qualifies as a defined benefits scheme as per Bangladesh Accounting Standard (BAS) 19: Employee Benefits.
No actuarial valuation is performed for the gratuity scheme to quantify actuarial liabilities as per BAS 19: Employee Benefits. In the
view of the management, such valuation is not likely to yield a result significantly different from the current provision.
3.6.3 Workers' Profit Participation Fund (WPPF)
Bangladesh Labour Act 2006 (amended in 2013) requires companies to contribute 5% of the pre-tax profit to a Workers' Profit
Participation Fund (WPPF). As the Company has incurred a pre-tax loss for the year, no WPPF contributions have been made.
3.7 Provisions
A provision is recognised in the statement of financial position when the company has a present obligation (legal or constructive) as a
result of a past event and it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. If the effect of the time value of money is material, provisions are determined by
discounting the expected future cash flows at a rate that reflects current market assessments of the time value of money and the risks
specific to the liability.
3.8 Contingencies
Contingencies arising from claims, lawsuits, fines, penalties etc. are recorded when it is probable that a liability has been incurred and the
amount can reasonably be measured.
3.9 Foreign currency transactions
Foreign currency transactions are translated into functional currency at the rates ruling on the transaction dates. All monetary assets and
liabilities at the reporting date are translated using prevailing rate on that day.
Foreign currency gains and losses are reported in statement of comprehensive income on a net basis as either exchange gain or loss
depending on whether foreign currency movements are in a net gain or net loss position.
3.10 Advances, deposits and prepayments
Advances are initially measured at cost. After initial recognition advances are carried at cost less deductions, adjustments or charges to
other account heads such as property, plant and equipment etc.
Deposits are measured at payment value.
Prepayments are initially measured at cost. After initial recognition prepayments are carried at cost less charges to the profit and loss
account.
3.11 Revenue recognition
Revenues are measured at fair value of the consideration received or receivable, net of sales related Taxes and VAT. Revenues are
reported gross with separate recording of expenses to agents or partners of services. Revenues comprise service fee income on Cash out,
P2P transactions, Merchant and Air time transactions.
Revenues are measured at fair value of the consideration received or receivable, net of sales related Taxes and VAT. Revenues are
reported gross with separate recording of expenses to agents or partners of services. Revenues comprise service fee income on Cash out,
P2P transactions, Merchant and Air time transactions.
3.12 Finance income and expenses
Finance income comprises interest income on short notice deposits and fixed deposit receipts (FDR) and finance expense mainly
comprises bank charges.
Interest income and expenses are recognised on accrual basis.

Finance income and expenses are reported in statement of comprehensive income on a net basis as either finance income or finance
expense depending on whether finance income and expenses are in a net income or expense position.
3.13 Operating lease
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases.
Payments made under operating leases (net of any incentives received from the lessor) are charged as expense to the statement of
comprehensive income on a straight-line basis over the period of the lease.
3.14 Income tax
Income tax expense comprises current and deferred tax. Income tax expense is recognised in profit and loss, except to the extent that it
relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.
(a) Current tax
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the
reporting date, and any adjustment to tax payable in respect of previous years. Provision for current tax has been made in accordance
with the Income Tax Ordinance, 1984 (ITO) as amended up to Finance Act, 2014. For 2013-14, minimum tax provision at 0.3% on
receipts has been made as per section 16CCC of the ITO.
(b) Deferred tax
Deferred tax is recognised in compliance with BAS 12: Income Taxes, providing for temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not recognised if they
arise from the initial recognition of goodwill; deferred income tax is not accounted for if it arises from initial recognition of an asset or
liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit
or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the reporting
date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which the temporary
difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realised.
3.16 Events after reporting date
Events after the reporting date that provide additional information about the Company's position at the date of statement of financial
position are reflected in the financial statements. Events after the reporting date that are not adjusting event are disclosed in the notes
when material.
Independent Auditor’s Report
to the Shareholders of XYZ Ltd
Report on the Financial Statements
We have audited the accompanying financial statements of XYZ Ltd ("the Company") statements
of financial position as at 31 December 2014, statements of profit or loss, statements of other
comprehensive income, statements of changes in equity, statements of cash flows for the year then
ended, and a summary of significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements of
the Company in accordance with Bangladesh Financial Reporting Standards, and for such internal
control as management determines is necessary to enable the preparation of the separate financial
statements of the Company that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on the financial statements of the Company based on
our audit. We conducted our audit in accordance with Bangladesh Standards on Auditing. Those
standards require that we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial statements of the Company are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements of the Company. The procedures selected depend on our
judgment, including the assessment of the risks of material misstatement of the financial statements
of the Company , whether due to fraud or error. In making those risk assessments, we consider
internal control relevant to the entity's preparation and fair presentation of the financial statements
of the Company 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 entities internal control. An
audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements of the Company.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
1
Opinion
In our opinion, the financial statements of the Company give a true and fair view of the financial
position of the Company as at 31 December 2014, and of their financial performance and their cash
flows for the year then ended in accordance with Bangladesh Financial Reporting Standards.
Other matter
The financial statements of the Company for the year ended 31 December 2013 were audited by
another auditor who expressed an unmodified opinion on those financial statements on 29 April
2014.
Report on Other Legal and Regulatory Requirements
In accordance with the Companies Act 1994 and Bangladesh Securities and Exchange Rules 1987,
we also report the following:
(a) we have obtained all the information and explanation which to the best of our knowledge and
belief were necessary for the purpose of our audit and made due verification thereof;
(b) in our opinion, proper books of account as required by law have been kept by the Company so
far as it appeared from our examination of those books;
(c) the statement of financial position and statement of profit or loss and statement of other
comprehensive income dealt with by the report are in agreement with the books of account;
and
(d) the expenditure incurred was for the purposes of the Company’s business.
Dhaka Auditor
2
XYZ Ltd
Statement of financial position
In Taka Note 31 December 2014 31 December 2013
Assets
Property, plant and equipment 7 3,799,146,712 3,384,489,286
Investments 8 1,799,058,949 1,846,292,287
Intangible assets 825,571 1,358,905
Non-current assets 5,599,031,232 5,232,140,478
Inventories 10 2,961,175,971 2,553,330,342

Trade and other receivables 11 5,802,572,938 5,796,239,556
Advances, deposits and prepayments 12 700,887,177 728,000,934
Cash and cash equivalents 13 462,525,465 384,201,664
Current assets 9,927,161,551 9,461,772,496
Total assets 15,526,192,783 14,693,912,974
Equity
Share capital 14 343,944,021 285,820,824
Share premium 15 351,340,343 333,302,465
Reserves 16 1,049,866,633 1,005,465,390
Retained earnings 4,861,534,405 4,012,663,572
Total equity 6,606,685,402 5,637,252,251
Liabilities
Employee benefits 17 441,858,763 340,664,767
Other non-current liabilities 18 56,114,163 519,789,367
Deferred tax liabilities 19 62,743,398 94,711,720
Non-current liabilities 560,716,324 955,165,854
Bank overdraft 20 427,836,789 741,441,244

Loans and borrowings 21 5,916,571,029 5,059,890,494
Trade and other payables 22 1,624,157,078 1,833,527,360
Provision for tax 23 390,226,161 466,635,771
Current liabilities 8,358,791,057 8,101,494,869
Total liabilities 8,919,507,381 9,056,660,723
Total equity and liabilities 15,526,192,783 14,693,912,974
The annexed notes 1 to 40 form an integral part of these financial statements.
________________ ________________ ________________

Managing Director Director Company Secretary
As per our report of same date.
_________________
3
Dhaka, Auditor
4
XYZ Ltd
Statement of profit or loss
For the year ended 31 December

In Taka Note 2014 2013
Revenue 24 12,318,723,190 10,683,600,712

Cost of sales 25 (7,147,881,434) (6,426,070,148)
Gross profit 5,170,841,756 4,257,530,564
Administrative, selling and distribution expenses 26 (3,468,192,050) (3,031,647,932)
Other income 27 82,582,624 137,591,248
Operating profit 1,785,232,330 1,363,473,880
Investment impairment provision 8 (150,000,000) -
Net finance costs 28 (296,400,829) (295,776,400)
Profit before contribution to WPPF 1,338,831,501 1,067,697,480
Contribution to WPPF (66,941,575) (53,384,874)
Profit before tax 1,271,889,926 1,014,312,606
Income tax expense: 29
Current tax (358,255,364) (258,442,537)
Deferred tax income/(expense) 37,079,047 8,317,837
(321,176,317) (250,124,700)
Profit after tax 950,713,609 764,187,906
Earnings per share 30

Basic earnings per share 27.65 22.27
Diluted earnings per share 27.47 22.18
________________ ________________ ________________

_________________
Dhaka, Auditor
4
XYZ Ltd
Statement of profit or loss and other comprehensive income

Profit after tax 950,713,609 764,187,906
Other comprehensive income:

Change in fair value of available-for-sale financial assets 51,107,250 (32,811,059)
Income tax on other comprehensive income (5,110,725) 3,281,106
Gain on amalgamation* 197,510,510 -
Total other comprehensive income, net of tax 243,507,035 (29,529,953)
Total comprehensive income 1,194,220,644 734,657,953
*This arises from the amalgamation of ABC Ltd. with XYZ Ltd. on 3 December 2014.
________________ ### ________________ ________________

Managing Director ### Director Company Secretary
###
_________________
Auditor
Dhaka,
5
XYZ Ltd
Statement of changes in equity
For the year ended 31 December 2013
Share Share Capital Available for Revaluation Retained Total
In Taka capital premium reserve sale reserve surplus earnings equity
Balance at 1 January 2013 237,738,330 321,892,801 1,671,386 140,860,043 894,621,959 3,484,501,642 5,081,286,161
Total comprehensive income
Profit after tax - - - - - 764,187,906 764,187,906
Total other comprehensive income - net of tax - - - (29,529,954) - - (29,529,954)
Total comprehensive income - - - (29,529,954) - 764,187,906 734,657,952
Contributions and distributions
Conversion of bond into equity 445,690 - - - - - 445,690
Share premium - 11,409,664 - - - - 11,409,664
Issuance of bonus shares 47,636,804 - - - - (47,636,804) -
Dividends paid - - - - - (190,547,216) (190,547,216)
Total transactions with owners of the company 48,082,494 11,409,664 - - - (238,184,020) (178,691,862)
Transactions recognized directly in equity
Realization of revaluation reserve - - - - (2,158,044) 2,158,044 -
Total transactions recognized directly in equity - - - - (2,158,044) 2,158,044 -
Balance at 31 December 2013 285,820,824 333,302,465 1,671,386 111,330,089 892,463,915 4,012,663,572 5,637,252,251
Share Share Capital Available for Revaluation Retained Total
In Taka capital premium reserve sale reserve surplus earnings equity
Balance at 1 January 2014 285,820,824 333,302,465 1,671,386 111,330,089 892,463,915 4,012,663,572 5,637,252,251
Profit after tax - - - - - 950,713,609 950,713,609
Total other comprehensive income - net of tax - - - 45,996,525 - - 45,996,525
Total comprehensive income - - - 45,996,525 - 950,713,609 996,710,134
Conversion of bond into equity 796,860 - - - - - 796,860
Share premium - 18,037,878 - 18,037,878
Issuance of bonus shares 57,323,537 - - - - (57,323,537) -
Issuance of shares for amalgamation 2,800 - - - - - 2,800
Gain on amalgamation - - - - - 197,510,510 197,510,510
Dividends paid - - - - - (243,625,031) (243,625,031)
Total transactions with owners of the company 58,123,197 18,037,878 - - - (103,438,058) (27,276,983)
Realization of revaluation reserve - - - - (1,595,282) 1,595,282 -
Total transactions recognized directly in equity - - - - (1,595,282) 1,595,282 -
Balance at 31 December 2014 343,944,021 351,340,343 1,671,386 157,326,614 890,868,633 4,861,534,405 6,606,685,402
6
XYZ Ltd
Statement of cash flows

In Taka 2014 2013
Cash flows from operating activities
Cash received from customers 12,574,405,294 10,384,833,297
Cash received from other income 15,670,279 18,290,369
12,590,075,573 10,403,123,666
Cash received/(paid) from/(for):
Other receivables 28,938,783 (38,755,147)

Purchase of inventory (7,469,705,323) ###
Operating expenses (3,337,753,149) ###
Other creditors (6,923,096) 66,068,471
Payment for WPPF (36,777,772) (27,346,823)
Advances, deposits and prepayments (149,400,157) 103,132,074
(10,971,620,714) (9,376,095,116)
Cash generated from operations 1,618,454,859 1,027,028,550
Finance costs (272,011,743) (275,980,149)

Income tax expense (280,723,692) (199,524,010)
(552,735,435) (475,504,159)
Net cash from operating activities 1,065,719,424 551,524,391
Cash flows from investing activities
Acquisition of property, plant and equipment (264,177,899) (124,037,084)
Payments for capital work in progress (101,436,791) (405,725,906)
Sale proceeds from property, plant and equipment 5,189,954 4,586,741
Dividend received 63,021,168 63,021,168
Investment (76,237,372) (36,905,576)
Net cash (used) in investing activities (373,640,940) (499,060,657)
Cash flows from financing activities
Inter-company debts received/(paid) (577,108,638) 145,151,341
Dividends paid (235,967,127) (185,992,855)
Payment for finance lease (888,385) (761,580)
Payment for redemption of Zero Coupon Bonds (219,434,948) (203,425,516)
Short-term bank loan received 894,740,288 821,307,836
Long-term bank loan (paid)/received (161,491,418) 226,653,261
Net cash (used)/from financing activities (300,150,228) 802,932,487
Net increase in cash and cash equivalents 391,928,256 855,396,221

Cash and cash equivalents at 1 January (357,239,580) (1,212,635,801)
Cash and cash equivalents at 31 December 34,688,676 (357,239,580)
Closing balance represents

Cash and cash equivalents 462,525,465 384,201,664
Bank overdraft (427,836,789) (741,441,244)
34,688,676 (357,239,580)
7
XYZ Ltd
Consolidated statement of financial position
In Taka Note 31 December 2014 31 December 2013
Assets
Property, plant and equipment 7(a) 8,112,567,981 7,716,361,670
Investments 8(a) 931,255,152 766,291,205
Biological assets 5,395,070 -
Intangible assets #REF! 33,559,214 74,434,629
Non-current assets 9,082,777,417 8,557,087,504
Inventories #REF! #REF! #REF!

