Fourth Schedule: Fourth Schedule

FOURTH SCHEDULE (See Section 225) DISCLOSURE REQUIREMENTS AS TO FINANCIAL STATEMENTS OF LISTED COMPANIES AND THEIR SUBSIDIARIES PART I GENERAL REQUIREMENTS I. All listed companies and their subsidiaries shall follow the International Financial Reporting Standards in regard to financial statements as are notified for the purpose in the official Gazette by the Commission, under section 225 of the Companies Act, 2017 (Act); II. The disclosure requirements, as provided in this schedule,87[ are applicable to the annual financial statements and] are in addition to the disclosure requirements prescribed in International Financial Reporting Standards88[…] and shall be made in the notes to the accounts unless specifically required otherwise; III. In addition to the information expressly required to be disclosed under the Act and this schedule, there shall be added such other information as may be considered necessary to ensure that required disclosure is not misleading. IV. In this schedule, unless there is anything repugnant in the subject or context— A. "capital reserve" includes: (i) share premium account; (ii) reserve created under any other law for the time being in force; (iii) reserve arising as a consequences of scheme of arrangement; (iv) profit prior to incorporation; and (v) any other reserve not regarded free for distribution by way of dividend 87 Inserted vide SRO No. 1169(I)/2017 dated 7th November 2017. 88 Omitted expression “notified by the Commission” vide SRO No. 1169(I)/2017 dated 7th November 2017. B. "executive" means an employee, other than the chief executive and directors, whose basic salary exceeds twelve hundred thousand rupees in a financial year; C. "revenue reserve" means reserve that is normally regarded as available for distribution through the profit and loss account, including general reserves and other specific reserves created out of profit and un-appropriated or accumulated profits of previous years; V. Any word or expression used herein but not defined in the Act shall have the same meaning as under the International Financial Reporting Standards; VI. The following shall be disclosed in the financial statements, namely:__ 1. General information about the company comprising the following: (i) Geographical location and address of all business units including Mills/plant; (ii) Particulars of company’s immovable fixed assets, including location and area of land; (iii) The capacity of an industrial unit, actual production and the reasons for shortfall; (iv) Number of persons employed as on the date of financial statements and average number of employees during the year89[…]; 90[(v) Name of associated companies or related parties or undertakings, with whom the company had entered into transactions or had agreements and / or arrangements in place during the financial year, along with the basis of relationship describing common directorship and percentage of shareholding;] 91[Explanation: Definition of related party as per International Financial Reporting Standards shall be considered for the disclosure requirements;] 89 Omitted expressions “, separately disclosing factory employees” vide SRO No. 888(I)/2019 dated 29th July 2019. 90 Substituted vide SRO No. 1169(I)/2017 dated 7th November 2017. The substituted paragraph (v) was read as under: “(v) Name of associated companies or related parties or undertakings along with the basis of relationship describing common directorship and percentage of shareholding.” 91 Inserted vide SRO No. 1169(I)/2017 dated 7th November 2017. 2. In respect of associated companies, subsidiaries, joint ventures or holding companies incorporated outside Pakistan,92[ with whom the company had entered into transactions or had agreements and / or arrangements in place during the financial year,] following shall be separately disclosed; (i) Name of undertaking93[…] and country of incorporation; (ii) Basis of association; 94[and] (iii) Aggregate Percentage of shareholding, including shareholding through other companies or entities; (iv) 95[…] (v) 96[…] (vi) 97[…] 3. General nature of any credit facilities available to the company under any contract, other than trade credit available in the ordinary course of business, and not availed of at the date of the statement of financial position; 4. 98[…] 5. 99[…] 92 Inserted vide SRO No. 1169(I)/2017 dated 7th November 2017. 93 Omitted expression “, registered address” vide SRO No. 888(I)/2019 dated 29th July 2019. 94 Added vide SRO No. 888(I)/2019 dated 29th July 2019. 95 Omitted vide SRO No. 888(I)/2019 dated 29th July 2019. The omitted paragraph (iv) was read as under: “(iv) Name of Chief Executive Officer or Principal Officer or Authorized Agent;” 96 Omitted vide SRO No. 888(I)/2019 dated 29th July 2019. The omitted paragraph (v) was read as under: “(v) Operational status; and” 97 Omitted vide SRO No. 888(I)/2019 dated 29th July 2019. The omitted paragraph (vi) was read as under: “(vi) Auditor‘s opinion on latest available financial statements.” 