TRANSACTION SOLUTIONS GHANA LIMITED ANNUAL ... - 199 TRANSOL YEAR END...Solicitors Alloh & Partners...

TRANSACTION SOLUTIONS GHANA LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS FOT THE YEAR ENDED 31 DECEMBER, 2014

Transaction Solutions (Ghana) Limited Annual Report Year ended 31 December 2014 ___________________________________________________________________________

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CONTENTS PAGES CORPORATE INFORMATION 2 FINANCIAL HIGHLIGHTS 3 REPORT OF DIRECTORS 4 STATEMENT OF DIRECTORS RESPONSIBILITIES 4 REPORT OF THE INDEPENDENT AUDITOR 7-8 STATEMENT OF COMPREHENSIVE INCOME 9 STATEMENT OF FINANCIAL POSITION 10 STATEMENT OF CHANGES IN EQUITY 11 STATEMENT OF CASH FLOW 12-13 NOTES OF THE FINANCIAL STATEMENTS 14-31 SHAREHOLDER’S INFORMATION 32 FIVE YEAR FINANCIAL SUMMARY 33


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CORPORATE INFORMATION Directors Paul Jacquaye Romeo Bugyei Fouad Chalabi Company secretary Reuben Amanor Registered office 16 Adebeto Close North Labone P. O. Box CT 1003 Accra Independent auditors UHYVoscon Chartered Accountants

No. C806/4, Boundary Road, Tudu, Accra Adjacent to City Paints Supply

P. O. Box LA 476 La, Accra. Solicitors Alloh & Partners P. O. Box NT 478 Newtown - Accra Bankers Ecobank Ghana Limited SG-SSB Limited Prudential Bank Ghana Limited United Bank for Africa (Ghana) Limited FirsTrust Savings & Loans Limited Registrars NTHC Limited Martco House P. O. Box KA 9563 Airport, Accra Ghana


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FINANCIAL HIGHLIGHTS 2014 2013 Percentage GH¢’000 GH¢’000 Change Revenue - - N/A Profit/Loss before taxes 569,705 (856,480) 166.5% Income tax expense (137,596) (6,100) 2,155.7% Profit/Loss after tax 432,109 (862,580) (150.1%) Total Assets 99,728 204,405 (51.2%) Total liabilities 2,790,908 4,527,694 (38.4%) Retained earnings (6,041,180) (6,473,289) (6.7%) Total equity and liabilities 99,728 204,405 (-51.2%)


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REPORT OF THE DIRECTORS The Directors submit their report of Transaction Solutions (Ghana) Limited (“the Company”) for the year ended 31 December, 2014. STATEMENT OF DIRECTORS’ RESPONSIBILITIES The Directors are responsible for preparation of financial statements for each period which gives a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss and cash flows for the period. In preparing these financial statements, the Directors have selected suitable accounting policies and then applied them consistently, made judgments and estimates that are reasonable and prudent, followed the International Financial Reporting Standards (IFRS), and complied with the requirements of the Companies Act, 1963 (Act 179). The Directors are responsible for ensuring that the Company keeps proper accounting records that disclose with reasonable accuracy at any time the financial position of the Company. The Directors’ are also responsible for safeguarding the assets of the Company and taking reasonable steps for the prevention and detection of fraud and other irregularities. Financial results for the year GH¢ The Company recorded a profit after taxation of 432,109 to which is added balance on retained earnings of prior year adjustment of (6,473,289) Leaving a balance on retained earnings of (6,041,180) Nature of business The Company did not carry on any business during the year under review. The Company’s core business being the sale and switching of electronic recharge vouchers will be revived in 2015. The Company has reached an agreement with Nomanini SA to deploy exclusively in Ghana a new revolutionary Point of Sale Terminal. The roll out of the new terminals commenced in the first quarter of 2015. Going concern The directors would like to draw attention to the arrangement referred to in Note 21. On the basis of assurance given, the directors are of the opinion that the going concern basis for preparing these financial statements is appropriate.


