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ATLAS POWER LIMITED

F!NANCIAL STATEMENTSFOR THE YEAR ENDED

30 JUNE 2014

Emst & Young Ford Rhodes Sidat HyderCharter€d Accounlantsilall View Building, 4- Bank SquareP.O- 8ox No. 1O4, Laho.e 540OOPatistan

Teli +e242 3721 15ar-r"Fax: +92423727I53O &39eyfrsh.lhr@pk.ey.cqlley-corrr/ot

AUDITORS'REPORT TO THE MEMBERS

We have audited the annexed balance sheet of Atlas Power Limited (the Company) as at 30 June2OL4 and the related profit and loss account, cash flow statement and statement of changes in equitytogether with the notes forming part thereof, for the year then ended and we state that we haveobtained all the information and explanations which, to the best of our knowledge and belief, werenecessary for the purposes of our audit.

It is the responsibility of the Company's management to establish and maintain a system of internalcontrol, and prepare and present the above said statements in conformity with the approvedaccounting standards and the requirements of the Companies Ordinance, 1984. Our responsibility isto express an opinion on these statements based on our audit.

We conducted our audit in accordance with the auditing standards as applicable in Pakistan. Thesestandards require that we plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free of any material misstatement. An audit includes examining on a testbasis, evidence supporting the amounts and disclosures in the above said statements. An audit alsoincludes assessing the accounting policies and significant estimates made by management, as well as,evaluating the overall presentation of the above said statements. We believe that our audit provides areasonable basis for our opinion and, after due verification, we report that:

(a) in our opinion, proper books of account have been kept by the company as required by theCompanies Ordinance, 1984;

(b) in our opinion:

i) the balance sheet and profit and loss account together with the notes thereon have beendrawn up in conformity with the Companies Ordinance, 1984, and are in agreement with thebooks of account and are further in accordance with accounting policies consistently applied,except for the changes as stated in Note 2.3 with which we concur;

ii) the expenditure incurred during the year was for the purpose of the company,s business;and

iii) the business conducted, investments made and the expenditure incurred during the yearwere in accordance with the objects of the Company;

(c) in our opinion and to the best of our information and according to the explanations given to us,the balance sheet, profit and loss account, cash flow statement and statement of changes inequity together with the notes forming part thereof conform with approved accounting standardsas applicable in Pakistan, and, give the information required by the companies ordinance, 19g4,in the manner so required and respectively give a true and fair view of the state of the Company,saffairs as at 30 June 2014 and of the profit, cash flows and changes in equity for the year thenended; and

(d) in our opinion, no Zakat was deductible at source under the Zakat and Ushr Ordinance, 19g0(XVlll of 1980).

L*v^\--. (,.-t fuJ \' J-,- \) \Chartered Accountants

Audit Engagement Partner: Farooq Hameed

Lahore: 12 August 2014

ATLAS POWER LIMITEDBALANCE SHEETAS AT JUNE 30,2014

ASSETS

NON-CURRENT ASSETS

Property, plant and equipmentlntangible assetsLong-term deposit

CURRENT ASSETS

lnventory of fuelTrade debtsAdvancesShort{erm prepaymentsOther receivablesTaxation-netlnvestmentCash and bank balances

TOTAL ASSETS

EQUITY AND LIABILITIES

SHARE CAPITAL AND RESERVESAuthorized share capital

500,000,000 (2013:500,000,000) ordinaryshares of Rs. 10/- each

lssued, subscribed and paid-up capital474,000,000 (201 3: 474,000,000) ordinaryshares of Rs. 10/- eachGeneral reserveUn-appropriated profit

NON.CURRENT LIABILITIES

Long term loansLong term depositsDefened liabilities

CURRENT LIABILITIES

Trade and other payablesAccrued mark-upShort term borrowingsCurrent portion of long term loans

CONTINGENCIES AND COMMITMENTS

Note 2013

Restated------ (Rupees in '000') ---

567

16,254,0996,178

32416,260,60'l

8I1011

't2't314

47 4,02511,084,686

9,237280,081650,852

5,289336,9851

't2,994,502

____?9i!!t_9!_ ____25f13225_

15

5,000,000

4,740,000530,000

2,690,0887,960,088

5,000,000

4,740,000530,000

2,994,9828,264,982

t617't8

2016

't9

8,911,94978'l

't18,924,567

6,346,948380,132

4,354,2801

12,370,448 7,',t99,244

lrL \\\tY .!1\',

'17 ,052,586

442,3266,548,572

'148,569

81,954zoJ,60z

721

815,296

8,620,639

10,208,999

29,255,103 25,673,225

"\

^1 |

21

Chairman/Director

ATLAS POWER LIMITEDPROFITAND LOSS ACCOUNTFOR THE YEAR ENDED JUNE 30, 2014

Sales - net

Cost of sales

Gross profit

Administrative expenses

Exchange gain / ( loss) - net

Other operating expenses

Finance cost

Other income

Profit before taxation

Taxation

Profit for the year

Other comprehensive income for the year - net- not to be reclassified to profit and loss

Restated*- (Rupees in '000') --28,292,999 25,901,312

(23,984,s82) (21,544,347)

Note 2014 2013

22

24

25

4,308,417

(167,646)

5,411

(1,967,894)

7,94

4,356,965

(1s0,920)

(1,798)

(38)

(2,368,135)

133

26

27

28

2,186,232

(2,806)

1,836,207

(47I,

2,183,426

180

1,836,160

'l ,195

Total comprehensive income 2,183,606

The annexed notes from 1 to 37 form an integral part of these financial statements.

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I'', x( Chairman/Director

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ATLAS POWER LIMITEDCASH FLOW STATEMENTFOR THE YEAR ENDED JUNE 30,2014

Note

CASH FLOWS FROM OPERATING ACTIVITIES

Proflt before taxation

Adlustment for non-cash and other items:DepreciationAmortization(Gain) / Loss on disposal of assetsProvision for:

- deferred liabiljties- gratuity

Operating profit before working capital changes

(lncrease) / decrease in assets

Long-term depositlnventory of fuelTrade debtsAdvancesShort-term prepaymentsOther receivables

lncrease / (decrease) in liabilitiesLong-term depositsTrade and other payablesAccrued mark-up

Cash flow (used in) / generated from operations

lncome tax paidDeferred liabilities paidGratuity paid

Net cash flo$r (used in) / generated from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of- property, plant and equipment- intangible assets

Sale proceeds of property, plant and equipment disposedAddition to capital work-in-progress

Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Long term loansDividend paidShort-term borrowings

19.5.2

Net cash flow generated from / (used in) financing activities

Net (decrease) / increase in cash and cash equivalentsCash and cash equivalents at the beginning of the yearCash and cash equivalents at the end of the year 29

The annexed notes from 1 to 37 form an integral part of these financial statements.