98 Omitted vide SRO No. 888(I)/2019 dated 29th July 2019. The omitted sub-clause (4) was read as under: “4. Any penalty in terms of money or otherwise imposed under any law by any authority, on the Company shall be disclosed in the first annual report furnished after the imposition of the penalty. If, as a result of any appeal, revision petition, or review application, such penalty is reduced enhanced or waived, the original penalty imposed shall nevertheless be disclosed, and the fact of any reduction, enhancement or waiver shall be disclosed, in the first annual report furnished after such reduction, enhancement or waiver;” 99 Omitted vide SRO No. 888(I)/2019 dated 29th July 2019. The omitted sub-clause (5) was read as under: “5. Summary of significant transactions and events that have affected the company‘s financial position and performance during the year;” 6. In financial statements issued after initial or secondary public offering(s) of securities or issuance of debt instrument(s) implementation of plans as disclosed in the prospectus/offering document with regards to utilization of proceeds raised shall be disclosed till full implementation of such plans; 7. 100[…] 8. In cases where company has given loans or advances or has made investments (both short term and long term) in foreign companies or undertakings following disclosures are required to be made: (i) Name of the company or undertaking along with jurisdiction where it is located; (ii) Name and address of beneficial owner of investee company, if any; (iii) Amount of loan/investment (both in local and foreign currency); (iv) Terms and conditions and period for which loans or advances or investments has been made; (v) Amount of return received; (vi) Details of all litigations against the Investee company in the foreign jurisdictions; (vii) Any default/breach relating to foreign loan or investment; and (viii) Gain or loss in case of disposals of foreign investments. 9. In cases where company has made export sales following disclosures are required to be made in respect of outstanding trade debts: 100 Omitted vide SRO No. 1169(I)/2017 dated 7th November 2017. The omitted sub-clause (7) was read as under: “7. Particulars of major foreign shareholders, other than natural person, holding more than 5% of paid up capital in the company: (i) Names and address of beneficial owners and legal status along with the name of Chief Executive or Principal Officer or Authorized Agent; (ii) Name and particulars of Pakistani resident associated with such shareholder or entity, if any; and (iii) Detail of conditions and compliance status thereof, imposed by regulatory authorities in Pakistan/foreign jurisdiction for foreign investments, if any.” (i) 101[…] (ii) Name of company or undertaking in case of related party; 102[and] (iii) Name of defaulting parties, relationship if any, and the default amount; 103[…] (iv) 104[…] 10. 105[Shariah compliant] companies and the companies listed on Islamic index shall disclose: (i) Loans/advances obtained as per Islamic mode; (ii) Shariah compliant bank deposits/bank balances; (iii) Profit earned from shariah compliant bank deposits/bank balances; (iv) Revenue earned from a shariah compliant business segment; (v) Gain/loss or dividend earned from shariah compliant investments; (vi) Exchange gain earned 106[…]; (vii) Mark up paid on Islamic mode of financing; (viii) Relationship with shariah compliant banks; and (ix) Profits earned or interest paid on any conventional loan or advance. PART II REQUIREMENTS AS TO STATEMENT OF FINANCIAL POSITION 101 Omitted vide SRO No. 888(I)/2019 dated 29th July 2019. The omitted paragraph (i) was read as under: “(i) Amount of export sales made in each foreign jurisdiction along with break up into confirmed LC, contract or other significant categories;” 102 Added vide SRO No. 888(I)/2019 dated 29th July, 2019. 103 Omitted the word “and” vide SRO No. 888(I)/2019 dated 29th July, 2019. 104 Omitted vide SRO No. 888(I)/2019 dated 29th July, 2019. The omitted paragraph (iv) was read as under: “(iv) Brief description of any legal action taken against the defaulting parties; 105 Substituted words “Sharia complaint” vide SRO No. 1169(I)/2017 dated 7th November 2017. 106 Omitted expressions “from actual currency” vide SRO No. 1169(I)/2017 dated 7th November 2017. 11. Following items shall be disclosed as separate line items on the face of the 107[statement of financial position]; (i) Revaluation surplus on property, plant and equipment; (ii) Long term deposits and prepayments; (iii) Unpaid dividend; (iv) Unclaimed dividend; and (v) Cash and bank balances. Fixed Assets 12. Where any property or asset acquired with the funds of the company and is not held in the name of the company or is not in the possession and control of the company, this fact along with reasons for the property or asset not being in the name of or possession or control of the company shall be stated; and the description and value of the property or asset, the person in whose name and possession or control it is held shall be disclosed; 13. Land and building shall be distinguished between free-hold and leasehold; 14. Forced sale value shall be disclosed separately in case of revaluation of Property, Plant and Equipment or investment property. 