Trade and other receivables 11(a) 4,053,338,744 3,896,139,716
Advances, deposits and prepayments 12(a) 1,728,588,712 1,511,756,213
Cash and cash equivalents 13(a) 966,996,727 801,850,966
Current assets #REF! #REF!
Total assets #REF! #REF!
Equity
Share capital 343,944,021 285,820,824
Share premium 351,340,343 333,302,465
Reserves 16(a) 1,420,482,845 1,624,621,785
Retained earnings 2,021,838,686 1,548,580,887
Equity attributable to the owners of the company 4,137,605,895 3,792,325,961
Non-controlling interest 136,592,850 248,088,826
Total equity 4,274,198,745 4,040,414,787
Liabilities
Employee benefits 17(a) 455,997,727 353,101,757
Other non-current liabilities 18(a) 1,051,592,449 1,643,051,082
Deferred tax liabilities 281,461,770 316,345,060
Non-current liabilities 1,789,051,946 2,312,497,899
Bank overdraft 20(a) 818,454,318 1,158,146,135

Loans and borrowings #REF! #REF! #REF!
Trade and other payables 22(a) 3,010,184,390 2,679,923,623
Provision for tax #REF! #REF! #REF!
Current liabilities #REF! #REF!
Total liabilities #REF! #REF!
Total equity and liabilities #REF! #REF!
________________ ________________ ________________

_________________
8
Auditor
Dhaka,
9
XYZ Ltd
Consolidated statement of profit or loss

Revenue 24(a) 25,821,967,586 22,167,421,731

Cost of sales 25(a) (17,771,157,148) (15,569,844,148)
Gross profit 8,050,810,438 6,597,577,583
Administrative, selling and distribution expenses 26(a) (5,676,681,463) (4,754,846,786)
Other income 27(a) 84,031,881 64,333,022
Operating profit 2,458,160,856 1,907,063,819
Share of profit of equity accounted investees 100,124,297 56,856,441
2,558,285,153 1,963,920,260
Net Finance costs 28(a) (1,401,354,696) (1,326,814,390)
Profit before contribution to WPPF 1,156,930,457 637,105,870
Contribution to WPPF (97,899,765) (77,151,122)
Profit before tax 1,059,030,692 559,954,748
Income tax expense: 29(a)
Current tax (619,894,364) (470,029,531)
Deferred tax income/(expense) 39,978,849 13,314,265
(579,915,515) (456,715,266)
Profit after tax 479,115,177 103,239,482
Profit attributable to:

Equity holders of the company 573,451,642 203,681,693
Non-controlling interests (94,336,465) (100,442,211)
Profit 479,115,177 103,239,482
Earnings per share 30(a)

Basic earnings per share 16.68 5.94
Diluted earnings per share 16.58 5.94
________________ ________________ ________________

______________________
Auditor
Dhaka,
9
XYZ Ltd
Consolidated statement of profit or loss and other comprehensive income

Net profit after tax 479,115,177 103,239,482
Other comprehensive income:

Change in fair value of available-for-sale financial assets 50,955,606 (32,811,060)
Income tax on other comprehensive income (5,095,561) 3,281,106
Elimination of goodwill due to amalgamation (49,261,574) -
Total other comprehensive income, net of tax (3,401,529) (29,529,954)
Total comprehensive income 475,713,648 73,709,528
Profit attributable to:

Equity holders of the company 531,121,334 174,151,739
Non-controlling interests (94,311,693) (100,442,211)
Profit 436,809,641 73,709,528
________________ ________________ ________________

###
_________________
Auditor
Dhaka,
10
XYZ Ltd
Consolidated Statement of changes in equity

Attributable to owner of the Company
Share Share Capital Available for Revaluation Retained Non-controlling Total
In Taka capital premium reserve sale reserve surplus earnings Total Interests equity
Balance at 1 January 2013 237,738,330 321,892,801 1,671,386 140,860,043 1,513,778,354 1,580,925,170 3,796,866,084 358,514,398 4,155,380,482

Net profit after tax 203,681,693 203,681,693 (100,442,211) 103,239,482
Total other comprehensive income-net of tax - (29,529,954) - (29,529,954) - (29,529,954)
Total comprehensive income - - - (29,529,954) - 203,681,693 174,151,739 (100,442,211) 73,709,528
Conversion of bond into equity 445,690 445,690 445,690
Share premium 11,409,664 11,409,664 11,409,664
Issuance of bonus shares 47,636,804 (47,636,804) - -
Dividends paid (190,547,216) (190,547,216) (52,293,361) (242,840,577)
Capital paid by non controlling interest - 42,310,000 42,310,000
Total transactions with owners of the company 48,082,494 11,409,664 - - - (238,184,020) (178,691,862) (9,983,361) (188,675,223)
Realization of revaluation reserve (2,158,044) 2,158,044 - - -
Total transactions recognized directly in equity - - - - (2,158,044) 2,158,044 - - -
Balance at 31 December 2013 285,820,824 333,302,465 1,671,386 111,330,089 1,511,620,310 1,548,580,887 3,792,325,961 248,088,826 4,040,414,787

Attributable to owner of the Company
Share Share Capital Available for Revaluation Retained Non-controlling Total
In Taka capital premium reserve sale reserve surplus earnings Total Interests equity
Balance at 1 January 2014 285,820,824 333,302,465 1,671,386 111,330,089 1,511,620,310 1,548,580,887 3,792,325,961 248,088,826 4,040,414,787

Net profit after tax 573,451,642 573,451,642 (94,336,465) 479,115,177
Total other comprehensive income-net of tax - 45,877,359 - (49,261,574) (3,384,215) (17,313) (3,401,528)
Total comprehensive income - - - 45,877,359 - 524,190,068 570,067,427 (94,353,778) 475,713,649
Conversion of bond into equity 796,860 - - - - - 796,860 - 796,860
Share premium - 18,037,878 - - - - 18,037,878 - 18,037,878
Issuance of bonus shares 57,323,537 - - - - (57,323,537) - - -
Issuance of shares for amalgamation 2,800 - - - - - 2,800 - 2,800
Dividends paid (243,625,031) (243,625,031) (52,312,238) (295,937,269)
Capital paid by non controlling interest - - - - - - - 35,170,040 35,170,040
Total transactions with owners of the company 58,123,197 18,037,878 - - - (300,948,568) (224,787,493) (17,142,198) (241,929,691)
Realization of revaluation reserve (250,016,299) 250,016,299 - - -
Total transactions recognized directly in equity - - - - (250,016,299) 250,016,299 - - -
Balance at 31 December 2014 343,944,021 351,340,343 1,671,386 157,207,448 1,261,604,011 2,021,838,686 4,137,605,895 136,592,850 4,274,198,745
11
Advanced Chemical Industries Limited
Consolidated statement of cash flows

In Taka 2014 2013
Cash flows from operating activities
Cash received from customers 25,615,836,736 21,768,760,924
Cash received from other income 77,284,799 63,103,937
25,693,121,535 21,831,864,861
Cash received/(paid) from/(for):
Other receivables 27,410,523 (41,865,633)

Purchase of inventory ### ###
Operating expenses (5,462,859,415) (4,549,674,189)
Other creditors (4,501,561) 61,556,244
Payment for WPPF (86,415,964) (33,619,170)
Advances, deposits and prepayments (274,369,625) 21,428,479
(23,728,844,814) (20,319,265,577)
Cash generated from operations 1,964,276,721 1,512,599,284
Finance costs (1,376,603,665) (1,302,925,797)

Income tax expense (538,822,852) (364,296,479)
(1,915,426,517) (1,667,222,276)
Net cash from operating activities 48,850,204 (154,622,992)
Cash flows from investing activities
Acquisition of property, plant and equipment (438,387,682) (239,896,389)
Payments for capital work in progress (384,123,944) (555,892,891)
Sale proceeds from property, plant and equipment 5,189,954 4,586,741
Dividend received 2,855,906 -
Investment (23,802,053) (17,043,930)
Net cash used in investing activities (838,267,819) (808,246,469)
Cash flows from financing activities
Payment to non-controlling interest (51,446,746) (51,627,604)
Inter-company debts received/(paid) (43,810,920) (1,630,375)
Dividend paid (235,967,127) (185,992,855)
Issue of shares 35,160,160 42,310,000
Payment for finance lease (11,645,514) (9,885,217)
Payment for redemption of Zero Coupon Bonds (219,434,948) (203,425,516)
Short-term bank loan received 2,322,368,422 1,040,192,148
Long-term bank loan received (500,968,134) 812,712,666
Net cash from financing activities 1,294,255,193 1,442,653,247
Net increase in cash and cash equivalents 504,837,578 479,783,786

Cash and cash equivalents at 1 January (356,295,169) (836,078,955)
Cash and cash equivalents at 31 December 148,542,409 (356,295,169)
Closing balance represents

Cash and cash equivalents 966,996,727 801,850,966
Bank overdraft (818,454,318) (1,158,146,135)
148,542,409 (356,295,169)
12
XYZ Ltd
Notes to the financial statements

as at and for the year ended 31 December 2014
1. Reporting entity
1.1 Company profile
XYZ Ltd ( the company) is a public limited company incorporated in Bangladesh on XX January
XXXX as Company limited by Shares . The registered office of the Company is situated in Dhaka.
The Company is listed with Dhaka Stock Exchange Limited (DSE) and Chittagong Stock Exchange
Limited (CSE).
1.2 Nature of business
The Company primarily is involved in manufacturing of pharmaceuticals, consumer brands, animal

health products and marketing them along with fertilizer, seeds and other agricultural items.
1.3 Description of subsidiaries
1.3.1 XYZ Formulations Limited
The company was incorporated on 29 October 1995 as a private limited company under the
Companies Act 1994. The principal activities of the company are manufacturing and marketing of a
number of agrochemical and consumer products. The Company is a publicly listed company with
Dhaka Stock Exchange Limited and Chittagong Stock Exchange Limited.
1.3.2 XYZ Salt Limited
The company was incorporated on 13 June 2004 as a private limited company under the Companies
Act 1994. The principal activity of the company is manufacturing and marketing of edible branded
salt.
1.3.3 XYZ Foods Limited
The company was incorporated on 14 September 2006 as a private limited company under the
Companies Act 1994. The main objectives of the company are manufacturing, processing and
marketing of different food items including spices and different snack items.
1.3.4 XYZ Pure Flour Limited
The company was incorporated on 29 August 2006 as a private limited company under the
Companies Act 1994. The main objectives of the company are to carry on the business of milling,
processing, packaging and marketing of wheat flour products.
13
1.3.5 XYZ Insecticides Limited
The company was incorporated on 5 October 1991 as a private limited company under the
Companies Act 1994. The company's main function was to manufacture and sale of mosquito coil.
There was no business operation of the company during the year under review.
1.3.6 XYZ Agrochemicals Limited
The company was incorporated on 4 July 2006 as a private limited company under the Companies
Act 1994. The main objectives of the company are to carry on the business of manufacturing,
formulating and packaging of pesticide, fertilizer, plant nutrient, animal food and other nutrient
products. The company is yet to start its commercial operation.
1.3.7 XYZ Motors Limited
The company was incorporated on 11 December 2007 as a private limited company under the
Companies Act 1994. The main objectives of the company are to carry on the business of buying,
selling, importing and assembling of vehicles for both agricultural and non-agricultural use
including other agricultural equipment and supplying of spare parts and providing service fXYZ
lities for these vehicles and equipment.
1.3.8 XYZ Communication Limited
The company was incorporated on 2 September 2007 as a private limited company under the
Companies Act 1994. The principal activities of the company are managing media solutions and
similar services for different clients including television commercials and other advertisement and
promotion related activities.
1.3.9 XYZ Plastics Limited
The company was incorporated on 11 June 2007 as a private limited company under the Companies
Act 1994. The main objectives of the company are to carry out the business of manufacturing and
marketing of plastic products, flexible printing and other ancillary business associated with plastic
and flexible printing. The Company commenced its commercial production from 1 December 2008.
1.3.10 XYZ Logistics Limited
The company was incorporated on 29 April 2008 as a private limited company under the Companies
Act 1994. The main objective of the company is to set-up nationwide retail outlets in order to fXYZ
litate the improvement in goods marketing efficiency and to provide a modern self service shopping
option to customers.
1.3.11 XYZ Edible Oils Limited
The company was incorporated on 13 December 2010 as a private limited company under the
Companies Act 1994. The main objective of the company is to carry out the business as
manufacturing as well as trading of all kinds of crude and refined edible oils, edible fats, food grade
chemicals, cleansing materials, preservatives and other allied food products.
14
1.3.12 XYZ HealthCare Limited
The company was incorporated on 18 February 2013 as a public limited company under the
Companies Act 1994. The principal activities of the company are to be manufacturing and marketing
of pharmaceutical products for regulated markets. The company is yet to start its commercial
operation.
1.3.13 XYZ Chemicals Limited
The company was incorporated on 26 November 2013 as a private limited company under the
Companies Act 1994. The main objective of the company is to represent foreign and local principals
and market and promote their products and process and engage in the service of indenting on their
behalf.
2. Basis of accounting
2.1 Statement of compliance
The financial statements have been prepared in accordance with Bangladesh Accounting Standards
(BASs), Bangladesh Financial Reporting Standards (BFRSs), the Companies Act 1994, the
Securities and Exchange Rules 1987 and other applicable laws and regulations.
2.2 Date of authorisation
The consolidated financial statements as well as separate financial statements were authorized by the
Board of Directors on __ April 2015 for publication.
3 Functional and presentational currency
These financial statements are presented in Bangladesh Taka (Taka/TK/BDT), which is both
functional and presentation currency of the Company. The amounts in these financial statements
have been rounded off to the nearest Taka.
Details of the Company's accounting policies are included in Notes 38 and 39.
4 Use of estimates and judgments
In preparing these financial statements, management has made judgment, estimates and assumptions
that affect the application of accounting policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revision to estimates are
recognised prospectively.
15
Information about assumptions and estimation uncertainties that have a significant risk of resulting
in a material adjustment in the year ended 31 December 2014 is included in the following notes:
Note 7 Property, plant and equipment

Note 10 Inventories
Note 11 Trade and other receivables
Note 17 Employee benefits
Note 19 Deferred tax liabilities
Note 23 Provision for tax
When measuring the fair value of an asset or a liability, the Company uses market observable data as
far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the
inputs used in the valuation techniques as follows:
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or
liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
• Level 3: inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
If the inputs used to measure the fair value of an asset or a liability might be categorised in different
levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the
same level of the fair value hierarchy as the lowest level input that is significant to the entire
measurement.
The Company recognises transfers between levels of the fair value hierarchy at the end of the
reporting period during which the change has occurred.
5 Reporting period
The financial period of the companies other than the following two associates covers one year from
1 January to 31 December and is followed consistently.
Financial periods of two associates are:
Associate 1 Ltd. From 1 August to 31 July

Associate 2 Ltd From 1 April to 31 March
The figures involved in the aforesaid two associated companies up to 31 December 2014 from the
end of their accounting years are considered to be immaterial to these financial statements.
16
6 Operating segments
(i) Basis for segmentation
An operating segment is a component of the Company that engages in business activities from which
it may earn revenues and incur expenses, including revenues and expenses that relate to transactions
with any of the Company's other components. However, a segment is a distinguishable component
of the Company that is engaged either in providing related products or services (business segment),
or in providing products or services within a particular economic environment (geographical
segment), which is subject to risks and rewards that are different from those of other segments. The
Company's primary format for segment is based on business segments.
All operating segments' operating results are reviewed regularly by the Company's managing
director to make decisions about resources to be allocated to the segment and to assess its
performance, and for which discrete financial information is available. Segment results that are
reported to the managing director include items directly attributable to a segment as well as those
that can be allocated on a reasonable basis.
The business described below as part of segment analysis of units analyzed for the criteria of
reportable segments as specified in Bangladesh Financial Reporting Standard 8: Operating
Segments.
Pharmaceuticals: Involves in manufacturing and marketing of health care products in home and
abroad.
Consumer Brands: Involves in marketing and distributing of consumer products.
Animal Health: Involves in manufacturing and distributing of veterinary and fisheries products.
Crop Care and Public Health: Involves in manufacturing and marketing of crop protection items.
XYZ Motors: Involves in the business of buying and selling of agricultural equipment.
XYZ Pure Flour: Involves in milling, processing, packaging and marketing of wheat flour products.
Retail Chain: Involves in XYZ litating the improvement in goods marketing efficiency and to provide
a modern self-service shopping option to customers.
Premiaflex Plastics: Involves in manufacturing, processing and marketing of plastic products at

home.
17
(ii) Information about reportable segments
Information related to each reportable segment is set out below. Segment profit before tax is used to measure performance because management believes that this information is the most relevant in evaluating the results of the respective segments relative to other entities that operate in the
same industries.
2014
Reportable segments
Consumer Crop Care and Total reportable