Restated

--- (Rupees in '000') ---.

2,186,232

794,2465,334(150)

6,242928

1,836,207

791,3591,380

3,U21,358

2,992,872 2,6U,184

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(15,240)

(644,303) 1,O29,270t,'t34,635 105,365490,332 1,134,635

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(s,0r3,639) 3,923,755

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I trs,msll I ir oo,zagtl657,061

(1,363,706)

(7,374t.('t,4221

0,359)(r,373,861)

8,521,417

(1,152)(6,967)(4,098)

8,509,600

t*Chairman/Director

ATLAS POWER LIMITEDNotes to the financial statementsFor the year ended June 30, 2014

1. THE COMPANY AND ITS OPERATION

Atlas Power Limited (the Company) was incorporated as an unquoted - public limitedcompany in Pakistan on January 05, 2007, under the Companies Ordinance, 1984.The registered office of the Company is situated al26-27 km Lahore - SheikhupuraRoad, Sheikhupura.

The Company has been established to build, operate and own a power plant of213.856 Mega Watts for net generation of electricity and onward sale to NationalTransmission and Despatch Company Limited (NTDC). The Company hascommenced its commercial operations on December 18, 2009. The power plant is

situated at 26-27 km Lahore - Sheikhupura Road, Sheikhupura.

As of balance sheet date, Shirazi lnvestments (Private) Limited - holding companyheld 51 .05 o/o (2013: 51 .05%) ordinary shares of the Company.

2. STATEMENTOF COMPLIANCE

2.'l These financial statements have been prepared in accordance with approvedaccounting standards as applicable in Pakistan. Approved accounting standardscomprise of such lnternational Financial Reporting Standards (lFRSs) issued by thelnternational Accounting Standards Board (IASB) as are notified under the CompaniesOrdinance, 1984, provision of and directives issued under the Companies Ordinance,1984. ln case requirements differ, the provisions or directives of the CompaniesOrdinance, 1984 shall prevail.

2.2 Applicability of IFRIG 4 "Determining whether an Arrangement contain a Lease"

IFRIC 4, 'Determining Whether an Arrangement Contains a Lease'is applicable forperiods beginning on, or after January 01, 2006, however, lndependent PowerProducers (lPPs), whose letter of intent or 'approval' was issued by Government ofPakistan on or before June 30, 2010, have been exempted from its application by theSecurities and Exchange Commission of Pakistan (SECP). This interpretation providesguidance on determining whether arrangements that do not take the legal form of alease should, nonetheless, be accounted for as a lease in accordance withlnternational Accounting Standard (lAS) 17, 'Leases'.

Consequent to aforesaid exemption, the Company is not required to account for aportion of its Power Purchase Agreement (PPA) with National Transmission andDespatch Company Limited (NTDCL) as a lease under IAS - 17. Had the exemptionnot been granted, the impact as on June 30,2014, for the years ended June 30,2014and 2013 would have been as follows:

q*

ATLAS POWER LIMITED

2014 2013

---- (Rupees in '000) ---De-recognition of property, plant and equipment (16,225,351) (17,010,460)

Recognition of net investment in finance lease 19,01 5,901 'l 9,1 75,0132,790,550 2,164,553

Increase / (decrease) in:

Un-appropriated profit at the beginning of the year 2,164,553 1 ,478,049Profit for the year:

- Depreciationreversed- Finance income recognized- Sales revenue reversed

Un-appropriated profit at the end of the year

785,1114,349,63s

4,508,749)

785,0464,372,019

(4,47O,561

625,997 686,5042,790,550 2,164,553

2.3 The accounting policies adopted in the preparation ofthese financial statementsare consistent with those of the previous financial year except as describedbelow:

New and amended standards and interpretations

The Company has adopted the following revised standard, amendments andinterpretation of IFRSs which became effective for the current year

IAS 19 - Employee Benefits -(Revised)

IFRS 7 - Financial lnstruments: Disclosures - (Amendments)-Amendments enhancing disclosures about offsetting of financial assets andfinancial liabilities

IFRIC 20 - Stripping Costs in the Production Phase of a Surface Mine

IFAS 3 - Profit and Loss Sharing on Deposits

lmprovements to Accounting Standards lssued by the IASB

IAS 1 - Presentation of Financial Statements - Clarification of the requirements forcomparative information

IAS 16 -Property, Plant and Equipment - Clarification of Servicing Equipment

IAS 32 - Financial lnstruments: Presentation - Tax Effects of Distribution to Holders ofEquity lnstruments

IAS 34 - lnterim Financial Reporting - lnterim Financial Reporting and Segmentlnformation for Total Assets and Liabilities

The adoption of the above amendments, revisions, improvements to accountingstandards and interpretations did not have any effect on the financial statements exceptfor IAS 19.

" \.l--\

ATLAS POWER LIMITED

Change in accounting policy relating to Defined Benefit Plan

Amendments to IAS 19 'Employee Benefits' range from fundamental changes tosimple clarification and rewording. The significant changes to IAS 19 include thefollowing:

For defined benefit plans, the ability to defer recognition of actuarial gains and losses(i.e., the corridor approach) has been removed. As revised, actuarial gains and lossesare recognized in other comprehensive income when they occur. Amounts recorded inprofit and loss are limited to current and past service costs, gains or losses onsettlements, and net interest income (expense). All other changes in the net definedbenefit asset (liability) are recognized in other comprehensive income with nosubsequent recycling to profit and loss.

Objectives for disclosures of defined benefit plans are explicitly stated in the revisedstandard, along with new or revised disclosure requirements. These new disclosuresinctude quantitative information regarding the sensitivity of the defined benefitobligation to a reasonably possible change in each significant actuarial assumption.

This change in accounting policy has been accounted for retrospectively as requiredunder lnternational Accounting Standard-8 'Accounting Policies, Changes in

Accounting Estimates and Errors', and the comparative financial statements have beenre-stated.

Effect of the retrospective application of the change in the accounting policy is a

decrease of Rs. 653,000 in the gratuity payable and an increase in othercomprehensive income of Rs. 1,195,000 and decrease in the unappropriated profit ofRs 542,000.

As the amount of restated adjustment is not material, the third balance sheet has notbeen presented.