15. In the case of sale of fixed assets, if the aggregate book value of assets exceeds 108[five million rupees, following particulars of each asset, which has book value of five hundred thousand rupees or more] shall be disclosed,__ (i) cost or revalued amount, as the case may be; (ii) the book value; (iii) the sale price and the mode of disposal (e.g. by tender or negotiation); (iv) the particulars of the purchaser; (v) gain or loss; and (vi) relationship, if any of purchaser with Company or any of its directors. 107 Substituted words “financial statements” vide SRO No. 1169(I)/2017 dated 7th November 2017. 108 Substituted expression “five hundred thousand rupees, following particulars of each assets” through SRO 888(I)/2019 dated 29th July, 2019. Long Term Investments 16. 109[…] Long Term Loans And Advances 17. With regards to loans and advances to directors following shall be disclosed: (i) 110[…] (ii) the purposes for which loans or advances were made; and (iii) reconciliation of the carrying amount at the beginning and end of the period, showing disbursements and repayments; 18. In case of any loans or advances obtained/provided, at terms other than arm’s length basis, reasons thereof shall be disclosed; 19. In respect of loans and advances to associates and related parties there shall be disclosed,__ (i) the name of each associate and related party; (ii) the terms of loans and advances; (iii) the particulars of collateral security held, if any; (iv) the maximum aggregate amount outstanding at any time during the year calculated by reference to month-end balances; (v) provisions for doubtful loans and advances; and (vi) loans and advances written off, if any. Current Assets 20. In respect of debts/receivables from associates and related parties there shall be disclosed,__ 109 Omitted vide SRO No. 888(I)/2019 dated 29th July, 2019. The omitted clause (16) was read as under: “16. A statement as to whether the Investments in associated companies or undertakings have been made in accordance with the requirements under the Act;” Before omission, this clause (16) was amended vide SRO No. 1169(I)/2017 dated 7th November 2017. 110 Omitted vide SRO No. 888(I)/2019 dated 29th July, 2019. The omitted sub-clause (i) was read as under: “(i) that the loans and advances have been made in compliance with the requirements of the Act;” (i) the name of each associate and related party; (ii) the maximum aggregate amount outstanding at any time during the year calculated by reference to month-end balances; (iii) receivables, that are either past due or impaired, along with age analysis distinguishing between trade debts, loans, advances and other receivables; (iv) debts written off as irrecoverable, distinguishing between trade debts and other receivables; (v) provisions for doubtful or bad debts distinguishing between trade debts, loans, advances and other receivables; and (vi) justification for reversal of provisions of doubtful debts, if any 21. In respect of loans and advances, other than those to 111[employees as per company’s human resource policy or to] the suppliers of goods or services, the name of the borrower and terms of repayment if the loan or advance exceeds rupees one million, together with the particulars of collateral security, if any, shall be disclosed separately; 22. Provision, if any, made for bad or doubtful loans and advances or for diminution in the value of or loss in respect of any asset shall be shown as a deduction from the gross amounts; Share Capital And Reserves 23. Capital and Revenue reserves shall be clearly distinguished. Any reserve required to be maintained under the Act shall be separately disclosed. Any legal or other restrictions, on the ability of the company to distribute or otherwise, shall be disclosed for all kind of reserves maintained by the company; 24. In respect of issued share capital of a company following shall be disclosed separately; (i) shares allotted for consideration paid in cash; (ii) shares allotted for consideration other than cash, showing separately shares issued against property and others (to be specified); 111 Added vide SRO No. 888(I)/2019 dated 29th July, 2019. (iii) shares allotted as bonus shares; 112[and] (iv) treasury shares 113[24A. Discount on issue of shares shall be shown separately as a deduction from share capital in the statement of financial position and the statement of changes in equity;] 25. Shareholder agreements for voting rights, board selection, rights of first refusal, and block voting shall be disclosed. Non-Current Liabilities 26. Amount due to associated companies and related parties shall be disclosed separately. Current Liabilities 27. Following items shall be disclosed as separate line items; (i) Payable to provident fund 114[, contributory pension fund or any other contributory retirement fund]; (ii) Deposits, accrued liabilities and advances; (iii) Loans from banking companies and other financial institutions, other than related parties; (iv) Loans and advances from related parties including sponsors and directors along with purpose and utilization of amounts; and (v) Loans and advances shall be classified as secured and unsecured. 