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Directors and their interests The Present membership of the Board is set out in page 1. The Directors’ interests in the ordinary shares of the Company as at 31 December 2014 were as follows: Name No. of shares Paul Tse Jacquaye 54,080,958 Directors’ interests in contracts The Directors have no material interest in contracts entered into by the Company. Auditors In accordance with Section 134 (5) of the Companies Act, 1963 (Act 179) Messrs UHYVoscon Chartered Accountants have agreed to continue in office as the Company auditor’s. The financial statements of the Company as indicated above were approved by the board of directors on 11th of June, 2015 and are signed on their behalf by: SIGNED SIGNED PAUL TSE JACQUAYE FOUAD CHALABI DIRECTOR DIRECTOR


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STATEMENT OF DIRECTORS’ RESPONSIBILITIES The directors are responsible for preparing financial statements for each financial year which give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss and cash flows for that period. In preparing these financial statements, the directors have selected suitable accounting policies and applied them consistently, made judgements and estimates that are reasonable and prudent and followed International Financial Reporting Standards and complied with the requirements of the Companies Act, 1963 (Act 179). The directors are responsible for ensuring that the Company keeps proper accounting records that disclose with reasonable accuracy at any time the financial position of the Company. The directors are also responsible for safeguarding the assets of the Company and taking reasonable steps for the prevention and detection of fraud and other irregularities. SIGNED SIGNED PAUL TSE JACQUAYE FOUAD CHALABI DIRECTOR DIRECTOR


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REPORT OF THE INDEPENDENT AUDITOR TO THE MEMBERS We have audited the accompanying financial statements of Transaction Solutions Ghana Limited on pages 6 to 26 which comprise the statement of financial position as at 31 December, 2014, statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, together with the summary of significant accounting policies and other explanatory notes, and have obtained all information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit. Directors’ responsibility for the financial statements The Directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards (IFRS) and the Companies Act, 1963 (Act 179). These responsibilities include designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error, selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance as to whether the financial statements are free from material misstatements. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing opinion on the effectiveness of the entity’s 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. We believe that the audit evidence we have obtained is sufficient and appropriate to provide the basis for our audit opinion.


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Opinion In our opinion, the Company has kept proper accounting records and the financial statements are in agreement with the records in all material respects and report in the prescribed manner, information required by the Companies Act, 1963 (Act 179). The financial statements give a true and fair view of the financial position of the Company as at 31 December, 2014, and of its financial performance and statement of cash flow for the year then ended and are drawn up in accordance with the International Financial Reporting Standards, issued by the International Accounting Standards Board (IASB). Emphasis of matter-going concern In forming our opinion on the financial statements which is not qualified, we have considered the adequacy of the disclosure made in the directors’ report to the financial statement concerning the Company’s ability to continue as a going concern. The Company’s current liabilities exceed its total assets by GH¢2,691,180 and GH¢ 4323,289 during the year ended 31 December, 2014 and 2013 respectively, meaning the Company may not be able to realize its assets and discharge its liabilities on demand. Also, the Company does not have any revenue for the year ended 2014 and 2013. These conditions along with the recent downturn of zero sales indicate the existence of material uncertainty which cast a significant doubt about the Company’s ability to continue as a going concern. Our opinion is not modified in respect of these matters that have been emphasized. Report on other legal and regulatory requirements The Ghana Companies Act, 1963 (Act 179) requires that in carrying out our audit work we consider and report on the following matters. We confirm that: 1. We have obtain all the information and explanations which to the best of our knowledge and belief

were necessary for the purposes of our audit; 2. In our opinion proper books of account have been kept by the Company, so far as appears from our

examination of those books; and 3. The statement of financial position and statement of comprehensive income of the Company are in

agreement with the books of account. Signed by: Emmanuel K.D. Abbey (ICAG/P/1167) For and on behalf of: UHYVoscon (ICAG/F/2014/086) Chartered Accountants No. C806/4, Boundary Road, Tudu, Accra P.O. Box LA 476, La –Accra Date: 12th June, 2015


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STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER, 2014 NOTE 2014 2013 GH¢ GH¢ REVENUE 3a - - COST OF OPERATIONS 5 - - GROSS TRADING PROFIT - - SELLING, GENERAL AND ADMINISTRATIVE EXPENSES: Bank/Interest charges 58 383,009 Auditors remuneration 5,000 4,275 Depreciation 43,487 43,187 Other costs 6 7,186 453,735 55,731 884,206 OPERATING LOSS (55,731) (884,206) Other income 7 625,436 27,726 PROFIT BEFORE TAX 569,705 (856,480) TAXATION: Corporate tax 8 (137,596) (6,100) TOTAL COMPREHENSIVE INCOME 432,109 (862,580) Earnings per share Basic earnings per share 9 0.005 (0.011) Diluted earnings per share 9 0.005 (0.011) Notes 1 to 22 form an integral part of these financial statements.