2.4 Standards, interpretations and amendments to approved accounting standardsthat are not yet effective:

The following revised standards, amendments and interpretations with respect to theapproved accounting standards as applicable in Pakistan would be effective from thedates mentioned below against the respective standard or interpretation:

Standard or lnterpretation Effective date(annual periodsBeginning on or

after)

01 January 2014

01 January 2014

01 January 2014

01 January 2014

IAS 32 - Offsetting Financial Assets and Financial liabilities -(Amendment)

IAS 36 - Recoverable Amount for Non-Financial Assets -(Amendment)

IAS 39 - Novation of Derivatives and Continuation of HedgeAccounting - (Amendment)

IFRIC 21 - Levies

(.rs

ATLAS POWER LIMITED

Standard or lnterpretation Effective date(annual periodsBeginning on or

after)

The Company expects that the adoption of the above revision, amendments andinterpretation of the standards will not affect the Company's financial statements in theperiod of initial application.

ln addition to the above amendments, improvements to various accounting standardshave also been issued by the IASB. Such improvements are generally effective foraccounting periods beginning on or after July 01, 2014. The Company expects thatsuch improvements to the standards will not have any material impact on theCompany's financial statements in the period of initial application.

Further, following new standards have been issued by IASB which are yet to benotified by the SECP for the purpose of applicability in Pakistan.

Standard or interpretation IASB Effective date(annual periodsBeginning on or

after)

IFRS I - Financial lnstruments: Classification and Measurement 01 January 2018

IFRS 10 - Consolidated Financial Statements

IFRS 1 1 - Joint Arrangements

IFRS 12 - Disclosure of lnterests in Other Entities

IFRS 13 - Fair Value Measurement

IFRS 14 - Regulatory Deferral Accounts

01 January 2013

01 January 2013

01 January 2013

01 January 2013

01 January 2016

3.

The Company expects that the adoption of the above revision, amendments andinterpretation of the standards will not affect the Company's financial statements in theperiod of initial application.

BASIS OF MEASUREMENT

These financial statements have been prepared under the historical cost convention.

SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of financial statements in conformity with approved accountingstandards requires the use of certain critical accounting estimates. lt also requiresmanagement to exercise its judgments in the process of applying the Company'saccounting policies. Estimates and judgments are continually evaluated and are basedon historic experience and other factors, including expectations of future events that arebelieved to be reasonable under the circumstances. Revisions to accounting estimatesare recognized in the period in which the estimate is revised and in any future periodsaffected. In the process of applying the Company's accounting policies, management

\J-

(a)

ATLAS POWER LIMITED

has made the following estimates and judgments which are significant to these financialstatements:

determining the residual values, useful lives and impairment of property, plantand equipmentdetermining the residual values, useful lives and impairment of intangible assets;impairment of inventory of fuel / adjustment of inventory of fuel to their netrealizable value,recognition of employees' retirement benefits at present value; andrecognition of taxation.

Other areas where judgments, estimates and assumptions involved are disclosed inrespective notes to these financial statements.

4.1. Property, Plant and Equipment

Operating fixed assets

These are stated at cost less accumulated depreciation and accumulatedimpairment losses, if any, except freehold land, which is stated at cost and capitalwork-in-progress which is stated at cost less accumulated impairment losses, if any.Capital work-in-prog ress represents expenditures connected with purchase ofassets during the construction period and transfers from capital work-in-progress tooperating fixed assets will be made as and when assets become available for use.

Depreciation is recognized in profit and loss account using reducing balancemethod so as to write off the historical cost of the assets over their estimated usefullives at the rates stated in note 6 to these financial statements except for building onfreehold land and power plant which are depreciated using straight line method overtheir useful life of 25 years. Depreciation on additions is charged from the month in

which the asset is available for use and on disposals up to the preceding month ofdisposal.

Major renewals and improvements for assets are capitalized and the assets soreplaced, if any, are retired. Maintenance and normal repairs are recognized inprofit and loss account.The gain or loss on disposal or retirement of an asset represented by the differencebetween the sale proceeds and the carrying amount of the asset is recognized inprofit and loss account.

Assets residual values and useful lives are reviewed, and adjusted, if appropriate ateach balance sheet date. An asset's carrying amount is written down immediately toits recoverable amount if the asset's carrying amount is greater than its estimatedrecoverable amount.

4.2. lntangible assets

lntangible assets acquired separately are measured on initial recognition at cost.Costs that are directly associated with identifiable software products controlled bythe Company and have probable economic benefit beyond one year are recognizedas intangible asset. Following initial recognition, intangible assets are carried at costless any accumulated amortization and accumulated impairment losses, if any.

(b)(c)

(d)(e)

"\-

ATLAS POWER LIMITED

Amortization of intangible assets is charged over their useful economic life onstraight line basis at the rate stated in note 6.

Amortization on additions is charged from the month in which the assets areavailable for use while no amortization is charged in the month in which the assetsare disposed off.

4.3. Trade debts and other receivables

Trade debts and other receivables are stated at original invoice amount net ofprovision for doubtful debts, if any. Trade debts and other receivables are written offwhen considered irrecoverable.

4.4. lnventory of fuel

lnventory of fuel represents fuel for power generation plant and is valued principallyat lower of cost on first-in-first-out (FIFO) basis of valuation and net realizable value.Net realizable value is the estimated selling price in the ordinary course of businessless estimated cost necessary to make sale.

4.5. lmpairment

The carrying amounts of assets are reviewed at each balance sheet date todetermine whether there is any indication of impairment of any asset or a group ofassets. lf any such indication exists, the recoverable amount of that asset isestimated and impairment losses are recognized in the profit and loss account.

4.6. Cash and cash equivalents

Cash and cash equivalents are defined as cash in hand, cash at banks and short-term highly liquid investments that are readily convertible to known amounts of cashand subject to insignificant risk of changes in value. For the purpose of cash flowstatement, cash and cash equivalents comprise bank balances including shorttermdeposits net of bank overdraft, if any.

4.7. Long term loans

These are recorded at the proceeds received in accordance with the syndicate loanagreement. Finance cost is accounted for on accrual basis and is disclosed asaccrued mark-up to the extent of the amount remaining unpaid.

4.8. Borrowing cost

Borrowing costs are recognized in profit and loss account in the period in whichthese are incurred except to the extent of borrowing cost that is directly attributableto the acquisition, construction or production of the qualifying assets are capitallzedand included in respective assets.

s

ATLAS POWER LIMITED

4.9. Employee retirement benefits

4.9.1. Staff gratuity

With effect from December 01, 2009, the Company has registered its gratuityfund. The Company operates a recognized funded gratuity scheme for its allpermanent employees completing prescribed period of service in accordancewith service rules of the Company. Provision is made for gratuity inaccordance with the requirements laid down by IAS 19. The latest actuarialvaluation was carried out by the Company as on June 30,2014. For definedbenefit plans, the ability to defer recognition of actuarial gains and losses (i.e.,the corridor approach) has been removed. As revised, actuarial gains andlosses are recognized in other comprehenslve income when they occur.Amounts recorded in profit and loss are limited to current and past servicecosts, gains or losses on settlements and net interest income (expense). Allother changes in the net defined benefit asset (liability) are recognized inother comprehensive income with no subsequent recycling to profit and loss.