Pharmaceuticals Animal Health ACI Motors ACI Pure Flour Retail Chain ACI Salt ACI Foods Premiaflex Unallocated Total
Brands Public Health segments
In Taka
External revenue 5,744,012,657 1,669,138,273 3,586,619,853 1,577,973,708 1,869,364,121 2,533,139,258 3,983,033,669 1,338,271,791 636,642,969 1,400,707,580 24,338,903,879 1,483,063,707 25,821,967,586
Intra-segment revenue 30,121,324 11,106,730 121,885,462 213,513,508 376,627,024 (376,627,024) -
Segment revenue 5,744,012,657 1,669,138,273 3,586,619,853 1,577,973,708 1,869,364,121 2,563,260,582 3,983,033,669 1,349,378,521 758,528,431 1,614,221,088 24,715,530,903 1,106,436,683 25,821,967,586
Depreciation and amortization 188,773,296 19,164,454 37,164,450 22,588,239 3,061,828 24,059,284 111,171,034 78,052,383 17,402,693 51,561,082 552,998,743 47,311,480 600,310,223
Operating expenses 1,906,776,454 359,229,441 820,497,587 328,859,252 248,139,187 162,784,110 960,128,679 175,046,103 175,368,777 51,743,468 5,188,573,058 487,275,939 5,675,848,997
Finance costs 131,690,887 26,172,193 101,281,153 40,576,583 93,425,201 12,156,392 613,947,686 94,618,985 149,222,242 93,848,468 1,356,939,790 44,052,958 1,400,992,748
Segment profit/(loss) before tax 1,256,614,073 134,953,593 118,225,833 234,631,409 170,354,065 107,638,943 (1,011,845,985) 68,989,126 (160,411,242) 151,921,368 1,071,071,183 (8,999,106) 1,062,072,077
-
Segment assets 3,968,490,196 1,233,641,046 2,306,805,964 1,928,254,808 1,815,912,191 670,258,534 2,433,580,827 1,279,219,620 443,624,886 1,558,305,051 17,638,093,123 4,353,350,502 21,991,443,625
Segment liabilities 902,565,254 356,349,932 851,711,912 678,044,968 1,485,376,917 394,650,770 6,543,689,253 881,178,023 1,493,627,637 1,039,974,999 14,627,169,665 2,351,942,831 16,979,112,496
2013
Reportable segments
Crop Care and Total reportable

Pharmaceuticals Animal Health Consumer Brands ACI Motors ACI Pure Flour Retail Chain ACI Salt ACI Foods Premiaflex Unallocated Total
Public Health segments
In Taka
External revenue 4,975,668,245 1,271,620,170 3,350,515,901 1,163,673,316 1,401,110,707 2,648,481,606 3,199,729,767 1,153,976,863 575,253,826 1,279,063,434 21,019,093,835 1,148,327,896 22,167,421,731
Intra-segment revenue 16,451,185 9,417,085 50,527,679 134,338,310 210,734,259 (210,734,259) -
Segment revenue - -
Depreciation and amortization 168,100,645 16,946,266 34,149,829 22,454,949 1,370,951 24,813,820 92,203,820 77,153,444 17,785,682 41,718,924 496,698,330 34,823,696 531,522,026
Operating expenses 1,767,139,548 271,498,541 754,120,366 287,411,080 189,065,009 142,380,557 732,126,112 138,526,454 144,373,227 36,191,910 4,462,832,804 292,013,982 4,754,846,786
Finance costs 131,413,454 26,117,056 101,999,609 54,165,440 4,972,684 37,549,945 540,805,077 118,492,666 158,300,341 106,950,244 1,280,766,516 46,047,874 1,326,814,390
Segment profit/(loss) before tax 785,385,141 94,484,921 98,051,529 131,942,332 130,435,907 132,910,394 (832,994,292) 44,715,066 (165,273,504) 101,646,574 521,304,068 38,650,680 559,954,748
Segment assets 3,805,204,450 1,046,123,991 2,699,017,831 1,695,216,109 1,604,643,448 725,003,621 1,900,962,478 1,418,006,937 352,310,184 1,402,464,943 16,648,953,992 3,402,715,752 20,051,669,744
Segment liabilities 1,094,492,486 372,493,040 1,009,450,095 450,769,018 1,384,233,852 503,858,406 4,998,702,943 1,186,325,370 1,244,173,703 983,906,504 13,228,405,417 2,782,849,540 16,011,254,957
18
7 Property, plant and equipment
See accounting policy in Note 39(I).
Electrical and
Plant and Furniture and other Office Under
In Taka Note Land Building Machinery fixture appliances machinery Vehicles construction Total
Cost
Balance at 1 January 2013 378,580,685 354,209,638 1,025,340,614 81,499,108 60,193,137 34,504,185 127,505,329 889,671,313 2,951,504,009
Additions 1,230,000 - 2,184,231 10,980,307 26,548,467 6,422,467 76,251,612 405,725,906 529,342,990
Transfer 427,681,028 27,048,784 238,474,782 15,875,153 1,060,702 - - (710,140,449) -
Disposals (379,549,373) - - - (131,652) - (1,732,398) (381,413,423)
Balance at 31 December 2013 427,942,340 381,258,422 1,265,999,627 108,354,568 87,670,654 40,926,652 202,024,543 585,256,770 3,099,433,576
Additions due to amalgamation 225,000,000 102,336,777 - 11,248,179 16,904,068 - - - 355,489,024
Additions 78,331,300 - 20,440,446 15,645,366 33,362,882 8,673,382 112,704,023 101,436,791 370,594,190
Transfer 178,540 45,782,064 239,008,986 274,500 175,000 - - (285,419,090) -
Disposals - - (517,600) - (106,963) (238,750) (2,848,925) - (3,712,238)
Balance at 31 December 2014 731,452,180 529,377,263 1,524,931,459 135,522,613 138,005,641 49,361,284 311,879,641 401,274,471 3,821,804,552
Electrical and
Revaluation
Balance at 1 January 2013 744,081,718 38,483,654 56,379,485 3,814,918 3,924,343 2,227,188 47,608,423 - 896,519,729
Additions - - - - - - - - -
Transfer - - - - - - - - -
Disposals - - - - (185,607) - (2,791,006) - (2,976,613)
Balance at 31 December 2013 744,081,718 38,483,654 56,379,485 3,814,918 3,738,736 2,227,188 44,817,417 - 893,543,116
Balance at 1 January 2014 744,081,718 38,483,654 56,379,485 3,814,918 3,738,736 2,227,188 44,817,417 - 893,543,116
Additions - - - - - - - - -
Transfer - - - - - - - - -
Disposals - - (3,840) - (45,053) - (2,151,496) - (2,200,389)
Balance at 31 December 2014 744,081,718 38,483,654 56,375,645 3,814,918 3,693,683 2,227,188 42,665,921 - 891,342,727
19
Electrical and
Accumulated depreciation- Cost
Balance at 1 January 2013 - 12,179,540 214,600,968 21,288,834 17,525,584 9,059,790 71,735,245 - 346,389,961
Depreciation - 10,053,814 134,476,687 10,165,039 7,332,223 4,347,456 37,153,562 - 203,528,781
Disposals - - - - (119,391) - (162,277) - (281,668)
Balance at 31 December 2013 - 22,233,354 349,077,655 31,453,873 24,738,416 13,407,246 108,726,530 - 549,637,074
Depreciation - 11,177,401 147,112,214 12,075,226 10,415,255 16,341,519 48,210,610 - 245,332,225
Additions due to amalgamation - 26,973,615 - 5,660,733 10,367,633 - - - 43,001,981
Disposals - - (322,040) - (94,210) (38,200) (837,244) - (1,291,694)
Electrical and
Accumulated depreciation- Revaluation -
Balance at 1 January 2013 - 1,924,182 17,042,430 1,507,765 1,539,236 819,104 19,043,369 - 41,876,086
Depreciation - 962,091 8,619,429 755,215 710,631 409,739 8,963,483 - 20,420,588
Transfer - - - - - - - - -
Disposals - - - - (84,937) - (1,116,402) - (1,201,339)
Depreciation - 962,092 7,879,027 518,688 593,608 408,740 8,533,074 - 18,895,229
Transfer - - - - - - - - -
Disposals - - (1,213) - (30,064) (79) (1,291,228) - (1,322,584)
20
Electrical and
Leased Assets
Balance at 1 January 2013 - - - - - - 17,067,493 - 17,067,493
Additions - - - - - - - - -
Transferred to property, plant and equipment - - - - - - - - -
Disposals - - - - - - (1,445,000) - (1,445,000)
Balance at 31 December 2013 - - - - - - 15,622,493 - 15,622,493

Acquisitions through business combinations - - - - - - - - -
Other additions - - - - - - - - -
Transferred to property, plant and equipment - - - - - - - - -
Disposals - - - - - - (4,979,500) - (4,979,500)
Electrical and
Accumulated depreciation- Leased assets
Depreciation - - - - - - 898,000 - 898,000
Transfer - - - - - - - - -
Disposals - - - - - - (1,444,999) - (1,444,999)

Depreciation - - - - - - 898,000 - 898,000
Transfer - - - - - - - - -
Disposals - - - - - - (4,979,496) - (4,979,496)
Carrying amounts
At 31 December 2013 1,172,024,058 394,622,449 947,639,598 78,452,633 64,506,044 28,517,751 113,469,983 585,256,770 3,384,489,286
At 31 December 2014 1,475,533,898 503,628,182 1,051,899,602 87,366,031 93,543,756 20,240,403 165,660,369 401,274,471 3,799,146,712
Notes:
1. In 2010, all the property, plant and equipment of the company were revalued by the independent professional valuer MNC Limited. Such revaluation is made with sufficient regularity to ensure that carrying amount
does not differ materially from their fair value.
2. For office machinery equipment useful life has been changed to 5 years from 10 years. As a result, depreciation has been increased to BDT 16,750,259 from BDT 5,392,500 (as per previous estimation).
3. Due to amalgamation on 3 December 2014 of Apex leather craft with XYZ limited by the order of the honarable High Court Division of the Supreme Court of Bangladesh, all the assets of ABC Ltd. were transferred
to XYZ Limited's books.
21
Notes to the financial statements
6 Property, plant and equipment
See accounting policy in Note 41(e).
Electrical and
Plant and Furniture other Office Under
In Taka Land Building Machinery and fixture appliances machinery Vehicles construction Total
Cost
Revaluation 744,081,718 38,483,654 56,379,485 3,814,918 3,924,343 2,227,188 47,608,423 - 896,519,729
Additions 1,230,000 - 2,184,231 10,980,307 26,548,467 6,422,467 76,251,612 405,725,906 529,342,990
Transferred to property, plant and equipment 427,681,028 27,048,784 238,474,782 15,875,153 1,060,702 - - (710,140,449) -
Disposals (379,549,373) - - - (317,259) - (4,523,404) (384,390,036)
Balance at 31 December 2013 1,172,024,058 419,742,076 1,322,379,112 112,169,486 91,409,390 43,153,840 246,841,960 585,256,770 3,992,976,692
Balance at 1 January 2014 1,172,024,058 419,742,076 1,322,379,112 112,169,486 91,409,390 43,153,840 246,841,960 585,256,770 3,992,976,692
Acquisitions through business combinations/amalgamation 225,000,000 102,336,777 - 11,248,179 16,904,068 - - 101,436,791 456,925,815
Revaluation -
Other additions 78,331,300 - 20,440,446 15,645,366 33,362,882 8,673,382 112,704,023 - 269,157,399
Transferred to property, plant and equipment 178,540 45,782,064 239,008,986 274,500 175,000 - - - 285,419,090
Disposals - - (521,440) - (152,016) (238,200) (5,000,971) (285,419,090) (291,331,717)
Balance at 31 December 2014 1,475,533,898 567,860,917 1,581,307,104 139,337,531 141,699,324 51,589,022 354,545,012 401,274,471 4,713,147,279
Electrical and
In Taka Note Land Building Machinery and fixture appliances machinery Vehicles construction Total
Depreciation - 11,015,905 143,096,116 10,920,254 8,042,854 4,757,195 46,117,045 - 223,949,369
Acquisitions through business combinations/amalgamation - - - - - - - - -
Disposals - - - - (204,328) - (1,278,679) - (1,483,007)
Depreciation - 12,139,493 154,991,241 12,593,914 11,008,863 16,750,259 56,743,684 264,227,454
Acquisitions through business combinations/amalgamation 26,973,615 5,660,733 10,367,633 43,001,981
Disposals (323,253) (124,274) (38,279) (2,128,472) (2,614,278)
9
Electrical and
In Taka Land Building Machinery and fixture appliances machinery Vehicles construction Total
Leased Assets
Balance at 1 January 2013 17,067,493 17,067,493
Additions -
Transferred to property, plant and equipment -
Disposals (1,445,000) (1,445,000)

Acquisitions through business combinations -
Other additions -
Transferred to property, plant and equipment -
Disposals (4,979,500) (4,979,500)
Electrical and
In Taka Note Land Building Machinery and fixture appliances machinery Vehicles construction Total
Depreciation - - - - - - 898,000 - 898,000
Transfer - - - - - - - - -
Disposals - - - - - - (1,444,999) - (1,444,999)

