php first mutual fund trustee: bangladesh general insurance … · 2018-09-11 · php first mutual...

PHP First Mutual FundTrustee: Bangladesh General Insurance Company Limited42 Dilkusha Commercial AreaDhaka 1000

PHP First Mutual Fund

Auditors' report and financial statementsfor the year ended 30 June 2013

S. F. AHMED & COChartered AccountantsHouse # 5\ (3rd floor), Road # 9, Block # F. Banani, Dhaka 12\3, BangladeshTelephones (880-2): PABX 987-\0\8 & 987-06\9Emails:(i)[email protected] (ij) [email protected]: www.sfahmedco.org

S. F. AHMED & COChartered Accountants-- Established: 1958

House # 51 (3rd Floor)Road # 9, Block # F, BananiDhaka 1213, Bangladesh

Phones: (880-2) 987-1018 & 987-0619E-mails:(i)[email protected]

(ii) [email protected]

Auditors' Report to the Trustee of PHP First Mutual Fund

We have audited the accompanying financial statements of PHP First Mutual Fund (the Fund), which comprise thestatement of financial position (balance sheet) as at 30 June 2013, statement of comprehensive income (revenueaccount) and statement of cash flows for the year ended 30 June 2013, and a summary of significant accountingpolicies and other explanatory notes.

Management's responsibility for the financial statementsManagement is responsible for the preparation and fair presentation of these financial statements in accordance withBangladesh Financial Reporting Standards / Bangladesh Accounting Standards and other applicable laws andregulations. This responsibility includes: designing, implementing and maintaining internal control relevant to thepreparation and fair presentation of financial statements that are free from material misstatements, whether due tofraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that arereasonable in the circumstances.

Auditors' responsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit inaccordance with Bangladesh Standards on Auditing. Those standards require that we comply with relevant ethicalrequirements and plan and perform the audit to obtain a reasonable assurance whether the financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financialstatements. The procedures selected depend on the auditors' judgement, including the assessment of the risks ofmaterial misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, weconsider internal control relevant to the entity's preparation and fair presentation of the financial statements in order todesign audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion onthe effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of accounting estimates made by management, as well as evaluating the overallpresentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion.

OpinionIn our opinion, the financial statements prepared in accordance with Bangladesh Financial Reporting Standards /Bangladesh Accounting Standards give a true and fair view of the state of the Fund's affairs as of 30 June 2013 and ofthe results of its operations and its cash flows for the year then ended and comply with the requirements ofBangladesh Securities and Exchange Commission (Mutual Fund) Bidhimala (Rules) 200 I, Trust Deed and otherapplicable laws and regulations.

We also report that:

a. we have obtained all the information and explanations which to the best of our knowledge and belief werenecessary for the purposes of our audit and made due verification thereof;

b. in our opinion, proper books of account as required by law have been kept by the Fund so far as it appeared fromour examination of those books;

c. the statement of financial position (balance sheet) and statement of comprehensive income (revenue account)dealt with by the report are in agreement with the books of account and returns;

d. the investment was made as per Rule 56 of Bangladesh Securities and Exchange Commission (Mutual Fund)Bidhimala (Rules) 2001; and

e. the expenditure incurred and payments made were for the purpose of the Fund's business.

House # 51 (3rd floor), Road # 9, Block # FBanani, Dhaka 1213, BangladeshDated, 13 August 2013

~S. F. AHMED & COChartered Accountants


Statement of Financial Position(Balance Sheet) at 30 June 2013

Assets

Marketable (listed) securities - at costNon-listed securities -at costCash and bank balancesPreliminary and issue expensesOther current assetsTotal Assets

Capital and Liabilities

CapitalRetained earnings/(Iosses)Market risk reserveCurrent liabilities and provisionsTotal Capital and Liabilities

Net Asset Value per Unit

At CostAt Market

See annexed notes I

1L1L-

S. F. AHMED & COChartered Accountants

Amounts in TakaAt At

30 June 2013 30 June 2012

34567

1,468,120,142265,555,556464,290,66848,955,36220,086,191

1,447,672,50890,000,000

590,520,55455,569,4086,787,083

2,267,007,919 2,190,549,553

8 2,000,000,000 2,000,000,000(104,90 I ,889) (230,893,533)

3.1 364,006,027 413,689,5199 7,903,781 7,753,566

2,267,007,919 2,190,549,553

11.30 10.919.48 8.85

For PHP First Mutual Fund

Asset ManagerRACE Management PCL

tI'lChvAyTrusteeBangladesh General Insurance Company Limited

Signed in terms of our report of even date annexed


--2--


Statement of Comprehensive Income (Revenue Account)for the year ended 30 June 2013

Income

Dividend from investment in sharesProfit on sale of investmentInterest on bank deposits and bondsOther incomeTotal Income