115[28. In the case of provident fund, contributory pension fund or any other contributory retirement fund, maintained by the company a statement that, investments in collective investment schemes, listed equity and listed debt securities out of aforementioned funds have been made in accordance with the provisions of section 218 of the Act and the conditions specified thereunder;] 112 Inserted through SRO 1169(I)/2017 dated 7th November 2017. 113 Inserted vide SRO No. 1169(I)/2017 dated 7th November 2017. 114 Added vide SRO No. 1169(I)/2017 dated 7th November 2017. 115 Substituted vide SRO No. 1169(I)/2017 dated 7th November 2017. The substituted clause (28) was read as under: “28. In the case of provident fund/provident fund trust, maintained by the company a statement that, investments in collective investment schemes, listed equity and listed debt securities out of provident fund/trust have been made in accordance with the provisions of section 218 of the Act and the Rules formulated for this purpose” 29. In respect of security deposit payable, following shall be disclosed: (i) Bifurcation of amount received as security deposits for goods/services to be delivered/provided, into amounts utilizable for company business and others; (ii) Amount utilized for the purpose of the business from the security deposit in accordance with requirements of written agreements, in terms of section 217 of the Act; and (iii) Amount kept in separate bank account. Contingencies And Commitments 30. In describing legal proceedings, under any court, agency or government authority, whether local or foreign, include name of the court, agency or authority in which the proceedings are pending, the date instituted, the principal parties thereto, a description of the factual basis of the proceeding and the relief sought; PART III 116[REQUIREMENTS AS TO STATEMENT OF PROFIT OR LOSS ACCOUNT] 31. Following items shall be disclosed as deduction from turnover as separate line items; (i) trade discount; and (ii) sales and other taxes directly attributed to sales. 32. The aggregate amount of auditors’ remuneration, showing separately fees, expenses and other remuneration for services rendered as auditors and for services rendered in any other capacity and stating the nature of such other services. In the case of joint auditors, the aforesaid information shall be shown separately for each of the joint auditors; 33. In case, donation to a single party exceeds 117[10 per cent of company’s total amount of donation or Rs. 1 million, whichever is higher], name of donee(s) shall be disclosed and where any director or his spouse has interest in the donee(s), irrespective of the amount, names of such directors along with their interest shall be disclosed; 116 Substituted heading “REQUIREMENTS AS TO PROFIT AND LOSS ACCOUNT” vide n SRO No. 888(I)/2019 dated 29th July, 2019. 117 Substituted expression “Rs.500,000” vide SRO No. 888(I)/2019 dated 29th July, 2019. 34. 118[…] 35. Complete particulars of the aggregate amount charged by the company shall be disclosed separately for the directors, chief executive and executives together with the number of such directors and executives such as: (i) fees; (ii) managerial remuneration; (iii) commission or bonus, indicating the nature thereof; (iv) reimbursable expenses which are in the nature of a perquisite or benefit; (v) pension, gratuities, company's contribution to provident, superannuation and other staff funds, compensation for loss of office and in connection with retirement from office; (v) other perquisites and benefits in cash or in kind stating their nature and, where practicable, their approximate money values; and (vi) amount for any other services rendered. 36. In case of royalties paid to companies/entities/individuals, following shall be disclosed: (i) Name and registered address; and; (ii) Relationship with company or directors, if any. 118 Omitted vide SRO No. 888(I)/2019 dated 29th July, 2019. The omitted clause (34) was read as under: “34. Management assessment of sufficiency of tax provision made in the company‘s financial statements shall be clearly stated along with comparisons of tax provision as per accounts viz a viz tax assessment for last three years;”

Effective date: 2017-05-30

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