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Askari General Insurance Company Limited: 1st Quarter Report 2020

IM Insights
By IM Insights
3 years ago
Askari General Insurance Company Limited: 1st Quarter Report 2020

Shariah, Takaful, Waqf, General Takaful, Mark-Up, Provision, Receivables, Reserves

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  1. R HE IG H C A RE I H G N G G N I O R E H T R U F 1st Quarter Report 2020 ASKARI INSURANCE CO . LTD 1
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  3. CONTENTS 03 Vision & Mission 06 Corporate Information 07 Directors’ Report on Consolidated Interim Financial Information 08 Directors’ Report on Consolidated Interim Financial Information - Urdu 09 Directors’ Report on Unconsolidated Interim Financial Information 10 Directors’ Report on Unconsolidated Interim Financial Information - Urdu 12 Unconsolidated Condensed Interim Statement of Financial Position (Unaudited) 14 Unconsolidated Condensed Interim Statement of Comprehensive Income (Unaudited) 15 Unconsolidated Condensed Interim Cash Flow Statement (Unaudited) 17 Unconsolidated Condensed Interim Statement of Changes in Equity (Unaudited) 18 Notes to and forming part of the Unconsolidated Condensed Interim Financial Information (Unaudited) 34 Consolidated Condensed Interim Statement of Financial Position (Unaudited) 36 Consolidated Condensed Interim Statement of Comprehensive Income (Unaudited) 37 Consolidated Condensed Interim Cash Flow Statement (Unaudited) 39 Consolidated Condensed Interim Statement of Changes in Equity (Unaudited) 40 Notes to and forming part of the Consolidated Condensed Interim Financial Information (Unaudited) WINDOW TAKAFUL OPERATIONS 56 Condensed Interim Statement of Financial Position (Unaudited) 58 Condensed Interim Statement of Comprehensive Income (Unaudited) 59 Condensed Interim Statement of Changes in Fund (Unaudited) 60 Condensed Interim Cash Flow Statement (Unaudited) 62 Notes to and forming part of the Condensed Interim Financial Information (Unaudited) ASKARI INSURANCE CO. LTD 1
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  5. VISION The vision of askari general insurance company limited (agico) is to be amongst the leading insurance companies of the country with the clear perception of upholding the principles of corporate governance and making agico a profitable and growth oriented insurance company while creating insurance awareness and culture. ASKARI INSURANCE CO. LTD 3
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  7. MISSION To become a leading insurance company by providing client friendly services through highly motivated team of dedicated professionals and ensuring progressive return to the shareholders . ASKARI INSURANCE CO. LTD 5
  8. Corporate INFORMATION Board of Directors Lt Gen Najib Ullah Khan (Retd) Chairman Maj Gen Akhtar Iqbal (Retd) Member Maj Gen Imtiaz Hussain Sherazi (Retd) Member Brig Kamran Asad (Retd) Member Mr. Malik Riffat Mehmood Member Mr. Abdul Hai Mahmood Bhaimia Member Mr. M. Munir Malik Member Mr. Imran Iqbal Member Ethics, Human Resource and Remuneration Committee Mr. Imran Iqbal Chairman Brig Kamran Asad (Retd) Member Mr. Abdul Waheed Member President & Chief Executive Officer Mr. Abdul Waheed Claims Settlement Committee Mr. Malik Riffat Mehmood Chairman Mr. Abdul Waheed Member Mr. M. Qasim Member Chief Financial Officer Mr. Razi Haider Company Secretary Mr. Faizan Zafar Head of Internal Audit Mr. Usman Nawaz Executive, Risk Management & Compliance Committee Maj Gen Akhtar Iqbal (Retd) Chairman Maj Gen Imtiaz Hussain Serazi (Retd) Member Brig Kamran Asad (Retd) Member Mr. Abdul Waheed Member Audit Committee Mr. M. Munir Malik Chairman Mr. Malik Riffat Mehmood Member Brig Kamran Asad (Retd) Member 6 1st Quarter Report 2020 Underwriting, Reinsurance & Coinsurance Committee Maj Gen Akhtar Iqbal (Retd) Chairman Mrs. Samina Khan Member Mr. Sohail Khalid Member Investment Committee Mr. Malik Riffat Mehmood Chairman Mr. M. Munir Malik Member Mr. Abdul Waheed Member Mr. Razi Haider Member Mr. Shahid Qayyum Member External Auditors KPMG Taseer Hadi & Co. Chartered Accountants Islamabad Shariah Compliance Auditors S.M. Suhail & Co. Chartered Accountants Islamabad Shariah Advisor Mufti Ehsan Waquar Legal Advisors Hassan Kaunain Nafees Bankers Askari Bank Limited Askari Islamic Bank Limited Habib Bank Limited The Bank of Punjab Bank Alfalah Limited Summit Bank Limited NRSP Microfinance Bank Limited Silk Bank Limited Faysal Bank Limited Bank Al Habib Limited Meezan Bank Limited Finca Microfinance Bank Limited Zarai Taraqiati Bank Limited Samba Bank Limited U Microfinance Bank Limited JS Bank Limited Sindh Bank Limited The Bank of Khyber MCB Islamic Bank Limited Al Baraka Bank Limited Punjab Provincial Cooperative Bank Limited Registrar & Share Transfer Office THK Associates (Private) Limited 1st Floor, 40-C, Block-6, P.E.C.H.S., Karachi 75400, Pakistan. PABX: +92 (021) 111-000-322 Direct: +92 (021) 34168270 Fax: +92 (021) 34168271 Registered Office/Head Office 3rd Floor, AWT Plaza, The Mall, Rawalpindi, Pakistan Ph: +92-51-9028101-2 Fax: +92-51-9272424 Email: info@agico.com.pk
  9. DIRECTORS ’ REPORT On Consolidated Interim Financial Information For the Quarter Ended 31st March 2020 The Directors are pleased to present the consolidated un-audited major cities is causing significant reduction in public and private condensed interim financial information of Askari General Insurance revenue and it is expected to persist throughout the year. Business Company Limited and its subsidiary (the Group) for the first quarter development in current scenario is very challenging. We would ended 31st March 2020. adopt a careful and vigilant business approach, together with During the period, the Group’s results from core operations are liquidity management and investment planning, we will strive to better than the similar period last year. A comparison of key maintain a balance between growth, profitability and liquidity. performance indicators is as follows: Acknowledgements We would like to take this opportunity to thank our Regulators, the 31st March 2019 Insurance Association of Pakistan for their continued support, and (Rupees in Thousands) our valued Reinsurers and other stakeholders for their trust and 2020 Gross premium written (incl. Takaful Contribution) 605,425 652,842 Net premium revenue 471,407 518,769 Underwriting Profit 52,944 49,301 Investment and other income 83,942 55,430 Profit before tax 150,032 124,139 Profit after tax 106,739 90,175 1.48 1.25 Earnings per share (Rs.) The Group achieved growth of 7% in underwriting profits, despite confidence in us. . For and Behalf of the Board Abdul Waheed Lt Gen Najib Ullah Khan (Retd) President & Chief Executive Chairman – Board of Directors a 7% decline in gross premium written. The Investment and other income increased by 51% whereas Profit after tax and Earnings per Rawalpindi Share increased by 18%. 27 April 2020 Future Outlook In the wake of Coronavirus outbreak, Pakistan is experiencing major economic losses in different sectors. The lockdown of ASKARI INSURANCE CO. LTD 7
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  11. DIRECTORS ’ REPORT On Unconsolidated Interim Financial Information For the Quarter Ended 31st March 2020 The Directors are pleased to present the un-audited condensed development in current scenario is very challenging. We would interim financial information of Askari General Insurance Company adopt a careful and vigilant business approach, together with Limited (the Company) for the first quarter ended 31st March 2020. liquidity management and investment planning, we will strive to During the period, the Company’s results from core operations maintain a balance between growth, profitability and liquidity. are better than the similar period last year. A comparison of key Acknowledgements performance indicators is as follows: We would like to take this opportunity to thank our Regulators, the Insurance Association of Pakistan for their continued support, and 31st March 2020 our valued Reinsurers and other stakeholders for their trust and 2019 confidence in us. (Rupees in Thousands) Gross premium written (incl. Takaful Contribution) 605,425 652,842 Net premium revenue 471,407 518,769 Underwriting Profit 53,707 49,301 Investment and other income 83,942 55,430 Profit before tax 150,795 124,139 Profit after tax 107,502 90,175 1.50 1.25 Earnings per share (Rs.) For and Behalf of the Board Abdul Waheed Lt Gen Najib Ullah Khan (Retd) President & Chief Executive Chairman – Board of Directors The Company achieved growth of 9% in underwriting profits, despite a 7% decline in gross premium written. The Investment Rawalpindi and other income increased by 51% whereas Profit before tax 27 April 2020 and Earnings per Share (after tax) increased by 21% and 20% respectively. Future Outlook In the wake of Coronavirus outbreak, Pakistan is experiencing major economic losses in different sectors. The lockdown of major cities is causing significant reduction in public and private revenue and it is expected to persist throughout the year. Business ASKARI INSURANCE CO. LTD 9
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  13. UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 ASKARI INSURANCE CO . LTD 11
  14. UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION (UNAUDITED) AS AT 31 MARCH 2020 Note (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand ASSETS Property and equipment 7 359,408 285,565 Intangible assets 8 368 345 Investment property 9 40,173 40,501 Investment in subsidiary 10 10,000 10,000 - Equity securities 11 143,740 314,451 - Debt securities 12 2,156,845 1,640,386 - Term deposits 13 111,000 252,000 184,386 132,406 Investments Loans and other receivables Insurance / Reinsurance receivables 14 868,131 1,166,352 Reinsurance recoveries against outstanding claims 18 214,246 331,317 41,283 39,206 99,842 124,175 15,570 15,591 Prepayments 407,500 457,438 Cash and bank 190,018 342,238 Total assets from Window Takaful Operations - OPF 305,073 279,427 5,147,583 5,431,398 Salvage recoveries accrued Deferred commission expense / Acquisition cost Deferred taxation Total Assets Razi Haider Chief Financial Officer 12 1st Quarter Report 2020 19 Abdul Waheed President & Chief Executive
  15. (Unaudited) (Audited) 31 March 31 December 2020 2019 Note Rupees in thousand EQUITY AND LIABILITIES Capital and reserves attributable to Company's equity holders Ordinary share capital 719,019 719,019 Share premium 121,161 121,161 70,389 70,339 Unappropriated profit 1,163,362 1,055,860 Total Equity 2,073,931 1,966,379 Reserves Liabilities Underwriting Provisions - Outstanding claims including IBNR 18 496,691 624,125 - Unearned premium reserves 17 1,209,156 1,388,337 - Unearned reinsurance commission 19 82,870 104,848 Retirement benefit obligations 39,428 37,367 Staff compensated absences 30,803 29,715 184,252 100,390 Taxation - provision less payment 15,301 295 Premium received in advance 12,524 15,021 721,123 853,022 7,158 7,158 132,702 167,431 44,093 45,610 2,976,101 3,373,320 97,551 91,699 5,147,583 5,431,398 Liabilities against assets subject to finance lease - secured Insurance / Reinsurance payables Unclaimed dividends Other creditors and accruals 15 Deposits and other payables Total Liabilities Total liabilities from Window Takaful Operations - OPF Total Equity and Liabilities Contingencies and commitments 16 The annexed notes 1 to 25 form an integral part of this condensed interim financial information. Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 13
  16. UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Quarter ended 31 March 2020 Note 2019 Rupees in thousand Net insurance premium 17 471,407 518,769 Net insurance claims 18 (274,091) (340,586) Net commission and other acquisition costs 19 19,904 21,663 Insurance claims and acquisition expenses (254,187) (318,923) Management expenses (163,513) (150,545) 53,707 49,301 75,516 49,676 1,434 1,274 Underwriting results Investment income 20 Rental income Other income Other expenses Results of operating activities 6,992 4,480 (2,330) (1,923) 135,319 102,808 (4,319) (1,501) 131,000 101,307 19,795 22,832 Profit before tax 150,795 124,139 Income tax expense (43,293) (33,964) Profit after tax 107,502 90,175 50 4,546 107,552 94,721 1.50 1.25 Finance costs Profit before tax from General Operations Profit before tax from Window Takaful Operations - OPF Other comprehensive income: Items that will be reclassified subsequently to profit and loss account: Unrealised gain on available-for-sale investments - net Total comprehensive income for the period Earnings (after tax) per share - Rupees (Restated) 21 The annexed notes 1 to 25 form an integral part of this condensed interim financial information. Razi Haider Chief Financial Officer 14 1st Quarter Report 2020 Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman
  17. UNCONSOLIDATED CONDENSED INTERIM CASH FLOW STATEMENT (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 2020 2019 Rupees in thousand Operating cash flows a) Underwriting activities: 808,232 757,340 Reinsurance premium paid (850,887) (26,084) Claims paid Premium received (480,489) (405,095) Reinsurance and other recoveries received 480,363 3,882 Commission paid (54,325) (29,174) Commission received Management expenses paid Net cash flows (used in) / generated from underwriting activities 199,220 5,039 (146,990) (151,351) (44,876) 154,557 (28,287) (25,131) b) Other operating activities: Income tax paid Other expenses paid Other operating receipts / (payments) (3,679) (1,691) 100,713 (53,893) (342) 104 Net cash generated from (used in) other operating activities 68,405 (80,611) Total cash flow generated from all operating activities 23,529 73,946 30,295 30,503 Advances to employees Investing activities: Profit / return received 1,781 22 (1,505,591) (751,723) 1,311,866 605,277 Fixed capital expenditure 2,714 (2,733) Proceeds from disposal of fixed assets 1,905 - (157,030) (118,654) (4,319) (1,501) (14,518) (7,932) 17 100 Dividends received Payments for investments Proceeds from investments Total cash used in investing activities Financing activities: Financial charges paid Repayment of obligation under finance lease Staff house building finance - net 101 316 (18,719) (9,017) (152,220) (53,725) Cash and cash equivalents at beginning of the period 342,238 147,175 Cash and cash equivalents at end of the period 190,018 93,450 Mark-up on staff house building finance received Total cash used in financing activities Net cash used in all activities The annexed notes 1 to 25 form an integral part of this condensed interim financial information. Razi Haider Chief Financial Officer Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 15