4.9.2. Long service award

The Company provides a facility to eligible employees for long service awardafter completion of minimum 15 years of services in group companies equal tovalue of 15 gram of gold and equal to 5 gram of gold for every subsequentservice of five years up to 40 years of service. The liability for long serviceaward is recognized on terminal basis.

4.9.3. Provident fund

With effect from December 01, 2009, the Company has registered itsprovident fund. The Company operates a recognized provident fund (definedcontribution plan) for its all permanent employees. Contributions are made,both by the Company and the employees at the rale of 11o/o of basic salary.

4.9.4. Compensatedabsences

The Company also provides a facility to employees for compensatedabsences on the basis of un-availed earned leave balance of each employeeat the end of the year on the basis of the current salary. Accrual is made foremployee compensated absences in accordance with the requirements laiddown by IAS 19. The latest actuarial valuation was carried out by theCompany as on June 30, 2014. Actuarial gains and losses are recognizedimmediately.

4.'l0.Provisions

Provisions are recognized when the Company has a present (legal or constructive)obligation as a result of past events and it is probable that an outflow of resourcesembodying economic benefits will be required to settle the obligation and a reliableestimate of the obligations can be made. Provisions are reviewed at each balancesheet date and accordingly adjusted to reflect current best estimates.

4.1 1 . Revenue

Revenue is recognized to the extent that it is probable that the economic benefitswill flow to the Company and the revenue can be reliably measured. The Company

\=

ATLAS POWER LIMITED

assesses it revenue arrangements against specific criteria in order to determine if itis acting as a principal. The Company has concluded that it is acting as a principalin all its revenue arrangements. The following are the specific recognttion criteriathat must be met before revenue is recognized:

- Revenue from sale of electricity to National Transmission and DespatchCompany Limited (NTDC) is recorded based on the output delivered and

capacity available at the rates as specified under Power Purchase Agreement(PPA) dated September 06, 2007 and adjusted tariff determination by

National Electric Power Regulatory Authority (NEPRA) dated May 19, 2010 atcommercial operation date.

- Delayed payment interest is recognized on relevant amount that remainsunpaid on overdue bills of NTDC as per PPA dated September 06' 2007 '

- lnterest income on deposits is recognized using the effective interest ratemethod.

- All other income is recognized on accrual basis.

4.l2.Taxation

4.12.1. Currenl

Profit and gains derived by the Company from the power generation project

are exempt from the tax under Clause (132) of Part I of the Second Scheduleto the Income Tax Ordinance, 2001 .

The Company is also exempt from the minimum tax on the turnover underClause '1 1A (v) of the Part lV of the Second Schedule to the lncome TaxOrdinance, 2001.

However, provision for current taxation on profits and gains other than frompower generation project is based on taxable income at current rates oftaxation after taking into account tax credits and rebates available, if any, inaccordance with the provision of the Income Tax Ordinance, 2001. It alsoincludes any adjustment to tax payable in respect of prior years.

4.12.2. Oelefied

As the Company's major portion of revenue is exempted from tax, thereforeno deferred tax has been recognised in these financial statements.

4.1 3. Foreign currency transactions

Foreign currency transactions during the year are recorded in Pakistani Rupee (Pak

Rupee) at the exchange rates approximating those ruling on the date of thetransaction. Monetary assets and liabilities in foreign currencies are retranslated atthe rates of exchange ruling at the balance sheet date. Any resulting exchangegains or losses arislng on retranslation are taken to profit and loss account.

4.14. Financial instruments

All financial assets and liabilities are recognized at the time when the Companybecomes party to the contractual provisions of the instrument and are derecognizedin case of assets, when the contractual rights under the instrument are realized,expired or surrendered and in case of liability, when the obligation is discharged,

J \..,*N

ATLAS POWER LIMITED

cancelled or expired. Any gain or loss on the recognition and de-recognition of thefinancial assets and liabilities is recognized in profit and loss account.

4.15. Offsetting of financial assets and financial liabilities

A financial asset and a financial liability is offset and the net amount is reported inthe balance sheet if the Company has a legally enforceable right to setoff therecognized amounts and inlends either to settle on a net basis or to realize theasset and settle the liability simultaneously.

4.16. Appropriation of reserves

Appropriations to reserves are recognized in the financial statements in the periodin which these are approved.

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Atlas Power Limited

LONG-TERM DEPOSITS

Represents non-interest bearing security deposit paid to Sui Northern Gas Pipelines Limited and is for a term of more than a year.

2014 2013

---*lPupees in aOOl;-8 TRADE DEBTS -s€cured, considercd good

NTDC

E.1

8.r & 8.2 ____19!lggg_ _____qgqf4_These represent trade receivables from NTDC and are considered good. These are securcd by a guarantee from theGovernment of Pakistan (GoP) under the lmplementation Agreement and are in normal course of business and interestfree, however, a penal mark-up at the rate of 3 months KIBOR plus 4.5 percent is charged in case the amounts are notpaid within due dates. lncluded herein is delayed payment interest of Rs. 890.9 million (June 2O13: Rs.4't4.5 million) at theeffective interest rate of '14.24 percent (June 2013:'15.72 percent) per annum.

These are generally on 30 days term and includes an amount of Rs. 6,5'12.44 million (20'13: Rs.6,548.56 million) which isneither due nor impaired. These include Rs.4,572.25 million 12013:

'11.6 million)which is past due but not impaired.

2014 2013.._-- lnupees in lgo) .-----_

8.2

ADVANCES - unsecured, considered good

Advance to suppliers- Pakistan State Oil Company Limited (PSO)

Advance against import dutiesAdvances to employeesOlhers

9.1

9.1 These are non-interest bearing and generally on an average term of 1 to .12 months.

8,382

233622

't46,732

1,157313367

IO SHORT-TERM PREPAYMENTS

Prepayment - insurancePrepayment - othersMan Oiesel Operation North America

OTHER RECEIVABLES - considered good

Man Diesel Operation North AmericaWorkers' Welfare FundWorkers' Profil Participation FundSales tax receivableUC CommissionOthers

_9.3!z_ ______11!,!qr

2014 2013

-- (Rupees in ,000,) ---

l0.l & 10.2 90,019 77,46010.2 7,255 4,49410.3 182,807

1o.z ------UEoISi- ------lIE54-

10.1 This represenG insurance premium paid to Atlas lnsurance Limited (related party).

10.2 These are non-interest bearing and generally on an average ierm of 1 to 12 months.

10.3 Represents payments to MAN Diesel & Turbo North Amerjca (related pady) for the supply of spare parts under the sparepa.ts supply agreement.

2014 2013

11

--- (Rupees in '000') ----

105,07795,10032,745

35730,583

8,966147,429201,121112,122

181,211

6s0,852 263.862

11.111.1

11,2

I1.3tr ft.i'N'

11.1 Workers' Profit Participation Fund (WPPF) and Workers'Welfare Fund (WWF)

Nole I,VWF

AUas Power Limited

WPPF2014 2013 2014 2013

---.--- (Rupees in '000) ------.