Depreciation - - - - - - 898,000 - 898,000
Transfer - - - - - - - - -
Disposals - - - - - - (4,979,496) - (4,979,496)
Carrying amounts
At 31 December 2013 1,172,024,058 394,622,449 947,639,598 78,452,633 64,506,044 28,517,751 113,469,983 585,256,770 3,384,489,286
At 31 December 2014 1,475,533,898 503,628,182 1,051,899,602 87,366,031 93,543,756 20,240,953 165,659,819 401,274,471 3,799,146,712
10
7(a) Consolidated Property, plant and equipment
See accounting policy in Note 39(I).
Electrical and
Cost
Balance at 1 January 2013 762,792,485 1,210,263,906 2,975,498,752 424,629,808 212,392,471 202,324,132 183,221,657 916,027,131 6,887,150,342
Additions 436,014,042 1,188,358 8,562,457 11,947,307 28,368,077 7,403,706 76,535,917 654,455,740 1,224,475,604
Transfer 427,681,028 45,071,025 260,994,607 41,764,982 19,125,944 13,918,683 - (808,556,269) -
Disposals (379,549,373) - - - (131,652) - (1,732,398) - (381,413,423)
Balance at 31 December 2013 1,246,938,182 1,256,523,289 3,245,055,816 478,342,097 259,754,840 223,646,521 258,025,176 761,926,602 7,730,212,523
Balance at 1 January 2014 1,246,938,182 1,256,523,289 3,245,055,816 478,342,097 259,754,840 223,646,521 258,025,176 761,926,602 7,730,212,523
Additions 83,308,779 618,830 31,982,105 16,906,271 33,895,213 11,302,586 135,247,160 690,193,392 1,003,454,336
Transfer 178,540 63,015,126 459,375,629 85,770,228 47,310,829 89,050,856 - (744,701,208) -
Disposals - - (14,360,703) - (106,963) (238,750) (2,848,925) - (17,555,341)
Balance at 31 December 2014 1,330,425,501 1,320,157,245 3,722,052,847 581,018,596 340,853,919 323,761,213 390,423,411 707,418,786 8,716,111,518
Electrical and
Revaluation
Balance at 1 January 2013 1,555,030,636 82,265,271 83,525,055 7,179,208 9,803,818 4,617,813 50,756,150 - 1,793,177,951
Additions - - - - - - - - -
Transfer - - - - - - - - -
Disposals - - - - (185,607) - (2,791,006) - (2,976,613)
Balance at 31 December 2013 1,555,030,636 82,265,271 83,525,055 7,179,208 9,618,211 4,617,813 47,965,144 - 1,790,201,338
Balance at 1 January 2014 1,555,030,636 82,265,271 83,525,055 7,179,208 9,618,211 4,617,813 47,965,144 - 1,790,201,338
Additions - - - - - - - - -
Transfer - - - - - - - - -
Disposals - - (3,840) - (45,053) 550 (2,152,046) - (2,200,389)
Balance at 31 December 2014 1,555,030,636 82,265,271 83,521,215 7,179,208 9,573,158 4,618,363 45,813,098 - 1,788,000,949
22
Electrical and
Balance at 1 January 2013 - 89,652,401 740,049,044 162,097,575 71,842,851 89,847,929 102,706,553 - 1,256,196,353
Depreciation - 30,630,428 303,505,585 62,887,613 25,014,005 26,610,498 46,663,592 - 495,311,721
Disposals - - - - (119,391) - (162,277) - (281,668)
Balance at 31 December 2013 - 120,282,829 1,043,554,629 224,985,188 96,737,465 116,458,427 149,207,868 - 1,751,226,406
Balance at 1 January 2014 - 120,282,829 1,043,554,629 224,985,188 96,737,465 116,458,427 149,207,868 - 1,751,226,406
Depreciation - 30,672,265 325,130,176 67,880,273 32,211,052 47,248,345 58,323,193 - 561,465,304
Disposals - - (3,654,281) - (94,210) (38,200) (837,244) - (4,623,935)
Balance at 31 December 2014 - 150,955,094 1,365,030,524 292,865,461 128,854,307 163,668,572 206,693,817 - 2,308,067,775
Electrical and
Accumulated depreciation- Revaluation
Depreciation - 2,410,288 13,263,552 1,030,821 1,177,529 665,323 9,593,028 - 28,140,541
Transfer - - - - - - - - -
Disposals - - - - (84,937) - (1,116,402) - (1,201,339)
Depreciation - 2,276,643 10,179,150 809,795 1,067,127 571,840 9,162,619 - 24,067,174
Transfer - - - - - - - - -
Disposals - - (1,213) - (30,064) (79) (1,291,228) - (1,322,584)
23
Electrical and
Leased Assets
Balance at 1 January 2013 - - - - - 32,998,000 28,515,577 - 61,513,577
Additions - - - - - - - - -
Transfer - - - - - - - - -
Disposals - - - - - - (1,445,000) - (1,445,000)
Balance at 31 December 2013 - - - - - 32,998,000 27,070,577 - 60,068,577

Other additions - - - - - - - - -
Transfer - - - - - - - - -
Disposals - - - - - - (4,979,500) - (4,979,500)
Electrical and
Balance at 1 January 2013 - - - - - 393,226 15,338,362 - 15,731,588
Depreciation - - - - - 4,718,715 1,742,618 - 6,461,333
Transfer - - - - - - - - -
Disposals - - - - - - - - -

Depreciation - - - - - 4,718,714 3,187,618 - 7,906,332
Transfer - - - - - - - - -
Disposals - - - - - - (4,979,496) - (4,979,496)
Carrying amounts
At 31 December 2013 2,801,968,818 1,211,315,567 2,242,535,329 256,342,099 167,874,088 136,406,203 137,992,964 761,926,602 7,716,361,670
At 31 December 2014 2,885,456,137 1,242,000,615 2,387,874,688 290,328,530 215,774,209 184,020,825 199,694,191 707,418,786 8,112,567,981
Notes:
1.For office machinery equipment useful life has been changed to 5 years from 10 years. As a result, depreciation has been increased to BDT 19,496,379 from BDT 6,314,793 (as per previous estimation)
24
8 Long-term investments
i) Investment in shares
2014 2013
Number Face value Called and paid up
of shares per share capital per share Shareholding Value Value
Taka Taka % Taka Taka
Investment in subsidiaries
Flyban Insecticides Limited 25,500 100 100 51.00 2,550,000 2,550,000
XYZ Formulations Limited 24,066,105 10 10 53.48 66,872,823 66,872,823
XYZ Salt Limited 233,000 1,000 1,000 77.67 155,000,000 78,000,000
XYZ Foods Limited 380,000 100 100 95.00 38,000,000 38,000,000
XYZ Pure Flour Limited 380,000 100 100 95.00 38,000,000 38,000,000
Apex Leathercraft Limited 370,000 100 100 - - 24,567,963
XYZ Agrochemicals Limited 180 100 100 90.00 18,000 18,000
Creative Communication Limited 6,000 100 100 60.00 600,000 600,000
XYZ Motors Limited 6,650 100 100 66.50 665,000 675,000
Premiaflex Plastics Limited 261,945 1,000 1,000 87.32 229,945,000 229,945,000
XYZ Logistics Limited 273,600 1,000 1,000 76.00 273,600,000 273,600,000
XYZ Healthcare Limited 46,469,000 10 10 92.94 464,690,000 464,690,000
XYZ Edible Oils Limited 850,000 10 10 85.00 8,500,000 8,500,000
XYZ Chemicals Limited 6 10 10 60.00 60 -
1,278,440,883 1,226,018,786
Investment in Associates and Joint Ventures
Asian Consumer Care (Pvt.) Limited 8,393,321 10 10 24.00 115,205,895 115,233,210
XYZ Godrej Agrovet ( Pvt.) Limited 1,850,000 100 100 50.00 185,000,000 185,000,000
Computer Technology Limited 200 100 100 40.00 20,000 20,000
Stochastic Logic Limited 2,000 100 100 20.00 200,000 200,000
Tetley XYZ (Bangladesh) Limited 1,600,000 100 100 50.00 160,000,000 160,000,000
460,425,895 460,453,210
Investment in others
Mutual Trust Bank Limited 10,258,755 10 10 3.33 203,123,351 152,016,098
Central Depository Bangladesh Limited 1,142,362 10 10 0.58 3,138,890 3,138,890
206,262,241 155,154,988
ii) Other investment

Term deposit and others 3,929,930 4,665,303
3,929,930 4,665,303
1,949,058,949 1,846,292,287
Impairment (150,000,000) -
Total investment 1,799,058,949 1,846,292,287
25
Investment in XYZ Salt limited has been increased due to investment in right shares.
ABC Limited was amalgamated with XYZ limited on 3 Dec 2014 by the order of the Honorable High Court Division of Supreme Court of Bangladesh. An extra ordinary meeting was
held on 11 June 2013 to resolve on this merger.
Other investment includes Term Deposit amounting to Taka 3,429,930 which is kept as lien against service received from Titas Gas Transmission and Distribution Limited. Therefore,
the Company has no intention to encash the said amount and recorded as long term investment.
Impairment relates to investment in XYZ Logistics Limited. XYZ Logistics Limited has been loss making since its inception, which led management to make this impairment
provision.
26
10 Inventories
See accounting policy in Note 39(H).
Raw materials 724,011,984 502,928,357

Packing materials 241,697,100 169,566,009
Work in process 82,684,794 56,750,090
Finished goods 1,951,960,246 1,774,219,427
Goods in transit 115,235,985 198,109,813
Other inventories 26,850,950 30,789,189
Allowance for slow-moving inventory (181,265,088) (179,032,543)
2,961,175,971 2,553,330,342
As the Company deals in large number of items which vary in units, item-wise quantity statement of inventories could not be given.
11 Trade and other receivables
See accounting policy in Note 39(L).

Trade receivables:
Related parties 11.1 13,181,414 22,239,391
Other than related parties 11.2 1,514,068,488 1,628,279,733
1,527,249,902 1,650,519,124
Less: Provision for doubtful debts (176,732,751) (71,168,692)
1,350,517,151 1,579,350,432
Other receivables:
Related party 11.3 4,338,996,481 4,077,096,197
Other parties 11.4 113,059,306 139,792,927
4,452,055,787 4,216,889,124
5,802,572,938 5,796,239,556
Below six months 5,499,381,180 4,981,183,336

Over six months 479,924,509 886,224,912
Provision for doubtful debt (176,732,751) (71,168,692)
5,802,572,938 5,796,239,556
11.1 Related parties
2014 2013
Dues over Dues below
In Taka 6 months 6 months Total Total
XYZ Formulations Limited - 94,874 94,874 140,156

XYZ Foods Limited - 18,140 18,140 8,160
XYZ Motors Limited - 35,207 35,207 14,315
XYZ Logistics Limited - 13,033,193 13,033,193 22,076,760
- 13,181,414 13,181,414 22,239,391
11.2 Other than related parties
2014 2013
Pharmaceuticals 32,816,911 214,177,365 246,994,276 234,293,910

Animal health 50,057,398 231,482,509 281,539,907 277,906,066
Consumer brands 39,930,444 256,581,667 296,512,111 486,478,165
Seeds 21,269,644 317,367,269 338,636,913 237,581,051
Fertilizer 46,470,148 186,227,081 232,697,229 214,249,959
Cropex 114,523,754 3,164,298 117,688,052 177,770,582
305,068,299 1,209,000,189 1,514,068,488 1,628,279,733
Less: Provision for doubtful debts (176,732,751) (71,168,692)
1,337,335,737 1,557,111,041
27
11.3 Related party
2014 2013
Flyban Insecticides Limited 1,022,933 1,728 1,024,661 1,014,308

Apex Leathercraft Limited - - - 99,543,253
Computer Technology Limited 30,000 - 30,000 30,000
Tetley XYZ (Bangladesh) Limited 421,249 46,782,069 47,203,318 442,622
Asian Consumer Care (Pvt.) Limited 7,893,516 - 7,893,516 8,205,086
XYZ Salt Limited - 379,630,573 379,630,573 354,571,804
XYZ Godrej Agrovet (Pvt. ) Limited 879,726 - 879,726 879,726
XYZ Foods Limited - 729,057,993 729,057,993 746,527,424
XYZ Edible Oils Limited 2,914,561 - 2,914,561
XYZ Agrochemicals Limited 241,172 4,927 246,099 229,202
Stochastic Logic Limited 5,475,428 654,105 6,129,533 8,767,739
Premiaflex Plastics Limited - 196,721,432 196,721,432 210,564,943
XYZ Motors Limited - 60,943,318 60,943,318 39,369,746
Creative Communication Limited - 12,452,424 12,452,424 10,723,821
XYZ Pure Flour Limited - 10,930,186 10,930,186 44,534,754
XYZ Chemicals Limited 516,260 3,334,699 3,850,959
XYZ Logistics Limited - 2,734,915,043 2,734,915,043 2,508,800,927
XYZ Healthcare Limited 112,865,221 31,307,918 144,173,139 42,890,842
132,260,066 4,206,736,415 4,338,996,481 4,077,096,197
At Balance Sheet date, 'Trade and Other Receivables' includes Tk 273 crore receivable from XYZ Logistics. This is the current account
balance with XYZ Logistics Limited. XYZ Limited consciously made this funding to XYZ Logistics as a part of prudent treasury
management at Group level. XYZ Limited, as a parent company, is always subject to evaluation at the consolidation level than the
company level. So, through this funding XYZ Limited succeeded to minimize its financing cost to a considerable level thus improving
the profitability at Group level. Besides, parent funding helped XYZ Logistics to minimize its financing cost.
It is worth to be noted here that XYZ Logistics could have borrowed this fund at its own merit while cost of fund (COF) would have been
higher than the parent by almost 200 to 300 basis point. XYZ Limited genuinely believes that this sort of financing should always be
explored while there is an opportunity to reduce financing cost at Group level.
11.4 Other parties
2014 2013
Receivable from Novartis (Bangladesh) Limited - - - 583,270

Receivable from Oram Limited 2,262,050 - 2,262,050 2,262,050
Godrej consumer product advertisement and - -
promotional fund 497,650 - 497,650 497,650
Merisant advertisement and promotional fund 3,452,470 - 3,452,470 1,826,359
Electronics advertisement and promotional fund - - - 5,087,117
Colgate advertisement and promotional fund - 5,493,519 5,493,519 193,876
Les Laboratories Servier - 39,516,914 39,516,914 26,890,402
Transcom Distribution Limited 14,653 10,823 25,476 41,278,286
Receivables from other entities 36,369,321 25,441,906 61,811,227 61,173,917
42,596,144 70,463,162 113,059,306 139,792,927
28
12 Advances, deposits and prepayments

Advances:
Staff 83,342,746 71,637,664
Suppliers, C&F agents and others 142,303,261
### 92,925,780
Rent 63,259,496 55,570,644
Bank guarantee margin 3,580,021 6,368,453
VAT current account 34,907,266
### 57,055,444
Advance for capital expenditure 156,444,470 59,550,792
Advance income tax 12.1 198,436,147
### 350,013,451
682,273,407 693,122,228
Deposits:
Deposits for utilities 6,195,366 6,855,366
Tender deposits 12,059,820 27,273,019
18,255,186 34,128,385
Prepayments:
Prepaid expenses 358,584 750,321
358,584 750,321
700,887,177 728,000,934
12.1 Advance income tax

Balance at 1 January 350,013,451 150,489,441
Paid during the year 280,723,692 199,524,010
Adjustment for amalgamation 3,794,523 -
Adjustment during the year (436,095,519) -
Balance at 31 December 198,436,147 350,013,451
13 Cash and cash equivalents

Cash in hand 21,450,971 18,243,393
Collection in hand 13.1 205,840,819 115,519,105
Cash at banks 13.2 235,233,675 250,439,166
Cash and cash equivalents in the statement of financial position 462,525,465 384,201,664
Bank overdrafts (427,836,789) (741,441,244)
Cash and cash equivalents in the statement of cash flows 34,688,676 (357,239,580)
13.1 This represent cash in hand at depots which was collected against cash sales and payment instrument collected against credit sale at the
end of the reporting period.
13.2 Cash at banks

Eastern Bank Limited 34,750,398 82,654,631
The Hongkong and Shanghai Banking Corporation Limited 74,298,765 54,776,739
AB Bank Limited 41,174,551 29,889,216
Standard Chartered Bank 23,066,121 33,698,470
Sonali Bank Limited 19,048,246 3,857,926
Janata Bank Limited 13,387,553 18,430,297
One Bank Limited 9,449,323 9,935,565
Commercial Bank of Ceylon Plc. 7,699,356 5,736,054
Jamuna Bank Limited 5,487,088 3,978,969
The City Bank Limited 4,031,690 2,942,126
Dutch-Bangla Bank Limited 2,087,250 1,409,363
BRAC Bank Limited 707,016 3,129,773
Mutual Trust Bank Limited 44,093 37
Trust Bank Limited 1,425 -
Mercantile Bank Limited 800 -
235,233,675 250,439,166
29
14 Share capital
See accounting policy in Note 39(M).
In issue at 1 January 285,820,824 237,738,330

Bonus share issued 57,323,537 47,636,804
Issued for Zero Coupon Bond 796,860 445,690
Issued for amalgamation 2,800 -
In issue at 31 December - fully paid 343,944,021 285,820,824
Authorised - par value Tk. 10 500,000,000 500,000,000
Number and percentage of shareholdings:
No. of share Percentage Value (Taka)

2014 2013 2014 2013 2014 2013
Directors & sponsors 12,048,813 10,038,279 35.03% 35.03% 120,488,130 100,382,790
Institutions 10,530,284 10,799,816 30.62% 30.62% 105,302,840 107,998,160
General shareholders 11,815,304 7,743,987 34.35% 34.35% 118,153,051 77,439,874
34,394,401 28,582,082 100.00% 100.00% 343,944,021 285,820,824
30
A distribution schedule of the above shares as at 31 December 2014 is given below as required by the Listing Rules:
Percentage
Number of of total Number
Share owning shareholders shareholdings of shares
Less than 500 13,559 4.38 1,507,249
501-5,000 2,237 9.17 3,153,576
5,001-10,000 169 3.59 1,234,952
10,001-20,000 87 3.65 1,255,327
20,001-30,000 43 3.31 1,136,884
30,001-40,000 22 2.25 772,304
40,001-50,000 17 2.19 752,370
50,001-100,000 25 5.08 1,747,766
100,001-1,000,000 22 26.35 9,062,143
Over-1,000,000 4 40.04 13,771,830
16,185 100.00 34,394,401
15 Share premium
See accounting policy in Note 39(M).

Issued for Zero Coupon Bond 17,929,350 11,409,664
Issued for amalgamation 108,528 -
16 Reserves
In Taka 2014 2013

Capital reserve 16.1 1,671,386 1,671,386
Revaluation surplus 16.2 890,868,633 892,463,915
Available-for-sale reserve 16.3 157,326,614 111,330,089
1,049,866,633 1,005,465,390
16.1 Capital reserve
This represents the total grant received from Imperial Chemical Industries plc., London towards the cost of property, plant and equipment.
16.2 Revaluation surplus
In Taka 2014 2013

Realized during the year (1,595,282) (2,158,044)
16.3 Available-for-sale reserve
Changes in fair
No. of shares Cost of Movement in fair AFS reserve as at
Year MV of shares value of AFS
held investment value 31 December
financial assets
Taka Taka Taka Taka Taka
2010 706,526 500,397,040 28,316,000 472,081,040 257,970,169 424,872,936
2011 8,478,310 292,501,695 28,316,000 264,185,695 (207,895,345) 237,767,126
2012 8,478,310 184,827,158 28,316,000 156,511,158 (107,674,537) 140,860,043
2013 9,326,141 152,016,099 28,316,000 123,700,099 (32,811,059) 111,330,089
2014 10,258,755 203,123,349 28,316,000 174,807,349 51,107,250 157,326,614
31
17 Employee benefits

Staff gratuity provision 17.1 358,552,986 278,792,990
Other long term employee benefits 83,305,777 61,871,777
441,858,763 340,664,767
17.1 Staff gratuity provision

Provision made during the year 91,297,922 66,384,170
Paid during the year (11,537,926) (13,224,751)
18 Other non-current liabilities

Employees group insurance fund 400,000 400,000
Obligation under finance lease 18.1 1,100,850 2,137,153
Long term bank loans 18.2 54,613,313 275,501,644
XYZ 20% Convertible Zero Coupon Bonds (ZCBs) - 241,750,570
56,114,163 519,789,367
18.1 Obligation under finance lease

Paid during the year (1,036,303) (888,384)
18.2 Long term bank loans

IPDC Bangladesh Limited 17,623,977 78,471,244
AB Bank Limited - 147,387,934
54,613,313 275,501,644
32
1,042,773,576 1,378,771,429
19 Deferred tax liabilities
See accounting policy in Note 39(F).

Deferred tax (income)/expense recognised through profit or loss (37,079,047) (8,317,837)
Deferred tax (income)/expense recognised through other comprehensive income 5,110,725 (3,281,106)
Taxable/
Carrying (deductible)
amount on temporary
In Taka reporting date Tax base difference
At 31 December 2014
Property, plant and equipment 1,922,338,342 1,105,819,128 816,519,214
Land 1,475,533,898 - 1,475,533,898
Provision for inventory 181,265,088 - (181,265,088)
Provision for trade receivables 176,732,751 - (176,732,751)
Impairment for investment 150,000,000 - (150,000,000)
Provision for gratuity 358,552,986 - (358,552,986)
Provision for available for sale reserve 174,807,351 - (174,807,351)
Taxable/(Deductible) temporary differences 4,439,230,416 1,105,819,128 1,250,694,936
Applicable tax rate for land ### 4%

Applicable tax rate for available for sale reserve ### 10%
Applicable tax rate for other than land and available for sale reserve 27.50%
Deferred tax liabilities 62,743,398
33
Taxable/
Carrying (deductible)
amount on temporary
In Taka reporting date Tax base difference
At 31 December 2013
Property, plant and equipment 1,627,208,458 884,027,947 743,180,511
Provision for inventory 179,032,543 - (179,032,543)
Provision for trade receivables 71,168,692 - (71,168,692)
Provision for gratuity 278,792,990 - (278,792,990)
Provision for available for sale reserve 123,700,098 - (123,700,098)
Taxable/(Deductible) temporary differences 2,279,902,781 884,027,947 214,186,286
Applicable tax rate for land ### 4%

Applicable tax rate for available for sale reserve ### 10%
Applicable tax rate for other than land and available for sale reserve 27.50%
Deferred tax liabilities 94,711,720
20 Bank overdraft

The Hongkong and Shanghai Banking Corporation Limited 24,569 15,506,558
Citibank, N.A. - 5,000
Mercantile Bank Limited - 69,518
Bank Alfalah Limited 75,185,182 10,269,038
BRAC Bank Limited 18,037,241 100,862,891
The Premier Bank Limited 13,066,463 -
Pubali Bank Limited 1,031,151 20,542,652
National Credit and Commerce Bank Limited 30,284,968 194,374,060
Dutch-Bangla Bank Limited 195,222 4,010,911
United Commercial Bank Limited 35,765,668 -
One Bank Limited 23,492,492 -
427,836,789 741,441,244
21 Loans and borrowings

Short term loan 21.1 5,572,662,756 4,677,922,468
Current portion of long term loan 21.2 343,908,273 381,968,026
5,916,571,029 5,059,890,494
34
21.1 Short term loan

The Hongkong and Shanghai Banking Corporation Limited 241,586,638 327,148,470
AB Bank Limited 34,772,743 39,968,399
Eastern Bank Limited 1,591,250,431 2,056,158,719
BRAC Bank Limited 1,027,198,064 532,168,038
One Bank Limited 20,915,922 -
Dutch Bangla Bank Limited 3,497,282 83,313,447
Pubali Bank Limited - 239,833
Jamuna Bank Limited - 400,000,000
The Premier Bank Limited 310,477 -
5,572,662,756 4,677,922,468
21.2 Current portion of long term loan

IPDC Bangladesh Limited 63,312,710 59,995,145
Current portion of obligation under finance lease 1,036,304 888,386
XYZ 20% Convertible Zero Coupon Bonds 262,689,350 259,099,938
343,908,273 381,968,026
35
Facility arrangement for bank overdraft, short term bank loan and term loan is as follows:
In Taka
Short-term Revolving Trust
Overdraft Long-term loan
Name of the bank fXYZ lities Receipt Limit/ Bank guarantee
limits limits
limits Letter of credit
AB Bank Limited 30,000,000 65,000,000 - 200,000,000 -

Bank Alfalah Limited 120,000,000 100,000,000 - 180,000,000 -
Bank Asia Limited 15,000,000 - - 200,000,000 20,000,000
BRAC Bank limited 60,000,000 550,000,000 800,000,000 10,000,000
Commercial Bank of Ceylon 130,000,000 300,000,000 - 300,000,000 -
Dutch Bangla Bank Limited 150,000,000 - - 500,000,000 -
Eastern Bank Limited 40,000,000 2,000,000,000 200,000,000 760,000,000 10,000,000
The Hongkong ans Shanghi Banking
Corporation Limited 30,000,000 - 590,000,000 10,000,000
Mercantile Bank Limited 65,000,000 - - 200,000,000 -
One Bank Limited 100,000,000 500,000,000 - 300,000,000 -
Standard Chartered Bank 100,000,000 600,000,000 200,000,000 600,000,000 20,000,000
The City Bank Limited 200,000,000 900,000,000 - 390,000,000 10,000,000
Pubali Bank Limited 1,000,000 500,000,000
NCC Bank Limited 1,000,000,000 - - - -
Premier Bank Limited 400,000,000 - - 750,000,000 -
United Commercial Bank 50,000,000 - - 500,000,000 10,000,000
Trust Bank Limited - - 250,000,000 -
Securities for the facilities mentioned above are as below:

a) Demand promissory notes for BDT 3,307.69 million.
b) Registered hypothecation over inventories and accounts receivables on pari-passu basis for BDT 8,150 million.
c) Registered hypothecation over plant and machinery on pari-passu basis for BDT 2,102.5 million.
d) Corporate guarantee issued to AB Bank Limited by XYZ Formulations Limited, XYZ Pure Flour and XYZ Salt Limited.
e) Corporate guarantee issued to Bank Asia Limited by XYZ Motors Limited and XYZ Foods Limited.
f) Corporate guarantee issued to Dutch Bangla Bank Limited by XYZ Salt Limited, XYZ FoodsLtd. XYZ Motors Limited and
PremiaFlex Plastics Ltd.
g) Corporate guarantee issued to Dutch Bangla Bank Limited by XYZ Salt Limited, XYZ Motors Limited.
h) Corporate guarantee issued to The Premier Bank Limited by XYZ Salt Limited.
i) Post dated Cheque to NCC Bank Ltd. from SCB & Premier Bank Ltd. covering total overdraft limit BDT 1000 million.
Facility for XYZ 20% zero coupon bonds are as below:
XYZ 20% Convertible Zero Coupon Bonds (Note: 21.2)
Issue Price : BDT 1,000,017,310

Face value : BDT 1,335,850,000
Purpose : For project financing and repaying existing debts.
Tenure : 5 years
Repayment : From sales proceeds
Redemption : At maturity of each respective bond, redemption will be made in cash to the extent of 80% and rest 20% is eligible
for convertible option.
Conversion : Net Assets Value (NAV) per share as per last annual audited financial statements multiplied by 1.1
strike price
Conversion : 20% of the redemption value of the Zero Coupon Bonds at each maturity
value
Securities for the facility mentioned above are as follows:
i) The bonds are subordinated to the bank liabilities.

ii) Post dated cheques equivalent to the total face value of the ZCBs.
36
22 Trade and other payables

Trade payables 22.1 362,330,430 448,787,894
Inter company payables 22.2 137,299,218 364,070,950
Other payables 22.3 1,124,527,430 1,020,668,516
1,624,157,078 1,833,527,360
22.1 Trade payables

Related parties:
XYZ Formulations Limited 5,929,521 7,777,522
Premiaflex Plastics Limited 9,200,687 2,797,774
XYZ Salt Limited 40,250 -
XYZ Foods Limited 16,668 21,288
15,187,126 10,596,584
Other than related parties:

Image Printing And Packages Limited 9,521,794 4,958,049
Globe Drugs Limited 8,079,375 7,245,000
Quality Plastic Industry Limited 4,354,570 2,133,135
D M International Limited 4,116,496 2,189,903
Padma Lamitube Limited 3,382,897 3,491,980
Padma Blowing Limited 3,153,458 4,482,141
JMS Glass Industries Limited 3,109,630 1,601,661
Siddique Plastic Industries Limited 3,034,407 4,382,765
The Bengal Glass Works Limited 2,653,918 4,335,755
Moni Printers And Packages Limited 2,458,079 1,865,030
Others 303,278,680 401,505,891
347,143,304 438,191,310
362,330,430 448,787,894
22.2 Inter company payables

XYZ Formulations Limited 137,299,218 363,250,594
XYZ Edible Oils Limited - 820,356
137,299,218 364,070,950
22.3 Other payables

Accruals 397,491,322 352,647,614
Advance from customers 17,264,384 9,889,425
Security money received from customers 191,209,253 205,395,300
Workers' profit participation fund 22.3.1 286,233,804 231,680,915
Unclaimed dividend 52,429,105 44,771,201
Tax and VAT deducted at source 16,740,378 21,596,912
Employees welfare fund 128,675,434 122,826,050
Rights share deposit to be refunded 563,723 563,723
Family day fund 4,020,643 4,107,269
Non-management staff provident fund 2,642,111 2,734,630
Unclaimed refund warrant - Zero Coupon Bonds 3,647,450 3,647,450
Payable for redemption of Zero Coupon Bonds 15,464,555 13,810,873
Management staff provident fund 6,680,254 3,892,749
Laser advertisement and promotional fund 310,595 3,104,405
Electronics advertisement and promotional fund 1,154,419 -
1,124,527,430 1,020,668,516
22.3.1 Workers' profit participation fund

Addition during the year 66,941,575 53,384,874
Interest accrued during the year 24,389,086 19,796,251
Paid during the year (36,777,772) (27,346,823)
37
23 Provision for tax

Provision made during the year 358,255,364 258,442,537
Adjustment for amalgamation 1,430,545 -
Adjustment on completion of assessment for prior years (436,095,519) -
24 Revenue
See accounting policy in Note 39(B).
Pharmaceuticals 24.1 5,744,012,657 4,975,668,245

Animal Health 1,669,138,273 1,271,620,170
Consumer brands 3,590,229,865 3,350,515,901
Seeds (Local) 378,897,032 365,547,389
Seeds (Import) 167,004,135 84,979,986
Fertilizer 490,736,885 377,719,065
Cropex 278,704,343 257,549,956
12,318,723,190 10,683,600,712
Revenue is presented as net of discount, volume rebate and VAT.
24.1 Pharmaceuticals
Pharmaceuticals turnover includes sales of the following in units :
Name of unites Quantity 2014 2013
Tablets Pc 15,765,298 14,861,505

Capsules Pc 4,230,243 3,764,771
Injection Pc 4,859,101 4,531,036
Bottled products Pc 24,586,658 22,310,616
Creams Pc 5,826,452 4,868,931
Inhaler 468,831 488,029
38
25 Cost of sales
2014 2013
Consumer
In Taka Note Pharmaceuticals Animal health brands Seeds Fertilizer Cropex Total Total
Stock of finished goods as at 1 January 288,430,888 459,307,583 848,117,700 115,428,794 62,934,462 - 1,774,219,427 1,411,884,326
Cost of goods manufactured 25.1 2,533,806,364 195,174,463 550,550,803 57,115,900 341,868,188 - 3,678,515,718 3,252,956,485
Finished goods purchased 76,516,665 1,095,922,462 1,874,525,499 336,218,498 871,935 263,051,476 3,647,106,535 3,535,448,764
Cost of finished goods available for sale 2,898,753,917 1,750,404,508 3,273,194,002 508,763,192 405,674,585 263,051,476 9,099,841,680 8,200,289,575
Stock of finished goods as at 31 December (307,066,094) (672,852,853) (743,215,885) (167,931,686) (60,893,728) - (1,951,960,246) (1,774,219,427)
Inter business adjustment (197,934,274) 64,178,570 133,755,704 - - - - -
2,393,753,549 1,141,730,225 2,663,733,821 340,831,506 344,780,857 263,051,476 7,147,881,434 6,426,070,148
25.1 Cost of goods manufactured

2014 2013
Consumer
Cost of materials consumed 25.1.1 1,930,740,967 141,019,660 412,247,868 35,259,349 331,177,022 - 2,850,444,866 2,638,256,005
Manufacturing expenses 26 539,780,937 68,479,209 68,255,197 37,251,512 10,100,176 - 723,867,031 614,857,326
Quality control and development expenses 26 112,104,108 - - - - - 112,104,108 91,282,947
Cost of samples, product bonus and stock write off (43,081,884) (17,108,725) 70,047,738 7,586,298 590,990 - 18,034,417 (90,024,012)
Cost of production 2,539,544,128 192,390,144 550,550,803 80,097,159 341,868,188 - 3,704,450,422 3,254,372,266
Work in process as at 1 January 36,313,417 6,952,615 - 13,484,058 - - 56,750,090 55,334,309

Work in process as at 31 December (42,051,181) (4,168,296) - (36,465,317) - - (82,684,794) (56,750,090)
(5,737,764) 2,784,319 - (22,981,259) - - (25,934,704) (1,415,781)
2,533,806,364 195,174,463 550,550,803 57,115,900 341,868,188 - 3,678,515,718 3,252,956,485
25.1.1 Cost of materials consumed
2014 2013
Consumer
Raw and packing materials:
Opening stock 455,540,173 80,327,870 71,251,002 15,701,405 49,673,915 - 672,494,365 633,915,140
Purchase 2,135,150,833 135,200,502 454,653,441 36,039,252 382,615,556 - 3,143,659,584 2,676,835,230
Closing stock (659,950,039) (74,508,712) (113,656,575) (16,481,308) (101,112,449) - (965,709,083) (672,494,365)
1,930,740,967 141,019,660 412,247,868 35,259,349 331,177,022 - 2,850,444,866 2,638,256,005
44
26 Allocation of expenses
2014 2013
QC and
Administrative Distribution Manufacturing development
In Taka expenses expenses expenses expenses Selling expenses Total Total
Salary and wages 219,566,303 115,922,391 227,149,414 67,959,159 1,031,486,899 1,662,084,166 1,444,651,020
Traveling and conveyance 7,926,946 87,071,850 3,007,096 731,084 304,515,467 403,252,443 364,072,220
Rent and rates 12,268,330 27,829,119 56,216,029 - 46,113,307 142,426,785 144,233,065
Repair and maintenance 5,819,352 5,337,463 57,539,503 7,656,939 11,023,362 87,376,619 54,903,211
Fuel and power 5,278,711 6,361,233 184,379,283 6,729,970 9,579,672 212,328,869 164,695,224
Postage 7,949,311 2,219,440 1,575,981 166,369 25,642,668 37,553,769 29,979,576
Printing and stationery 5,022,631 14,931,107 3,446,029 744,787 16,463,865 40,608,419 36,345,733
Promotional expenses 18,291,320 - 159,026 - 859,072,387 877,522,733 863,766,887
Entertainment 6,750,933 4,925,468 4,714,973 306,275 4,060,814 20,758,463 18,958,700
Vehicle maintenance 6,656,370 51,478,905 3,198,709 1,163,975 31,718,754 94,216,713 90,968,630
Bad debts - - - - 115,886,216 115,886,216 28,818,195
Truck and handling - 91,148,195 6,995,191 14,265 85,721,785 183,879,436 157,037,573
Legal and professional charges 7,457,553 38,590 - - 3,388,552 10,884,695 6,875,904
Audit fees 500,000 - - - - 500,000 450,000
Insurance 1,019,277 7,688,418 7,152,845 282,371 8,284,770 24,427,681 22,590,387
Directors' fees 20,250 - - - - 20,250 21,526
Bank charges - 1,984,896 - - 6,836,166 8,821,062 8,344,277
Sundry expenses - 285,660 7,650 - - 293,310 549,938
Product development expenses - - 74,575 290,201 25,110,102 25,474,878 15,300,327
Training expenses 737,117 305,641 38,354 135,522 24,597,096 25,813,730 7,121,157
Depreciation 13,895,815 17,842,504 163,368,742 14,490,267 50,548,630 260,145,958 224,427,369
Amortisation 518,932 - 14,000 - 115,000 647,932 583,432
Lab chemical and apparatus - - 4,599,224 11,432,924 - 16,032,148 14,660,040
Meeting expenses 2,513,563 15,482 9,799 - 27,464,240 30,003,084 24,991,244
Share department expenses 1,321,440 - - - - 1,321,440 902,199
Export expenses - - - - 8,244,879 8,244,879 4,639,151
ISO/TQM related expenses 457,047 - 125,481 - 79,200 661,728 701,849
Market research - - - - 10,940,473 10,940,473 5,491,976
Corporate Social Responsibility expenses 1,940,183 - 95,127 - - 2,035,310 1,707,396
325,911,384 435,386,362 723,867,031 112,104,108 2,706,894,304 4,304,163,189 3,737,788,206
In Taka 2014 2013

(a) Administrative expenses 325,911,384 276,224,476
(b) Distribution expenses 435,386,362 381,621,679
(c) Selling expenses 2,706,894,304 2,373,801,777
3,468,192,050 3,031,647,932
45
27 Other income

Service charges 4,122,794 1,905,190
Dividend received 63,021,168 63,021,166
Rental income 1,807,000 2,388,000
Proceeds from sale of fixed assets 2,769,410 56,294,280
Gain/(loss) from foreign currency translations 1,705,037 544,059
Proceeds from scrap sale 7,258,369 6,800,094
Miscellaneous income 1,898,846 6,638,459
82,582,624 137,591,248
28 Net finance costs
Bank loan 210,562,823 199,782,600

Employee welfare fund 15,687,235 13,085,490
Finance lease 407,603 534,407
Security deposits 16,037,409 10,583,375
Workers' profit participation fund 24,389,086 19,796,251
XYZ 20% Zero Coupon Bonds 29,252,922 51,889,132
Other funds/borrowings 63,751 105,145
296,400,829 295,776,400
46
29 Income tax expense

Current tax expense
Current year 358,255,364 258,442,537
Adjustment for prior years - -
358,255,364 258,442,537
Deferred tax expense/(income)

Change in deferred tax liabilities (37,079,047) (8,317,837)
(37,079,047) (8,317,837)
Tax expense/(income) 321,176,317 250,124,700
30 Earnings per share
See accounting policy in Note 39(S).
30.1 Basic earnings per share
The calculation of basic earnings per share based on the profit attributable to ordinary shareholders and
weighted average number of ordinary shares outstanding is as follows:
Profit(loss) attributable to ordinary shareholders 950,713,609 764,187,906

Weighted average number of ordinary shares at 31 December 34,380,864 34,307,008
Earnings per share (Taka) 27.65 22.27
47
Earnings per share (Taka) 16.68 5.94
30.2 Diluted earnings per share
The calculation of diluted earnings per share for the year 31 December is as follows:
Attributable profit for basic earnings per share 950,713,609 764,187,906

Interest savings for conversion of bond into equity 677,944 6,779,439
Adjusted profit for diluted earnings per share 951,391,553 770,967,345
Weighted average number of shares for basic earnings per share 34,380,864 34,307,008
Incremental number of shares from conversion 246,884 455,283
Weighted average number of ordinary shares at 31 December 34,627,748 34,762,291
Diluted earnings per share (Taka) 27.47 22.18
48
31 Financial risk management
The Company has exposure to the following risks arising from financial instruments:
● Credit risk (see (ii))

● Liquidity risk (see (iii))
● Market risk (see (iv))
(i) Risk management framework
The Company's management has overall responsibility for the establishment and oversight of the
Company's risk management framework. The Company’s risk management policies are established to
identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to
monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to
reflect changes in market conditions and the Company’s activities. The Company, through its training
and management standards and procedures, aims to maintain a disciplined and constructive control
environment in which all employees understand their roles and obligations.
(ii) Credit risk
Credit risk is the risk of a financial loss to the Company if a customer or counterparty to a financial
instrument fails to meet its contractual obligations.
The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each
customer. However, management also considers the factors that may influence the credit risk of its
customer base, including the default risk of the industry and country in which customers operate.
The maximum exposure to credit risk is represented by the carrying amount of each financial asset in
the statement of financial position.
(a) Exposure to credit risk
The carrying amount of financial assets represents the maximum credit exposure. The maximum
exposure to credit risk at the reporting date was:
Carrying amount
Trade receivables* 11(a) 3,625,256,345 3,507,450,464
Other receivables 11(a) 223,350,787 183,957,640
Tender deposits 12(a) 34,646,032 48,223,224
Cash and cash equivalents 13(a) 966,996,727 801,850,966
1,224,993,546 1,034,031,830
* Trade receivables is net off of security money in Note 22(a).1.
At 31 December, the maximum exposure to credit risk for trade and other receivables by geographic
regions was as follows:
Carrying amount
Domestic 11(a) 3,753,613,811 3,618,438,160
49
Foreign receivable 11(a) 94,993,321 72,969,944
3,848,607,132 3,691,408,104
50
(b) Impairment
The aging of trade receivables that were not impaired was as follows:
Carrying amount
In Taka 2014 2013
Dues below 6 months 3,394,592,945 2,228,004,063

Dues over 6 months 787,107,273 1,699,639,653
4,181,700,218 3,927,643,716
The movement in the allowance for impairment in respect of trade receivables during the year was as
follows:
In Taka 2014 2013

Impairment loss recognised 166,305,496 54,715,166
51
(iii) Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or
another financial asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are
due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.
The Company aims to maintain the level of its cash and cash equivalents and other investments at amounts in excess of expected cash outflows on financial liabilities. The
Company also monitors the level of expected cash inflows on trade and other receivables together with expected cash outflows on trade and other payables.
Exposure to liquidity risk
The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted, and include estimated interest
payments and exclude the impact of netting agreements.
31 December 2014
Contractual cash flows
Carrying 2 months 1-5 More than
In Taka Note amount Total or less 2-12 months years 5 years
Non-derivative financial liabilities:

Short term interest bearing loans 5,572,662,756 5,572,662,756 - 5,572,662,756 - -
Long term interest bearing loans 1,042,773,576 1,042,773,576 - - 1,042,773,576 -
XYZ 20% Convertible Zero Coupon Bonds 262,689,350 262,689,350 - 262,689,350 - -
Finance lease liabilities 22,122,215 22,122,215 - 8,418,873 13,703,342 -
Trade and other payables 3,010,184,390 3,017,684,389 2,812,952,777 204,731,612
Bank overdraft 818,454,318 818,454,318 818,454,318 - - -
10,728,886,605 10,736,386,604 3,631,407,095 5,843,770,979 1,261,208,530 -
Derivative financial liabilities - - - - - -

10,728,886,605 10,736,386,604 3,631,407,095 5,843,770,979 1,261,208,530 -
51
31 December 2013
Contractual cash flows
Carrying 2 months 1-5 More than
In Taka Note amount Total or less 2-12 months years 5 years
Non-derivative financial liabilities:

Short term interest bearing loans 4,677,922,468 4,677,922,468 - 4,677,922,468 - -
Long term interest bearing loans 1,378,771,429 1,378,771,429 - - 1,378,771,429 -
XYZ 20% Convertible Zero Coupon Bonds 500,850,508 500,850,508 - 259,099,938 241,750,570 -
Finance lease liabilities 33,767,730 33,767,730 - 22,129,083 11,638,647 -
Trade and other payables 2,679,923,623 2,679,923,623 2,427,140,113 - 252,783,510 -
Bank overdraft 1,158,146,135 1,158,146,135 1,158,146,135 - - -
10,429,381,893 10,429,381,893 3,585,286,248 4,959,151,489 1,884,944,156 -
Derivative financial liabilities - - - - - -

10,429,381,893 10,429,381,893 3,585,286,248 4,959,151,489 1,884,944,156 -
52
(iv) Market risk
Market risk is the risk that any change in market prices, such as foreign exchange rates and interest rates
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 optimising the return.
a) Currency risk
The Company is exposed to currency risk to the extent that there is a mismatch between the currencies in
which purchases are denominated and the respective functional currency of the Company. The functional
currency of the Company is Bangladesh Taka (Taka/TK/BDT). The foreign currency in which these
transactions are denominated is US Dollar (USD).
Exposure to currency risk
The summary quantitative data about the Company's exposure to currency risk as at the date of consolidated
statement of financial position was as follows.
In USD 2014 2013
Trade receivables 359,721 360,735

Other receivables: 254,286 72,454
Cash and cash equivalents 764,942 384,073
Trade payables (1,516,455) (1,808,590)
Loans and borrowings (26,791,896) (6,676,032)
Net exposure (26,929,402) (7,667,360)
In Euro 2014 2013
Trade receivables - -
Other receivables: 274,020 349,686
Trade payables (178,884) (319,569)
Loans and borrowings (1,122,280) (286,385)
Net exposure (1,024,924) (254,048)
In GBP 2014 2013
Trade receivables - -
Other receivables: - -
Trade payables - -
Loans and borrowings (26,475) -
Net exposure (25,036) 1,439
The following significant exchange rates have been applied during the year:
Average rate Year-end spot rate

In Taka 2014 2013 2014 2013
USD 78.25 78.48 78.95 78.25

EUR 103.06 106.21 97.07 108.74
53
GBP 128.63 124.60 123.46 129.50
Sensitivity analysis
A reasonably possible strengthening (weakening) of foreign currency against functional currency at 31

December would have affected the measurement of financial instruments denominated in a foreign currency
and affected equity and profit or loss by the amounts shown below. This analysis assumes that all other
variables, in particular interest rates, remain constant and ignore any impact of forecast sales and purchase.
Equity, net of tax

Profit/(loss) increase/(decrease)
Effect in Taka Strengthening Weakening Strengthening Weakening
31 December 2014
USD (5% movement) 106,303,815 (106,303,815) 106,303,815 (106,303,815)
EUR (5% movement) 4,974,548 (4,974,548) 4,974,548 (4,974,548)
GBP (5% movement) 154,541 (154,541) 154,541 (154,541)
31 December 2013
USD (5% movement) 29,998,546.00 (29,998,546) 29,998,546 (29,998,546)
EUR (5% movement) 1,381,218.29 (1,381,218) 1,381,218 (1,381,218)
GBP (5% movement) (9,319.95) 9,320 (9,320) 9,320
b) Interest rate risk
Interest rate risk is the risk that arises due to changes in interest rates on borrowings. At present the
company has no borrowings which is subject to interest rate risk.
Exposure to interest rate risk
The interest rate profile of the Company's interest-bearing financial instruments as at the date of
consolidated statement of financial position date is as follows.
Nominal Amount
Fixed rate instruments

Financial assets
Term deposit 125,886,613 115,574,050
Financial liabilities - -
Bank overdraft 818,454,318 1,158,146,135
Loans and borrowings 5,916,571,029 5,059,890,494
125,886,613 115,574,050
Variable rate instruments -

Financial liabilities
Offshore loan 2,222,233,034 562,049,007
2,222,233,034 562,049,007
54
v) Financial instruments - Fair values and financial risk management
Accounting classifications and fair values
The following table shows the carrying amounts and fair values, where applicable, of financial assets and financial liabilities, including their levels in the fair value hierarchy. It does not include fair value information for financial
assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.
31 December 2014
Carrying amount Fair value
Fair value - Held to maturity Loans and Available for Other financial
Total Level 1 Level 2 Level 3 Total
Held-for- Designated hedging receivables sale liabilities
In Taka Note trading at fair value instruments
Financial assets measured at fair value - - - - - - - - - - - -

Equity securities 206,570,500 206,570,500
206,570,500
Financial assets not measured at fair value
Investment 8(a) 125,886,613 598,798,039
Trade and other receivables 11(a) - - - - 4,053,338,744 - - 4,053,338,744 - - - -
Tender deposits 12(a) - - - - 34,646,032 - - 34,646,032 - - - -
Cash at banks 13(a) - - - - 404,809,161 - - 404,809,161 - - - -
- - - 125,886,613 4,492,793,937 598,798,039 - 4,492,793,937 - - - -
Financial liabilities measured at fair value - - - - - - - - - - - -
Financial liabilities not measured at fair value
Employee benefits 17(a) - - - - - - 455,997,727 455,997,727 - - - -

Short term interest bearing loans #REF! 5,572,662,756 5,572,662,756
Long term interest bearing loans 18(a) 1,042,773,576 1,042,773,576
XYZ 20% Convertible Zero Coupon Bo #REF! 262,689,350 262,689,350
Finance lease liabilities #REF! 22,122,215 22,122,215
Trade and other payables #REF! 3,010,184,390 3,010,184,390
Bank overdraft 20(a) 818,454,318 818,454,318
- - - - - - 11,184,884,332 11,184,884,332 - - - -
55
31 December 2013
Carrying amount Fair value
Fair value - Held to maturity Loans and Available for Other financial
Total Level 1 Level 2 Level 3 Total
Held-for- Designated hedging receivables sale liabilities
In Taka Note trading at fair value instruments
Financial assets measured at fair value - - - - - - - - - - - -

Equity securities 152,016,098 152,016,098
152,016,098
Financial assets not measured at fair value
Investment 8(a) - 614,275,107
Trade and other receivables 11(a) - - - - 3,896,139,716 - - 3,896,139,716 - - - -
Tender deposits 12(a) - - - - 48,223,224 - - 48,223,224 - - - -
Cash at banks 13(a) - - - - 394,574,233 - - 394,574,233 - - - -
- - - - 4,338,937,173 614,275,107 - 4,338,937,173 - - - -
Financial liabilities measured at fair value - - - - - - - - - - - -
Financial liabilities not measured at fair value
Employee benefits 17(a) - - - - - - 353,101,757 353,101,757 - - - -

Short term interest bearing loans 21.1 4,677,922,468 4,677,922,468
Long term interest bearing loans 18(a) 1,378,771,429 1,378,771,429
XYZ 20% Convertible Zero Coupon Bo 21.2 500,850,508 500,850,508
Finance lease liabilities 21.2 33,767,730 33,767,730
Trade and other payables 22 2,679,923,623 2,679,923,623
Bank overdraft 20 1,158,146,135 1,158,146,135
- - - - - - 10,782,483,650 10,782,483,650 - - - -
The Company has not disclosed the fair values for financial instruments because their carrying amounts are a reasonable approximation of fair values.
56
32 Commitments
On the date of statement of financial position, the Company was enjoying unfunded credit facilities from the
following banks:
In Taka 2014 2013

AB Bank Limited 344,550,000 31,736,000
BRAC Bank limited 205,094,000 13,062,868
Commercial Bank of Ceylon 43,144,868 39,277,294
The Hongkong Shanghai Banking Corporation Limited 168,802,081 85,533,647
Dutch Bangla Bank Limited 23,230,028 36,863,373
One Bank Limited 552,299 -
1,432,607,105 504,225,220
33 Contingencies
In Taka 2014 2013

Shipping Guarantee
Standard Chartered Bank Limited 6,749,633 7,839,810
6,749,633 7,839,810
Bank Guarantee
Standard Chartered Bank Limited 6,274,732 3,000,000
Bank Asia Limited 3,429,930 3,152,866
11,231,112 508,099,754
34 Capital expenditure
In Taka 2014 2013

i) Contracted but not approved for - -
ii) Approved but not contracted for 226,780,511 64,730,141
57
35 Production capXYZ ty
CapXYZ ty in units pack

per 8hr/month Utilization
2014 2013 2014 2013
Pharmaceuticals, Consumer Brand and 5,650,000 5,650,000 103% 99%

Animal Health
36 Related parties
a) Transactions with key management personnel
(i) Loans to directors
During the year, no loan was given to the directors of the Company.
(ii) Key management personnel compensation
Key management personnel compensation comprised the following:
In Taka 2014 2013
Salary 22,724,500 20,142,200

Benefit 9,018,674 8,096,090
Provident fund contribution 1,740,420 1,542,870
33,483,594 29,781,160
Company’s key management personnel includes the Company's directors. Compensation includes salaries, non-
cash benefits, and contributions to a post employment defined benefit plan.
58
(b) Other related party transactions
Balance outstanding as at
Transactions during the year ended 31 December 31 December
In Taka 2014 2013 2014 2013 2014 2013
(Purchase)/Revenue Working capital financing
XYZ Formulations Limited (1,285,452,679) (1,170,433,319) 655,232,123 465,707,400

(137,299,218) (363,250,594)
689,911
XYZ Salt Limited (11,106,730) (9,417,085) 108,432,200 96,361,399
379,630,573 354,571,804
43,411
Apex Leathercraft Limited* - - - 5,633,134 - 99,543,253
Flyban Insecticides Limited - - 10,353 6,978 1,024,661 1,014,308
XYZ Pure Flour Limited (30,121,324) (16,451,185) 172,459,704 53,892,014 10,930,186 44,534,754
XYZ Foods Limited (121,885,462) (50,527,679) 178,353,487 113,449,958
729,057,993 746,527,424
95,318
XYZ Agrochemicals Limited - - 16,897 51,940 246,099 229,202
Creative Communication Limited - - 30,519,809 30,597,762 12,452,424 10,723,821
XYZ Motors Limited 175,481 - 82,856,119 165,581,800 60,943,318 39,369,746
Premiaflex Plastics Limited (213,513,508) (134,338,310) 75,397,456 56,384,428 196,721,432 210,564,943
XYZ Logistics Limited (6,013,627) (5,115,237) 364,037,514 475,158,225
2,734,915,043 2,508,800,927
2,605,890
XYZ Edible Oils Limited (7,500) - 3,760,812 1,776,071 2,914,561 (820,356)
XYZ Healthcare Limited - - 101,307,353 108,035,187 144,173,139 42,890,842
Tetley XYZ (Bangladesh) Limited - - 73,512,617 1,938,056 47,203,318 442,622
Asian Consumer Care (Pvt.) Limited - - 1,113,131 2,519,010 7,893,516 8,205,086
XYZ Godrej Agrovet (Pvt.) Limited - - - - 879,726 879,726
Stochastic Logic Limited - - 3,411,794 1,549,047 6,129,533 8,767,739
XYZ Chemicals Limited - - 3,870,598 - 3,850,959 -
59
*Apex Leathercraft Limited was amalgamated with XYZ Limited on 3 December 2014. On that date Assets and Liabilities were as follows:
Accumulated
In Taka Cost depreciation Carrying value
Assets:
Land and Land development 225,000,000 - 225,000,000
Building 95,304,141 (25,064,311) 70,239,830
Road and other construction 7,032,636 (1,909,304) 5,123,332
Internal decoration 11,248,179 (5,660,733) 5,587,446
Electrical and other appliances 598,225 (503,526) 94,699
Generator & Lift 16,305,843 (9,864,107) 6,441,736
Advance Income tax 3,794,523
Security deposit 210,000
Other receivable 784,700
Total Assets 317,276,266
Liabilities:
Accrued expenses 23,000
Income tax payable 1,430,545
Inter company receivable/ payables 93,632,920
Total Liabilities 95,086,465
60
37 Other disclosures
37.1 Number of employees
During 2014, number of regular employees receiving remuneration of Tk. 36,000 or above per annum
was 6,930 (2013: 4,955).
37.2 Comparatives
Previous year's figures have been rearranged, whenever considered necessary to conform to the current
year's presentation.
37.3 Subsequent events
The Directors of XYZ Limited have entered into Agreements on 24 April 2015 whereby S. C. Johnson
& Son, Inc. a corporation incorporated under the laws of the State of Wisconsin, USA has purchased the
Brands in the categories of Insect Control, Air Care and Toilet Care Products on mutually beneficial
terms at a price of Taka 250.5 crore and that XYZ Limited will continue to be the Distributor of the
Products for a period of 5 years.
In addition, the Board of Directors in their meeting held on ----- April 2014 have recommended cash
dividend @ ----- per share of Taka 10 each aggregating to Taka ------ for the year ended 31 December
2014 subject to approval of the shareholders' in the Annual General Meeting scheduled to be held on
----2015. The financial statements for the year ended 31 December 2014 do not include the effect of the
cash dividend which will be accounted for in the period when shareholders' right to receive payment is
established.
There are no other events identified after the date of the statement of financial position which require
adjustment or disclosure in the accompanying financial statements.
38 Basis of measurement
The financial statements have been prepared on historical cost basis except for certain assets which are
stated either at revalued amount or fair market value as explained in the accompanying notes.
61
39 Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in these
financial statements.
Set out below is an index of the significant accounting policies, the details of which are available on the
following pages:
A. Basis of consolidation
B. Revenue
C. Foreign currency
D. Employee benefits
E. Finance income and finance costs
F Income tax
G. Investment
H. Inventories
I. Property, plant and equipment
J. Intangible assets
K. Leased Assets
L. Financial instruments
M. Share capital
N. Provisions
O. Impairment
P. Going concern
Q. Contingencies
R. Statement of cash flows
S. Earnings per share (EPS)
T. Events after the reporting period
(B) Revenue
(i) Sale of goods
Revenue is recognized upon invoicing the customers for goods sold and delivered. Sales are
accounted for net of value added tax, trade discount and allowances (if any). In case of cash
delivery, revenue is recognized when delivery is made and cash is received by the Company.
62
(ii) Revenue arising from services
Revenue from services rendered is recognized in income statement in proportion to the stage of
completion of the transaction at the reporting date.
(iii) Revenue arising from commission
When the Group acts in the capacity of an agent rather than as the principal in a transaction, the
revenue is recognized in the net amount of commission earned by the Group.
(iv) Dividend income
Dividend income is recognized when right to receive payment of such dividend is established.
(v) Allocation of common service costs
Common costs and facilities are allocated to entities based on common cost sharing agreement
and followed consistently.
(C) Foreign currency
Foreign currency transactions are accounted for at exchange rate prevailing on the date of transaction.
Monetary assets and liabilities denominated in foreign currencies at reporting date are translated at rates
ruling at the statement of financial position date. All exchange differences are charged / credited to the
statement of comprehensive income.
(D) Employee benefits
(i) Defined contribution plan (provident fund)
The Company operates a recognized provident fund scheme where employees contribute 10% of
their basic salary with equal contribution by the Company. The provident fund is considered as
defined contribution plan being managed by a Board of Trustees.
(ii) Defined benefit plan (gratuity)
The Company operates an unfunded gratuity scheme, provision in respect of which is made
annually covering all permanent employees. The Employees' Gratuity Fund is being considered as
defined benefit plan.
Defined benefit plan is a retirement benefit plan under which amounts to be paid as retirement
benefits are determined by reference to employees' earnings and year of services. The rate used to
discount post employment benefit obligations is determined by reference to the rate stated in the
actuarial report. Actuarial valuation of gratuity scheme has been made in 2013 to assess the
adequacy of the liabilities provided for the schemes.
(iii) Workers' profit participation fund
The Company had created funds for workers as 'Workers' Profit Participation Fund' and 5% of the
profit before charging such expense have been transferred to this fund.
63
(E) Finance income and finance costs
The Company’s finance income and finance costs include:

• interest income; and
• interest expense;
Interest income or expense is recognised using the effective interest method.
(F) Income tax
Income tax expense comprises current and deferred tax. It is recognised in profit or loss except to the
extent that it relates to items recognised directly in equity or in OCI (Other Comprehensive Income).
(i) Current tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the
year and any adjustment to tax payable or receivable in respect of previous years. It is measured
using tax rates enacted or substantively enacted at the reporting period. The applicable tax rate for
the Company is currently 27.5%
(ii) Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognised for:
- temporary differences on the initial recognition of assets or liabilities in a transaction that is not a
business combination and that affects neither accounting nor taxable profit or loss;
- taxable temporary differences arising on the initial recognition of goodwill.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible
temporary differences to the extent it is probable that future taxable profits will be available
against which they can be used. Deferred tax assets are reviewed at each reporting date and are
reduced to the extent that it is no longer probable that the related tax benefit will be realised; such
reductions are reversed when the probability of future taxable profits improve.
(G) Investment in shares
In the separate financial statements of the Company, investment in subsidiaries, associates and joint
ventures has been carried at cost as per Bangladesh Accounting Standard 27 Separate Financial
Statements. All other investments categorized under 'Investment available for sale' and 'Held-to-
maturity' are carried at fair value.
In the consolidated financial statements of XYZ Limited, following valuation principles have been
used:
Investments in subsidiaries - Investment in subsidiaries has been accounted for as per Bangladesh
Financial Reporting Standard 10 Consolidated Financial Statements. The investment is eliminated in
full against the equity of acquiree measured at fair value at the date of acquisition as per Bangladesh
Financial Reporting Standard 3 Business Combinations.
Investments available for sale - These are valued at fair value and the change in fair value of
investments available for sale is presented in comprehensive income statement and in statement of
financial position. This is as per Bangladesh Financial Reporting Standard 7 Financial Instruments
Disclosures, Bangladesh Accounting Standard 32 Financial Instruments: Presentation and Bangladesh
Accounting Standard 39 Financial Instruments: Recognition and Measurement.
64
Investments available for sale - These are valued at fair value and the change in fair value of
investments available for sale is presented in comprehensive income statement and in statement of
financial position. This is as per Bangladesh Financial Reporting Standard 7 Financial Instruments
Disclosures, Bangladesh Accounting Standard 32 Financial Instruments: Presentation and Bangladesh
Accounting Standard 39 Financial Instruments: Recognition and Measurement.
Associates and joint ventures - Associates are those entities in which XYZ Limited has significant
influence, but not control, over the financial and operating policies. Joint ventures are those entities
over whose activities XYZ Limited has joint control, established by contractual agreement and
requiring unanimous consent for strategic, financial and operating decisions. Associates and joint
ventures are accounted for using the equity method (equity accounted investees). The consolidated
financial statements include the XYZ Limited's share of the income and expenses of equity accounted
invested, after adjustments to align the accounting policies with those of the XYZ Limited, from the date
that significant influence or joint control commences until the date that significant influence or joint
control ceases. This is in consistent with Bangladesh Financial Reporting Standard 11 Joint
Arrangements and Bangladesh Financial Reporting Standard 12 Disclosure of Interests in other
Entities.
Amalgamation - All assets, liabilities, income and expenditure of ABC Limited (transferor company)
have been amalgamated with assets, liabilities, income and expenditure of XYZ Ltd. (transferee
company). Investment held by XYZ Limited in transferor company is eliminated against the share
capital of Apex Leathercraft Limited. Transactions between transferor and transferee companies have
also been eliminated.
Issuance of shares pursuant to the Scheme of Amalgamation -

As per verdict of the Honourable High Court, necessary shares of XYZ Limited has been allotted in
favour of the shareholders of the Apex Leathercraft Limited after having approval from regulatory
authorities on the basis of the scheme of amalgamation. Brief scheme of amalgamation as approved by
the Honourable High Court on 17 November 2014 are as follows:
Effective date of amalgamation : The judgement and order has been taken effect after filing of the
certified copy of the same to the Registrar of Joint Stock Companies and Firm on 3 December 2014.
Purchase consideration: 2.8 ordinary shares of Taka 10 each in XYZ Limited has been issued in
exchange of 1 (one) ordinary share of Taka 100 each in Apex Leathercraft Limited. Transferee company
has issued in total 280 shares of Taka 10 each in favour of shareholders of transferor company.
Date of allotment: Allotment has been made after obtaining approval from Bangladesh Securities and
Exchange Commission (BSEC) and Registrar of Joint Stock Companies and Firm.
(H) Inventories
Inventories except materials in transit are measured at the lower of cost and net realisable value. The
cost of inventories is based on the weighted average method, and includes expenditure incurred in
acquiring the inventories, production or conversion costs and other costs incurred in bringing them to
their existing location and condition. In the case of manufactured inventories and work-in-progress, cost
includes an appropriate share of production overheads based on normal operation capacity.
Net realizable value is the estimated selling price in the ordinary course of business, less the estimated
costs of completion and selling expenses.
Stock- in-transit represents the cost incurred up to the date of the statement of financial position for the
items that were not received till to the date of reporting. Inventory losses and abnormal losses are
recognized as expenses.
65
(I) Property, plant and equipment
(i) Recognition and measurement
Items of property, plant and equipment are measured at cost or revaluation less accumulated
depreciation. The items of property, plant and equipment were revalued in the year 2004, 2007
and 2010 by the firm of professional valuers on the basis of fair market value. When revalued
assets are disposed off, the amounts included in the revaluation surplus are transferred to retained
earnings. Capital work-in-progress represents the cost incurred for acquisition and / or
construction of items of property, plant and equipment that were not ready for use at the end of
2014 and these are stated at cost.
Cost includes expenditure that is directly attributable to the acquisition of asset. The cost of self
constructed asset includes the cost of material, direct labour and any other costs directly
attributable to bringing the assets to the working condition for their intended use.
Subsequent to initial recognition cost of replacing part of an item of property, plant and equipment
is recognized in the carrying amount of the item if it is probable that the future economic benefits
embodied within the part will flow to the Company and its cost can be measured reliably. All
other repair and maintenance expenses are charged to income statement as it is incurred.
(ii) Depreciation
All items of property, plant and equipment have been depreciated on straight line basis.
Depreciation on additions are charged at 50% of normal rates only in the year of acquisition and
no depreciation is charged in the year of disposal. Depreciation is charged at the rates varying
from 2.5% to 20% depending on the estimated useful lives of assets. No depreciation is charged
for land and capital work-in-progress. The Company is following this policy consistently from
past years.
The revalued items of property, plant and equipment are depreciated by writing off their revalued
amount at the date of revaluation over their remaining estimated useful lives.
The estimated useful lives for the current and comparative years are as follows:
In Year 2014 2013

Building 40 40
Plant and machinery 10 10
Furniture and fixture 10 10
Electrical and other office appliances 10 10
Office machinery 5 10
Vehicles 5 5
Depreciation methods, useful lives and residual values are reviewed at each reporting date.
Estimation of useful life of office equipment has been revised from 10 years to 5 years during the
year 2014.
(iii) Capitalization of borrowing costs
Borrowing cost relating to acquisition of fixed assets is capitalized as per Bangladesh Accounting
Standard (BAS) - 23, Borrowing costs at the weighted average cost of borrowings. However,
capitalization of borrowing costs is ceased when acquisition of relevant asset is completed.
66
(iv) Impairment
The carrying amount of the entity's non-financial assets, other than inventories and deferred tax
assets (considered as disclosed separately under respective accounting standards), are reviewed at
each reporting date to determine whether there is any indication of impairment. If any such
indication exists, the asset's recoverable amount is reestimated. However, no such conditions that
might be suggestive of a heightened risk of impairment of assets existed at the reporting date.
(J) Intangible asset
(i) Goodwill
Goodwill represents the excess of the cost of the acquisition over the Group's interest in the net
value of the identifiable assets and liabilities of the acquiree on the date of acquisition.
(ii) Software
Software that is acquired by the Group, which has finite useful life, is measured at cost less
accumulated amortization and accumulated impairment losses.
Subsequent expenditure is capitalized only when it increases the future economic benefits
embodied in the specific assets to which it relates.
(iii) Amortization
Amortization is charged in the income statement on a straight line basis over the estimated useful
lives of intangible assets other than goodwill. Amortization on additions are charged at 50% of
normal rates only in the year of acquisition. Amortization is charged at the rates of 10-20%
depending on the estimated useful lives of assets and no amortization is charged in the year of
disposal.
The estimated useful life for the current intangible asset is as follows:
Useful life Normal rate

Software 5-10 years 10-20 Percent
Amortization methods, useful lives and residual values are reviewed at each reporting date.
(K) Leased assets
(i) Finance lease
Leases in terms of which the Company assumes substantially all the risks and rewards of
ownership are classified as finance leases. Upon initial recognition, the leased asset is measured at
an amount equal to the lower of its fair value and the present value of the minimum lease
payments. Subsequent to initial recognition, the asset is accounted for in accordance with the
accounting policy applicable to that asset.
Depreciation
Depreciation is charged according to the policy applicable for the owned assets of the Company.
Lease payments
Minimum lease payments made under finance leases are apportioned between the finance expense
and the reduction of the outstanding liability. The finance expense is allocated to each period
during the lease term so as to produce a constant periodic rate of interest on the remaining balance
of the liability. 67
Minimum lease payments made under finance leases are apportioned between the finance expense
and the reduction of the outstanding liability. The finance expense is allocated to each period
during the lease term so as to produce a constant periodic rate of interest on the remaining balance
of the liability.
(ii) Operating lease
Payments made under operating leases are recognized in income statement on a straight line basis
over the term of the lease.
(L) Financial instruments
Non-derivative financial instruments comprise investments in shares and term deposit, trade
receivables, cash and cash equivalents, trade payables and interest-bearing borrowings.
(i) Financial assets
The Company initially recognises receivables and deposits issued on the date when they are
originated. All other financial assets are initially recognised on the trade date.
The Company derecognises a financial asset when the contractual rights to the cash flows from the
asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which
substantially all of the risks and rewards of ownership of the financial asset are transferred, or it
neither transfers nor retains substantially all of the risks and rewards of ownership and does not
retain control over the transferred asset.
The Company's financial assets comprise trade and other receivables, investment in shares and
term deposit and cash and cash equivalents.
Trade and other receivables
Trade receivables are recognized at original invoiced amount. Receivables are stated at netted off
provision for bad and doubtful debt and written off. Provision is made in the financial statements
considering the uncertainty of recovery at the date of the statement of financial position and bad
debts are written off when the debts became finally irrecoverable based on assessment and
judgment made by senior management of the Company.
Investment in shares-other than the investment in subsidiaries, associates and joint ventures
Investment in shares are non-derivative financial assets that are designated as available-for-sale.
Initially they are recognized at cost and subsequent to initial recognition, they are measured at fair
value and changes therein, other than impairment losses and foreign currency differences on
available-for-sale are recognized in other comprehensive income and presented in fair value
reserve in equity. When an investment is derecognized, the gain or loss accumulated in equity is
reclassified to profit or loss.
Investment in Term Deposit
The Company has the positive intent and ability to hold term deposit to maturity, and as such
financial assets are classified as held to maturity. Held-to-maturity financial assets are recognized
at fair value plus any directly attributable transaction cost.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and all call deposits with original maturities of
three months or less. Bank overdrafts that are repayable on demand and form an integral part of
the Company's cash management are included as a component of cash and cash equivalents for the
purpose only of the statement of cash flows.
68
(ii) Financial Liabilities
The Company initially recognises financial liabilities on the transaction date at which the
Company becomes a party to the contractual provisions of the liability.
The Company derecognises a financial liability when its contractual obligations are discharged or
cancelled, or expired.
The Company's financial liabilities comprise trade and other payables and interest - bearing
borrowings.
The Company recognises such financial liability when its contractual obligations arising from past
events are certain and the settlement of which is expected to result in an outflow from the entity of
resources embodying benefits.
(vi) Trade payables
Trade payables are recognized at fair value.
(vii) Interest-bearing borrowings
Interest-bearing borrowings are recognized initially at fair value less attributable transaction costs.
Subsequent to initial recognition, interest-bearing borrowings are stated at amortized cost using
the effective interest method less any impairment losses.
(viii) XYZ 20% Convertible Zero Coupon Bonds (ZCB)
Zero Coupon Bonds are recognized initially at fair value less attributable transaction costs.
Subsequent to initial recognition, ZCBs are stated at amortized cost using the effective interest
method.
M. Share capital
Ordinary shares are classified as equity. Incremental cost directly attributable to the issue of ordinary
shares are recognized as a deduction from equity, net of any tax effect.
N. Provisions
A provision is recognized in the statement of financial position when the Company has a legal or
constructive obligation as a result of a past event, it is probable that an outflow of economic benefits
will be required to settle the obligation and a reliable estimate can be made of the amount of the
obligation.
O. Impairment
(i) Financial assets
Financial assets are assessed at each reporting date to determine whether there is objective
evidence of impairment. Objective evidence that financial assets are impaired includes:
- default or delinquency by a debtor;

- restructuring of an amount due to the Company on terms that the Company would not consider
otherwise;
- indications that a debtor or issuer will enter bankruptcy;
- adverse changes in the payment status of borrowers or issuers; or
- observable data indicating that there is measurable decrease in expected cash flows from a
company of financial assets.
69
observable data indicating that there is measurable decrease in expected cash flows from a
company of financial assets.
The Company considers evidence of impairment for these assets at both an individual asset and a
collective level. All individually significant assets are individually assessed for impairment. Those
found not to be impaired are then collectively assessed for any impairment that has been incurred
but not yet individually identified. Assets that are not individually significant are collectively
assessed for impairment. Collective assessment is carried out by grouping together assets with
similar risk characteristics.
In assessing collective impairment, the Company uses historical information on the timing of
recoveries and the amount of loss incurred, and makes an adjustment if current economic and
credit conditions are such that the actual losses are likely to be greater or lesser than suggested by
historical trends.
An impairment loss is calculated as the difference between an asset’s carrying amount and the
present value of the estimated future cash flows discounted at the asset’s original effective interest
rate. Losses are recognised in profit or loss and reflected in an allowance account. When the
Company considers that there are no realistic prospects of recovery of the asset, the relevant
amounts are written off. If the amount of impairment loss subsequently decreases and the decrease
can be related objectively to an event occurring after the impairment was recognised, then the
previously recognised impairment loss is reversed through profit or loss.
(ii) Non-financial assets
At each reporting date, the Company reviews the carrying amounts of its non-financial assets
(other than deferred tax assets) to determine whether there is any indication of impairment. If any
such indication exists, then the asset’s recoverable amount is estimated.
For impairment testing, assets are grouped together into the smallest group of assets that generates
cash inflows from continuing use that are largely independent of the cash inflows of other assets
or CGUs (Cash-generating units).
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less
costs to sell. Value in use is based on the estimated future cash flows, discounted to their present
value using a pre-tax discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset or CGU.
An impairment loss is recognised in profit or loss if the carrying amount of an asset or CGU
exceeds its recoverable amount.
P. Going concern
During the year under review, XYZ Logistics Limited, a subsidiary of XYZ Limited, incurred a net
loss of Tk. 1,027,288,608 making an accumulated loss at the reporting date to Tk. 4,472,869,073. The
Company's current liabilities exceeded the current assets by Tk. 4,284,491,475at the reporting date. The
paid up capital of the Company at the closing date was Tk. 360,000,000. Its dues to banks and finance
lease Company on the same date was Tk. 2,944,147,920. The management is, however, confident that
the Company will continue in operational existence for a foreseeable future on the basis of continued
support from the parent Company, XYZ Limited and improved trading conditions.
During the year under review, XYZ Foods Limited, a subsidiary of XYZ Limited, incurred a net loss
of Tk. 158,139,232 making an accumulated loss at the balance sheet date amounting to Tk.
1,090,002,749 and the Company's current liabilities exceeded the current assets by Tk. 1,341,573,534.
The paid up capital of the Company at the closing date was Tk. 40,000,000, where as its dues to Banks
on the same date was Tk. 665,670,040. The management is, however, confident that the Company will
continue in operational existence for a foreseeable future on the basis of continued support of the
Company's banks and shareholders.
70
In view of the continued support and assurance from the Group and major shareholders, management
believes that it remains appropriate to prepare these financial statements on a going concern basis.
Q. Contingencies
Contingent liability
Contingent liability 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 entity.
The Company discloses contingent liability in the financial statements. A provision is recognised in the
period in which the recognition criteria of provision is met.
Contingent asset
Contingent asset 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 entity.
The Company does not recognise contingent asset.
R. Statement of cash flows
Cash flows from operating activities are presented under direct method as per BAS 7: Statement of cash
flows.
S. Earnings per share (EPS)
The Company and the Group (which is made up of XYZ Limited and its subsidiaries and associates)
present its basic earnings per share (EPS) for its ordinary shares. Basic EPS is calculated by dividing the
profit or loss attributable to ordinary shareholders of the Company / Group by the weighted average
number of ordinary shares outstanding during the year. Diluted EPS is determined by adjusting the
profit or loss attributable to the ordinary shareholders and the weighted average number of ordinary
shares outstanding for the effects of all dilutive potential ordinary shares. This has been shown on the
face of income statement and computation of EPS is stated in note 30.
T. Events after the reporting period
Events after the reporting period that provide additional information about the Company's position at
the reporting date or those that indicate the going concern assumption is not appropriate are reflected in
the financial statements. Events after the reporting period that are not adjusting events are disclosed in
the notes when material.
71

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XYZ Ltd

Report and financial statements as at and

1.2 Nature of business

2.1 Statement of compliance

2.2 Basis of measurement

2.3 Changes in accounting policies

(a) BFRS 13: Fair Value Measurement

(c) BFRS 10: Consolidated Financial Statements

(d) BFRS 11: Joint Arrangements

(e) BFRS 12: Disclosure of Interests in Other Entities

(f) Presentation of items of Other Comprehensive Income (Amendments to BAS 1)

(g) Recoverable Amount Disclosures for Non-Financial Assets

2.4 Functional and presentational currency

2.5 Use of judgments and estimates

2.7 Reporting period

2.8 Comparative information

3. Significant accounting policies

3.1 Property, plant and equipment

(a) Recognition and measurement

(b) Subsequent costs

Office furniture 10%

3.2 Intangible assets

(a) Recognition and measurement

(b) Subsequent costs

3.3 Financial instruments

3.3.1 Financial assets

(a) Trade and other receivables

(b) Cash and cash equivalents

3.3.2 Financial liabilities

(a) Financial assets

(b) Non-financial assets

3.6 Employee benefits

3.6.1 Short-term employee benefits

3.6.2 Long-term employee benefits

(a) Defined contribution plan (provident fund)

(b) Defined benefit plan (gratuity)

3.6.3 Workers' Profit Participation Fund (WPPF)

3.9 Foreign currency transactions

3.10 Advances, deposits and prepayments

Deposits are measured at payment value.

3.11 Revenue recognition

3.12 Finance income and expenses

Interest income and expenses are recognised on accrual basis.

3.13 Operating lease

3.14 Income tax

(a) Current tax

(b) Deferred tax

3.16 Events after reporting date

Report on the Financial Statements

Management's Responsibility for the Financial Statements

Report on Other Legal and Regulatory Requirements

Statement of financial position

In Taka Note 31 December 2014 31 December 2013

Inventories 10 2,961,175,971 2,553,330,342

Bank overdraft 20 427,836,789 741,441,244

The annexed notes 1 to 40 form an integral part of these financial statements.

________________ ________________ ________________

As per our report of same date.

Statement of profit or loss

###