  18. UNCONSOLIDATED CONDENSED INTERIM CASH FLOW STATEMENT (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 2020 2019 Rupees in thousand Reconciliation to Profit and Loss Account Operating cash flows 23,529 73,946 Depreciation expense (21,234) (12,451) (4,319) (1,501) 1,012 - (1,013,652) (68,182) 1,036,868 30,563 - 544 Financial charges Gain on disposal of fixed assets Decrease in assets other than cash Decrease in liabilities other than running finance Unrealized gain on investments - held for trading Provision for diminution in value of AFS investments Dividend income Investment income Profit on bank deposits Income tax provision - 17,076 1,781 1,207 69,533 28,923 4,993 4,126 (43,293) (33,964) 4,202 1,925 Tax paid 28,287 25,131 Profit after taxation from General Insurance Operations 87,707 67,343 19,795 22,832 107,502 90,175 Gain on trading Profit from Window Takaful Operations - OPF Profit after taxation Definition of cash : Cash comprises cash in hand, bank balances, stamp in hand and short term placements with banks which are readily convertible to cash in hand and which are used in the cash management function on a day-to-day basis. 2020 Cash for the purpose of cash flow statement consists of: 2019 Rupees in thousand Cash and other equivalents 1,569 Cash in hand 1,024 36 - 1,605 1,024 Current accounts 124,208 20,538 Deposit accounts 64,205 71,888 188,413 92,426 190,018 93,450 Stamp in hand Current and other accounts Total The annexed notes 1 to 25 form an integral part of this condensed interim financial information. Razi Haider Chief Financial Officer 16 1st Quarter Report 2020 Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman
  19. UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Share capital Reserves Issued, subscribed and paid up Capital reserve Total reserves Total equity Revenue reserve Share premium General reserve Available for sale investment revaluation reserve Retained earnings Rupees in thousand Balance as at 01 January 2019 625,234 121,161 70,000 (17,462) Profit for the period - - - - Other comprehensive income for the period - - - 4,546 Total comprehensive income for the period - - - 4,546 Balance as at 31 March 2019 625,234 121,161 70,000 (12,916) Balance as at 01 January 2020 719,019 121,161 70,000 Profit for the period - - Other comprehensive income for the period - - Total comprehensive income for the period - 719,019 887,788 1,061,487 1,686,721 Total comprehensive income for the period 90,175 90,175 90,175 4,546 4,546 94,721 94,721 977,963 1,156,208 1,781,442 339 1,055,860 1,247,360 1,966,379 - - 107,502 107,502 107,502 - 50 - 50 50 - - 50 107,552 107,552 121,161 70,000 389 90,175 Total comprehensive income for the period Balance as at 31 March 2020 107,502 1,163,362 1,354,912 2,073,931 The annexed notes 1 to 25 form an integral part of this condensed interim financial information. Razi Haider Chief Financial Officer Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 17
  20. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 1 2 LEGAL STATUS AND NATURE OF BUSINESS askari general insurance company limited (“the Company”) was incorporated under the Companies Ordinance, 1984 as a public limited company on 12 April 1995. The Company is engaged in non-life insurance business comprising of fire, marine, motor, health and miscellaneous. The Company commenced its commercial operations on 15 October 1995. Shares of the Company are quoted on Pakistan Stock Exchange Limited. The registered office and principal place of business of the Company is located at AWT Plaza, Rawalpindi. The Company has 20 branches in Pakistan. The Company is a subsidiary of Army Welfare Trust. BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE This condensed interim financial information has been prepared in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting consist of: - International Accounting Standard (IAS) 34, Interim Financial Reporting, issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017 - Provisions of and directives issued under the Companies Act, 2017 - Insurance Rules, 2017, Insurance Accounting Regulations, 2017 and Insurance Ordinance, 2000 Where the provisions of and directives issued under the Companies Act, 2017 differ with the requirements of IAS 34, the provisions of and directives issued under the Companies Act, 2017, the Insurance Ordinance, 2000, the Insurance Rules, 2017 and the Insurance Accounting Regulations, 2017 shall prevail. 2.1 2.2 18 This condensed interim financial information does not include all of the information and disclosures required for annual financial statements and should be read in conjunction with the annual audited financial statements of the Company for the year ended 31 December 2019. Comparative balance sheet is extracted from annual audited financial statements for the year ended 31 December 2019 whereas comparative for condensed interim statement of comprehensive income, condensed interim statement of changes in equity, condensed interim cash flow statement, are stated from unaudited condensed interim financial information for the three months period ended 31 March 2019. Total assets, total liabilities and profit / (loss) of the Window Takaful Operations of the Company referred to as the Operator’s Fund has been presented in this condensed interim financial information in accordance with the requirements of Circular 25 of 2015 dated 9 July 2015. A separate set of financial statements of Window Takaful Operations has been reported which is annexed to this condensed interim financial information as per the requirements of the SECP Takaful Rules, 2012. Basis of measurement This condensed interim financial information has been prepared under the historical cost convention except for certain financial instruments which are carried at their fair values and obligations under certain employee benefits which are measured at their present values. Figures have been rounded off to the nearest rupees in thousand. Functional and presentation currency This condensed interim financial information is presented in Pakistani Rupees, which is the Company’s functional and presentation currency. 1st Quarter Report 2020
  21. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 3 4 5 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies and methods of computation including judgements and estimates used in measurement of fair values for the preparation of this condensed interim financial information are the same as those applied in the preparation of the financial statements for the year ended 31 December 2019. FINANCIAL RISK MANAGEMENT The Company’s financial risk management objectives and policies are consistent with those disclosed in the financial statements for the year ended 31 December 2019. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of condensed interim financial information requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing this condensed interim financial information, the significant judgement made by management in applying the Company’s accounting policies and the key sources of estimation uncertainty were the same as those that were applied in the preparation of the financial statements for the year ended 31 December 2019. 6 PREMIUM DEFICIENCY RESERVE During the period, management has reviewed the results of each class of business and considers that no additional reserve is required to be created as the unearned premium reserve for each class of business as at the period end is adequate to meet the expected future liability after reinsurance from claims and other expenses, expected to be incurred after the balance sheet date in respect of the policies in force at the balance sheet date. (Unaudited) 31 March 2020 Note 7 7.1 (Audited) 31 December 2019 Rupees in thousand PROPERTY AND EQUIPMENT Capital work-in-progress 7.1 2,850 3,310 Operating assets 7.2 356,558 282,255 359,408 285,565 Opening balance 3,310 2,871 Additions 2,384 4,664 Transfers (2,844) (4,225) 2,850 3,310 Movement in Capital work-in-progress is as follows: Closing balance ASKARI INSURANCE CO. LTD 19
  22. 20 1st Quarter Report 2020 2 ,637 23,674 20,675 18,227 (26,376) 23,802 3,428 1,970 (1,053) 1,039 Additions / (Disposals) 577,711 74,498 109,155 Right of use assets - Rental properties Tracking devices Leasehold improvements 118,800 25,694 67,421 22,100 139,368 31 December 2019 (audited) Building Furniture and fixtures Computers and office equipment Motor vehicles (Owned) Right of use assets - Motor vehicles Opening balance (663) (1,845) 86,994 87,004 23,312 605,610 Tracking devices Leasehold improvements 4,225 - 4,225 - Adjustments 1,787 1,787 - - Adjustments Cost (2,216) 93,421 140,407 92,725 Additions / (Disposals) Right of use assets - Motor vehicles Right of use assets - Rental properties Opening balance Cost (645) (355) (703) 7.2.1 Note 142,602 29,122 69,391 21,047 31 March 2020 (unaudited) Building Furniture and fixtures Computers and office equipment Motor vehicles (Owned) Operating assets 605,610 23,312 92,725 87,004 142,602 29,122 69,391 21,047 140,407 Closing balance 88,128 21,467 694,391 138,191 186,146 142,602 28,477 69,036 20,344 Closing balance 1,015 663 22,808 7,070 10,149 891 781 1,480 759 For the period 277,250 16,162 104,222 743 17,760 57,076 12,452 68,835 Opening balance (558) (1,845) (8,330) (3,914) - 88,730 2,513 38,818 3,389 3,059 2,605 6,790 3,087 28,469 For the period (639) (516) (858) (Disposals) / Adjustments (42,625) - (25,610) (760) (4,318) (931) (11,006) (Disposals) / Adjustments Depreciation Rupees in thousand 82,001 18,675 323,355 86,298 38,818 3,802 19,605 59,548 14,608 Opening balance Depreciation Rupees in thousand 323,355 18,675 38,818 82,001 3,802 19,605 59,548 14,608 86,298 Closing balance 82,458 17,493 337,833 89,454 48,967 4,693 19,747 60,512 14,509 Closing balance 8.1 8 5,139 Total - 31 December 2019 (audited) 74 366 74 - - - Adjustments Cost Additions / (Disposals) Amortization for the three months period ended 31 March 2019 was Rs. 31 thousand. 5,505 5,505 Computer software Opening balance Total - 31 March 2020 (unaudited) INTANGIBLE ASSETS 5,505 5,579 5,579 Closing balance 5,067 5,160 5,160 Opening balance 93 51 51 For the period - - - (Disposals) / Adjustments Depreciation 5,160 5,211 5,211 Closing balance 7.2.1 This represents the carrying value of one office located at 8th Floor of Askari Tower, Lahore. The total area of the office is 5,460 square feet. 7.2.2 Additions, disposals and depreciation for the three months period ended 31 March 2019 were Rs.10,775 thousand, nil and 12,810 thousand respectively. 7.2 345 368 368 Written down value 282,255 4,637 53,907 5,003 138,800 9,517 9,843 6,439 54,109 Written down value 5,670 3,974 356,558 48,737 137,179 137,909 8,730 8,524 5,835 Written down value 5 5 Useful life (years) 3 1 to 9 3 40 5 3 5 5 Useful life (years) 3 3 5 1 to 9 40 5 3 5 Useful life (years) NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  23. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 9 INVESTMENT PROPERTY This represents the carrying amount of two offices in Islamabad Stock Exchange building, classified as investment property based on the management’s intention to hold the property for earning rentals and / or capital appreciation. (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand Cost Balance at beginning of the period / year 52,400 52,400 Balance at end of the period / year 52,400 52,400 (11,899) (10,589) (328) (1,310) (12,227) (11,899) 40,173 40,501 40 40 Depreciation Balance at beginning of the period / year Depreciation for the period / year Balance at end of the period / year Useful life (years) Depreciation for the three months period ended 31 March 2019 was Rs. 327,500. 10 10.1 11 (Unaudited) (Audited) 31 March 31 December 2020 2019 INVESTMENT IN SUBSIDIARY Note Rupees in thousand AskTech (Private) Limited - At cost 10.1 10,000 10,000 AskTech (Private) Limited is engaged in establishing, developing, expanding, enhancing, managing and operating information technology services, GPS/GSM based tracking and systems. The Company acquired 100% shareholding in AskTech (Private) Limited in February 2019. The Company holds 99.96% shares of AskTech (Private) Limited whereas the directors nominated by the Company on the Board of Directors of AskTech (Private) Limited hold qualification shares of 0.04%. (Unaudited) (Audited) 31 March 31 December 2020 2019 INVESTMENTS IN EQUITY SECURITIES\ Note Fair value through profit and loss 11.1 140,640 311,421 Available-for-sale 11.2 3,100 3,030 143,740 314,451 Total equity securities Rupees in thousand ASKARI INSURANCE CO. LTD 21
  24. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 31 March 2020 (unaudited) Cost Impairment / provision 31 December 2019 (audited) Carrying value Cost Impairment / provision Carrying value Rupees in thousand 11.1 Fair value through profit and loss Mutual funds 11.2 140,640 - 140,640 Listed shares - - - - - - Mutual funds 2,554 - 2,554 2,554 - 2,554 546 - - 476 3,100 2,554 - 3,030 - 311,421 Available-for-sale Unrealized surplus on revaluation 2,554 12 311,420 - INVESTMENTS IN DEBT SECURITIES 31 March 2020 (unaudited) Cost Impairment / provision 31 December 2019 (audited) Carrying value Impairment / provision Cost Carrying value Rupees in thousand HELD TO MATURITY Government Securities 112,871 - 112,871 112,259 - 112,259 1,656,291 - 1,656,291 1,223,102 - 1,223,102 1,769,162 - 1,769,162 1,335,361 - 1,335,361 Term Finance Certificates 160,000 - 160,000 160,000 - 160,000 Sukuks 227,683 - 227,683 145,025 - 145,025 387,683 - 387,683 305,025 - 305,025 11,128 (11,128) - 11,128 (11,128) - 2,167,973 (11,128) 2,156,845 1,651,514 (11,128) 1,640,386 Pakistan Investment Bonds Treasury Bills AVAILABLE-FOR-SALE LOANS AND RECEIVABLES Certificates of Investments (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 13 INVESTMENTS IN TERM DEPOSITS Loans and receivables Deposits maturing within 12 months 22 1st Quarter Report 2020 111,000 252,000