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TRANSACTION SOLUTIONS GHANA LIMITED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER, 2014 NOTE 2014 2013 ASSETS GH¢ GH¢ NON-CURRENT ASSETS Property, plant and equipment 10 89,664 133,151 CURRENT ASSETS Inventory 11 2,790 2,790 Trade and other accounts receivable 12 5,690 60,308 Cash and cash equivalents 13 1,584 8,156 Total current assets 10,640 71,254 TOTAL ASSETS 99,728 204,405 CURRENT LIABILITIES Trade accounts payable 600,795 601,523 Other accounts payable 14 355,049 404,938 Taxation 15 94,628 (42,968) Bank overdraft 16 1,740,436 3,564,201 Total Current Liabilities 2,790,908 4,527,694 SHAREHOLDERS’ FUNDS Stated capital 17 2,150,000 2,150,000 Shareholder’s loan 1,200,000 - Retained earnings (6,041,180) (6,473,289) Total shareholders’ funds (2,691,180) (4,323,289) TOTAL LIABILITIES AND SHAREHOLDERS’ FUNDS 99,728 204,405 SIGNED SIGNED PAUL TSE JACQUAYE FOUAD CHALABI DIRECTOR DIRECTOR


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STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER, 2014 2014 Stated Shareholder’s Retained Capital Loan Earnings Total GH¢ GH¢ GH¢ GH¢ Balance as at 1 January 2,150,000 - (6,473,289) (4,323,289) Contribution by shareholders - 1,200,000 - 1,200,000 Profit for the year - - 432,109 432,109 Balance as at 31 December 2,150,000 1,200,000 (6,041,180) (2,691,180) 2013 Stated Retained Capital Earnings Total GH¢ GH¢ GH¢ Balance as at 1 January 2,150,000 (5,760,809) (3,610,809) Prior year adjustment - 150,100 150,100 Loss for the year - (862,580) (862,580) Balance as at 31 December 2,150,000 (6,473,289) (4,323,289) Notes 1 to 22 form an integral part of these financial statements.


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STATEMENT OF CASH FLOW FOR THE YEAR ENDED 31 DECEMBER, 2014 2014 2013 GH¢ GH¢ CASH FLOW FROM OPERATING ACTIVITIES: Profit before tax 569,705 (856,480) Reconciliation of profit to net cash flow from Operating activities Adjustment for non-cash items: Depreciation 43,487 43,187 Net interest expense - 382,946 Impairment of asset held for sale - 374,127 613,192 (56,220) Changes in working capital Decrease in trade and other accounts receivable 54,618 193,456 Increase in trade accounts payable (728) (32,001) Increase in other accounts payable (49,889) (34,368) Inventory - (2,790) 4,001 124,297 Tax paid: Corporate tax - (31,789) 4,001 92,508 Net cash provided by operating activities 617,193 36,288 Cash flow from investing activities: Investments - 112,146 Net cash provided by investing activities: - 112,146 Cash flow from financing activities Interest expense - (382,946) Shareholder’s loans 1,200,000 - Net cash used in financing activities 1,200,000 (382,946) Increase in cash and cash equivalents 1,817,193 (234,512)


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STATEMENT OF CASH FLOW FOR THE YEAR ENDED 31 DECEMBER, 2014 (CONT’D) 2014 2013 GH¢ GH¢ Increase in cash and cash equivalents 1,817,193 (234,512) CASH AND CASH EQUIVALENTS: at beginning of year:- Cash and equivalents (3,556,045) (3,321,533) at end of year 1,738,852 (3,556,045) Analysis of balances of cash and cash equivalents as shown in the financial position. Cash and cash equivalents 1,584 8,156 Bank overdraft (1,740,436) (3,564,201) 1,738,852 (3,556,045) Notes 1 to 22 form an integral part of these financial statements.