Expenditure

Amortization of preliminary and issue expensesManagement feesTrustee feesCustodian feesAnnual listing feesAudit feeLoss on sale of securitiesOther operating expensesTotal ExpenditureProfit before provisionMarket risk reserveProfit/(Ioss) during the yearAccumulated losses brought forwardAccumulated losses carried forward

Earnings per unit for the year

ISee annexed notes I


Notes

Amounts in TakaYear ended Year ended

30 June 2013 30June2012

10

26,277,4905,920,327

80,274,356

112,472,173

2.52.82.92.102.11

6,598,48923,937,3692,186,415

682,6642,200,000

57,500

1/ 501,58436,164,021

2.676,308,15249,683,492

125,991,644(230,893,533)(104,90 I ,889)

0.63


House # oor), Road # 9, Block # FBanani, Dhaka 1213. BangladeshDated, 13 August 2013

27,511,18822,067,04780,239,895

161,477129,979,607

6,620,57830,212,870

1,859,638674,263

2,200,00057,500

521,9501,471,661

43,618,46086,361,147

(219,592,968)(133,231,821)(97,661,712)

(230,893,533)

(0.67)

Il(h,~TrusteeBan ladesh General Insurance Com any Limited

Signed in terms of our report of even date annexed

--3--

~S. F. AHMED & COChartered Accountants


Statement of Cash Flowsfor the year ended 30 June 2013

Cash flows from operating activities:Dividend incomeInterest on bank deposits and bondsOther incomeOther advance, deposit and receivablesOther operating expensesNet cash from operating activities (A)

Cash flows from investing activities:

Value oflisted securitiesReceivable from sundry securitiesPreliminary and issue expensesNon-listed securityNet cash used in investing activities (8)

Cash flows from financing activities:

Capital contribution

et cash from financing activities (C)et decrease in cash (D =A+8+C)

Opening cash and cash equivalents (E)Closing cash and cash equivalents (F =D+E)

___ Asset Manager// .r- ~CE Management PCL


Amounts in TakaYear ended Year ended

30 June 2013 30 June 2012

28,719,12888,287,445

161,477(1,318,061) 1,655,184

(29,41 5,3 I 8) _---"(5':-:0:-'-:,4:-':77'9,:.:-88,:-,:9'f-)68,569,070 68,343,345

25,014,47174,287,978

(361,231,405)62,011,429

186,134

( 175,555,556) _~(9::-::0~'0:70-:::"0,-::-00:-:07-)(194,798,956) (389,033,842)

(21,267,635)2,024,235

(320,690,497)911,211,051

( 126,229,887)590,520,554

590,520,554464,290,668


i?{Ly+TrusteeBan ladesh General Insurance Com an Limited

Signed in terms of our report of even date annexedf~l()\cf"~~yj'}House #~d floor), Road # 9, Block # FBanani, Dhaka 1213, BangladeshDated, 13 August 2013

~Chartered Accountants

--4--

PHP First Mutual FundNotes to financial statements for the year ended 30 June 2013

IGeneral I


I. Legal status and nature of business

PHP First Mutual Fund (hereinafter called as "Fund") was established under a Trust Deed signed on 20 May2010 between PHP Power Generation Plant Limited as a 'Sponsor' and the Bangladesh General InsuranceCompany Limited (BGlC) as a "Trustee". The Fund was registered under the Trust Act 1882 and subsequentlylisted with the Bangladesh Securities and Exchange Commission (BSEC) on 17 June 20 10 under theBangladesh Securities and Exchange Commission (Mutual Fund) Bidhimala (Rules) 200 I. The operations ofthe Fund was commenced on 29 November 2010 by listing with Dhaka and Chittazonz Stock Exchanges.

As provided in Trust Deed, RACE Management PCL is the Fund Manager. RACE Management PCL wasincorporated as a private limited company under Companies Act 1994 on March 2008.

PHP First Mutual Fund is a close-end Mutual Fund of ten years' tenure. The objectives of the Fund are toprovide regular dividend to the investors by investing the Fund both in capital and money market instruments.The Fund consists of200,000,000 units of Taka 10 each. The units of the Fund are transferable.

2. Significant accounting policies

2.1 Basis of preparation of accounts

These financial statements have been prepared under historical cost convention in accordance withgenerally accepted accounting principles as laid down in the International Accounting Standards(IASs)/International Financial Reporting Standards (IFRSs), applicable to the Fund so far adopted by theInstitute of Chartered Accountants of Bangladesh as Bangladesh Accounting Standards(BASs)/Bangladesh Financial Reporting Standards (BFRs). The disclosures of information made inaccordance with the requirements of Trust Deed, Securities and Exchange Rules 1987, BangladeshSecurities and Exchange Commission (Mutual Fund) Bidhimala (Rules) 2001 and other applicable Rulesand regulations.

2.2 Presentation of financial statements

The Fund was registered on 20 May 2010 under the Trust Act 1882 and subsequently listed with StockExchanges on 29 November 2010 and transactions were started accordingly. The financial statementsare prepared and presented covering the period from 01 July 2012 to 30 June 2013.

2.3 Investment

All purchases and sales of securities that require delivery within the time-frame established by regulationor market convention are recognised at the date of trading i.e. the date on which the Fund commits topurchase or sell the investment.

Bonus entitlements, if any, are not accounted for as income rather included in the portfolio to reduce theaverage cost.

2.3.1 Valuation of investment

Listed securities are valued at average closing quoted market prices prevailed as of30 June 2013on an aggregate portfolio basis.

Investment is recorded in the Financial position at cost.

--5--

PHP First Mutual FundNotes to financial statements for the year ended 30 June 2013


2.4 Taxation

The income of the Fund is exempted from Income Tax as per SRO No. 333-Actllncome TaxJ2011 dated10 November 2011, under Section 44(4) clause (b) of Income Tax Ordinance, 1984; hence no provisionfor tax is required.

2.5 Amortisation of preliminary and issue expensesPreliminary and issue expenses represent expenditure incurred prior to commencement of operations andestablishment of the Fund. These costs are amortised within ten years' tenure after adjusting interestincome from escrow accounts as per trust deed and Bangladesh Securities and Exchange Commission(Mutual Fund) Bidhimala (Rules) 2001.

2.6 Market risk reserve

Investment has been valued on aggregated portfolio basis and provision is required to be made onportfolio value of investment as on June 30, 2013 which comes to Taka 364,006,027, last year on June30,2012 total provision was Taka 413,689,519. As the current year required provision is less than theearlier year of Taka 49,683,492, this has been transfered to revenue account as income. Details are innote 3.1

2.7 Dividend policy

As per Rule 66 of Bangladesh Securities and Exchange Commission (Mutual Fund) Bidhimala (Rules)200 I as amended, the Fund is required to distribute its profit in the form of dividend either in cash or re-investment (bonus share) or both to its unit holders an amount which shall not be less than 70% ofannual profit during the year, net provisions.

2.8 Management fee

RACE Management PCL, the management company of the Fund is to be paid an annual managementfees on weekly average net asset value (NA V) as per Rule 65 of Bangladesh Securities and ExchangeCommission (Mutual Fund) Bidhimala (Rules) 2001 and as per Trust Deed @ 2.50% up to 5 crores,2.00% on next 20 crores, 1.50% on next 25 crores and 1.00% on next remaining balance of the weeklyaverage NA V per annum.

2.9 Trustee fee

The Trustee is entitled to get an annual Trusteeship fee @ 0.10% of the net asset value per annum,payable semi-annually in advance basis during the entire life of the Fund as per Trust Deed.

2.10 Custodian feeBRAC Bank Limited is entitled to receive a safekeeping fee @ 0.07% on the balance of securitiescalculated on average monthend value oer annum as a custodian.

2.11 Annual listing fee

Annual fee of Taka 2,000,000 (at the rate of 0.1 0% ofthe fund size) was also paid to BSEC as per Rules10 and II of Bangladesh Securities and Exchange Commission (Mutual Fund) Bidhimala (Rules) 2001.

2.12 Revenue recognition

Gains/losses arising on sale of investment are included in the Revenue Account on the date at which thetransaction takes place. Dividend and interest income are recognised as per BAS-18 and BangladeshSecurities and Exchange Commission (Mutual Fund) Bidhimala (Rules) 200 I.

--6--


Notes to financial statements for the year ended 30 June 2013

IBalance Sheet I


Amounts in TakaAt At

30 June 2013 30 June 2012

3. Marketable (listed) securities - at cost

Equity shares (note 3.1)

3.1 Sector-wise break up of investment in shares are as follows:

1,468,120,142 1,447,672,508

Sector/categoryNumber of Amounts in Taka

shares Cost Market value Difference

Bank 5,419,779 266,715,579 124,845,609 (141,869,969)Cement 88,000 28,121,485 29,480,000 1,358,515Ceramic 5,324 783,255 277,913 (505,342)Corporate Bond 22,925 22,899,180 25,710,513 2,811,332Engineering 129,707 16,125,879 9,091,522 (7,034,357)Food and Allied 42,500 27,115,559 45,275,250 18,159,691Fuel and Power 2,922,591 271,581,433 209,085,638 (62,495,795)Insurance 255,871 40,566,430 24,142,920 (16,423,510)Miscellaneous 42,030 25,734,563 24,316,137 (1,418,426)Mutual Funds 16,509,700 239,239,930 175,042,140 (64,197,790)NBFI 221,731 197,140,191 120,728,369 (76,411,822)Pharma 546,907 127,955,518 137,040,828 9,085,311Services and Real Estate 14,089 1,728,331 404,354 (1,323,977)Tannery 256,400 81,964,398 68,198,260 (13,766,138)Telecommunication 343,960 77,624,460 61,855,380 (15,769,080)Textile 207,238 16,204,752 11,725,278 (4,479,475)Travel & Leisure 323,210 26,619,201 36,894,006 10,274,805

27,351,962 1,468,120,142 1,104,114,115 (364,006,027)

4. Non-listed securities -at cost

Trust Bank Unsecured Subordinated BondRenata Ltd Short Term BondSK. Akijuddin Ltd Short Term BondFarmers' Bank Ltd - shares

90,000,00030,000,000

120,000,00025,555,556

90,000,000

265,555,556 90,000,000

5. Cash and bank balances

Fixed depositsShort term deposits with:

Sponsor account-The Premier Bank (AlC-1 041360000008)The Premier Bank (AlC-O 14913500000002)Social Islami Bank Ltd (AlC-0083131 00000006)ONE Bank Ltd (AlC-0123000000549)Eastern Bank Ltd (AlC-1011220139908)BRAC Bank Ltd (AlC-1501101738427001)EXIM Bank Ltd (AlC-00713100188497)AB Bank Ltd (AlC-4005779044430)Dhaka Bank Ltd (AlC-0201150000002844)

Provisional investment account - Eastern Bank Ltd(NC-1011360242531)

IPO account (BDT) - BRAC Bank Ltd (A/C-1501101738427003)Escrow account - BRAe Bank Ltd (A/C-1501101738427002)

179,720,021127,831,39897,277,63747,286,8188,355,6253,106,339

145,10128,489

744

252,335,954

310,972,8195,501,821

142,896949,054

2,804

15,505522,991

20,101,6555,766

507,784464,290,668 590,520,554

An amount of Taka 310,629 which was collected during subscription of unit would require to be refundedto the subscribers on demand which is deposited with the above-refund IPO account.

--7--




Amounts in Taka

5.1 Bank accountants having nil balanceAt At

30 June 2013 30 June 2012

TPO-USD account (AlC-1501201738427001)TPO-GBP account (AlC-150 120 1738427003)IPO-EURO account (AlC-1 501 201 738427002)

The above foreign currency accounts were opened/maintained for collection/refund of share applicationmoney (unit capital) from non-resident Bangladeshis, book balance of those bank accounts appeared "nil"after issuance of refund warrants but as per bank statements their closing balances were USD-158.59 , GBP-45.80 and EURO-52.74 respectively at 30 June 2013, awaiting for clearance against which reconciliationstatements were prepared.

6. Preliminary and issue expenses

Opening balanceLess: Interest income from escrow account

55,569,40815,557

62,376,120186,134

Less: Amortization of preliminary and issue expensesClosing balance

55,553,8516,598,489

62,189,9866,620,578

48,955,362 55,569,408

7. Other current assets

Interest receivableReceivable from sale of marketable securitiesDividend receivableOther receivable and advances

8,509,2416,357,8801,426,6183,792,452

2,507,3051,641,788

163,6002,474,390

20,086,191 6,787,083

8. Capital

200,000,000 units of Taka 10 each fully paid-up 2,000,000,000 2,000,000,000

9. Current liabilities and provisions

Withholding income tax payableCustodian feesWithholding VAT payablePreliminary expensesPrinting and publicationManagement feesAudit feesPayable to sundry securities

4,528,648 4,974,8011,360,471 1,131,2971,371,637 1,099,543

402,925 402,925100,000 100,00095,09845,000 45,000

27,903,781 7,753,566

--8--

S. F. AHMED & COChartered AccountantsPHP First Mutual Fund


IRevenue Account I Amounts in TakaYear ended Year ended

30 June 2013 30 June 2012to. Interest on bank deposits and bonds

Interest onShort term depositsCorporate bondsFixed deposits

54,698,75423,036,5092,539,093

33,070,9349,839,120

37,329,84180,274,356 80,239,895

II. Other operating expenses

Bank chargesCDBL ChargesOther expenses

141,97887,95658,962

354,666 1,329,683501,584 1,471,661

12. Others

12.1 These notes form an integral part of the annexed financial statements and accordingly are to be read inconjunction therewith.

12.2 Figures in these notes and annexed financial statements have been rounded off to the nearest Taka.

12.3 Figures of previous year have been rearranged wherever considered necessary, to conform the currentyear's presentation.


~~Asset ManagerRACE Management PCL

1'7'~~TrusteeBangladesh General Insurance Company Limited

Dhaka, BangladeshDated, 13 August 2013

--9--

php first mutual fund trustee: bangladesh general insurance … · 2018-09-11 · php first mutual...

Documents