Opening balance 105,077 39,503 95,100 170.881

Add: Provision for rhe year l--15,6-tl [---65s7l l- lorJlrl l- ,1.eoolLess: Received during lhe year I Il ll ll (167,ss9)lLess: Reversed during the year '11.1.1 | (f,317)l I (3,291)J

ctosins batance 11.1.2 _1!,rrs_ ____f!!.qzz_ __rtl" _______igJ!g_

11.1.1 These receivables were related to the period before commercial operation date (COD).

11,1,2 Under section 9.3 of PPA with NTDC, payments to Workers'Welfare Fund and Workers' Profit ParticipationFund are recoverable from NTOC as a pass through item.

11.2 lncluded herein an amount of Rs. 180.5 million (2013: 30.075) receivable from NTDC on account of withholding taxdeducted on dividend paid. Under section 9.3 of PPA with NTDC, withholding tax deducted on the payment of dividend isrecoverable from NTDC as a pass through item.

11.3 These are generally on an average term of 1 to '12 months and are neither psst due nor impaired except withhodling taxdeducted on dividend paid and WPPF amounting to Rs 180.5 million and Rs g1 mallion respectively, which are past due butnot impaired.

2014 2013

--- (Rupees in'000') ---TAXATION . net

Balance as at July 01

Advance tax deducted at sourceProvision for the yearPaid during the yearAdjusted durjng the year

Balance as at June 30

7217,371

(2,806)

4,771't,152

\o't(s,155)

_________ug9_ __________l2t_

13 INVESTMENT

This represents investrnent in term deposit receipts for a period of 2 days (2013:4 days) carrying a markup at the rate oI 7.5%(201317%)

2014 2013.-- lnupees in tOOl --14 CASH AND BANK BALANCES

Cash in handCash at bank - current accounts

12153,335

30319,309

15 ISSUED, SUBSCRIBED AND PAID-UP CAPITAL

2ll1A 2013Number of shares

474,000,000 474.000.000

----lE5}it ------31r,-fut

Note 2014 20't3

---. (Rupees in '000') ---

rs.1 ___1119199_ ____1J19!99_

15.1 Shirazi Investments (Private) Limited (holding company) held 241.99 million (2013: 241.99 mi jon) ordinary shares ofRs 10/- each as of balance sheet date whereas MAN Diesel SE holds 158.99 million (20'13: 158.99 miilion) ordinary sharesof Rs. 10/- each.

t'*

Note

AUas Power Limited

2014 2013---- (Rupees in '000') ---

t6.t16.1

10,201,037 '11,305.398

16.1 Represent syndicated project loan facilities from consortium ot banks. The facilities are repayable in 40 equal quarterlyinstallments commencing from twenty first month of fi.st drawdown or three months after completion of the project,whichever is earlier. The facilities carry mark-up at the rate of 3 months KIBOR plus 37o per annum, payable on quarterlybasls. The facilities are secured against assignment over receivable from NTDC due under PPA, first ranking andexclusive charge by hypothecation on all future moveable assets, first ranking and exclusive mortgage over immovableproperties related to project complex, pledge of sponsors'shares in the Company not less than 51% of the Company'sshare capital, lien over set-off rights over all project accounts and assignment over project insurance.

17 LONG.TERM OEPOSITS

Represent security deposits from employees in accordance with the terms and conditions of Company's vehicle policy. Thesedeposits are non-interest bearing and generally on a term of more than a year.

Note 2011 2013

----

lnupees ii, o66f=::-

16 LONG-TERM LOANS - secured

Long-term Loan I

Long-term Loan ll

Less: Current portion

18 DEFERREDLIABILITIES

Compensated absencesLong service a, ,ard

TRADE AND OTHER PAYABLES

Trade creditorsMurabahaAccrued IiabilitiesPayable to provident fundCustom duty payableGratuity payableWorkers'Welfare FundWorkers' Profit Participation FundRetention moneyOthers

T-J-zsq746 1 I 10290"060lI go+,zsr | | r,ors,ias I

r8.t 10,999838

14.2 11,837

6,229748

19

19.119.219.3

19.419.5.2

19.6

2,736,0823,03t,516

79,657287

120,72694

80,392109,3't 2

75'188,807

2,198,0582,853,627

160,849

120,726705

36,72391,808

33763,061

6,346,948 5,525,894

19.1 Trade creditors includes following

Man Diesel Operatjons PakistanMan Diesel Operation North AmericaPakistan Slate OilAttock PetroleumRIL Logistics

19.1.t43,6_22

2,691,575885

41.545792,225

2,4671,36't,821

2,736,082 2,198,058

Represents payabre to I\,!AN Dieser & Turbo operation, North America (rerated party) for the suppry of spareparts in respect of generation and transmission of electricity.

18.1 These are provided on the basis of acluary valuation by taking the assumption of annual discount rate of 13% (2019 11ok)and salary increase ralF ot 12o/o (2013:'10%).

18.2 These are non-interest bearing and generally on an average term of more than a year.

Note

---- (Rupees in '000') ---

19.1.1

Atlas Power Limited

19.2 Represents short-term Murabaha term finance facilities aggregating to Rs. 3,032 million (2013: Rs. 3,400 million) fromcommercial banks payable on maturity latest by August, 2014. These carry mark-up ranging from 10.20 percent to 11.89percent (20131 1'1.09 percent to '14.33 percent) per annum, payable on maturity and are secured against hypothecation oninventory ot tuels and receivables with 2070 margin.

19.3 Accrued liabilities includes Rs. 55.407 million (2013: 120.082) in respect of interest on delayed payments of liquiditydamages, in accordance with PPA.

19.4 The Company has imported power plant that is leviable to cusiom duty at the rate of 20 percent on the imported value.However, the Ministry of Finance, Govemment ol Pakistan vide its S.R.O. 565(ly2OO6 (SRO) dated June 06, 2006 asamended vide SRO 564(l)/2008 dated June ll, 2008 has exempted plant, machinery, etc. from the custom duty leviable inexcess ot concessionary taxes i.e. 5 percent on the import value provided that the imports are made against validcontracts or letter of credit (UC) and total C&F value of such imports for the project is US Dollar 50 million or above. ln thisregard, the Custom department raised a query to Federal Board of Revenue (FBR) whether this relaxation is applicable tothe Company which has esiablished UC before June 11, 2008. The company has paid the custom duty at the rate of 5percent on the import value of Power Plant to the custom authorities and recorded a liability for the remaining 15 percenton import value of Power Plant, till the clarilicalion is received from the regulatory authorities.

19.5 Actuarial valuation ot retirement benetit

ln accordance with the requirements of IAS-'19 .Employee Benefiirs', actuarial valuation was carried out as at June 30,2014, using the "Projected Unit Credit Method'. Provision has been made in these financial statements to cover obligationsin accordance with the actuarial recommendations.

2014 2013Reslated

--- (Per annum) ---19.5.1 Principal actuarial assumptions us6d aae as follows:

Discount rateSalary increase

19.5.2 Reconciliation of obligation atyearend:

Present value ofdefined benefits obligationFair value of plan assetsReceivable from group companies

Reslated balance sheet liability

19.5.3 Charge for the year:

Cunent service costlnterest costReturn on plan assets

-- (Rups$ in '000') --

13,526(13,297)

(13s)

94 705

13%12%

't1.ook10.00/6

85,1

1,304(1,230)

11,53'l(10,826)

9231,798

(1,363)

Movement in the liability recognized in thq balance sheet:

Opening balanceCharge for the yearContribution to the fundNet acturial gain recognized during the year

Closing balance

Movement in the presentvalue of defined benefil obligationi

Opening balanceCurrent service costlnterest costLiability recognized in respect of transfereesBenefit paid during the yearActuarialgain

Closing balance

11,531854

1,304171

(337)

16,975923

1,798

(7,188)(s77)

928 1.358

705928

(1,359)(r80)

---------r

3,4451,358

(2,903)(1,1e5)

------id5.

*r.13,526 11.53.1

Atlas Power Limited

2014 2013

--- (Rupees in '000') ---19.5.6 Movement in the fair value of plan assets:

Opening balanceReturn on plan assetsContributlonBenefit paid during the yearActuarial loss/(gain)Transferred from group companies

(10,826)(r,230)(r,35s)

157(39)

(13.530)(1,363)(2.903)7,188(218)

Closing balance

19.5.7 The Company expects to contribute Rs. 730,650 to the defined benefit ptan in 2014-2015.

19.5.9 Historicalinformation

Jun-20j4 Jun-2013 Jun-2O12 Jun-2011 Jun-2010

---{Rupoes in'000)---__

Experience adjustments arising on:

benefit obligation

_q9qI99_

337 977 196 1.334 31

plan liabilities (ls7) 218 798 39 2O5

19.6 This includes an amount of Rs. 186 million (2013: 60.150) relating to withholding tax deducted on the payment ofdividend.payable to shareholde.s.

19'7 Accrued liabilities and other payables are non-interest bearing except for murabaha financing (see note 19.2) and aregenerally on an average term of 3 to 12 months.

SHORT-TERM BORROWINGS

Represents utilized portion of tacilities for short-term running finance available from various banks amounting to Rs. 4,354 million(2013: Rs.24 million), total limit of facilities is Rs '10,190 million (2013i Rs.5,570 million). The repurchase prices are repayabte onvarious dates, during the year. The rate of mark-up ranges from 9.97ok lo 12.20% (2013: 11.31% to 13.99%) percent per annumand are payable with various maturity dates. These are secured by way of mortgage over assets including trade receivables of theCompany.

CONTINGENCIES AND COMMITMENTS

2'1.1 Contingencies

21.1.1 Possible claims due to non compliance with agreements, not acknowledged by the Company, amount to Rs. 586 million(June 30,2013: 3ll).

21.1.2 fhe Company has entered into the litigation with NTDC over the deductions of capacity payments. The case waspresented belore the Supreme Court of Pakistan (SCP) and an Expert was appointed as per the terms of PPA. The caseis still on going, both parties have presented their evidences to Expert. Possible write off of trade receivables amount toRs. 1.2 billion.

2011 2013---- (Rupees in '000') ---21.2 Commitments

Guarantee in local currency

21,2.1 fhe Company has entered into an agreement with MAN Djesel & Turbo Operation Pakistan (Private) Limited for theoperations and maintenance (O&ir) of the power stalion and with irAN Diesel & Turbo Operation, Norih Anerica, lnc forspare parts tor a period of ten years starting from COD of the power station i.e. Decembe||8, 2009. Under the terms ofthe O&M agreement, the Company is required to pay a monthly fixed O&M fee and a variable O&M fee depending on thenet power output, both of which are adjustable according to the consumer price index general (general - Cpl) as notified byFederal Bureau of Statistics and US Consumer Price lndex (CPl) issued by US Bureau of Labour Statistics.

2'1.2,2 fhe Company has also entered into an agreement for purchase of fuel and light diesel oil from pakistan Stale Oilcompany Limited (PSO) for a period of thirteen years starting from the COD of the power station i.e. December 18, 2009.However, due to disputes in the terms of lhe agreement, the company is not purchasing fuel from pso.

2013Restated

o\^

Atlas Power Limited

SALES - NET

Energy purchase priceCapacity purchase price

PLANT CAPACIW AND PROOUCTION

lnstalled capacity - per hour

lnstalled capacity, based on 8,760 hours (2013: 8.760 hours)

Actual nel electdcjty exported

23.1 Output produced by the plant is dependent on theterms of PPA.

213.855 213.856

_____19!.!29_ ____L,929.929_

__lc1!.93!_ __-L,!q!.919_

plant availability and other factors as per

Note 2014 2013

----

6upees ii.6di---

22.1

----39i9499- ----4f91312-22.1 Energy purchase price is exclusave of sales tax amountjng to Rs. 3,954 million (2013: Rs.3,309 million).

Note 20'14 2013MYY'1 MWH

23,548,4714,f 41,528

21,155,3724,745,940

23.1

load demanded by NTDC,

Note 2011 2013--- (Rupees in '000') ---

24 COST OF SALES

Fuel costDepreciationlnsuranceOperation and maintenance feeLicense feesElectricity import from NTDC

ADMINISTRATIVE EXPENSES

Salaries and other benefltsTravelling and conveyanceRepairs and maintenanceDepreciationAmortizationVehicle runningPrinting and stationeryAuditors' remunerationlnsuranceLegal and professional chargesDonationsPostage, telephone and gas chargesNewspapers, periodicals and membership feeStaff trainingOtherS

21,15.1

21,122,763785,111r79,304

1,593,3112,5241,569

19,175,299785,046161,528

1,415,0082,2935,173

____z$g!,!gl ___z_,5/4347_

2,1.1 Fuelcostis net of sale of waste fuelamounting to Rs. 21 .594 million (2012: Rs.24.362 million).

24.2 Rep.esent expenses incurred in respect of project management services for generation and transmission of electricity.

Note 20'14 2013

--- (Rupees in '000') ---

5.1

6

25.1

25.3

90,8365,7423,3309,,t355,3341,1511,773t,3592,356

I1,879,l8,986

4,0081,896

4236,128

ftrFa6-

89,4744,9011,2776,3131,3804,764

8401,3182,8349,027

14,9514,4052,982

268

6.r86--- 1so-5r6-

25.2

25.1 lncluded herein is anamountof Rs. '10.68 million (2013: Rs.5.74 million) in respect of slaff retirement benefits.

d'*

Atlas Power Limited

2013

25.2 Audito6' remuneratioo

Statutory audit feeHalf yea.ly reviewSpecial audit, certjfications and other advisory servicesOut of pocket expenses

25.3 Donations

FINANCE COST

Markup on:- long-term loans- short-term borrowings- Liquidated Damages payable to NTDC

Guarantee and commission chargesAgency and project monltoring feeBank charges

OTHER INCOME

Profit on term deposit receiptSale of scrapGain on sale of operating fixed assets

TAXATION

Current year

29 CASH AND CASH EQUIVLENTS

lnvestmetnsCash and bank balances

30 REMUNERATION OF CHIEF EXECUTIVE, DIRECTOR AND EXECUTIVES

Chi6f Exscutive

88022512588

1,559,0't4756,989

33,3349,2571,4178,124

1,967,894 2,368,135

7,791 1

t50

7,9U 133

2,806

2014 2013

303

47

28,1 No deferred tax asset or liability has been recognized as the revenue generated by Company is exempt lrom tax.

815,296319,339

----l J 34.63s-

Directors Executives2011

15,578

1,008

8,361

2011 2013

Managerial RemuneiationRetirement beneftsOlhers

No. of persons

14,035

908

6,U2

18,077'1,170

10, 130

23,2821,381

12.549

(Rupees in '000')

7,767

15,910 15,910

7,103

24,947 21,585 23,677 23.013 29.377 37.212

10 11

3O.l The Chief Executive, Director and Executives of the Company have been provided with free use of Company ownedand/or maintained cars and other benefits in accordance v/ith their terms of employment.

--- (Rupees in '000') ----

968242107

52

1.3i18,213573,635

40,2191,824i|,003

1,369

This includes an amount of Rs. 18.362 million (2013: '14.4 million) paid to Atlas Foundation at 1olo of the prior yeads profit

2014 2013

----1nupeesiir566

j;=:-

--- (Rupees in '000') ---336,985153,347

490,332

q'

Atlas Power Limited

31 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company finances its operations through equity, borrowings and managemgnt of working capital wjth a view to maintaining anappropriate mix between various sources of finance to minimize risk. Taken as whole, the Company is exposed to market risk(including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Company's principal financial liabilities comprise bank loans, trade and other payables and due to related parties. The mainpurpose of these financial liabilities is to raise finance for Company's operations. The Company has various financial assets such asdeposits, trade and other receivables, cash and bank balances which are directly related to its operations.

The Company's finance department oversees the management of these risks and provide assurance to the Company's seniormanagement that the Company's tinancial risk-taking activities are governed by appropriate policies and procedures and that financialrisks are identified, measured and managed in accordance with Company policies and risk appetite. No changes were made in theobjectives, policies or processes and assumptions during the year ended June 30, 20i4.

31.1 Market risk

Market risk is the risk that the tair value of luture cash flows of a financial instrument will fluctuate because of changes rnmarket prices. Market prices comprise three types of risk: interest rate risk, curency risk and other price risk. The sensitivityanalyses in the following sections relate to the position as at June 30, 2014 and 2013.

31.1,1 Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because oIchanges in foreign exchange rates. Foreign currency risk arises mainly where receivables and payables exist dueto transactions entered into foreign currencies. The Company's foreign currency risk exposure is limited to theagreement with foreign suppliers, consultants, contractors and government organization mainly in US Dollar- Thesaid exposure is covered through tariff order with NEpRA.

As ot balance sheet date, the sensitivity to a reasonably possible change in exchange rate if PKR had weakened /strengthen by 10% against the US Oollar, with all other variables held constant would be of Rs. 15.81 mi ion(2013: Rs.79.22 million) on Company's profit before tax (due to changes in the fair value of monetary items).

3'1.'|..2 Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows ot the financial instruments will fluctuatebecause of changes in market interest rates. The Company manages these mismatches through riskmanagement strategies where significant changes in gap position can be adjusted. The Company ente6 intovarious types of long-term and short-term financing facilities for its generation, transmission and distributionoperations and meeting working capital requirements at variable rates.

31.'1.3 lnterest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all othervariables held constant, on the Company's profit before tax (through impact on floating rate borrowings). Thisanalysis excludes the impact of movement in market variables on the carrying values of employees' retirementobligation and on non-financial assets and liabilities oI the Company.

2014lncrease,

dec.ease in basispoints

+100

100

lncrease /decrease in basis

Dointg

Effect on profitbefore tax

Pak RupeePak Rupee

2013

(Rs. in '000)

(145,553)145,553

Effect on prolitbefore tax

Pak RupeePak Rupee

(Rs. in '000)

('t 13,298)113,298

+'t00-100

31.1.4 Othe. price risk

Other price risk is the risk that the fair value of future cash flows of the financial instruments will lluctuate becauseof changes in market prices such as equity price risk. As at balance sheet date, the Company is not exposed toother price risk.

Credit.isk

Credit risk is the risk that one party to a financial instrument will cause a flnancial loss for the other party by failing todischarging an obligation. Out of the total financial assets ot Rs. '11,766 million (20'13: Rs.7,714 mitlion), the financial assetswhich are subject to credit risk amounted to Rs. 1'1,766 million (2013: Rs. 7,714 mjllion). The Company's credit risk isprimarily attributable to its trade debt, investments and bank balances. The Company's trade debts are secured by aguarantee from the Government of Pakistan (GoP) under the lmplementation Agreement. The credit risk on liqujd funds islimited because the counter parties are banks with reasonably high credit ratings.

The Company monitors the credit policy of its flnancial assets with reference to historical performance of such assets andavailable external credit ratings. The credit quality of financial assets that are past due but not impaired is disclosed in note8.2 to these financial statements. As at balance sheet date, there are no financial assets that would otherwise be past due orimpaired whose terms have been renegotiated. The carrying values of financial assets which are neither past due norimpaired are as under:

Atlas Power Limited

Note 2014 2013

- (Rupees in '000')

-Long-term depositTrade debtsOther receivableslnvestmentBank balances

3246,512,,140

r90,180335,98s153,335

6,548,57230,583

815,296319,309

____!_9!,39!_ __-_lfl3p43_The credit quality of major financial assets can be assessed by reference to external credit ratings (if available) or to historicalinlormation about counteparty default rate:

Short Term lnvestrrEnts:National Bank of Pakislan

Total

Cash At Bank:National Bank of PakistanSummit Bank LimitedUnited Bank LimitedStandard Charterod BankBank Alfalah LimitedTotal

Rating

Short Term Long Term

A-'1+ AAA

RatingAgency

JCR-VIS

JCR-VISJCR-VISJCR-VISPACRAPACRA

2014 2013

Rupees in'OO0'

336,945 815,296

336,985 815,296

A-3149,135

142,273

1,909

300,26312,6866,360

r53.336 3t9.309

31.3 Liquidity risk

Liquidity risk represents the risk that a Company will encounter difficulties in meeting obligations with the financiat liabilities.The Company manages its risks through close monitoring of Company's liquidity and cash flows position The Company'sobjective is to maintain liquidity ratios through the use of financing tacilities from banks and borrowings trom related padies.