  25. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 14 INSURANCE / REINSURANCE RECEIVABLES 709,877 1,013,864 (20,760) (20,760) 689,117 993,104 194,514 188,748 (15,500) (15,500) 179,014 173,248 868,131 1,166,352 Agents' commission payable 51,961 64,947 Tax deducted at source 11,985 13,395 Federal excise duty / federal insurance fee 17,000 39,939 Accrued expenses 20,642 12,269 853 2,262 Fund received against vehicle Ijarah 2,213 145 Payable to subsidiary 4,454 4,853 23,594 29,620 132,702 167,431 Due from insurance contract holders Less: provision for impairment of receivables from insurance contract holders Due from other insurers / reinsurers Less: provision for impairment of receivables from other insurers / reinsurers 15 OTHER CREDITORS AND ACCRUALS Fund received against leased vehicle Others 16 CONTINGENCIES AND COMMITMENTS There is no change in contingencies and commitments as reported in the annual financial statements of the Company for the year ended 31 December 2019. ASKARI INSURANCE CO. LTD 23
  26. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 17 NET INSURANCE PREMIUM 513,735 558,246 Add: Unearned premium reserve opening 1,388,337 1,642,458 Less: Unearned premium reserve closing 1,209,156 1,440,048 Premium earned 692,916 760,656 Less: Reinsurance premium ceded 153,989 179,970 Add: Prepaid reinsurance premium opening 454,811 547,973 Less Prepaid reinsurance premium closing 387,291 486,056 Reinsurance expense 221,509 241,887 471,407 518,769 Claims paid 480,489 405,595 Add: Outstanding claims including IBNR closing 496,691 493,043 Less: Outstanding claims including IBNR opening 624,126 445,799 Claims expense 353,054 452,839 Less: Reinsurance and other recoveries received 196,034 71,048 214,246 222,185 331,317 180,980 78,963 112,253 274,091 340,586 Written gross premium 18 NET INSURANCE CLAIMS Add: Reinsurance and other recoveries in respect of outstanding claims closing Less: Reinsurance and other recoveries in respect of outstanding claims opening Reinsurance and other recoveries revenue 24 1st Quarter Report 2020
  27. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 19 NET COMMISSION EXPENSE / ACQUISITION COST 39,060 55,923 Add: Deferred commission expense opening 124,175 97,956 Less: Deferred commission expense closing 99,842 101,014 Net commission 63,393 52,865 Less: Commission received or recoverable 61,319 64,072 Add: Unearned reinsurance commission opening 104,848 107,337 Less Unearned reinsurance commission closing 82,870 96,881 Commission from reinsurers 83,297 74,528 (19,904) (21,663) 1,781 - - 1,207 1,781 1,207 Return on government securities 51,744 943 Return on other fixed income securities 17,849 42,421 69,593 43,364 4,202 1,926 - (14,441) 4,202 (12,515) Unrealized profit on re-measurement of investments held for trading - 544 Reversal of diminution in available-for-sale investments - 17,076 (60) - 75,516 49,676 Commission paid or payable 20 INVESTMENT INCOME Dividend income on investments Dividend income on securities held for trading Dividend income on available-for-sale investments Income from debt securities Net realised gains on investments Gain on trading of held for trading investments Loss on sale of available-for-sale investments Investment related expenses Total investment income ASKARI INSURANCE CO. LTD 25
  28. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 21 (Unaudited) (Audited) 31 March 31 December 2020 2019 EARNINGS PER SHARE Profit after tax (Rupees in thousand) 107,502 90,175 Weighted average number of shares 71,902 71,902 1.50 1.25 Earnings per share (Rupees) - Restated No figure for diluted earnings per share has been presented as the Company has not issued any instrument which would have an impact on earnings per share when exercised. The restatement is due to issuance of 9,378,508 bonus shares. 22 RELATED PARTY TRANSACTIONS The Company is a subsidiary of Army Welfare Trust (“the parent company”) therefore all subsidiaries and associated undertakings of the parent company are related parties of the Company. Other related parties comprise directors, key management personnel, entities with common directorships and entities over which the directors are able to exercise influence. Balances and transactions with related parties are as follows: (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand Balances at period / year end Parent: Premium due: 2,358 1,316 323 6,946 (1,381) (5,904) 1,300 2,358 Balance at beginning of the period / year (4,853) - Services acquired (7,481) (22,200) Balance at beginning of the period / year Insurance premium written (including government levies, administrative surcharge and policies stamps) Receipts during the period / year Balance at end of the period / year Subsidiary: Paid during the period / year Balance at end of the period / year 7,880 17,347 (4,454) (4,853) 80,204 94,261 7,559 108,957 (32,139) (123,014) 55,624 80,204 Associated undertakings: Premium due: Balance at beginning of the period / year Insurance premium written (including government levies, administrative surcharge and policies stamps) Receipts during the period / year Balance at end of the period / year 26 1st Quarter Report 2020
  29. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) Quarter ended 31 March 2020 Transactions during the period: 2019 Rupees in thousand With parent: Insurance premium written (including government levies 323 403 1,381 484 941 544 6,191 5,692 - 10,000 Services acquired 7,481 - Payments made 7,880 - 7,559 9,768 32,139 41,302 Insurance claims paid 5,167 7,272 Contribution to staff retirement benefit funds 9,492 9,109 16,154 10,951 administrative surcharge and policies stamps) Premium received during the period Insurance claims paid Rent paid With subsidiary: Investment made during the period With associates: Insurance premium written (including government levies administrative surcharge and policies stamps) Premium received during the period Remuneration of chief executive, directors and executives ASKARI INSURANCE CO. LTD 27
  30. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 23 FAIR VALUE OF FINANCIAL INSTRUMENTS The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy for financial instruments measured at fair value. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value. 31 March 2020 (unaudited) Held-fortrading Available-for -sale Held-tomaturity Loans and receivables Other financial liabilities Level 1 Rupees in thousand Financial assets measured at fair value Investment at fair value through profit and loss Investment at fair value through other comprehensive income 140,640 - - - - 140,640 - 3,100 - - - 3,100 - 10,000 - - - - Financial assets not measured at fair value Investment in subsidiary Investments - Government securities - - 1,769,162 - - - - Certificates of Investment (COIs) / TDRs - - - 111,000 - - - Fixed term deposits - 387,683 - - - - Loans to employees - - - 354 - - Accrued investment income* - - - 81,509 - - Staff house building finance - - - 2,944 - - Sundry receivables* - - - 99,579 - - Amounts due from insurance contract holders* - - - 689,117 - - Amounts due from other insurers / reinsurers* - - - 179,014 - - Reinsurance recoveries against outstanding claims* - - - 214,246 - - Salvage recoveries accrued* - - - 41,283 - - Cash and bank deposits* - - - 190,018 - - Total assets of Window Takaful Operations - OPF - - - 305,073 - - Financial liabilities not measured at fair value 28 Provision for outstanding claims (including IBNR)* - - - - 496,691 - Lease liabilities - - - - 184,252 - Premium received in advance - - - - 12,524 - Amounts due to other insurers / reinsurers* - - - - 721,123 - Unclaimed dividend* - - - - 7,158 - Accrued expenses* - - - - 20,642 - Other creditors and accruals* - - - - 112,060 - Deposits and other payables* - - - - 44,093 - Total liabilities of Window Takaful Operations - OPF - - - - 97,551 - 140,640 400,783 1,769,162 1,914,137 1,696,094 143,740 1st Quarter Report 2020
  31. NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 31 December 2019 (audited) Held-fortrading Available-for -sale Held-tomaturity Other financial liabilities Loans and receivables Level 1 Rupees in thousand Financial assets measured at fair value Investment at fair value through profit and loss 311,421 - - - - 311,421 - 3,030 - - - 3,030 - 10,000 - - - - - Government securities - - 1,335,361 - - - - Certificates of Investment (COIs) / TDRs - - - 252,000 - - - Fixed term deposits - 305,025 - - - - Loans to employees - - - 12 - - Accrued investment income* - - - 44,028 - - Staff house building finance - - - 2,961 - - Sundry receivables* - - - 85,405 - - Amounts due from insurance contract holders* - - - 993,104 - - Amounts due from other insurers / reinsurers* - - - 173,248 - - Reinsurance recoveries against outstanding claims* - - - 331,317 - - Salvage recoveries accrued* - - - 39,206 - - Cash and bank deposits* - - - 342,238 - - Total assets of Window Takaful Operations - OPF - - - 279,427 - - Provision for outstanding claims (including IBNR)* - - - - 624,125 - Lease liabilities - - - - 100,390 - Premium received in advance - - - - 15,021 - Amounts due to other insurers / reinsurers* - - - - 853,022 - Unclaimed dividend* - - - - 7,158 - Accrued expenses* - - - - 12,269 - Other creditors and accruals* - - - - 155,162 - Deposits and other payables* - - - - 45,610 - Total liabilities of Window Takaful Operations -OPF - - - - 91,699 - 311,421 318,055 1,335,361 2,542,947 1,904,456 314,451 Investment at fair value through other comprehensive income Financial assets not measured at fair value Investment in subsidiary Investments Financial liabilities not measured at fair value * The Company has not disclosed the fair value of these items because their carrying amounts are a reasonable approximation of fair value. Fair value is an amount for which an asset could be exchanged, or a liability settled, between knowledgeable willing parties in an arm’s length transaction. Consequently, differences may arise between the carrying values and the fair values estimates. The Company measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements: Level 1: Fair value measurements using quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Fair value measurements using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Fair value measurements using inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs). ASKARI INSURANCE CO. LTD 29
  32. 30 SEGMENT INFORMATION 1st Quarter Report 2020 110 ,311 1,873 (562) 103,154 (92,529) Facultative inward premium Service charges Insurance premium earned Insurance premium ceded to reinsurers (200) 40,129 (21,469) (12,571) (7,162) (10,914) (6,485) 15,568 Net claims Commission expense Management expense Underwriting results 2020 31 March 101,306 Profit before tax 150,795 19,795 131,000 Profit before tax from Window Takaful Operations - OPF (1,501) (1,923) (4,319) 124,138 22,832 1,274 49,676 49,301 (150,545) (52,865) (340,586) 112,253 (452,839) 593,297 74,528 518,769 (241,887) 760,656 (561) 2,815 14,891 541,101 558,246 2,298 5,562 67,751 633,857 (2,330) 53,707 (163,513) (63,393) (274,091) 78,963 (353,054) 554,704 83,297 471,407 (221,509) 692,916 (409) 2,908 11,346 499,890 513,735 1,623 5,085 55,621 576,064 2019 31 March Unaudited Finance costs 49,759 (16,329) (8,874) (14,823) 16,476 (31,299) 89,785 30,533 59,252 (62,542) 121,794 (486) 135 1,785 93,293 94,727 39 943 10,356 106,065 2020 31 March Other expenses 58,818 (33,856) (20,798) (23,491) 10,738 (34,229) 136,963 33,746 103,217 (39,231) 142,448 (57) 747 1,237 106,696 108,623 30 1,079 6,096 115,828 2019 31 March Total 4,480 (27,966) (49,960) (6,486) (160,369) 39,524 (199,893) 188,849 7,560 181,289 (47,259) 228,548 323 - 405 92,305 93,033 2 927 - 93,962 2020 31 March Unaudited 1,434 (55,082) (42,227) (6,221) (141,634) 45,566 (187,200) 135,000 6,258 128,742 (41,953) 170,695 295 - 200 82,065 82,560 3 819 - 83,382 2019 31 March Unaudited Miscellaneous Unaudited 6,992 237 (71,175) (16,044) (154,320) 4,195 (158,515) 241,776 132 241,644 (2,220) 243,864 (91) - 8,774 232,498 241,181 47 2,442 38,421 282,091 Rupees in thousand 2019 31 March Unaudited Accident and health Unaudited Rental income 25,577 (76,188) (14,553) (98,348) 1,726 (100,074) 214,666 348 214,318 (5,120) 219,438 (74) 288 7,000 200,921 208,135 40 2,087 32,933 243,195 2020 31 March Unaudited Motor Unaudited Other income 7,813 (6,060) (8,890) (10,390) 52,542 (62,932) 33,153 11,162 21,991 (34,148) 56,139 (56) - 2,242 55,433 57,619 2,200 577 8,377 68,773 2019 31 March Unaudited 75,516 8,826 (4,757) (10,907) (3,456) 6,626 (10,082) 27,946 13,441 14,505 (42,676) 57,181 (11) - 1,677 43,150 44,816 1,544 434 6,160 52,954 2020 31 March Unaudited Investment income 19,457 (7,022) (684) 14,307 Insurance claims recovered (484) 25,141 39,734 29,504 Commission income Net underwriting income Insurance claims 14,593 (95,718) 2,680 10,625 Net insurance premium (251) 1,232 1,685 67,572 67,058 Gross premium Administrative surcharge 10 71,686 6 673 10,597 69,601 Gross written premium (inclusive of administrative surcharge) Stamp Duty 666 10,432 Federal Insurance Fee Less: Federal Excise Duty 2019 2020 82,966 31 March 31 March 80,705 Unaudited Unaudited Fire and property damage Marine, aviation and transport Premium receivable (inclusive of Federal Excise Duty, Federal Insurance Fee and Administrative surcharge) 24.1 Segment Profit and loss 24 NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  33. 25 568 ,730 709,851 50,746 5,771 5,205 10,750 11,421 82,035 DATE OF AUTHORIZATION FOR ISSUE This condensed interim financial information has been authorized for issue by the Board of Directors of the Company on 27 April 2020. Consolidated total liabilities 3,073,652 15,516 50,491 Corporate unallocated Segment liabilities Takaful OPF 2,599 340,683 2,443 Corporate unallocated Segment liabilities Conventional 11,571 12,580 876,409 53,341 1,970,201 2,635,418 659,848 4,695 554,421 368,388 1,014,588 4,952 466,120 2020 31 March Corporate Segment liabilities - Takaful OPF 936,345 2,338 630,697 2019 31 December Audited 3,465,019 10,029 237,597 81,542 3,135,851 5,431,398 222,272 2,749,544 58,156 2,401,426 2019 31 December Total 5,147,583 135,018 2,720 457,594 2020 31 March Unaudited Consolidated total assets 102,106 36,929 750,071 2019 31 December Audited Miscellaneous Unaudited Corporate Segment liabilities - Conventional 399,985 30,811 2020 Rupees in thousand 2019 31 March Audited Accident and health Unaudited 251,732 4,161 647,781 2020 31 March Audited 31 December Motor Unaudited Corporate unallocated assets - Takaful OPF 4,057 125,052 2019 31 December Audited 2,872,309 10,033 84,263 2020 31 March Unaudited Corporate unallocated assets - Conventional 10,801 Corporate Segment assets - Takaful OPF 341,185 2019 2020 314,442 31 December 31 March Corporate Segment assets - Conventional Audited Unaudited Fire and property damage Marine, aviation and transport 24.2 Segment Assets and Liabilities NOTES TO AND FORMING PART OF THE UNCONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 ASKARI INSURANCE CO. LTD 31