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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER, 2014 NOTE 1 - NATURE OF BUSINESS

Transaction Solutions Ghana Limited was incorporated on 8 July, 2002 and issued with a commencement certificate on9 July, 2002 with the following authorised business:

1. Transaction Switching and Processing Systems. 2. Electronic Funds Transfer Support Service. 3. Electronic Bill Payment Services. 4. Electronic Payroll Services. 5. Prepaid Utility and Telecommunication Services. 6. Information Technology Consultants. 7. Customer Payment Service Provider.

NOTE 2 - BASIS OF PREPARATION Statement of compliance

The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (IFRS) and its interpretations adopted by the International Accounting Standards Board (IASB) and in the manner required by the Companies Act, 1963 (Act 179).

Basis of measurement

The financial statements are presented in Ghana cedi which is the Company’s functional currency rounded up to the nearest cedi. They are prepared on the historical cost basis.

Use of estimates and judgment

The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, incomes and expenses. The estimates and associated assumptions are based on historical experience and various factors that are believed to be reasonable under circumstances, the results of which form the basis of making the judgment about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) Standards, amendments and interpretations effective in 2013 New and Amended Standards and Interpretations The accounting policies are consistent with those of the previous financial year, except the following new and amended IFRS effective as of 1 January, 2014:

2.4 New and amended standards and interpretations

Accounting standards

IFRS 14 Regulatory Deferred Accounts

IFRS 15 Revenue from contracts with customer IFRS 9 Financial Instruments

Issued/ amendments and effective date Issued in January 2014 and effective period beginning on or after 1 January, 2016

Issued in May 2014 and effective period beginning on or after January 2017 IFRS 9 (2014) was issued as a complete standard including the requirements previously issued and the additional amendments to introduce a new expected loss impairment charges to the classification and measurements requirements for financial assets. The amendment is effective periods beginning on or after 1 January, 2018 with earlier adoption permitted.

NOTE 3 - SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PREPARATION

The following is a summary of the significant accounting policies adopted in the presentation of these financial statements. The policies set out below have been consistently applied to all years presented. a - Revenue recognition Sales comprise the invoiced value of goods and services and are measured at the fair value of the consideration received or receivable.


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) b – Property, plant and equipment Property, plant and equipment are stated at cost or valuation less subsequent depreciation and impairment. Depreciation is provided on a straight line basis at annual rates estimated to write-off values over their useful economic lives. The annual rates used are:- Motor vehicles 20.0% Furniture, Fixtures and Fittings 10.0% Office equipment 20.0% Computers 30.0% Automated Teller Machines (ATMs) 10.0% Depreciation methods, useful lives and residual values are reassessed at each reporting date. Gains and losses on disposal of property, plant and equipment are included in the Statement of Comprehensive Income. c - Foreign currency translation Transactions in foreign currencies are converted at market rates ruling at the dates of such transactions. Exchange differences realised are accounted for through the income statement. ii. Assets and liabilities, which are denominated in other currencies, are translated into the reporting currency at the period end rates of exchange. Exchange differences arising on such translations are treated through the Income statement d - Trade and other accounts receivable Trade accounts receivable are recognized initially at fair value and subsequently at amortised cost less any provision for impairment. Specific provisions for doubtful debts are made for receivables of which recovery is doubtful. Other receivables are stated at their cost less impairment losses. e - Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, deposits held at call with banks and bank overdraft.

f - Provisions

Provisions are recognized when a legal or constructive obligation as a result of past transaction exists at the reporting date; it is probable that an outflow of resources will be


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) required to settle the obligation and the amount of the obligation can be reliably estimated.

g- Income tax

Income tax comprises current tax and deferred tax. (i) Current tax

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the balance sheet date and any adjustment to tax payable in respect of previous years.

(ii) Deferred income taxes

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Tax rates enacted or substantively enacted by the balance sheet date are used to determine deferred income tax.

Deferred income tax assets are recognized to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized.

h) Impairment Assets that have indefinite useful lives and are not subject to amortization are tested annually for impairment. Assets that are subject to amortization or depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less cost to sell and value in use.

i) Events after the reporting period

Events subsequent to the balance sheet date are reflected in the financial statements only to the extent that they relate to the year under consideration and the effect is material.


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

j) Dividend distribution

Dividend distribution to the company’s shareholders is recognized as a liability in

the company’s financial statement in the period in which the dividends are declared by the Board of directors.

k) Non-current assets held for sale Non-current assets or disposal groups comprising assets and liabilities are classified

as held-for-sale if it is highly probable that they will be recovered primarily through sale rather than through continuing use.

Immediately before classification as held-for-sale, the assets are re-measured in

accordance with the company’s other accounting policies. Thereafter, generally the assets are measured at the lower of their carrying amount and fair value less costs to

sell. l) Operating segments A segment is a distinguishable component of the company that is engaged either

providing products or services (business segments) 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 identification of operating segments on internal reports that are regularly reviewed by the company’s chief operating decision maker in order to allocate resources to the segment and asses its performance.

Financial assets and liabilities i Offsetting

Financial assets and liabilities are set off and the net amount presented in the balance sheet when, and only when, the company has a legal right to set off the amounts and intends with to settle on a net basis or to realize the asset and settle the liability simultaneously.

Income and expenses are presented on a net basis only when permitted by the accounting standards.


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ii. Amortised cost measurement The amortised cost of financial asset or liability is the amount at which financial asset or liability is measured at initial recognition, minus principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between the initial amount recognized and the maturity amount, minus any reduction of impairment.

iii. Financial assets The Company assesses at each financial position date whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred if, and only if, there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset ( a “loss event”), and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.

m) Determination of fair values

The fair value of financial instruments traded in active markets is based on quoted market price at the balance sheet date. The fair value of financial assets that are not traded in an active market is determined by using valuation techniques. The company uses a variety of methods and makes assumptions that are based on market conditions existing at each balance sheet date. The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the company for future similar financial instruments.

n) Borrowing costs Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are those borrowing costs that would have been avoided if the expenditure on the qualifying asset had not been made. It did not have an impact on the company.


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NOTE 4 - FINANCIAL RISK MANAGEMENT The company’s activities expose it to a variety of financial risks. Credit risk, liquidity risk, market risk and operational risk. The company’s overall risk management programme focuses on the unpredictability of the financial markets which seeks to minimize potential adverse effect on the company financial performance. This note presents information about the company’s exposure to each of the above risks, the company’s objectives, policies and processes for measuring and managing risk. Further quantitative disclosures are included throughout these financial statements Credit risk Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the company’s receivables from customers. The credit risk of the company is minimal since it is not actively trading now and it receivables are low. Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation, thus company’s activities are being funded by its Shareholders. Market risk Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return. Currency risk

The Company is exposed to currency risks on purchases of its terminals as it is mainly denominated in US Dollars which is different from the functional currency of the Company. In respect of other monetary assets and liabilities denominated in foreign currencies, the Company ensures that its net exposure is kept to an acceptable level by buying or selling foreign currencies at spot rates when necessary to address short term imbalances.


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) Interest rate risk The company is subject to cash flow interest risk due to fluctuations in the prevailing levels of market interest rates. The company’s only interest bearing financial instruments are the bank overdraft and bank balances, which have fixed interest rate. Operational risk

The primary responsibility for the development and implementation of controls to address operational risk is assigned to senior management, However development of overall entity standards for the management of operational risk in the following areas:

Requirements for appropriate segregation duties, including the independent authorization of transactions

Controls and procedures to address the risks identified

Training and professional development

Risk mitigation, including insurance where this is effective have not been functioning as they should.

NOTE 5 - COST OF OPERATIONS 2014 2013 GH¢ GH¢

Opening inventories 2,790 - Purchases - 2,790 - Closing inventories (2,790) (2,790) Cost of Operations - - NOTE 6 - OTHER COSTS 2014 2013 GH¢ GH¢

Salaries & wages 723 16,934 Professional fees - 891 Penalty on SSNIT 4,263 17,540 Bad debt written off - 44,243 Impairment on asset held for sale - 374,127 Registration and license 2,200 - 7,186 453,735


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) NOTE 7 - OTHER INCOME 2014 2013 GH¢ GH¢

Interest expense clawed back 642,009 27,726 Write-offs 1,428 - Finance income 625,437 27,726

NOTE 8 - INCOME TAX EXPENSE 2014 2013 GH¢ GH¢

Current Tax (137,596) (6,100) NOTE 9 - EARNINGS PER SHARE Basic and diluted earnings per share The calculation of basic and diluted earnings per share at December 31, 2014 was based on

the profit attributable to ordinary shareholders of GH¢432,109 (2013: GH¢862,580) and a weighted average number of ordinary shares outstanding of 80,000,000 (2013: 80,000,000).

There were no potential dilution in ordinary shares. This is calculated as follows: 2014 2013 GH¢ GH¢ Profit for the year attributable to the equity owners of the company 432,109 (862,580) Weighted average number of ordinary shares (basic and diluted) 2014 2013 Number Number (‘000) (‘000) Issued ordinary shares at beginning 80,000 80,000 Effect of conversion of debt to equity - - Weighted average number of ordinary share at 31 December , 2014 80,000 80,000 Basic earnings per share 0.005 (0.011) Diluted earnings per share 0.005 (0.011)

Transaction Solutions (Ghana) Limited Annual Report Year ended 31 December 2014

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) NOTE 10a - PROPERTY, PLANT AND EQUIPMENT Motor Computer/ Furniture & Office vehicles soft ware fittings equipment Total COST GH¢ GH¢ GH¢ GH¢ GH¢ At 1 January, 2014 31,318 1,172,787 119,363 53,773 1,377,241 Additions - - - - - At 31 December 2014 31,318 1,172,787 119,363 53,773 1,377,241 DEPRECIATION At 1 January, 2014 31,318 1,063,112 95,887 53,773 1,244,090 Charge for the Year - 31,551 11,936 - 43,487 At 31 December 2014 31,318 1,094,663 107,823 53,773 1,287,577 CARRYING AMOUNT At 31 December 2014 - 78,124 47,048 - 89,664 At 31 December 2013 - 109,675 23,476 - 133,151


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) NOTE 10 (b) - PROPERTY, PLANT AND EQUIPMENT Motor Computer/ Furniture & Office vehicles Soft ware Fittings equipment Total COST GH¢ GH¢ GH¢ GH¢ At 1 January, 2013 31,318 1,172,787 119,363 53,773 1,377,241 Additions - - - - - At 31 December 2013 31,318 1,172,787 119,363 53,773 1,377,241 DEPRECIATION At 1 January, 2013 31,318 1,031,561 84,251 53,773 1,200,903 Charge for the Year - 31,551 11,636 - 43,187 At 31 December 2013 31,318 1,063,112 95,887 53,773 1,244,090 NET BOOK VALUE At 31 December 2013 - 109,675 23,476 - 133,151 At 31 December 2012 - 172,777 47,048 - 219,285


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BLANK


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) NOTE 11 - INVENTORY

This represents E- vouchers at the year end.

NOTE 12- TRADE AND OTHER ACCOUNTS RECEIVABLE 2014 2013 GH¢ GH¢ Others 5,690 60,308 NOTE 13 - CASH AND CASH EQUIVALENTS 2014 2013 GH¢ GH¢ Prudential bank 1,123 7,695 Zenith bank 461 461 1,584 8,156 NOTE 14 - OTHER ACCOUNTS PAYABLE 2014 2013 GH¢ GH¢ Auditors remuneration 27,624 22,624 SSF 5,022 34,624 PAYE 69,876 69,812 VAT 39,764 42,764 Directors fees 18,900 18,900 Withholding taxes payable 17,655 16,927 Others 176,208 199,287 355,049 404,938


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) NOTE 15 - TAXATION Tax Balance credits/ Income Balance Y/A 1/1/14 Payments statement Adjustment 31/12/14 GH¢ GH¢ GH¢ GH¢ GH¢ Prior to 2011 2011 (89,974) - - - (89,974) 2012 11,025 - - - 11,025 2013 (25,689) - - - (25,689) 2014 - - 137,596 - 138,263 (104,638) - 137,596 - 32,958 Deferred tax Accelerated depreciation 61,670 - - - 61,670 (42,968) - 137,596 - 94,628 The 2014 tax computation is subject to agreement with the Domestic Tax Revenue Division of the Ghana Revenue Authority.


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NOTE 16- BANK OVERDRAFT 2014 2013 GH¢ GH¢ ECOBANK GHANA LIMITED - 630,328

On the 8th of October 2007 Ecobank Ghana Limited approved an overdraft facility of GH¢150,000 to supplement company’s working capital over a period of 12 months. Interest rate currently is 19.25% plus a spread of 3.0% per annum payable monthly in arrears. A further Guarantee line of credit of GH¢150,000 was also granted on October 8, 2007 over a period of 12 months. The purpose was a guarantee on behalf of Transol in favour of Scancom Limited in respect of purchase of MTN recharge voucher. Interest rate is 19.25% plus a spread of 5% per annum payable monthly in arrears. Security

1. Assignment of company’s Treasury bill

2. Personal guarantee of the principal shareholder.

FIRSTRUST SAVINGS & LOANS LIMITED 1,738,396 1,738,396

(Formerly Ezi Savings & Loans Limited) An overdraft facility of GH¢150,000 was granted on 31st May 2007 over a period of twelve months (12). Interest rate is 24% per annum. Security offered is Stock Hypothecation and a cash build up of GH¢5,000 per month.

ECOBANK A/C II - 1,193,437 This represents overdue balance made up of principal and interest repayments on financial lease transaction.

SG SSB II (overdrawn Balance) 1,226 1,226

United Bank for Africa (Ghana) Ltd. (overdrawn balance) 814 814 1,740,436 3,564,201


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) NOTE 17 - STATED CAPITAL

2014 2013 Number Number ‘000 GH¢ ‘000 GH¢ Authorized No. of shares of no par value:- 1,000,000 100,000 Issued and fully paid: Issued for cash 60,000 150,000 60,000 150,000 Issued for cash 20,000 2,000,000 20,000 2,000,000 80,000 2,150,000 80,000 2,150,000

There are no treasury shares. There are no unpaid calls on any share.

NOTE 18 RELATED PARTY TRANSACTIONS

The majority shareholder in the company also has substantial interests in Clydestone Ghana Limited. The interests in Ezi Savings & Loans Limited now FirsTrust Savings & Loans Limited have been sold. During the previous year, the following related party transactions took place as detailed below.

2014 2013 GH ¢ GH¢ Credit facilities FirsTrust Savings & Loans Limited - 382,946


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NOTE 19 FAIR VALUES OF FINANCIAL ASSETS AND LIABILITIES

The following table summarises the fair values and carrying amounts of the various financial assets and liabilities. The carrying amounts of the financial assets and liabilities are a reasonable approximation of their fair values, as they are short term in nature.

Fair Carrying Value Amount 2014 2013 2014 2013

GH ¢ GH ¢ GH ¢ GH¢ Financial Assets Trade and other accounts receivable 5,690 60,308 5,690 60,308 Cash and bank balances 1,584 8,156 1,584 8,156 Investment - - 112,146 Inventory 2,790 2,790 2,790 2,790 Financial Liabilities Trade accounts payable 600,795 601,523 600,795 601,523 Other accounts payable 355,049 404,938 355,049 404,938 Bank overdraft 1,740,436 3,584,201 1,740,436 3,584,201 NOTE 20 - SEGMENTAL REPORTING

The company operates only in Ghana and the key business being undertaken relates to payment and system integration net working and computer/communication technology and debt collection. These categories are managed by a single management team. Reporting the financial segments along these categories will involve subjective allocation of cost which will not give useful information for decision making purposes. Segmental reporting has therefore not been adopted in the presentation of these financial statements.

NOTE 21 - CONTINGENT LIABILITIES AND CAPITAL COMMITMENTS

There is a contingent liability in respect of legal and other costs on judgment granted MTN in the sum of GH¢286,000. There were no capital commitments at the year end.


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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) NOTE 21 - GOING CONCERN

The company incurred a net profit of GH¢432,109 (2013: Loss GH¢862,580) for the year ended 31 December, 2014 and of that date its current liabilities exceeded its current assets by GH¢2,780,268 (2013: GH¢4,456,440) as at the reporting date. This position indicates a material uncertainty which casts significant doubt on the company’s ability to continue as a going concern and therefore it may be unable to realise its assets and discharge its liabilities in the normal course of business without recourse to other sources of finance. The majority shareholder has undertaken to continue to provide the company with financial support in the 2015 financial year to settle its liabilities in the ordinary course of business until the company is able to meet its obligations from its resources and will provide such financial support as is necessary without prejudicing its ability to continue operations.