The table below summarizes the maturity profile of the Company's flnanciat liabllities at June 30, 2014 and 2013 based oncontractual undiscounted payment dates and present market interest rates:

On domand L6sa than 3 3 to 12 I to S vears More than Emonths months yeais Tota IJune 30,2014

Long-term loansLong-term deF,osltsTrad€ and other payablesAccrued mark-upShort-t6rm borowings

June 30. 2O13

Long-term loansLong-term depositsTrade and other payablesAccrued mark-upShort-tem borro /ingsDue to relaled parties

552,775 5,794,079- 374.466- 4,350,OOO

305,705 983,3a3 1o,201,0377A',l

94 6,345.94a3a0,132

4,354,24O5,2654,24O

8,9l l,9rrg

:"

552,775 ,tO,824,65O 992,928 8,912,730 21.2$,1n

Less than 3 3 to 12. 'l to 5 vears More than 5 TotatOn demand

121, 063

262,3a1 a41,979 6,6OO,u142 3,600,5S6 11,3O5,39a243 - 2a3

1,5Oa,499 3,a93.333 - 3.OOO 5,525,a94450,759 94,206 544,966

- 24,45A 24.45A

r, 1 .06- rZZ 1.63, -Z=EapE- --A=aO:Z- ---=Ed5- sr6-- -l?roo-ita

,t.

Atlas Power Limited

31.4 Fair value of tinancial instruments

Fair value is the amount for which an asset could be exchanged, or a liability can be settled, between knowledgeable willingparties in an arm's length transaction. The carrying amounts of all the financial instruments reflected in these financialstatements approximate to thei. fair value.

31.5 Capitalmanagement

The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern inorder to provide returns for shareholders and benefit tor other stakeholders and to maintain an optimal capital structure toreduce the cost of capital.

As per Articles of Association of the Company and the lmplementation Agreement with the Government of Pakistan, theCompany has certain restriction on transfer of shares of thg Company to person which is prescribed by law of Pakistan.

The Company manages its capital structure and makes adjustment to it in the light of changes in economic condjtions. Tomaintain or adjust the capital skucture, the Company may adjust ihe dividend payment to shareholders or issue new shares.No changes were made in the objectives, policies or processes during the year ended June 30, 2014.

The Company monitors capital using the gearing ratio. which is net debt divided by total equity plus net debt. Net debtincludes long-term loans less cash and bank balances and equity includes share capital and advance against share and lessaccumulated profit or losses. The gearing ratios as at June 30, 2014 and 2013 were as follows:

'rni/l )n11

--- (RuPees in'000')

-10,201,037 11,305,398153,347 319,339

10,047,690 10,986,058

Long-term loansLess: Cash and bank balancesNet debl

Share capitalRevenue reservesTotalequity

Gearing ratio

31.6 Collateral

4,740,000

7,960,088

4,740,000

8,2U,982

't8,007,778

56%

19,251,040

57o/o

The Company has charge over cerlain assets in order to fulfill the collateral requirements for various flnancing lacilities. Thecounter parties have an obligation to return the securities to the Company. The fair value and te.ms and conditionsassociated with the use oI these co,lateral and securities given by the Company are disclosed in respective notes to thesefinancial statements. As at balance sheet date, the Company did not hold collateral and securities of any sort from thirdparties.

32 TMNSACTIONS WITH RELATED PARTIES

The related padies comprise holding company, entities over which the dkectors are able to control, exercise significant influence,entities with common directors, major shareholders, directors, key management employees and employees fund. The transactionswith related parties, other than remuneration and other benefits to employees under the terms of employment are as follows:

2011 2013__ (Rupees in'000') .__

_________r,zz!E!!_ ____!gpqoHOLDING COMPANY

- Dividend paid

ASSOCIATEO COMPANIES - Common DirectoGhip

- Purchase of operating assets- lnsurance expenses paid- O&M expenses- Expenses paid on behalf- Advance io Contractor- Dividend paid- Donations paid __-___l_gEg?_ ___-_____17_,425

8,762222,880

2,676.963

1,21S,;OO

6,454290,167

1,070,231915

2,7611,534,750

32.1 All transactions with related parties are carried out by the Company at arm's length prices. The related parties' status ofoutstanding receivables and payables as of balance sheet date is included in respective notes to these financial statements.

u\,^

Atles Power Limited

33 STAFF PROVIDENT FUND

Size of the tundPercBntag€ of investments madeFair valus ot inv6t flents made

Mutual FundsTem Deposit ReceiptsScheduled Banks

2011 2013

- (Rups6 ln '000')

-3,900alx

3,1/r5

2,7093,529

8?2,7,060

Chalman DlBctor

7,061100%

7,0606,t 94Cost of inv63tnent made 2,580

33.1 Break-up of invastments in terms of amount and pcrcentage of the size of the provid€nt fund are as follotlls:

2011nudiHl

lnYsstrgntslRuoeesl

lnvoatmenl as % ot.lr. .f tha ftrrid

,,*1.7t6

-------------3Jrq

38%50%12%

37%o%4%

36

37

lnvgstrnenls out of provirent fund have been made in accordance with the provisions of sections 227 of the Companies Ordinance,I 9&{ and lie rubs furmulated for this pupose.

NU BER OF E}IPLOYEES

Total number of employees as at 30 June 2014 aod average number of employees for the yaar endsd arB 27 (2013: 25).

POST BALAI{CE SHEET EVEI{TS

The Board of Diredors at its meeting held on August 12, 201i1 has 8pproved a final dividend @ Rs. 1.25 per sharc for the year ended30 June 2014 (2013: Rs. 1.5 p3r share) amounting to Rs. 592.5{) millbn (2013: Rs. 711 million) fo, approval of tha rnsmbsrs al lhsAnnual General Meeting to be held on September 05, 201 4. The financial statemenG do not lBf,eat the eftci of lhe above evenb.

DATE OF AUTHORISATIO'{ FOR ISSUE

These fnancial statements rreIe authodzed for issue by the Board of Directo6 of the Company on August 12, 2014.

GENERAI

\=Jn

rounded on to ihe nearest thousand rupeq'' ""'*' "tn"*"

l, I

Ghlef Execuove

,{\

tlLI,/_

1t

u\'^

2013(Audited)

lnvesfunenls(Ruoees)

lnvestment as % ofsi2e of the fund