  35. CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  36. CONSOLIDATED CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION (UNAUDITED) AS AT 31 MARCH 2020 Note (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand ASSETS Property and equipment 7 360,842 287,179 Intangible assets 8 368 345 Investment property 9 40,173 40,501 - Equity securities 10 143,740 314,451 - Debt securities 11 2,156,845 1,640,386 - Term deposits 12 111,000 252,000 185,871 133,334 Investments Loans and other receivables Insurance / Reinsurance receivables 13 868,131 1,166,352 Reinsurance recoveries against outstanding claims 17 214,246 331,317 41,283 39,206 99,842 124,175 15,570 15,592 Prepayments 408,345 457,470 Cash and bank 191,549 346,798 Total assets from Window Takaful Operations - OPF 305,073 279,427 5,142,878 5,428,533 Salvage recoveries accrued Deferred commission expense / Acquisition cost Deferred taxation Total Assets Razi Haider Chief Financial Officer 34 1st Quarter Report 2020 18 Abdul Waheed President & Chief Executive
  37. Note (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand EQUITY AND LIABILITIES Capital and reserves attributable to Company's equity holders Ordinary share capital 719,019 719,019 Share premium 121,161 121,161 70,389 70,339 Unappropriated profit 1,160,950 1,054,211 Total Equity 2,071,519 1,964,730 Reserves Liabilities Underwriting Provisions - Outstanding claims including IBNR 17 496,691 624,125 - Unearned premium reserves 16 1,209,156 1,388,338 - Unearned reinsurance commission 18 82,870 104,849 Retirement benefit obligations 39,428 37,366 Staff compensated absences 30,803 29,715 184,252 100,390 Taxation - provision less payment 15,563 556 Premium received in advance 12,524 15,021 721,123 853,023 7,158 7,158 130,147 165,952 44,093 45,610 2,973,808 3,372,104 97,551 91,699 5,142,878 5,428,533 Liabilities against assets subject to finance lease - secured Insurance / Reinsurance payables Unclaimed dividends Other creditors and accruals 14 Deposits and other payables Total Liabilities Total liabilities from Window Takaful Operations - OPF Total Equity and Liabilities Contingencies and commitments 15 The annexed notes 1 to 24 form an integral part of consolidated condensed interim financial information. Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 35
  38. CONSOLIDATED CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Quarter ended 31 March 2020 Note 2019 Rupees in thousand Net insurance premium 16 471,407 518,769 Net insurance claims 17 (274,091) (340,586) Net commission and other acquisition costs 18 19,904 21,663 Insurance claims and acquisition expenses (254,187) (318,923) Management expenses (164,276) (150,545) 52,944 49,301 75,516 49,676 1,434 1,274 Underwriting results Investment income 19 Rental income Other income Other expenses Results of operating activities 6,992 4,480 (2,330) (1,923) 134,556 102,808 (4,319) (1,501) 130,237 101,307 19,795 22,832 Profit before tax 150,032 124,139 Income tax expense (43,293) (33,964) Profit after tax 106,739 90,175 50 4,546 106,789 94,721 1.48 1.25 Finance costs Profit before tax from General Operations Profit before tax from Window Takaful Operations - OPF Other comprehensive income: Items that will be reclassified subsequently to profit and loss account: Unrealised gain on available-for-sale investments - net Total comprehensive income for the period Earnings (after tax) per share - Rupees (Restated) 20 The annexed notes 1 to 24 form an integral part of consolidated condensed interim financial information. Razi Haider Chief Financial Officer 36 1st Quarter Report 2020 Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman
  39. CONSOLIDATED CONDENSED INTERIM CASH FLOW STATEMENT (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 2020 2019 Rupees in thousand Operating cash flows a) Underwriting activities: 808,232 757,340 Reinsurance premium paid (850,887) (26,084) Claims paid Premium received (480,489) (405,095) Reinsurance and other recoveries received 480,363 3,882 Commission paid (54,325) (29,174) Commission received Management expenses paid Net cash flows (used in) / generated from underwriting activities 199,220 5,039 (155,386) (151,351) (53,272) 154,557 (28,065) (25,131) b) Other operating activities: Income tax paid Other expenses paid Other operating receipts / (payments) (3,679) (1,691) 106,166 (53,893) (428) 104 Net cash generated from / (used in) other operating activities 73,994 (80,611) Total cash flow generated from all operating activities 20,722 73,946 30,073 30,503 Advances to employees Investing activities: Profit / return received 1,781 22 (1,505,591) (751,723) 1,311,866 605,277 Fixed capital expenditure 2,714 (2,733) Proceeds from disposal of fixed assets 1,905 - (157,252) (118,654) (4,319) (1,501) (14,518) (7,932) 17 100 Dividends received Payments for investments Proceeds from investments Total cash used in investing activities Financing activities: Financial charges paid Repayment of obligation under finance lease Staff house building finance - net 101 316 (18,719) (9,017) (155,249) (53,725) Cash and cash equivalents at beginning of the period 346,798 147,175 Cash and cash equivalents at end of the period 191,549 93,450 Mark-up on staff house building finance received Total cash used in financing activities Net cash used in all activities The annexed notes 1 to 24 form an integral part of consolidated condensed interim financial information. Razi Haider Chief Financial Officer Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 37
  40. CONSOLIDATED CONDENSED INTERIM CASH FLOW STATEMENT (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 2020 2019 Rupees in thousand Reconciliation to Profit and Loss Account Operating cash flows 20,722 73,946 Depreciation expense (21,345) (12,451) (4,320) (1,501) 1,012 - (1,012,750) (68,182) 1,038,344 30,563 - 544 Financial charges Gain on disposal of fixed assets Decrease in assets other than cash Decrease in liabilities other than running finance Unrealized gain on investments - held for trading Provision for diminution in value of AFS investments Dividend income Investment income Profit on bank deposits Income tax provision - 17,076 1,781 1,207 69,533 28,923 4,993 4,126 (43,293) (33,964) 4,202 1,925 Tax paid 28,065 25,131 Profit after taxation from General Insurance Operations 86,944 67,343 19,795 22,832 106,739 90,175 Gain on trading Profit from Window Takaful Operations - OPF Profit after taxation Definition of cash : Cash comprises cash in hand, bank balances, stamp in hand and short term placements with banks which are readily convertible to cash in hand and which are used in the cash management function on a day-to-day basis. 2020 Cash for the purpose of cash flow statement consists of: 2019 Rupees in thousand Cash and other equivalents 1,629 Cash in hand 1,024 36 - 1,665 1,024 Current accounts 125,288 20,538 Deposit accounts 64,596 71,888 189,884 92,426 191,549 93,450 Stamp in hand Current and other accounts Total The annexed notes 1 to 24 form an integral part of consolidated condensed interim financial information. Razi Haider Chief Financial Officer 38 1st Quarter Report 2020 Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman
  41. CONSOLIDATED CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Share capital Reserves Issued, subscribed and paid up Capital reserve Total reserves Total equity Revenue reserve Share premium General reserve Available for sale investment revaluation reserve Retained earnings Rupees in thousand Balance as at 01 January 2019 625,234 121,161 70,000 (17,462) Profit for the period - - - - Other comprehensive income for the period - - - 4,546 Total comprehensive income for the period - - - 4,546 Balance as at 31 March 2019 625,234 121,161 70,000 (12,916) Balance as at 01 January 2020 719,019 121,161 70,000 Profit for the period - - Other comprehensive income for the period - - Total comprehensive income for the period - 719,019 887,788 1,061,487 1,686,721 Total comprehensive income for the period 90,175 90,175 90,175 4,546 4,546 94,721 94,721 977,963 1,156,208 1,781,442 339 1,054,211 1,245,711 1,964,730 - - 106,739 106,739 - 50 - 50 50 - - 50 106,739 106,789 106,789 121,161 70,000 389 1,160,950 1,352,500 2,071,519 90,175 Total comprehensive income for the period Balance as at 31 March 2020 106,739 The annexed notes 1 to 24 form an integral part of consolidated condensed interim financial information. Razi Haider Chief Financial Officer Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 39
  42. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 1 2 LEGAL STATUS AND NATURE OF BUSINESS The group consists of: Holding Company Askari General Insurance Company Limited Subsidiary Company AskTech (Private) Limited Askari General Insurance Company Limited (Holding Company) askari general insurance company limited was incorporated under the Companies Ordinance, 1984 as a public limited company on 12 April 1995. The Holding Company is engaged in non-life insurance business comprising of fire, marine, motor, health and miscellaneous. The Holding Company commenced its commercial operations on 15 October 1995. Shares of the Holding Company are quoted on Pakistan Stock Exchange Limited. The registered office and principal place of business of the Holding Company is located at AWT Plaza, Rawalpindi. The Holding Company has 20 branches in Pakistan. The Holding Company is a subsidiary of Army Welfare Trust. AskTech (Private) Limited (Subsidiary Company) AskTech (Private) Limited was incorporated in Pakistan on 17 December 2018 as a private limited company under the Companies Act, 2017. AskTech (Private) Limited was acquired by Askari General Insurance Company Limited as a wholly owned subsidiary on 01 February 2019. The registered office and principal place of business of the subsidiary company is located at 1st Floor, Ferozsons Building, Harding Road, Saddar, Rawalpindi. The subsidiary company will engage in establishing, developing, expanding, enhancing, managing and operating information technology services, GPS/GSM based tracking and systems. The subsidiary company shall commence its commercial operations after issuance of CVAS license from Pakistan Telecommunication Authority. BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE The consolidated condensed interim financial information has been prepared in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting consist of: - International Accounting Standard (IAS) 34, Interim Financial Reporting, issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017 - Provisions of and directives issued under the Companies Act, 2017 40 - Insurance Rules, 2017, Insurance Accounting Regulations, 2017 and Insurance Ordinance, 2000 Where the provisions of and directives issued under the Companies Act, 2017 differ with the requirements of IAS 34, the provisions of and directives issued under the Companies Act, 2017, the Insurance Ordinance, 2000, the Insurance Rules, 2017 and the Insurance Accounting Regulations, 2017 shall prevail. This consolidated condensed interim financial information does not include all of the information and disclosures required for annual financial statements and should be read in conjunction with the annual audited financial statements of the Company for the year ended 31 December 2019. Total assets, total liabilities and profit / (loss) of the Window Takaful Operations of the Holding Company referred to as the Operator’s Fund has been presented in this consolidated condensed interim financial information in accordance with the requirements of Circular 25 of 2015 dated 9 July 2015. A separate set of financial statements of Window Takaful Operations has been reported which is annexed to this consolidated condensed interim financial information as per the requirements of the SECP Takaful Rules, 2012. 1st Quarter Report 2020
  43. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 2.1 2.2 3 4 5 6 Basis of measurement This consolidated condensed interim financial information has been prepared under the historical cost convention except for certain financial instruments which are carried at their fair values and obligations under certain employee benefits which are measured at their present values. Figures have been rounded off to the nearest rupees in thousand. Functional and presentation currency This consolidated condensed interim financial information is presented in Pakistani Rupees, which is the Company’s functional and presentation currency. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies and methods of computation including judgements and estimates used in measurement of fair values for the preparation of this consolidated condensed interim financial information are the same as those applied in the preparation of the financial statements for the year ended 31 December 2019. FINANCIAL RISK MANAGEMENT The Company’s financial risk management objectives and policies are consistent with those disclosed in the financial statements for the year ended 31 December 2019. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of consolidated condensed interim financial information requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing this consolidated condensed interim financial information, the significant judgement made by management in applying the Company’s accounting policies and the key sources of estimation uncertainty were the same as those that were applied in the preparation of the financial statements for the year ended 31 December 2019. PREMIUM DEFICIENCY RESERVE During the period, management has reviewed the results of each class of business and considers that no additional reserve is required to be created as the unearned premium reserve for each class of business as at the period end is adequate to meet the expected future liability after reinsurance from claims and other expenses, expected to be incurred after the balance sheet date in respect of the policies in force at the balance sheet date. (Unaudited) 31 March 2020 Note 7 7.1 (Audited) 31 December 2019 Rupees in thousand PROPERTY AND EQUIPMENT Capital work-in-progress 7.1 3,549 4,211 Operating assets 7.2 357,293 282,968 360,842 287,179 Opening balance 4,211 2,871 Additions 2,182 5,565 Transfers (2,844) (4,225) 3,549 4,211 Movement in Capital work-in-progress is as follows: Closing balance ASKARI INSURANCE CO. LTD 41