NOTE 22 - EVENTS AFTER THE REPORTING PERIOD The company signed an exclusive distribution agreement for Ghana in March, 2015 with Nomanini SA to deploy their cloud based Point of Sale (POS) Terminals in Ghana. Under the agreement, Transol for the next two years will deploy 4,000 (four thousand) terminals throughout Ghana. The first batches of 100 terminals have been deployed as at May this year with a deployment of an additional 500 in July, 2015. A total of 2,000 terminals will be deployed in 2015 and another 2,000 terminals in 2016. Transol with these planned deployments will regain its dominance of the Electronic Voucher Recharge market in Ghana, as per our original mandate on incorporation and the first to deploy electronic recharge in Ghana. Our discussions with the Mobile Networks indicate their strong desire to move to electronic recharge and to gradually phase out scratch cards. The new terminal is more suitable for deployment at informal locations including street vending. The new terminals are more suited to our environment and are very easy to use. The terminals can be monitored per their location via GPS and battery strength and signal can also be monitored. The terminals will also be can also vend other prepaid vouchers including that of electricity and can also be deployed by transportation companies for ticketing. Electronic Top-up will be introduced onto the terminals by the last quarter of 2015.


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SHAREHOLDERS INFORMATION 1. Details of the 20 largest shareholders

Showing top 20 share holder(s) of Transol as at 31/12/2014 Rank Shareholder Shareholdings

1 JACQUAYE PAUL TSE 54,080,958

2 V MOBILE LIMITED 5,500,000

3 SCGN/PICTET AND CIE (EUROPE) S.A., LUXEMBOURG 4,600,000

4 SIC LIFE COMPANY LIMITED 2,500,000

5 STD NOMS TVL PTY/BNYM/FRONTIER MARKET SELECT FUND 11, L.P. 2,411,675

6 SECURITIES AFRICA LIMITED 1,584,600

7 SIC INSURANCE COMPANY LIMITED 1,500,000

8 EDC STOCKBROKERS LTD. 1,068,050

9 WAHOME STEEL LTD 500,000

10 ESL-EDC A/C 257,300

11 SAS INVESTMENT MANAGEMENT LIMITED 200,000

12 COCA COLA PF NOMINEE 200,000

13 EBG STAFF SAVINGS SCHEME NOMINEE 200,000

14 VRA STAFF PF 200,000

15 UT LIFE INSURANCE COMPANY LIMITED 150,000

16 NSIA GHANA LIMITED 150,000

17 BOOHENE EDWARD HENAKU MR 150,000

18 SAS ITF. NOMINEES 3 150,000

19 GRAPHIC COMM. GRP LTD 100,000

20 SCGN/GGBL STAFF PROVIDENT FUND 83,000


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FIVE YEAR FINANCIAL SUMMARY 2014 2013 2012 2011 2010 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Revenue - 120,521 8,176 1,617,007 Profit/Loss before taxes 569,705 (856,480) (826,401) (1,048,667 (1,747,037) Income tax expense (137,596) (6100) (11,025) - (15,787) Loss after tax 432,109 (862,580) (837,426) (1,048,667) (1,762,824) Financial Position Financial assets Property, plant and equipment 89,664 133,151 176,338 219,825 1,336,703 Investment property - - 112,146 - - Financial assets (current assets) 10,064 71,254 267,012 488,466 367,836 Non-current assets held for sale - - 374,127 374,127 - Total Assets 99,728 204,405 929,623 1,082,418 1,704,539 Total liabilities 2,790,908 4,527,694 4,540,432 3,855,801 3,409,712 Stated capital 2,150,000 2,150,000 2,150,000 2,150,000 2,150,000 Preference shares - - - - - Retained earnings (6,041,180) (6473289) (5,760,809) (4,923,383) (3,855,173) Total equity and liabilities 99,728 204,405 929,623 1,082,418 1,704,539

TRANSACTION SOLUTIONS GHANA LIMITED ANNUAL ... - 199 TRANSOL YEAR END...Solicitors Alloh & Partners...

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Transcript of TRANSACTION SOLUTIONS GHANA LIMITED ANNUAL ... - 199 TRANSOL YEAR END...Solicitors Alloh & Partners...