  44. 42 1st Quarter Report 2020 2 ,637 27,141 577,711 18,227 (26,376) 23,802 3,970 4,164 (322) 1,039 Additions / (Disposals) 20,675 74,498 109,155 Right of use assets - Rental properties Tracking devices Leasehold improvements 118,800 25,694 67,421 22,100 139,368 31 December 2019 (audited) Building Furniture and fixtures Computers and office equipment Motor vehicles (Owned) Right of use assets - Motor vehicles Opening balance (602) (1,845) 87,099 87,004 23,312 609,077 Tracking devices Leasehold improvements 4,225 - 4,225 - Adjustments 1,787 1,787 - - Adjustments Cost (2,216) 93,421 Building Furniture and fixtures Computers and office equipment Motor vehicles (Owned) 140,407 92,725 Additions / (Disposals) Right of use assets - Motor vehicles Right of use assets - Rental properties Opening balance Cost (611) (345) (703) 7.2.1 Note 142,602 29,664 71,585 21,778 31 March 2020 (unaudited) Operating assets 609,077 23,312 92,725 87,004 142,602 29,664 71,585 21,778 140,407 Closing balance 88,189 21,467 697,963 138,191 186,146 142,602 29,053 71,240 21,075 Closing balance 1,019 663 22,891 7,070 10,149 891 797 1,520 782 For the period 277,250 16,162 104,222 743 17,760 57,076 12,452 68,835 Opening balance (558) (1,845) (8,330) (3,914) - 88,867 2,513 38,818 3,389 3,059 2,634 6,850 3,135 28,469 For the period (639) (516) (858) (Disposals) / Adjustments (40,008) - (25,610) (366) (2,531) (495) (11,006) (Disposals) / Adjustments Depreciation Rupees in thousand 82,001 18,675 326,109 86,298 38,818 3,802 20,028 61,395 15,092 Opening balance Depreciation Rupees in thousand 326,109 18,675 38,818 82,001 3,802 20,028 61,395 15,092 86,298 Closing balance 82,462 17,493 340,670 89,454 48,967 4,693 20,186 62,399 15,016 Closing balance 8.1 8 5,139 Total - 31 December 2019 (audited) 366 74 74 - - Adjustments Cost Additions / (Disposals) Amortization for the three months period ended 31 March 2019 was Rs. 31 thousand. 5,505 5,505 Opening balance Computer software Total - 31 March 2020 (unaudited) INTANGIBLE ASSETS 5,505 5,579 5,579 Closing balance 5,067 5,160 5,160 Opening balance 93 51 51 For the period - - (Disposals) / Adjustments Depreciation 5,160 5,211 5,211 Closing balance 7.2.1 This represents the carrying value of one office located at 8th Floor of Askari Tower, Lahore. The total area of the office is 5,460 square feet. 7.2.2 Additions, disposals and depreciation for the three months period ended 31 March 2019 were Rs.10,775 thousand, nil and 12,810 thousand respectively. 7.2 345 368 368 Written down value 282,968 4,637 53,907 5,003 138,800 9,636 10,190 6,686 54,109 Written down value 5,727 3,974 357,293 48,737 137,179 137,909 8,867 8,841 6,059 Written down value 5 5 Useful life (years) 3 1 to 9 3 40 5 3 5 5 Useful life (years) 3 3 5 1 to 9 40 5 3 5 Useful life (years) NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  45. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 9 INVESTMENT PROPERTY This represents the carrying amount of two offices in Islamabad Stock Exchange building, classified as investment property based on the management’s intention to hold the property for earning rentals and / or capital appreciation. (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand Cost Balance at beginning of the period / year 52,400 52,400 Balance at end of the period / year 52,400 52,400 (11,899) (10,589) (328) (1,310) (12,227) (11,899) 40,173 40,501 40 40 Depreciation Balance at beginning of the period / year Depreciation for the period / year Balance at end of the period / year Useful life (years) Depreciation for the three months period ended 31 March 2019 was Rs. 327,500. 10 (Unaudited) (Audited) 31 March 31 December 2020 2019 INVESTMENTS IN EQUITY SECURITIES Rupees in thousand Fair value through profit and loss 10.1 140,640 311,421 Available-for-sale 10.2 3,100 3,030 143,740 314,451 Total equity securities 31 March 2020 (unaudited) Cost Impairment / provision 31 December 2019 (audited) Carrying value Cost Impairment / provision Carrying value Rupees in thousand 10.1 Fair value through profit and loss Mutual funds 10.2 140,640 - 140,640 311,420 - 311,421 Listed shares - - - - - - Mutual funds 2,554 - 2,554 2,554 - 2,554 546 - - 476 3,100 2,554 - 3,030 Available-for-sale Unrealized deficit on revaluation 2,554 - ASKARI INSURANCE CO. LTD 43
  46. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 11 INVESTMENTS IN DEBT SECURITIES 31 March 2020 (unaudited) Cost Impairment / provision 31 December 2019 (audited) Carrying value Impairment / provision Cost Carrying value Rupees in thousand HELD TO MATURITY Government Securities 112,871 - 112,871 112,259 - 112,259 1,656,291 - 1,656,291 1,223,102 - 1,223,102 1,769,162 - 1,769,162 1,335,361 - 1,335,361 Term Finance Certificates 160,000 - 160,000 160,000 - 160,000 Sukuks 227,683 - 227,683 145,025 - 145,025 387,683 - 387,683 305,025 - 305,025 11,128 (11,128) - 11,128 (11,128) - 2,167,973 (11,128) 2,156,845 1,651,514 (11,128) 1,640,386 Pakistan Investment Bonds Treasury Bills AVAILABLE-FOR-SALE LOANS AND RECEIVABLES Certificates of Investments (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 12 INVESTMENTS IN TERM DEPOSITS Loans and receivables Deposits maturing within 12 months 44 1st Quarter Report 2020 111,000 252,000
  47. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 13 INSURANCE / REINSURANCE RECEIVABLES 709,877 1,013,864 (20,760) (20,760) 689,117 993,104 194,514 188,748 (15,500) (15,500) 179,014 173,248 868,131 1,166,352 Agents' commission payable 51,961 64,947 Tax deducted at source 11,985 13,422 Federal excise duty / federal insurance fee 17,798 41,852 Accrued expenses 20,816 12,346 853 2,262 2,213 145 24,521 30,978 130,147 165,952 Due from insurance contract holders Less: provision for impairment of receivables from insurance contract holders Due from other insurers / reinsurers Less: provision for impairment of receivables from other insurers / reinsurers 14 OTHER CREDITORS AND ACCRUALS Fund received against leased vehicle Fund received against vehicle Ijarah Others 15 CONTINGENCIES AND COMMITMENTS There is no change in contingencies and commitments as reported in the annual financial statements of the Company for the year ended 31 December 2019. ASKARI INSURANCE CO. LTD 45
  48. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 16 NET INSURANCE PREMIUM 513,735 558,246 Add: Unearned premium reserve opening 1,388,337 1,642,458 Less: Unearned premium reserve closing 1,209,156 1,440,048 Premium earned 692,916 760,656 Less: Reinsurance premium ceded 153,989 179,970 Add: Prepaid reinsurance premium opening 454,811 547,973 Less Prepaid reinsurance premium closing 387,291 486,056 Reinsurance expense 221,509 241,887 471,407 518,769 Claims paid 480,489 405,595 Add: Outstanding claims including IBNR closing 496,691 493,043 Less: Outstanding claims including IBNR opening 624,126 445,799 Claims expense 353,054 452,839 Less: Reinsurance and other recoveries received 196,034 71,048 214,246 222,185 331,317 180,980 78,963 112,253 274,091 340,586 Written gross premium 17 NET INSURANCE CLAIMS Add: Reinsurance and other recoveries in respect of outstanding claims closing Less: Reinsurance and other recoveries in respect of outstanding claims opening Reinsurance and other recoveries revenue 46 1st Quarter Report 2020
  49. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand 18 NET COMMISSION EXPENSE / ACQUISITION COST 39,060 55,923 Add: Deferred commission expense opening 124,175 97,956 Less: Deferred commission expense closing 99,842 101,014 Net commission 63,393 52,865 Less: Commission received or recoverable 61,319 64,072 Add: Unearned reinsurance commission opening 104,848 107,337 Less Unearned reinsurance commission closing 82,870 96,881 Commission from reinsurers 83,297 74,528 (19,904) (21,663) 1,781 - - 1,207 1,781 1,207 Return on government securities 51,744 943 Return on other fixed income securities 17,849 42,421 69,593 43,364 4,202 1,926 - (14,441) 4,202 (12,515) Unrealized profit on re-measurement of investments held for trading - 544 Reversal of diminution in available-for-sale investments - 17,076 (60) - 75,516 49,676 Commission paid or payable 19 INVESTMENT INCOME Dividend income on investments Dividend income on securities held for trading Dividend income on available-for-sale investments Income from debt securities Net realised gains on investments Gain on trading of held for trading investments Loss on sale of available-for-sale investments Investment related expenses Total investment income ASKARI INSURANCE CO. LTD 47
  50. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 20 (Unaudited) (Audited) 31 March 31 December 2020 2019 EARNINGS PER SHARE Profit after tax (Rupees in thousand) 106,739 90,175 71,902 71,902 1.48 1.25 Weighted average number of shares Earnings per share (Rupees) - Restated No figure for diluted earnings per share has been presented as the Company has not issued any instrument which would have an impact on earnings per share when exercised. The restatement is due to issuance of 9,378,508 bonus shares. 21 RELATED PARTY TRANSACTIONS The Company is a subsidiary of Army Welfare Trust (“the parent company”) therefore all subsidiaries and associated undertakings of the parent company are related parties of the Company. Other related parties comprise directors, key management personnel, entities with common directorships and entities over which the directors are able to exercise influence. Balances and transactions with related parties are as follows: (Unaudited) (Audited) 31 March 31 December 2020 2019 Rupees in thousand Balances at period / year end Parent: Premium due: Balance at beginning of the period / year 2,358 1,316 323 6,946 (1,381) (5,904) 1,300 2,358 80,204 94,261 Insurance premium written (including government levies, administrative surcharge and policies stamps) Receipts during the period / year Balance at end of the period / year Associated undertakings: Premium due: Balance at beginning of the period / year Insurance premium written (including government levies, administrative surcharge and policies stamps) Receipts during the period / year Balance at end of the period / year 48 1st Quarter Report 2020 7,559 108,957 (32,139) (123,014) 55,624 80,204
  51. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 (Unaudited) Quarter ended 31 March 2020 Transactions during the period: 2019 Rupees in thousand With parent: Insurance premium written (including government levies 323 403 1,381 484 941 544 6,191 5,692 7,559 9,768 32,139 41,302 Insurance claims paid 5,167 7,272 Contribution to staff retirement benefit funds 9,492 9,109 16,154 10,951 administrative surcharge and policies stamps) Premium received during the period Insurance claims paid Rent paid With associates: Insurance premium written (including government levies administrative surcharge and policies stamps) Premium received during the period Remuneration of chief executive, directors and executives ASKARI INSURANCE CO. LTD 49
  52. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 22 FAIR VALUE OF FINANCIAL INSTRUMENTS The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy for financial instruments measured at fair value. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value. 31 March 2020 (unaudited) Held-fortrading Available-for -sale Held-tomaturity Loans and receivables Other financial liabilities Level 1 Rupees in thousand Financial assets measured at fair value Investment at fair value through profit and loss Investment at fair value through other comprehensive income 140,640 - - - - 140,640 - 3,100 - - - 3,100 - - 1,769,162 - - - Financial assets not measured at fair value Investments - Government securities - Certificates of Investment (COIs) / TDRs - - - 111,000 - - - Fixed term deposits - 387,683 - - - - Loans to employees - - - 440 - - Accrued investment income* - - - 81,509 - - Staff house building finance - - - 2,944 - - Sundry receivables* - - - 100,978 - - Amounts due from insurance contract holders* - - - 689,117 - - Amounts due from other insurers / reinsurers* - - - 179,014 - - Reinsurance recoveries against outstanding claims* - - - 214,246 - - Salvage recoveries accrued* - - - 41,283 - - Cash and bank deposits* - - - 191,549 - - Total assets of Window Takaful Operations - OPF - - - 305,073 - - - - - - 496,691 - Financial liabilities not measured at fair value Provision for outstanding claims (including IBNR)* 50 Lease liabilities - - - - 184,252 - Premium received in advance - - - - 12,524 - Amounts due to other insurers / reinsurers* - - - - 721,123 - Unclaimed dividend* - - - - 7,158 - Accrued expenses* - - - - 20,642 - Other creditors and accruals* - - - - 109,505 - Deposits and other payables* - - - - 44,093 - Total liabilities of Window Takaful Operations - OPF - - - - 97,551 - 140,640 390,783 1,769,162 1,917,153 1,693,539 143,740 1st Quarter Report 2020
  53. NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 31 December 2019 (audited) Held-fortrading Available-for -sale Held-tomaturity Other financial liabilities Loans and receivables Level 1 Rupees in thousand Financial assets measured at fair value Investment at fair value through profit and loss Investment at fair value through other comprehensive income 311,421 - - - - 311,421 - 3,030 - - - 3,030 Financial assets not measured at fair value Investments - Government securities - - 1,335,361 - - - - Certificates of Investment (COIs) / TDRs - - - 252,000 - - - Fixed term deposits - 305,025 - - - - Loans to employees - - - 12 - - Accrued investment income* - - - 44,028 - - Staff house building finance - - - 2,961 - - Sundry receivables* - - - 85,983 - - Amounts due from insurance contract holders* - - - 993,104 - - Amounts due from other insurers / reinsurers* - - - 173,248 - - Reinsurance recoveries against outstanding claims* - - - 331,317 - - Salvage recoveries accrued* - - - 39,206 - - Cash and bank deposits* - - - 346,798 - - Total assets of Window Takaful Operations - OPF - - - 279,427 - - Provision for outstanding claims (including IBNR)* - - - - 624,125 - Lease liabilities - - - - 100,390 - Premium received in advance - - - - 15,021 - Amounts due to other insurers / reinsurers* - - - - 853,023 - Unclaimed dividend* - - - - 7,158 - Accrued expenses* - - - - 12,269 - Other creditors and accruals* - - - - 153,683 - Deposits and other payables* - - - - 45,610 - Total liabilities of Window Takaful Operations -OPF - - - - 91,699 - 311,421 308,055 1,335,361 2,548,084 1,902,978 314,451 Financial liabilities not measured at fair value * The Company has not disclosed the fair value of these items because their carrying amounts are a reasonable approximation of fair value. Fair value is an amount for which an asset could be exchanged, or a liability settled, between knowledgeable willing parties in an arm’s length transaction. Consequently, differences may arise between the carrying values and the fair values estimates. The Company measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements: Level 1: Fair value measurements using quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Fair value measurements using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Fair value measurements using inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs). ASKARI INSURANCE CO. LTD 51
  54. 52 SEGMENT INFORMATION 1st Quarter Report 2020 110 ,311 1,873 (562) 103,154 (92,529) Facultative inward premium Service charges Insurance premium earned Insurance premium ceded to reinsurers (200) 40,129 (21,469) (12,571) (7,162) (10,914) (6,502) 15,551 Net claims Commission expense Management expense Underwriting results 2020 31 March 101,306 Profit before tax 150,032 19,795 130,237 Profit before tax from Window Takaful Operations - OPF (1,501) (1,923) (4,319) 124,138 22,832 1,274 49,676 49,301 (150,545) (52,865) (340,586) 112,253 (452,839) 593,297 74,528 518,769 (241,887) 760,656 (561) 2,815 14,891 541,101 558,246 2,298 5,562 67,751 633,857 (2,330) 52,944 (164,276) (63,393) (274,091) 78,963 (353,054) 554,704 83,297 471,407 (221,509) 692,916 (409) 2,908 11,346 499,890 513,735 1,623 5,085 55,621 576,064 2019 31 March Unaudited Finance costs 49,759 (16,329) (8,874) (14,823) 16,476 (31,299) 89,785 30,533 59,252 (62,542) 121,794 (486) 135 1,785 93,293 94,727 39 943 10,356 106,065 2020 31 March Other expenses 58,651 (34,023) (20,798) (23,491) 10,738 (34,229) 136,963 33,746 103,217 (39,231) 142,448 (57) 747 1,237 106,696 108,623 30 1,079 6,096 115,828 2019 31 March Total 4,480 (27,966) (49,960) (6,486) (160,369) 39,524 (199,893) 188,849 7,560 181,289 (47,259) 228,548 323 - 405 92,305 93,033 2 927 - 93,962 2020 31 March Unaudited 1,434 (55,291) (42,436) (6,221) (141,634) 45,566 (187,200) 135,000 6,258 128,742 (41,953) 170,695 295 - 200 82,065 82,560 3 819 - 83,382 2019 31 March Unaudited Miscellaneous Unaudited 6,992 237 (71,175) (16,044) (154,320) 4,195 (158,515) 241,776 132 241,644 (2,220) 243,864 (91) - 8,774 232,498 241,181 47 2,442 38,421 282,091 Rupees in thousand 2019 31 March Unaudited Accident and health Unaudited Rental income 25,230 (76,535) (14,553) (98,348) 1,726 (100,074) 214,666 348 214,318 (5,120) 219,438 (74) 288 7,000 200,921 208,135 40 2,087 32,933 243,195 2020 31 March Unaudited Motor Unaudited Other income 7,813 (6,060) (8,890) (10,390) 52,542 (62,932) 33,153 11,162 21,991 (34,148) 56,139 (56) - 2,242 55,433 57,619 2,200 577 8,377 68,773 2019 31 March Unaudited 75,516 8,802 (4,781) (10,907) (3,456) 6,626 (10,082) 27,946 13,441 14,505 (42,676) 57,181 (11) - 1,677 43,150 44,816 1,544 434 6,160 52,954 2020 31 March Unaudited Investment income 19,457 (7,022) (684) 14,307 Insurance claims recovered (484) 25,141 39,734 29,504 Commission income Net underwriting income Insurance claims 14,593 (95,718) 2,680 10,625 Net insurance premium (251) 1,232 1,685 67,572 67,058 Gross premium Administrative surcharge 10 71,686 6 673 10,597 69,601 Gross written premium (inclusive of administrative surcharge) Stamp Duty 666 10,432 Federal Insurance Fee Less: Federal Excise Duty 2019 2020 82,966 31 March 31 March 80,705 Unaudited Unaudited Fire and property damage Marine, aviation and transport Premium receivable (inclusive of Federal Excise Duty, Federal Insurance Fee and Administrative surcharge) 23.1 Segment Profit and loss 23 NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  55. 24 568 ,904 709,851 50,746 5,771 5,205 10,750 11,421 82,035 DATE OF AUTHORIZATION FOR ISSUE The consolidated condensed interim financial information has been authorized for issue by the Board of Directors of the Company on 27 April 2020. Consolidated total liabilities 3,071,359 15,516 50,491 Corporate unallocated Segment liabilities Takaful OPF 2,599 337,592 2,443 Corporate unallocated Segment liabilities Conventional 11,571 12,580 876,409 53,341 1,971,635 2,636,216 660,066 4,695 554,421 368,406 1,014,588 4,952 466,268 2020 31 March Corporate Segment liabilities - Takaful OPF 936,708 2,338 630,697 2019 31 December Audited 3,465,019 10,029 237,597 81,542 3,135,851 5,431,398 222,272 2,749,544 58,156 2,401,426 2019 31 December Total 5,142,878 135,018 2,720 457,779 2020 31 March Unaudited Consolidated total assets 102,130 36,929 750,071 2019 31 December Audited Miscellaneous Unaudited Corporate Segment liabilities - Conventional 399,985 30,811 2020 Rupees in thousand 2019 31 March Audited Accident and health Unaudited 251,732 4,161 648,846 2020 31 March Audited 31 December Motor Unaudited Corporate unallocated assets - Takaful OPF 4,057 125,052 2019 31 December Audited 2,866,170 10,033 84,284 2020 31 March Unaudited Corporate unallocated assets - Conventional 10,801 Corporate Segment assets - Takaful OPF 341,185 2019 2020 314,457 31 December 31 March Corporate Segment assets - Conventional Audited Unaudited Fire and property damage Marine, aviation and transport 23.2 Segment Assets and Liabilities NOTES TO AND FORMING PART OF THE CONSOLIDATED CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 ASKARI INSURANCE CO. LTD 53
  56. 54 1st Quarter Report 2020
  57. FINANCIAL INFORMATION WINDOW TAKAFUL OPERATIONS FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 ASKARI INSURANCE CO . LTD 55
  58. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION OF OPF AND PTF AS AT 31 MARCH 2020 Operator 's Fund 31 March 2020 (Unaudited) ASSETS Property and equipment Note Participants' Takaful Fund 31 December 2019 (Audited) 31 March 2020 (Unaudited) 31 December 2019 (Audited) Rupees in thousand 5 265 527 - - - Equity securities 6 127,970 124,060 149,262 115,779 - Debt securities 7 35,000 35,000 25,000 25,000 - Term deposits 8 27,500 27,500 - - Loans and Other Receivables 9 2,934 1,887 1,571 1,903 Takaful/Retakaful receivable 10 759 766 79,202 63,655 - - 1,256 1 38,452 46,202 - - - - 16,113 16,397 14,889 15,193 - - 4,698 4,306 2,081 1,742 Investments Salvage recoveries accrued Receivable from OPF / PTF 11 Retakaful recoveries against outstanding claims / Benefits Deferred Commission expense/Acquisition cost Tax deducted at source Prepayments 12 953 21 57,533 58,623 Cash & Bank 13 52,654 24,966 32,293 67,328 306,074 280,428 364,311 350,428 Total Assets The annexed notes 1 to 30 form an integral part of these financial statements 56 1st Quarter Report 2020
  59. Operator 's Fund 31 March 2020 (Unaudited) FUNDS AND LIABILITIES Note Participants' Takaful Fund 31 December 2019 (Audited) 31 March 2020 (Unaudited) 31 December 2019 (Audited) Rupees in thousand Operator's Fund 50,000 50,000 - - Accumulated profit 158,523 138,728 - - Total Operator's Fund 208,523 188,728 - - Cede money - - 1,000 1,000 Accumulated surplus - - 30,031 22,978 Balance of Participants' Takaful Fund - - 31,031 23,978 Outstanding claims including IBNR - - 72,055 71,686 Unearned contribution reserves - - 109,469 109,469 Unearned retakaful rebate - - 10,620 10,790 - - 192,144 191,945 - - 1,687 2,165 4,321 3,228 94,795 77,606 70,975 72,162 - - Statutory Fund Waqf/Participants' Takaful Fund PTF Underwriting Provisions Contribution received in advance Takaful / retakaful payables 14 Unearned wakala fees Payable to OPF / PTF 11 - - 38,452 46,202 Other creditors and accruals 15 22,255 16,310 6,202 8,532 97,551 91,700 141,136 134,505 97,551 91,700 333,280 326,450 306,074 280,428 364,311 350,428 Total Liabilities Total funds and liabilities Contingencies and Commitments Razi Haider Chief Financial Officer Abdul Waheed President & Chief Executive 16 Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 57
  60. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) FOR THE PERIOD ENDED 31 MARCH 2020 Quarter ended 31 March 2020 Note 2019 Rupees in thousand Participants' Takaful Fund Contributions earned Less: Contribution ceded to retakaful Net contribution revenue 17 Retakaful rebate earned 18 Net underwriting income Net claims - reported / settled including IBNR 19 55,732 45,595 (31,268) (16,580) 24,464 29,015 5,908 3,295 30,372 32,310 (26,545) (31,509) (523) (877) 3,304 (76) 4,475 1,011 1,064 1,255 (1,790) (906) Results of operating activities 3,749 1,360 Surplus transferred to accumulated surplus 7,053 1,284 - - Other direct expenses Surplus / (Deficit) before investment income Investment income 23 Other income Less: Mudarib's share of investment income 25 Other comprehensive income Items that will be subsequently reclassified to profit and loss account Unrealized gain on available-for-sale investments Reclassification adjustment relating to available for sale investments disposed off in the period - (101) Other comprehensive loss for the period - (101) 7,053 1,183 Total comprehensive surplus for the period OPF Revenue Account Wakala fee 21 37,145 31,727 Commission expense 20 (8,356) (6,592) General administrative and Management expenses (17,553) (6,868) 11,236 18,267 Modarib's share of PTF investment income 25 1,790 906 Investment income 23 6,109 3,178 Direct expenses 26 (115) (110) Other income Results of operating activities Profit for the period 775 591 8,559 4,565 19,795 22,832 - - Other comprehensive income Items that will be subsequently reclassified to profit and loss account Unrealized losses on available for sale investments Other comprehensive loss for the period Total comprehensive income for the period - - 19,795 22,832 The annexed notes 1 to 30 form an integral part of these financial statements. Razi Haider Chief Financial Officer 58 1st Quarter Report 2020 Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman
  61. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS CONDENSED INTERIM STATEMENT OF CHANGES IN FUND (UNAUDITED) FOR THE PERIOD ENDED 31 MARCH 2020 Operator’s Fund Available for sale investments revaluation reserve Statutory Fund Accumulated Profit Total Rupees in thousand Balance as at 01 January 2019 50,000 84,253 134,253 - 22,832 22,832 Total comprehensive income for the period Profit for the period - - 22,832 22,832 Balance as at 31 March 2019 50,000 - 107,085 157,085 Balance as at 01 January 2020 50,000 - 138,728 188,728 19,795 19,795 - - 19,795 19,795 50,000 - 158,523 208,523 Total comprehensive income for the period - Profit for the period Balance as at 31 March 2020 Participants’ Takaful Fund Available for sale investments revaluation reserve Cede Money Accumulated Surplus Total Rupees in thousand Balance as at 01 January 2019 1,000 101 12,356 13,457 1,284 1,284 - (101) Total comprehensive income for the period Surplus for the period - Other comprehensive income for the period - (101) - (101) 1,284 1,183 Balance as at 31 March 2019 1,000 - 13,640 14,640 Balance as at 01 January 2020 1,000 - 22,978 23,978 7,053 7,053 - - 7,053 7,053 1,000 - 30,031 31,031 Total comprehensive income for the period - Surplus for the period Balance as at 31 March 2020 The annexed notes 1 to 30 form an integral part of these financial statements. Razi Haider Chief Financial Officer Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 59
  62. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS CONDENSED INTERIM CASH FLOW STATEMENT (UNAUDITED) FOR THE PERIOD ENDED 31 MARCH 2020 Operator’s Fund Participants’ Takaful Fund Quarter ended 31 March Quarter ended 31 March 2020 a) Takaful activities Contribution received - - 75,624 88,934 Re-takaful Contribution paid - - - (6,359) Claims paid - - (32,239) (28,074) Re-takaful and other recoveries received - - - 68 (5,439) (2,865) - - - - - 1,152 42,258 35,338 (42,258) (35,338) Re-takaful rebate received Wakala fee received/ (paid) 3,240 - (3,240) - (17,882) (7,101) (523) (1,557) 22,177 25,372 (2,636) 18,826 (392) (198) (339) (165) Other expenses paid - (164) - - Other operating payments - - (4,678) (1,354) 3,712 3,985 551 22,369 Modarib share received / (paid) Management expenses / Direct expenses paid Net cash flows generated from / (used in) underwriting activities Other operating activities: Income tax paid Other operating receipts Net cash flow generated from / (used in) other operating activities Total cash flow generated from all operating activities c) 3,320 3,623 (4,466) 20,850 25,497 28,995 (7,102) 39,676 1,349 591 1,076 1,255 139 764 202 15 - (10,503) (56,212) (10,000) 1,228 - 27,001 2,135 Investment activities: Profit / return received Dividends received Payment for investments Proceeds from disposals of investments Proceeds from disposals of fixed assets Total cash flow generated from / (used in) investing activities d) 2019 Rupees in thousand Commission paid b) 2020 2019 Operating Cash Flows 225 - - - 2,941 (9,148) (27,933) (6,595) (750) (509) - - Financing activities: Payment against Ijarah Total cash flow used in financing activities (750) (509) - - Net cash flow from all activities 27,688 19,338 (35,035) 33,081 Cash and cash equivalents at beginning of the period 24,966 3,915 67,328 70,797 Cash and cash equivalents at end of the period 52,654 23,253 32,293 103,878 The annexed notes 1 to 30 form an integral part of these financial statements. Razi Haider Chief Financial Officer 60 1st Quarter Report 2020 Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman
  63. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS CONDENSED INTERIM CASH FLOW STATEMENT (UNAUDITED) FOR THE PERIOD ENDED 31 MARCH 2020 Operator’s Fund Participants’ Takaful Fund Quarter ended 31 March Quarter ended 31 March 2020 2020 2019 Reconciliation to Profit and Loss Account: 2019 Rupees in thousand Operating cash flows 25,497 28,995 (7,102) 39,676 Depreciation expense (37) (45) - - - - 201 257 139 764 202 15 Gain on disposal of investments Dividend income (Decrease) / increase in assets other then cash (6,516) 4,281 26,525 (6,902) (Increase) / decrease in liabilities other than running finance (5,675) (13,748) (18,248) (33,812) Unrealized gain on investments held for trading 3,792 2,078 3,111 484 Investment income 2,178 146 961 146 775 591 1,064 1,255 392 198 339 165 (750) (509) - - Other income Tax paid Decrease in deposit against vehicle Ijarah - 81 - - 19,794 22,832 7,053 1,284 - - 7,053 1,284 19,795 22,832 - - 19,795 22,832 7,053 1,284 Reversal of diminution in value of AFS investments Profit/ surplus for the period Attributed to Participants' Takaful Fund Operator's Fund Definition of cash : Cash comprises of cash in hand, bank balances, stamp in hand and short term placements with banks which are readily convertible to cash in hand and which are used in the cash management function on a day-to-day basis. Cash for the purpose of the statement of cash flows consist of: Operator’s Fund Participants’ Takaful Fund Quarter ended 31 March Quarter ended 31 March 2020 2020 2019 2019 Rupees in thousand Cash and other equivalents - - 332 221 Current and other accounts 52,654 24,966 31,961 67,107 52,654 24,966 32,293 67,328 The annexed notes 1 to 30 form an integral part of these financial statements. Razi Haider Chief Financial Officer Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman ASKARI INSURANCE CO. LTD 61
  64. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 1 2 2.1 2.2 3 62 LEGAL STATUS AND NATURE OF BUSINESS askari general insurance company limited (“the Operator”) was incorporated under the Companies Ordinance, 1984 on 12 April, 1995. The Operator is registered in Pakistan Stock Exchange and is engaged in general insurance business. The registered office and principal place of the Operator is located at AWT Plaza, Rawalpindi. The Operator has been allowed to undertake Window Takaful Operations (WTO) on 10 August 2015 by Securities and Exchange Commission of Pakistan under SECP Takaful Rules 2012 to carry on General Window Takaful Operations in Pakistan. For the purpose of carrying on the takaful business, the Operator has formed a Waqf/ Participants’ Takaful Fund (PTF) under the Waqf deed. The Waqf deed governs the relationship of Operator and participants for management of takaful operations. BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE These condensed interim financial statements of the WTO have been prepared in accordance with approved accounting standards as applicable in Pakistan. Approved accounting standards comprise of such International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IFAS) and Islamic Financial Accounting Standereds (IFAS) issued by the Institute of Chartered Accountants of Pakistan as are notified under the Companies Act, 2017, provisions of and directive issued under the Companies Act, 2017, the Insurance Ordinance, 2000, the Takaful Rules, 2012 and the General Takaful Regulations, 2019. In case requirements differ, the provisions or directives of the Companies Act, 2017, Insurance Ordinance, 2000 the Takaful Rules, 2012, the General Takaful Accounting Regulations, 2019 shall prevail. These condensed interim financial statements reflect the financial position and results of operations of both the Operator’s Fund (OPF) and Participants’ Takaful Fund (PTF) in a manner that the assets, liabilities, income and expenses of the Operator and PTF remain separately identifiable. Total assets, total liabilities and profit/ (loss) of the Window Takaful Operations of the Company referred to as the Operator’s fund has been presented in these condensed interim financial statements in accordance with the requirements of Circular 25 of 2015 dated July 09, 2015. These condensed interim financial statements does not include all of the information and disclosures required for annual financials statements and should be read in conjunction with the annual audited financial statement of the WTO for the year ended 31 December, 2019. Comparative statement of financial position is extracted from annual financial statements for the year ended 31 March2019 whereas comparative for condensed interim statement of comprehensive income, condensed interim cash flow statement and statement of changes in fund are stated from unaudited condensed interim financial statements for the three months period ended 31 March 2019. Basis of measurement These condensed interim financial statements have been prepared under the historical cost convention except for certain financial instruments which are stated at their fair values. Functional and presentation currency These condensed interim financial statements are presented in Pakistani Rupees which is the Operator’s functional and presentation currency. All financial information presented in Pakistani Rupees has been rounded to the nearest thousand. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies and methods of computation adopted in the preparation of these condensed interim financial statements are the same as those applied in the preparation of the financial statements for the year ended 31 December 2019. 1st Quarter Report 2020
  65. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of condensed interim financial statements in conformity with approved accounting standards requires management to make judgements, estimates and assumptions that effect the application of policies and reported amounts of assets and liabilities, income and expenses. The judgements, estimates and assumptions are based on historical experience, current trends and various other factors that are believed to reasonable under the circumstances, the results of which form the basis of making the estimates about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate revised if the revision effects only that period or in the revision and future periods if the revision affects both current and future periods. In preparing these condensed interim financial statements, the significant judgement made by management in applying the Operator’s accounting policies and the key sources of estimation uncertainty were the same as those that applied in the preparation of the financial statements for the year ended 31 December 2019. 31 March 2020 (Unaudited) Note 5 31 December 2019 (Audited) Rupees in thousand PROPERTY AND EQUIPMENT Operating assets 5.1 265 527 265 527 ASKARI INSURANCE CO. LTD 63
  66. 64 1st Quarter Report 2020 (b) Operator’s Fund (a) (i) At fair value through profit and loss Others Listed shares Participants’ takaful fund Mutual funds (i) At fair value through profit and loss Others INVESTMENTS IN EQUITY SECURITIES Furniture & fixtures Office equipment Furniture & fixtures Office equipment OPERATING ASSETS - OPF 6 5.1 264 175 439 765 - - Adjustments - Adjustments Cost Additions / (Disposals) 490 275 As at 1 January (250) 754 450 1,204 (250) Additions / (Disposals) As at 1 January Cost 314 178 136 363 125 238 3,111 3,111 3,792 124,178 146,151 146,151 3,792 124,178 Cost/ Carrying Impairment/ value provision 149,262 149,262 127,970 127,970 527 451 76 Written down value as at 31 March 200 65 265 Written down value as at 31 March Cost/ Carrying value 115,779 115,779 120,443 120,443 - 3,617 3,617 Impairment/ provision 115,779 115,779 124,060 124,060 (Restated) Carrying value 5 3 Useful life (years) 5 3 Useful life (years) 31 December 2019 (Audited) 677 303 374 As at 31 March 304 385 689 As at 31 March Rupees in thousand Carrying value - - (Disposals) / Adjustments Depreciation For the year Rupees (‘000) As at 1 January (25) (25) (Disposals) / Adjustments 31 December 2019 (Audited) 303 374 677 26 11 37 For the period Rupees (‘000) As at 1 January 31 March 2020 (Unaudited) 1,204 754 450 As at 31 March 504 450 954 As at 31 March Depreciation 31 March 2020 (Unaudited) ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  67. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 7 INVESTMENTS IN DEBT SECURITIES 31 March 2020 (Unaudited) Cost Impairment / provision 31 December 2019 (Audited) Carrying value Cost Impairment / provision Carrying value Rupees in thousand (a) Operator’s Fund (i) Available for sale Sukuks (b) 35,000 - 35,000 35,000 - 35,000 35,000 - 35,000 35,000 - 35,000 Participants’ takaful fund (i) Available for sale Sukuks 8 25,000 - 25,000 25,000 - 25,000 25,000 - 25,000 25,000 - 25,000 27,500 - 27,500 27,500 - 27,500 INVESTMENTS IN DEBT SECURITIES Operator’s Fund Loans and receivables Deposits maturing within 12 months 9 LOANS AND OTHER RECEIVABLE - CONSIDERED GOOD Operator's 31 March 2020 (Unaudited) Fund Participants’ Takaful Fund 31 December 2019 (Audited) 31 March 2020 (Unaudited) 31 December 2019 (Audited) Rupees in thousand Receivable against sale of asset 68 76 - - Deposit against Ijarah - vehicles 1,112 929 - - Accrued investment income 839 580 394 405 Other receivable 916 302 1,177 1,498 2,934 1,887 1,571 1,903 ASKARI INSURANCE CO. LTD 65
  68. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Operator's 31 March 2020 (Unaudited) Fund Participants’ Takaful Fund 31 December 2019 (Audited) 31 March 2020 (Unaudited) 31 December 2019 (Audited) Rupees in thousand 10 TAKAFUL/RETAKAFUL RECEIVABLES Due from takaful contract holders Considered good Considered doubtful Provision against doubtful balances 58,744 48,911 222 222 58,966 49,133 (222) (222) 58,744 48,911 Due from other Takaful/Retakaful Operators 759 766 20,458 14,744 - - 1,171 1,171 759 766 21,629 15,915 - - (1,171) (1,171) 759 766 20,458 14,744 759 766 79,202 63,655 37,070 43,370 (37,070) (43,370) (408) (408) 408 408 36,662 42,962 (36,662) (42,962) 1,790 3,240 (1,790) (3,240) 38,452 46,202 (38,452) (46,202) Considered good Considered doubtful Provision against doubtful balances 11 RECEIVABLE / (PAYABLE) (Current account between OPF and PTF) Wakala fee Less: Provision for refund of wakala fee against doubtful balances Mudarib’s fee 66 1st Quarter Report 2020
  69. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Operator's 31 March 2020 (Unaudited) Fund Participants’ Takaful Fund 31 December 2019 (Audited) 31 March 2020 (Unaudited) 31 December 2019 (Audited) Rupees in thousand 12 PREPAYMENTS Prepaid Retakaful Contribution ceded - PTF Others - OPF 13 - 57,533 58,623 953 21 - - 953 21 57,533 58,623 - - 332 221 52,654 24,966 31,961 67,107 52,654 24,966 32,293 67,328 CASH AND BANK Cash and Cash Equivalent Stamps in hand Cash at bank - Savings account Operator's Fund 31 March 2020 (Unaudited) 14 TAKAFUL/RETAKAFUL PAYABLES 31 December 2019 (Audited) 31 March 2020 (Unaudited) 31 December 2019 (Audited) Rupees in thousand 4,321 3,228 94,795 77,606 4,321 3,228 94,795 77,606 11,060 9,380 - - - - 468 482 47 122 2,579 6,381 Tax deducted at source 402 404 272 393 Accrued expenses 577 462 - - 10,169 5,942 2,883 1,276 22,255 16,310 6,202 8,532 Due to Local takaful/retakaful operators 15 Participants’ Takaful Fund OTHER CREDITORS AND ACCRUALS Agents' commission payable Federal Takaful fee payable Federal excise duty payable Others ASKARI INSURANCE CO. LTD 67
  70. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 16 CONTINGENCIES AND COMMITMENTS Contingency There is no contingency as at 31 March 2020 (31 December 2019:Nil) Commitments The Operator’s commitment under Ijarah arrangement with Meezan Bank Limited is Rs.2.60 million (31 December 2019: Rs.3.03 million). The contracts have a term of five years. Future Minimum Ijarah (lease) payments are as under: 31 March 2020 (Unaudited) 31 December 2019 (Audited) Rupees in thousand Not later than 1 year Later than 1 year but not later than 5 years 1,720 1,720 884 1,314 2,604 3,034 Participants’ Takaful Fund Quarter ended 31 March 2020 2019 (Unaudited) Rupees in thousand 17 NET TAKAFUL CONTRIBUTION Written Gross Contribution Wakala fee Written Net Contribution (35,958) (38,110) 55,732 56,486 Add: Unearned contribution reserve opening - net 109,469 89,757 (109,469) (100,648) 55,732 45,595 30,178 24,540 Add: Prepaid retakaful contribution opening 58,623 29,421 Less Prepaid retakaful contribution closing (57,533) (37,381) 31,268 16,580 24,464 29,015 Less: Retakaful Contribution ceded Retakaful expense Net takaful contribution REBATE FROM RETAKAFUL OPERATORS 5,738 4,088 Add: Unearned retakaful rebate opening 10,790 5,352 Less: Unearned retakaful rebate closing (10,620) (6,145) 5,908 3,295 Retakaful Rebate income Rebate from retakaful operators 68 94,596 Less: Unearned contribution reserve closing - net Premium earned 18 91,690 1st Quarter Report 2020
  71. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Participants’ Takaful Fund Quarter ended 31 March 2020 2019 (Unaudited) 19 NET TAKAFUL CLAIMS EXPENSE Rupees in thousand 32,239 Claim paid 28,074 Add : Outstanding claims including IBNR closing 72,055 80,577 Less: Outstanding claims including IBNR opening (71,686) (68,644) 32,608 40,007 6,347 1,908 16,113 22,668 (16,397) (16,078) 6,063 8,498 26,545 31,509 Claim expense Less: Retakaful and other recoveries received Add: Retakaful and other recoveries in respect of outstanding claims - closing Less: Retakaful and other recoveries in respect of outstanding claims - opening Retakaful and other recoveries revenue Net takaful claim expense 20 COMMISSION EXPENSE 8,052 8,226 Add: Deferred commission expense opening 15,193 10,730 Less: Deferred commission expense closing (14,889) (12,364) 8,356 6,592 Commission paid or payable Commission expense 21 WAKALA FEE The Operator manages the general takaful operations for the participants and charges 35% for fire and property damage, 35% for marine and aviation, 45% for motor, 25% for health and accident and 40% for miscellaneous of the gross contribution written as wakala fee against the services as follows: Participants’ Takaful Fund Quarter ended 31 March 2020 2019 (Unaudited) Gross wakala fee 35,958 38,110 Add: Unearned wakala fee opening 72,162 61,788 Less: Unearned wakala fee closing (70,975) (68,171) 37,145 31,727 484 845 30 21 9 11 523 877 Net wakala fee income 22 DIRECT EXPENSES Tracker installation and monitoring charges Inspection charges Bank Charges ASKARI INSURANCE CO. LTD 69
  72. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Operator’s Fund Participants’ Takaful Fund Quarter ended 31 March Quarter ended 31 March 2020 2020 2019 2019 Rupees in thousand 23 INVESTMENT INCOME Income from equity securities - Available-for-sale - Dividend income - - - 15 - Gain on sale of investments - - - 257 - - - 272 139 764 202 - - - 201 - 139 764 403 - 832 109 - 109 1,346 146 961 146 2,317 1,019 1,364 527 3,792 2,078 3,111 484 - 81 - - 6,109 3,178 4,475 1,011 775 591 1,064 1,255 Income from equity securities - Held for trading - Dividend income - Gain on trading Income from debt securities - Held to maturity - Return on fixed income securities Income from debt securities - Available for sale - Return on fixed income securities Net unrealized gains on investment - Net unrealized gains on investments at fair value through profit or loss - held for trading Reversal of impairment in value of available-for-sale securities - Equity securities Total investment income 24 OTHER INCOME Return on bank balances 25 MODARIB’S FEE The Operator manages the participants’ investments as a Modarib and charge 40% Modarib’s share of the investment income earned by PTF. 70 1st Quarter Report 2020
  73. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 Operator’s Fund Quarter ended 31 March 2020 2019 Aggregate Aggregate Rupees in thousand 26 27 DIRECT EXPENSES Auditors' remuneration 72 69 Shariah Compliance Auditors' remuneration 43 41 115 110 RELATED PARTY TRANSACTIONS The related parties comprise of directors, major shareholders, key management personnel, entities under common control, entities with common directors and employees retirement benefit funds. The transactions with related parties are carried out at commercial terms and conditions except for compensation to key management personnel which are on employment terms. Transaction and balances with related parties for the period are as follows: 31 December 2019 (Audited) 31 March 2020 (Unaudited) Contribution due: Rupees in thousand Askari Guards (Private) Limited 1,108 1,633 (12) - - - 1,096 1,633 Mobil Askari Lubricants Pakistan Limited Petrosel Lubricants (Private) Limited 31 March Transactions during the period 2020 31 March 2019 (Unaudited) (Unaudited) Rupees in thousand Askari Guards (Private) Limited 525 2,104 30 62 Contribution written (including government levies and stamp duties) 2,243 2,085 Contribution received during the period 2,255 2,361 318 654 Contribution written (including government levies and stamp duties) - 53 Contribution received during the period - 84 87 87 555 230 Contribution received during the period Takaful benefits paid Mobil Askari Lubricants Pakistan Limited Takaful benefits paid Petrosel Lubricants (Private) Limited Takaful benefits paid Others Employees' retirement benefits ASKARI INSURANCE CO. LTD 71
  74. 28 72 Marine , aviation and transport 9,276 (956) (76) (272) 19,078 (2,345) (158) (4) Contribution receivable (inclusive of Federal Excise Duty, Federal Takaful Fee and Stamp duty) Less: Federal Excise Duty Federal Takaful Fee 1st Quarter Report 2020 7,972 - 16,571 - Gross direct contribution (372) (1) (27) (1) PTF Direct expense (778) (7,285) (1,044) (399) (1) (398) 376 (774) (645) 1,202 (1,847) (8,174) (3,031) 9,358 - 8,309 8,309 - 3,304 (27,068) (523) (26,545) 6,063 (32,608) 30,372 5,908 24,464 (31,268) (31,760) 87,492 - 91,690 91,690 (289) (914) (12,033) 22,404 26,445 225,080 Total liabilities Unallocated liabilities Segment liabilities 38,991 14,527 206,582 50,571 16,405 333,280 6,204 327,076 364,311 118,855 139,231 10,625 7,053 Total assets 46,751 As at 31 March 2020 (Unaudited) (1,790) Unallocated assets Segment assets Surplus for the year Modarib's share 1,064 4,303 (18,983) (1) (7,284) - (7,284) 6,507 - 6,507 - (2,032) 8,539 - 9,465 9,465 - (90) (1,353) 104,926 TOTAL 4,475 719 (95) 9,752 Miscellaneous Other income 104 Underwriting result (519) (18,464) 1,304 (19,768) 23,286 688 22,598 (5,278) (22,640) 50,516 - 49,373 49,373 (13) (495) (7,379) 57,260 9,560 Accident and Health Rupees in thousand Motor Net investment income (28) Net takaful claims and expenses (373) 1,832 2,551 Takaful claims recovered from retakaful operators Net takaful claims 1,092 (2,204) Net underwriting income 132 1,473 2,545 Retakaful Rebate income (2,578) (381) Takaful claims (6,125) (2,413) Retakaful contribution ceded to retakaful operators (11,691) (1,611) (2,446) Wakala expense Net takaful contribution 7,355 11,724 Takaful contribution earned Facultative inward contribution 7,972 16,571 Gross written contribution Stamp duty Participants’ Takaful Fund Fire and property damage Period ended 31 March 2020 - OPF & PTF Business class wise revenue and results have been disclosed in the profit and loss account prepared in line with the format issued by SECP through SEC (Insurance) Rules, 2017, vide SECP S.R.O. No 89 (1)/2017 dated 9 February 2017. The following table presents estimated information regarding certain assets and liabilities of the segments as at 31 March 2020 and 31 December 2019, unallocated capital expenditure and non-cash expenses during the year then ended. SEGMENT INFORMATION ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  75. 3 ,083 (1,809) 273 1,547 4,990 (2,477) 1,731 4,244 Commission expense Management expenses 37,145 (17,554) 11,236 (8,355) As at 31 March 2020 (Unaudited) 4,952 5,771 10,750 82,035 97,551 50,491 Total liabilities 2,443 306,074 252,733 53,341 15,516 12,580 2,720 Unallocated liabilities Segment liabilities Unallocated assets 30,811 Profit for the year 4,057 (115) 19,795 Other expenses Segment assets 775 Other income 10,801 6,109 1,325 5,386 (171) 4,232 TOTAL 1,790 (4,669) (2,881) (243) Miscellaneous Investment income (16,214) 2,940 (3,655) 22,809 2,031 Accident and Health Rupees in thousand Motor Modarib's share of PTF investment income Segment result Wakala Fee Marine, aviation and transport Fire and property damage Operator’s Fund ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 ASKARI INSURANCE CO. LTD 73
  76. 74 1st Quarter Report 2020 (57) (86) Total liabilities Unallocated liabilities 18,438 198,840 39,156 20,224 210,838 326,450 11,772 314,678 38,020 30,629 Segment liabilities 13,631 350,428 107,839 139,590 13,119 Total assets 45,620 Unallocated assets Segment assets 1,284 As at 31 December 2019 (Audited) Surplus for the period (76) (32,386) (877) (31,509) 8,498 (40,007) 32,310 3,295 29,015 (16,580) (29,309) 74,904 893 93,703 94,596 (906) 82 (938) (301) 1,255 55 (251) (68) (183) 323 (506) 333 621 (288) (4,114) (1,979) 5,805 52 2,857 2,909 (1) (12,802) Mudarib's share 511 (3,580) (33) (3,547) - (3,547) 3,635 - 3,635 - (1,245) 4,880 - 6,481 6,481 - (26) (203) 108,637 TOTAL Other income 683 (633) (26,262) (65) 3,139 Miscellaneous 1,011 (1,407) Underwriting result (472) (25,629) 1,243 (26,872) 26,773 68 26,705 (1,246) (23,332) 51,283 - 61,808 61,808 (15) (631) (9,525) 71,979 6,546 Accident and Health Rupees in thousand Motor Net investment income (1,821) PTF Direct expense Net takaful claims and expenses 404 (415) 6,528 (819) 1,155 (1,735) 414 Net underwriting income 984 Net takaful claims 1,622 Retakaful Rebate income 171 (4,146) Takaful claims recovered from retakaful operators (1,208) Net takaful contribution (8,263) (7,074) Takaful contribution ceded to retakaful operators (1,172) 5,489 54 8,927 8,981 (282) (73) (963) 10,299 Marine, aviation and transport Takaful claims 7,447 (1,581) Wakala expense 787 13,630 14,417 (3) Takaful contribution earned Facultative inward contribution Gross direct contribution Gross written contribution Stamp duty (143) (2,111) Less: Federal excise duty Federal takaful fee 16,674 Fire and property damage Contribution receivable (inclusive of Federal Excise Duty, Federal Takaful Fee and Stamp duty) Participants’ Takaful Fund Period ended 31 March 2019 - OPF & PTF ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  77. (6,868) 3,178 906 18,267 5,205 11,421 81,542 91,700 50,746 203,463 145,307 58,156 Total liabilities 2,599 2,338 10,158 11,571 36,929 Unallocated liabilities Segment liabilities Unallocated assets Segment assets (110) 4,695 2,414 (6,592) 22,832 252 68 (186) 31,727 TOTAL Profit for the year As at 31 December 2019 12,964 (860) (100) 2,532 Miscellaneous Other expenses 4,161 838 (6,322) (3,481) 22,767 1,212 Accident and Health Rupees in thousand Motor Year ended 31 March 2019 591 10,033 1,799 (40) (1,221) 2,099 Marine, aviation and transport Other income Investment income Modarib's share of PTF investment income Segment Result 286 (1,604) Commission expense Management expenses 3,117 Wakala Fee Fire and property damage ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 ASKARI INSURANCE CO. LTD 75
  78. 29 76 1st Quarter Report 2020 - - Loans and other receivables * - - Retakaful recoveries against outstanding claims* 60,000 277,232 Provision for outstanding claims (including IBNR)* Takaful / Retakaful payables* Payable to OPF / PTF Other creditors and accruals* Financial liabilities not measured at fair value - PTF Other creditors and accruals* Takaful / Retakaful payables* Financial liabilities not measured at fair value - OPF - - - 25,000 - Sukuks - - - - Takaful/Retakaful receivable* Investments Cash and bank deposits - PTF Financial assets not measured at fair value - PTF - Mutual funds Investment at fair value through profit and loss Financial assets measured at fair value - PTF - - - 149,262 35,000 - - Sukuks Loans and other receivables* Investments - - - Cash and bank deposits - OPF 127,970 Available-forsale Term deposits - OPF Financial assets not measured at fair value - OPF - Mutual funds Investment at fair value through profit and loss Financial assets measured at fair value - OPF Held-fortrading Held-tomaturity - - - - - - - - - - - - - - - - - 233,035 - - - - - - 79,202 - 32,293 - 2,934 38,452 - 27,500 52,654 - Rupees in thousand Loans and receivables 31 March 2020 (Unaudited) - - - - - - - - - - 254,193 6,202 38,452 94,795 72,055 22,255 4,321 16,113 Other financial liabilities 824,460 6,202 38,452 94,795 72,055 22,255 4,321 16,113 79,202 25,000 32,293 149,262 2,934 38,452 35,000 27,500 52,654 127,970 Total 277,232 - - - - - - - - - 149,262 - - - - 127,970 Level 1 The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy for financial instruments measured at fair value. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value. FAIR VALUE OF FINANCIAL INSTRUMENTS ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020
  79. - Retakaful recoveries against outstanding claims * Loans and other receivables* - - - - 60,000 - 239,839 - Other creditors and accruals* - - - - - - - - - - - - - - - Wakala fees payable* - - - - - - - - 25,000 - - - - - - - 220,435 - - - - - - - - 16,397 63,655 - 67,328 - 1,887 3,240 42,962 - 24,966 - Rupees in thousand Loans and receivables 31 December 2019 (Audited) Held-tomaturity Mudarib's fees payable* - Provision for outstanding claims (including IBNR)* Takaful / Retakaful payables* Financial liabilities not measured at fair value - PTF - Takaful / Retakaful payables* Other creditors and accruals* Financial liabilities not measured at fair value - OPF - Takaful/Retakaful receivable* - - Sukuks Investments Cash and bank deposits - PTF Financial assets not measured at fair value - PTF - Mutual funds Investment at fair value through profit and loss 115,779 - Loans and other receivables* Financial assets measured at fair value - PTF - Wakala fees receivable* - - - 35,000 Available-forsale - - 124,060 Mudarib's fees receivable* - Sukuks Investments Cash and bank deposits - OPF Financial assets not measured at fair value - OPF - Mutual funds Investment at fair value through profit and loss Financial assets not measured at fair value - OPF Held-fortrading - - - - - - - - - - - - 223,564 8,532 3,240 42,962 77,606 71,686 16,310 3,228 Other financial liabilities 743,838 8,532 3,240 42,962 77,606 71,686 16,310 3,228 - 16,397 63,655 25,000 67,328 115,779 1,887 3,240 42,962 35,000 24,966 124,060 Total 239,839 - - - - - - - - - - - - 115,779 - - - - - 124,060 Level 1 ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 ASKARI INSURANCE CO. LTD 77
  80. ASKARI GENERAL INSURANCE COMPANY LIMITED - WINDOW TAKAFUL OPERATIONS NOTES TO AND FORMING PART OF THE CONDENSED INTERIM FINANCIAL INFORMATION (UNAUDITED) FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2020 * The Operator has not disclosed the fair value of these items because their carrying amounts are a reasonable approximation of fair value. Fair value is an amount for which an asset could be exchanged, or a liability settled between knowledgeable willing parties in an arm’s length transaction. Consequently, differences may arise between the carrying values and the fair values estimates. The Operator measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements: Level 1: Fair value measurements using quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Fair value measurements using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Fair value measurements using inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs). 30 DATE OF AUTHORISATION FOR ISSUE These financial statements were authorized for issue by the Board of Directors on its meeting held on 27 April 2020. Razi Haider Chief Financial Officer 78 1st Quarter Report 2020 Abdul Waheed President & Chief Executive Maj Gen Akhtar Iqbal (Retd) Director Lt Gen Najib Ullah Khan (Retd) Chairman
  82. UAN : Ph: Fax: Email: 80 1st Quarter Report 2020 3rd Floor, AWT Plaza, The Mall Rawalpindi, Pakistan +92-51-111-444-687 +92-51-9272425-7 +92-51-9272424 info@agico.com.pk Design & Produced by: DESIGN MEDIA SOLUTION 0335-555-7717 Head Office: