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Habib Insurance Company Limited: Interim Statement of Financial Position - 30 September 2019

IM Insights
By IM Insights
4 years ago
Habib Insurance Company Limited: Interim Statement of Financial Position - 30 September 2019

Takaful, Waqf, Credit Risk, General Takaful, Provision, Receivables, Reserves

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  1. Habib Insurance Company Limited Condensed Interim Statement of Financial Position (Unaudited) as at September 30, 2019 (Unaudited) (Audited) September 30, December 31, 2019 2018 (Rupees in ' 000) Note Assets Property and equipment Intangible assets Investments Equity securities Debt securities Loans and other receivables Insurance/ reinsurance receivables Reinsurance recoveries against outstanding claims Salvage recoveries accrued Deferred commission expense Prepayments Cash and bank 6 169,747 3,518 109,076 4,443 7 8 9 10 18 818,809 276,171 126,043 925,824 394,579 28,043 72,540 405,091 10,906 1,129,856 70,763 110,522 932,311 406,143 9,616 61,071 292,158 102,396 3,231,271 3,228,355 65,622 54,048 3,296,893 3,282,403 619,374 389,288 70,889 619,374 608,509 110,676 1,079,551 1,338,559 607,752 726,034 111,865 102,102 35,702 161,118 4,117 281,903 170,289 4,503 543,938 631,754 77,002 88,470 129,519 68,950 424 222,570 166,118 9,147 2,205,384 1,937,892 19 11 12 Total Assets of Window Takaful Operations - Operator’s Fund Total assets EQUITIES AND LIABILITIES Capital and reserves attributable to Company's equity holders Ordinary share capital Reserve Unappropriated profit 13 Total Equity Liabilities Underwriting provisions Outstanding claims including IBNR Unearned premium reserves Unearned reinsurance commission Retirement benefit obligations Deferred taxation - net Financial lease liability Premium received in advance Insurance/ reinsurance payables Other creditors and accruals Taxation - provision less payment 18 17 19 14 15 Total Liabilities of Window Takaful Operations - Operator’s Fund 11,957 5,952 Total Liabilities 2,217,341 1,943,844 Total Equity and Liabilities 3,296,893 3,282,403 Contingencies and commitments 16 The annexed notes from 1 to 28 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 5 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  2. Habib Insurance Company Limited Condensed Interim Statement of Comprehensive Income (Unaudited) for the nine months period ended September 30, 2019 Note (Unaudited) Three months period ended September 30, 2019 2018 (Rupees in ' 000) (Unaudited) Nine months period ended Septemer 30, 2019 2018 (Rupees in ' 000) Net insurance premium 17 204,726 136,444 561,934 382,708 Net insurance claims Net commission and other acquisition cost Insurance claims and acquisition expenses 18 19 (128,637 ) 12,700 (115,937 ) (82,600 ) 17,068 (65,532 ) (318,520 ) 33,947 (284,573 ) (226,310) 51,713 (174,597) (71,468 ) 17,321 (63,370 ) 7,542 (215,219 ) 62,142 (181,926) 26,185 19,009 6,689 (21,228 ) 21,791 44,806 1,755 (22,222 ) 31,881 69,101 18,140 (79,519 ) 69,864 161,368 5,864 (67,651) 125,766 Finance costs (3,361 ) (1,064 ) (10,330 ) (2,119) Profit from Window Takaful Operations - Operator’s Fund Profit before tax for the period 2,952 21,382 –00 30,817 6,612 66,146 –00 123,647 (9,543 ) 11,839 (9,574 ) 21,243 (13,027 ) 53,119 (36,973) 86,674 (166,424 ) (33,021 ) (327,842 ) 94,965 11,818 (154,606 ) (41,151 ) (74,172 ) 25,813 (302,029 ) (110,040) (15,075) 44,835 19,113 82,808 20,350 Other comprehensive income for the period (109,771 ) (55,059 ) (219,221 ) 5,275 Total comprehensive income for the period (97,932 ) (33,816 ) (166,102 ) 91,949 0.43 0.70 Management expenses Underwriting results Investment income Other income Other expenses Results of operating activities 20 Income tax expense Profit after tax for the period 21 Other comprehensive income: Unrealised (loss) / gain on available-for-sale investments during the period Less: Net gain / (loss) transferred to profit and loss on disposal of investments Related tax impact Earning (after tax) per share - Rupees 22 0.10 0.17 The annexed notes from 1 to 28 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 6 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  3. Habib Insurance Company Limited Condensed Interim Statement of Changes in Equity (Unaudited) for the nine months period ended September 30, 2019 Share capital Balance as at January 01, 2018 Capital Reserves Reserve for exceptional losses General reserve Reserves Revenue Reserves Available for sale reserve (Rupees in ‘000) Total Unappropriated profit Total Equity 619,374 9,122 255,000 450,547 714,669 101,584 1,435,627 –00 –00 –00 –00 –00 –00 –00 5,275 –00 5,275 86,674 –00 86,674 5,275 –00 –00 –00 5,275 5,275 86,674 91,949 –00 –00 –00 –00 –00 (92,906 ) (92,906 ) Balance as at September 30, 2018 619,374 9,122 255,000 455,822 719,944 95,352 1,434,670 Balance as at January 01, 2019 619,374 9,122 255,000 344,387 608,509 110,676 1,338,559 –00 –00 –00 –00 –00 –00 –00 (219,221 ) –00 (219,221 ) 53,119 –00 53,119 (219,221 ) –00 –00 –00 (219,221 ) (219,221 ) 53,119 (166,102 ) –00 –00 –00 –00 –00 (92,906 ) (92,906 ) 619,374 9,122 255,000 125,166 389,288 Profit for the nine months ended September 30, 2018 Other comprehensive income Total comprehensive income for the nine months period ended September 30, 2018 Final dividend of Rs. 0.75 per share for the year ended December 31, 2017 Profit for the nine months ended September 30, 2019 Other comprehensive income Total comprehensive income for the nine months period ended September 30, 2019 Final dividend of Rs. 0.75 per share for the year ended December 31, 2018 Balance as at September 30, 2019 70,889 1,079,551 The annexed notes from 1 to 28 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 7 SHABBIR GULAMALI Chief Executive MURTAZA HUSSAIN Chief Financial Officer
  4. Habib Insurance Company Limited Condensed Interim Statement of Cash Flow (Unaudited) for the nine months period ended September 30, 2019 (Unaudited) (Unaudited) September 30, September 30, 2019 2018 (Rupees in ' 000) Operating cash flows (a) Underwriting activities Insurance premium received Reinsurance premium paid Claims paid Reinsurance and other recoveries received Commission paid Commission received Net cash flow from underwriting activities (b) Other operating activities Income tax paid Other operating payments Other operating receipts Loans advanced Loan repayment received Net cash flow from other operating activities Total cash flow (used in) operating activities Investment activities Profit/ return received Dividend received Payment for investments Proceeds from investments Fixed capital expenditure Proceeds from sale of property, plant and equipment Total cash flow from investing activities 1,188,330 (575,852) (688,606) 427,037 (101,473) 174,230 423,666 737,479 (434,153) (494,775) 265,038 (70,909) 138,280 140,960 (55,871) (246,799) 5,008 (10,903) 14,568 (293,998) 129,668 (69,723) (169,042) –00 (8,766) 17,057 (230,474) (89,514) 9,068 37,017 (722,479) 568,976 (10,897) 2,241 (116,074) 9,926 51,623 (455,794) 531,132 (57,717) 3,326 82,496 (90,358) (14,727) (105,085) (91,490) 102,396 10,906 (89,924) (6,827) (96,751) (103,769) 166,460 62,691 129,669 (25,105) 55,871 (10,330) 3,603 (14,950) 1,318 9,068 37,017 25,813 386 (13,027) 140,299 (286,513) 53,119 (89,514) (7,875) 69,723 (2,179) –00 (9,710) 7,039 9,926 51,623 110,040 212 (36,973) 168,624 (184,262) 86,674 Financing activities Dividends paid Lease rentals paid Total cash flow (used in) financing activities Net cash flows (used in) all activities Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period Reconciliation to profit and loss account Operating cash flows Depreciation expense Income tax paid Finance charges Provision for impairment Provision for gratuity Gratuity paid Profit/ return received Dividends received Capital gain Profit on disposal of property, plant and equipment Provision for taxation Increse / (decrease) in assets other than cash (Increase) / decrease in liabilities other than borrowings Profit after taxation The annexed notes from 1 to 28 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 8 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  5. Habib Insurance Company Limited Notes to the Condensed Interim Financial Statements for the nine months period ended September 30 , 2019 (Unaudited) 1 LEGAL STATUS AND NATURE OF BUSINESS Habib Insurance Company Limited (the Company) was incorporated as a Public Limited Company in the year 1942 under the Companies Act, 1913 (now the Companies Act, 2017). The registered office of the Company is situated at Habib Square, M. A. Jinnah Road, Karachi and the shares of the Company are quoted on the Pakistan Stock Exchange Limited. The Company is engaged in general insurance business. 2 BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE These condensed interim financial information has been prepared in accordance with the format prescribed by Securities and Exchange Commission of Pakistan (SECP) through Insurance Rules, 2017, vide SRO 89 (I) / 2017 dated February 09, 2017. These condensed interim financial statements have 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 comprise of: International Accounting Standard (IAS) 34, Interim Financial Reporting, issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017 and provisions of and directives issued under the Companies Act, 2017, the Insurance Ordinance, 2000, Insurance Rules, 2017, Insurance Accounting Regulations, 2017 and Takaful Rules, 2012. Where the provisions of and directives issued under the Companies Act, 2017, Insurance Ordinance, 2000, Insurance Rules, 2017, and Insurance Accounting Regulations, 2017, and Takaful Rules, 2012 differ with the requirements of IAS 34, the provisions of and directives issued under the Companies Act, 2017, Insurance Ordinance, 2000, Insurance Rules, 2017, and Insurance Accounting Regulations, 2017, and Takaful Rules, 2012 have been followed. In terms of the requirements of the Takaful Rules, 2012, read with SECP circular 25 of 2015 dated July 09, 2015, the assets, liabilities and profit and loss of the Operator's Fund of the Company have been presented as a single line item in the statement of financial position and profit and loss account of the Company respectively. Further, a separate set of the financial statements of the General Takaful Operations for the six months period ended June 30, 2019 has been annexed to these financial statements as per the requirements of the Takaful Rules, 2012. The disclosures made in these condensed interim financial statements have been limited based on the format prescribed by the Securities and Exchange Commission of Pakistan vide SRO 89(I)/2017 and International Accounting Standard (IAS) 34, "Interim Financial Reporting" and do not include all the information and disclosures required in the annual financial statements. Accordingly, these condensed interim financial statements should be read in conjunction with the annual financial statements of the Company for the year ended December 31, 2018. 2.1 Basis Of Measurement These condensed interim financial statements have been prepared on the historical cost basis except for certain investment which are carried at fair value and obligations under certain employment benefits which are measured at present value. 2.2 Functional And Presentation Currency These condensed interim financial statements are presented in Pak Rupees which is also the Company's functional currency. All the financial information presented in Pak Rupees has been rounded to nearest Thousand Rupees, unless otherwise stated. 9
  6. Habib Insurance Company Limited 2 .3 Standards, interpretations and amendments to published accounting and reporting standards that are effective in the current period IFRS 16, the accounting standard for leases, became effective for annual reporting periods commencing on or after January 01, 2019. The impact of the adoption of IFRS 16 is disclosed in note 3.1 of these condensed interim financial statements of the Company. In addition, there are certain other new standards and interpretations of and amendments to existing accounting standards that have become applicable for accounting periods beginning on or after January 01, 2019. These are considered either to not be relevant or not to have any significant impact on the Company's condensed interim financial statements. 2.4 Standards, interpretations and amendments to published accounting and reporting standards that are not yet effective in the current period IFRS 9 ‘Financial Instruments’ is effective for reporting period / year ending on or after June 30, 2019. It replaces the existing guidance in IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 includes revised guidance on the classification and measurement of financial instruments, a new expected credit loss model for calculating impairment on financial assets, and new general hedge accounting requirements. It also carries forward the guidance on recognition and derecognition of financial instruments from IAS 39. Amendment to IFRS 4 ‘Insurance Contracts’ - Applying IFRS 9 ‘Financial Instruments with IFRS 4 addresses issue arising from the different effective dates of IFRS 9 and the forthcoming new standard IFRS 17 ‘Insurance Contracts’. The amendments introduces two alternative options for entities issuing contracts within the scope of IFRS 4, notably a temporary exemption and an overlay approach. The temporary exemption enables eligible entities to defer the implementation date of IFRS 9. The overlay approach allows an entity applying IFRS 9 from July 01, 2018 onwards to remove from profit or loss the effects of some of the accounting mismatches that may occur from applying IFRS 9 before IFRS 17 is applied. The Company has determined that it is eligible for the temporary exemption option since the Company has not previously applied any version of IFRS 9 , its activities are predominantly connected with insurance as the percentage of the total carrying amount of its liabilities connected with insurance relative to the total carrying amount of all its liabilities is greater than 90 percent and the Company doesn't engage in significant activities unconnected with insurance based on historical available information. Under the temporary exemption option, the Company can defer the application of IFRS 9 until the application IFRS 17. To determine the appropriate classification of financial assets under IFRS 9, an entity would need to assess the contractual cash flows characteristics of any financial asset. Indeed, the contractual terms of the financial asset give rise, on specified dates, to cash flows that are solely payments of principal and interest on the principal amount outstanding (“SPPI”) i.e. cash flows that are consistent with a basic lending arrangement. In a basic lending arrangement, consideration for the time value of money and credit risk are typically the most significant elements of interest. IFRS 9 defines the terms “principal” as being the fair value of the financial asset at initial recognition, and the “interest” as being compensation for (i) the time value of money, and (ii) the credit risk associated with the principal amount outstanding during a particular period of time. The tables below set out the fair values as at the end of reporting period and the amount of change in the fair value during that period for the following two groups of financial assets separately: a) financial assets with contractual terms that give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding, excluding any financial asset that meets the definition of held for trading in IFRS 9, or that is managed and whose performance is evaluated on a fair value basis, and 10
  7. Habib Insurance Company Limited b ) all other financial assets. September 30, 2019 (Unaudited) Fail the SPPI test Pass the SPPI test Change in Carrying Cost less Change in Fair value unrealized value Impairment unrealized gain or loss gain or loss during the during the period period (Rupees in '000) Financial assets Cash and bank* Investment in equity securities - available for sale Investments in debt securities - held to maturity Loans and other receivables* 10,906 818,809 –00 –00 Total 829,715 –00 (302,029 ) –00 –00 (302,029 ) –00 –00 –00 –00 –00 –00 276,171 126,043 276,171 126,043 –00 –00 402,214 402,214 –00 September 30, 2019 (Un-audited) Gross carrying amounts of debt instruments that pass the SPPI test AAA AA+ A+ Unrated (Rupees in '000) Investments in debt securites - held to maturity Loans and other receivables* –00 –00 –00 –00 –00 –00 276,171 126,043 Total –00 –00 –00 402,214 * The carrying amount of these financial assets measured applying IAS 39 are a reasonable approximation of their fair values. 3 SIGNIFICANT ACCOUNTING POLICIES The significant accounting policies and method of computation adopted in preparation of these condensed interim financial statements are consistent with those followed in preparation of the annual financial statements of the Company for the year ended December 31, 2018 except accounting for leases as disclosed below in note 3.1. 3.1 Change in Accounting policies The Company has initially adopted IFRS 16 Leases from January 01, 2019. A number of other new standards are effective from January 01, 2019 but they do not have a material effect on the Company's financial statements. IFRS 16 introduced a single, on-balance sheet accounting model for lessees. As a result, the Company, as a lessee, has recognized right-of-use assets representing its rights to use the underlying assets and lease liabilities representing its obligation to make lease payments. The Company has applied IFRS 16 using the modified retrospective approach, under which the cumulative effect of initial application is recognized in retained earnings at January 01, 2019. Accordingly the comparative information presented for 2018 has not been restated - i.e. it is presented, as previously reported, under IAS 17 and related interpretations. The details of the changes in accounting policies are disclosed below. 11
  8. Habib Insurance Company Limited A . Definition of Lease Previously, the Company determined at contract inception whether an arrangement was or contained a lease under IFRIC 4 - Determining Whether an Arrangement contains a Lease. The Company now assess whether a contract is or contains a lease based on the new definition of a lease. Under identified asset for a period of time in exchange for consideration. On transition to IFRS 16, the Company elected to apply the practical expedient to 'grandfather' the assessment of which transactions are leases. Contracts that were not identified as leases under IAS 17 and IFRIC 4 were not reassessed. Therefore, the definition of a lease under IFRS 16 has been applied only to contracts entered into or changed on or after January 01, 2019. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease and non-leases component on the basis of their relative stand-alone prices. However, for leases of properties in which it is a lessee, the Company has elected not to separate non-lease components and will instead account for the lease and non-lease components as a single lease component. B. As a lessee The Company lease office premises and motor vehicles. As a lessee, the Company previously classified leases as operating or finance leases based on its assessment of whether the lease transferred substantially all of the risks and rewards of ownership. Under IFRS 16 , the Company recognises right-of-use assets and lease liabilities for most leases i.e. these leases are on balance sheet. The Company presents right-of-use assets that do not meet the definition of investment property in property, plant and equipment, the same line item as it presents underlying assets of the same nature that it owns. The carrying amounts of right-of-use assets are as below. Office premises and motor vehicles (Rupees in '000) Balance at January 01, 2019 Balance at September 30, 2019 i. 130,876 141,007 Significant accounting policies The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, are subsequently at cost less any accumulated depreciation and impairment losses, and adjusted for certain remeasurements of the lease liability. When a right-of-use asset meets the definition of investment property, it is presented in investment property. The right-of-use asset is initially measured at cost, and subsequently measured at fair value, in accordance with the Company’s accounting policies. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the rate implicit in the lease or, if that rate cannot be readily determined, the Company's incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate. The lease liability is subsequently increased by interest cost on the lease liability and decreased by lease payment made. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, a change in the estimate of the amount expected to be payable under a residual value guarantee, or as appropriate changes in the assessment of whether a purchase or extension option is reasonably certain to be exercised or a termination option is reasonably certain not to be exercised. 12
  9. Habib Insurance Company Limited The Company has applied judgement to determine the lease term for some lease contracts in which it is a lessee that include renewal options . The assessment of whether the Company is reasonably certain to exercise such options impacts the lease term, which significantly affects the amount of lease liabilities and right-of-use assets recognised. ii. Transition Previously, the Company classified property leases as operating leases under IAS 17 which include office premises and motor vehicles. The contract period of other offices are for short term typically run for 1 year with termination clause on both parties and option of renew for an additional period of one year. At transition, for leases classified as operating leases under IAS 17, lease liabilities were measured at the present value of the remaining lease payments, discounted at the Company's incremental borrowing rate as at January 01, 2019. Right-of-use assets are measured at either: - their carrying amount as if IFRS 16 had been applied since the commencement date, discounted using the lessee's incremental borrowing rate at the date of initial application - the Company applied this approach to its largest property leases and motor vehicles: or - an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments the Company applied this approach to all other leases. - The Company uses the following practical expedients when applying IFRS 16 to leases previously classified as operating leases under IAS 17: C. - Applied the exemption not to recognise right-of-use assets and liabilities for leases with less than 12 months of lease term - Excluded initial direct cost from measuring the right-of-use assets at the date of initial application. - Used hindsight when determining the lease term if the contract contains options to extend or terminate the lease. Impact on financial statements Summary of the effect of this change in accounting policy is as follows: i. Impact on Statement of Financial Position Increase in fixed assets - right of use assets Increase in other liabilities - lease liability against right of use assets Increase in net asset - before tax ii. Impact on Profit and Loss Account Increase in finance cost - lease liabilities Increase / decrease in management expenses Increase in depreciation expense - right of use assets Decrease in rent expense (Rupees in '000) 141,007 161,118 (20,111 ) 10,330 15,806 18,032 As a result of initially applying IFRS 16, in relation to the leases that were previously classified as operating leases, the Company recognised Rs. 141 million right-of-use assets and Rs. 161.12 million of lease liabilities as at September 30, 2019. Also in relation to those leases under IFRS 16, the Company has recognised depreciation and interest cost, instead of operating lease expense. During the nine months ended September 30, 2019, the Company recognise Rs.15.8 million depreciation charges and Rs. 10.3 million interest cost from these leases. 13
  10. Habib Insurance Company Limited 4 . ESTIMATES AND JUDGEMENTS The preparation of these condensed interim financial information requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates. The significant judgments made by management in applying the Company's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the annual financial statements for the year ended December 31, 2018. 5. MANAGEMENT OF INSURANCE AND FINANCIAL RISK Insurance and financial risk management objectives and policies are consistent with those disclosed in the financial statement for the year ended December 31, 2018. 6. (Unaudited) (Audited) September 30, December 31, Note 2019 2018 (Rupees in '000) Property and equipment Operating assets Right-of-use assets 7. 6.1 6.2 6.1.1 6.1.2 6.2.1 109,076 29,322 10,573 (1,854 ) (2 ) (9,299 ) 19,998 25,711 (10,211) –00 (6,176) 28,740 29,322 2,527 2,321 969 4,756 2,207 1,609 2,347 19,548 10,573 25,711 The following disposals of tangible - operating assets were made during the period / year Computer equipment Office equipment Motor Vehicles - owned 6.2 169,747 The following additions were made to tangible-property and equipment during the period/ year Furniture and fixtures Computer equipment Office equipment Motor Vehicles - owned 6.1.2 29,322 79,754 Operating Assets Opening written down value Additions during the period / year Disposals during period / year Write off during the period / year Depreciation for the period / year 6.1.1 28,740 141,007 36 17 1,801 70 48 10,093 1,854 10,211 Right-of-use assets Balance at January 01, 2019 Additions during the period / year Depreciation charge for the period / year 130,876 25,937 (15,806 ) –00 84,157 (4,403) Balance at September 30, 2019 141,007 79,754 This includes assets which were previously capitalised in Operating Assets under finance lease as per IAS 17 amounting to Rs. 79.8 million as at 31 December 2018, which are now recognised as Right-of-use assets under IFRS 16. 14
  11. Habib Insurance Company Limited 7 . INVESTMENT IN EQUITY SECURITIES 280,430 –00 280,430 309,093 –00 309,093 Others Listed share Mutual funds Modaraba certificate 345,920 1,480 15,014 –00 –00 –00 345,920 1,480 15,014 270,427 58,085 15,014 (757 ) –00 –00 269,670 58,085 15,014 362,414 –00 –00 –00 362,414 175,965 343,526 –00 (757 ) –00 342,769 477,994 642,844 –00 818,809 652,619 (757 ) 1,129,856 INVESTMENT IN DEBT SECURITIES Note Government securities 8.1 9. December 31, 2018 (Audited) Cost Impairment / Carrying provision value (Rupees in '000) Related Party Listed share Surplus on revaluation 8. September 30, 2019 (Unaudited) Cost Impairment / Carrying provision value (Rupees in '000) 8.1 September 30, 2019 (Unaudited) Cost Impairment / Carrying provision value (Rupees in '000) December 30, 2018 (Audited) Cost Impairment / Carrying provision value (Rupees in '000) 276,171 –00 276,171 70,763 –00 70,763 276,171 –00 276,171 70,763 –00 70,763 This represents Pakistan Investment Bonds having face value of Rs. 70 million (market value of Rs. 65.43 million) [December 31, 2018: face value Rs.70 million (market value of Rs.69.3 million]. These carry mark-up ranging from 7% to 12% (December 31, 2018: 7% to 12%) per annum and will mature between December 29, 2019 to July 19, 2022. These have been deposited with the State Bank of Pakistan (SBP) as statutory deposit in accordance with the requirements of Section 29 of the Insurance Ordinance, 2000 and circular no. 15 of 2008 dated July 07, 2008 issued by the SECP. LOANS AND OTHER RECEIVABLES - Considered good Accrued investment income Security Deposits Advances Agents Commission receivable Loan to employees Other receivables (Unaudited) (Audited) June 30, December 31, 2019 2018 (Rupees in '000) 7,695 33,832 14,700 341 51,984 17,491 3,334 26,799 9,994 2,522 52,607 15,266 126,043 110,522 478,613 519,477 10. INSURANCE / REINSURANCE RECEIVABLES - Unsecured and considered good Due from insurance contract holders Less: Provision for impairment of receivables from insurance Due from other insurers / reinsurers Less: Provision for impairment of due from other insurers / reinsurers (15,912 ) (15,912) 462,701 503,565 469,623 435,246 (6,500 ) 15 (6,500) 463,123 428,746 925,824 932,311
  12. Habib Insurance Company Limited 11 . (Unaudited) (Audited) September 30, December 31, 2019 2018 (Rupees in '000) PREPAYMENTS Prepaid reinsurance premium ceded Prepaid rent Prepaid insurance on leased vehicles Others 12. 390,924 –00 4,684 9,483 281,792 3,171 2,554 4,641 405,091 292,158 1,059 100 108 57 1,159 165 1,282 8,465 13,584 88,647 CASH AND BANK BALANCES Cash and cash equivalents Cash in hand Policy Stamps Cash at bank Current accounts Savings accounts 13. 102,396 255,000 9,122 125,166 255,000 9,122 344,387 389,288 608,509 171,183 32,566 78,154 99,554 27,849 95,167 281,903 222,570 47,629 16,996 1,282 14,108 2,263 60,099 27,079 833 32,213 24,457 1,704 22,894 2,629 57,551 23,140 1,530 170,289 166,118 INSURANCE / REINSURANCE PAYABLES Due to other insurers / reinsurers Foreign reinsurers Local reinsurers Co insurers payable 15. 102,231 RESERVES General reserve Reserve for exceptional losses Revaluation reserve - avaiable for sale investments 14. 9,747 10,906 OTHER CREDITORS AND ACCRUALS Agents commission payable Federal excise duty Federal insurance fee Accrued expenses Withholding tax payable Unclaimed dividend Sundry creditors Others 16
  13. Habib Insurance Company Limited 16 . CONTINGENCIES & COMMITMENTS 16.1 Contingencies There are no contingencies outstanding as at Septemer 30, 2019 except as disclosed in note 22. 16.2 Commitments There were no commitments as at September 30, 2019. Three months period ended September 30, 2019 2018 (Rupees in ' 000) 17. 18. NET INSURANCE PREMIUM Written gross premium Add: Unearned premium reserve opening Less: Unearned premium reserve closing 398,828 713,571 (726,034 ) 344,174 1,182,267 541,919 631,754 (580,103 ) (726,034 ) 958,238 481,048 (580,103) Premium earned 386,365 305,990 1,087,987 859,183 Less: Add: Less: 232,981 339,582 (390,924 ) 191,890 301,409 (323,753 ) 635,185 281,792 (390,924 ) 527,044 273,184 (323,753) Reinsurance expense 181,639 169,546 526,053 476,475 Net insurance premium 204,726 136,444 561,934 382,708 Claims paid Add: Outstanding claims including IBNR closing Less: Outstanding claims including IBNR opening 184,983 607,752 (482,507 ) 150,725 586,869 (586,701 ) 688,606 607,752 (543,938 ) 494,775 586,869 (666,850) Claims expense 310,228 150,893 752,420 414,794 97,352 65,506 427,037 265,038 422,622 468,681 422,622 468,681 Reinsurance premium ceded Prepaid reinsurance premium opening Prepaid reinsurance premium closing NET INSURANCE CLAIMS EXPENSE Less: Add: Less: 19. Nine months period ended September 30, 2019 2018 (Rupees in ' 000) Reinsurance and other recoveries received Reinsurance and other recoveries in respect of outstanding claims net of impairment - closing Reinsurance and other recoveries in respect of outstanding claims net of impairment - opening (338,383 ) (465,894 ) (415,759 ) (545,235) Reinsurance and other recoveries revenue 181,591 68,293 433,900 188,484 Net insurance claims 128,637 82,600 318,520 226,310 44,017 66,924 (72,540 ) 38,401 36,644 48,018 (57,761 ) 26,901 116,889 61,071 (72,540 ) 105,420 95,158 37,294 (57,761) 74,691 63,821 99,145 (111,865 ) 51,101 12,700 49,243 80,029 (85,303 ) 43,969 17,068 174,230 77,002 (111,865 ) 139,367 33,947 138,280 73,427 (85,303) 126,404 51,713 NET COMMISSION INCOME / ACQUISITION COST Commissions paid or payable Add: Deferred commission - opening Less: Deferred commission - closing Commission expense Less: Commission from reinsurers Commission received or receivable Add: Unearned reinsurance commission - opening Less: Unearned reinsurance commission - closing Commission from reinsurers Net commission income 17
  14. Habib Insurance Company Limited Three months period ended September 30 , 2019 2018 (Unaudited) (Rupees in ' 000) 20. INVESTMENT INCOME Income from equity securities and mutual fund units ‘available-for-sale’ - Dividend income 1,125 3,187 37,743 51,025 Income from debt securities - ‘held-to-maturity’ - Return on debt securities 2,543 2,180 5,779 5,292 11,559 259 15,486 40,650 501 46,518 23,409 2,404 69,335 107,913 2,127 166,357 3,603 (80 ) 19,009 –00 (1,712 ) 44,806 –00 (234 ) 69,101 –00 (4,989) 161,368 (9,227) (316 ) (9,543 ) (8,443 ) (1,131 ) (9,574 ) (23,889 ) 10,862 (13,027 ) (35,351) (1,622) (36,973) Net realised gain on investments Available-for-sale - Equity securities - Mutual funds units Total investment income Less: Impairment in value of available-for-sale investments Less: Investment related expenses 21. Nine months period ended September 30, 2019 2018 (Unaudited) (Rupees in ' 000) TAXATION For the period - Current - Deferred In respect of tax years 2004 to 2007, the tax authorities have served notices on the Company under section 122(9) for amendment under section 122(5A) in the returns filed by the Company in respect of the aforesaid years. The amendment mainly relates to taxability of capital gains and proration of expenses against dividend and capital gains. The proceedings in respect of tax years 2004 to 2007 are still pending due to the fact that the Company has filed writ petition before the Honourable High Court of Sindh against said notices. The Honourable High Court of Sindh has issued status quo order in respect of tax year 2005. Based on the opinion of legal advisor, the management believes that the case will be decided in favour of the Company. In 2015, the Company received orders u/s. 122(5A) passed by the Additional Commissioner Inland Revenue (ACIR) for the tax year 2009 and 2012 wherein prior year assessments were revised by treating dividend income as single basket income and taxing it at 35% instead of fixed rate of 10% resulting in aggregate demand of Rs.16 million. The Company has filed appeals against the said orders with Commissioner Income Tax - Appeals (CIT Appeals), who had confirmed the orders passed by ACIR .The Company then filed appeal before Appellate Tribunal Inland Revenue (ATIR) against the order of CIT (Appeals) which is yet to be fixed for hearing. Besides filing appeals against the said orders of CIT (Appeals) the Company has also challenged the same before the Honourable High Court of Sindh (HCS). The HCS has stayed the recovery of demands raised by the tax departments through these orders till next hearing. The Company, based on its tax advisor's opinion, is confident that the ultimate outcome of the appeal will be in its favour. Therefore, no provision for the said demand has been made in these financial statements. Further, the tax authorities have also issued orders for the tax year 2008 and 2009 wherein certain disallowances have been made mainly relating to the same matters mentioned above. During 2011, the Commissioner Income Tax has decided the matter in favour of the Company in respect of tax year 2008 and 2009. The department has filed appeal before the learned Appellate Tribunal Inland Revenue for the tax years 2008 and 2009. During the year 2012, the Appellate Tribunal Inland Revenue decided the matter in favour of the Company. However, the Department has filed reference application before the Honourable High Court of Sindh against the aforesaid order of the Appellate Tribunal Inland Revenue. However, no lawyer has been appointed in this regard by the Company to defend their case before Honourable High Court of Sindh. Based on the opinion of tax advisor, no demand has been raised till date, consequently, no provision in these financials statements has been made in this regard. 18
  15. Habib Insurance Company Limited For tax year 2017 , the Company had filed the appeals before the Commissioner (Appeals-I), Karachi, against the order passed under section 122(5A) of the Income Tax Ordinance, 2001 (ITO), for the tax year 2017, whereby a demand of Rs.3.3 million has raised. The recovery has automatically been stayed till the decision on payment of 10% demand. In response thereto, the Company filed second appeal before the ATIR, Karachi, against the Order of Commissioner (Appeals-I), Karachi, who has maintained the demand raised under section 161/205 of the ITO for the tax year 2017. The recovery has automatically been stayed till the decision on payment of 10% demand. Based on the opinion of tax advisor, the management believes that the case will be decided in favour of the Company. The Company has filed return of total income for the tax year 2018 (financial year ended December 31, 2017) against which a notice under section 122(5A) has been served on the Company for amendments in the return filed by the Company for the said tax year, the amendments mainly relate to non withholding of tax on commission paid, addition on amount of cash withdrawal and admissibility of various provision / expenses / credits etc. Furthermore, in respect of tax years 2011 to 2016 the tax authorities have issued orders disallowing certain expenses claimed by the Company. The Company has filed appeals against the said orders before the ATIR which are yet to fixed for hearing. Based on the opinion of tax advisor, the management believes that the case will be decided in favour of the Company. Further during the period, the tax authorities have also issued show cause notice u/s 14(1) of the Federal Excise Act, 2005 for the tax year 2017 for short payment of Federal Excise Duty amounting to Rs.75,545,059 on aggregate premium revenue received. The Company have obtained stay order from Honorable High Court of Sindh against the show cause notice. However, based on the opinion of tax advisor, the management believes that the case will be decided in favour of the Company. Three months period Nine months period ended September 30, ended September 30, 2019 2018 2019 2018 (Unaudited) (Unaudited) (Rupees in ' 000) 23. EARNINGS PER SHARE - BASIC AND DILUTED Profit after tax for the period 11,839 21,243 53,119 86,674 (Number of Shares) Weighted average number of ordinary shares of Rs. 5 each 123,874,755 123,874,755 123,874,755 123,874,755 (Rupees) Basic earnings per share 0.10 (Rupees) 0.17 0.43 0.70 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. 23. RELATED PARTY TRANSACTIONS Related parties comprise of directors, major shareholders, key management personnel, associated companies and entities with common directors and employee 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. The transactions and balances with related parties during the period other than those which have been specifically disclosed elsewhere in these condensed interim financial statements are as follows: Details of balances and transactions with related parties during the nine months ended September 30, 2019 are as follows: 19
  16. Habib Insurance Company Limited Three months period Nine months period ended September 30 , ended September 30, 2019 2018 2019 2018 (Rupees in ' 000) Transactions with related parties Associated Companies Dividend received Dividend paid Bank charges Investment made Interest received on bank Investment related expenses paid Lease rentals paid Security deposit paid Premium written Claims paid Investment sold –00 –00 50 7,814 1,870 67 5,690 1,251 29,378 31,597 41,878 –00 –00 50 58,096 1,034 196 3,510 4,961 22,247 40,659 75,681 14,883 8,474 271 16,118 6,924 239 14,727 4,320 140,723 130,059 70,724 33,910 12,250 257 156,484 3,184 368 6,827 21,431 185,011 116,270 212,875 Key Management Personnel Compensation 13,738 29,533 64,454 81,126 Others Employee’s fund Contribution to Provident Fund 2,277 2,175 6,580 5,574 (Unaudited) (Audited) September 30, December 31, 2019 2018 (Rupees in '000) Balances Associated Companies Bank balances Premium due but unpaid Claims outstanding Investment held Security deposit Finance lease liability Others Loans to employees Brokerage expenses payables 8,927 66,404 93,937 349,738 20,237 84,387 101,303 114,880 108,870 564,104 17,162 68,950 19,880 –00 25,519 370 Remuneration to the key management personnel are in accordance with the terms of their employment and the contribution to the provident fund is in accordance with the Company's staff service rules. 20
  17. Habib Insurance Company Limited 24 . SEGMENT REPORTING September 30, 2019 (Unaudited) Fire and property Marine and transport Motor Other classes Aggregate 1,182,267 (Rupees in ' 000) Gross Written Premium (inclusive of Administrative Surcharge) 509,040 176,331 373,366 123,530 Insurance premium earned Insurance premium ceded to reinsurers Net insurance premium Commission income Net underwriting income Insurance claims Insurance claims recovered from reinsurers Net Claims Commission expense Management expenses Net insurance claims and expenses Underwriting result Investment income Other income Other expenses Results of operating activities Finance cost Profit from Window Takaful Operations- Operator's Fund Profit before tax 396,789 (314,801) 81,988 81,862 163,850 248,431 (222,262) 26,169 (51,271) (92,666) (143,937) (6,256) 183,701 (65,388 ) 118,313 22,409 140,722 173,170 (116,061 ) 57,109 (20,889 ) (32,099 ) (52,988 ) 30,625 388,083 (80,392) 307,691 24,170 331,861 261,612 (65,152) 196,460 (19,918) (67,967) (87,885) 47,516 119,414 1,089,987 (65,472) (526,053) 53,942 561,934 10,926 139,367 64,868 701,301 69,207 752,420 (30,425) (433,900) 38,782 318,520 (13,342) (105,420) (22,487) (215,219) (35,829) (320,639) (9,743) 62,142 69,101 18,140 (79,519) 69,864 (10,330) 6,612 66,146 Segment assets Segment assets of General Takaful Operations - Operator's Fund Unallocated assets Unallocated assets of General Takaful Operations - Operator's Fund 723,993 335,187 708,108 217,886 1,985,174 10,417 5,060 8,745 392 24,614 1,246,097 Segment liabilities Segment liabilities of General Takaful Operations - Operator's Fund Unallocated liabilities Unallocated liabilities of General Takaful Operations - Operator's Fund 631,541 292,383 617,683 190,063 1,731,670 3,295 1,601 2,766 124 7,786 473,714 41,008 3,296,893 4,171 2,217,341 21
  18. Habib Insurance Company Limited Fire and property September 30 , 2018 (Unaudited) Marine Motor Other and classes transport (Rupees in ' 000) Aggregate Gross Written Premium (inclusive of Administrative Surcharge) 372,576 154,580 324,034 107,048 958,238 Insurance premium earned Insurance premium ceded to reinsurers Net insurance premium Commission income Net underwriting income 300,799 (266,772) 34,027 67,082 101,109 156,997 (68,836 ) 88,161 21,147 109,308 310,898 (110,872) 200,026 32,976 233,002 90,489 (29,995) 60,494 5,199 65,693 859,183 (476,475) 382,708 126,404 509,112 Insurance claims Insurance claims recovered from reinsurers Net Claims Commission expense Management expenses Net insurance claims and expenses Underwriting result Investment income Other income Other expenses Results of operating activities Finance cost Profit before tax 65,761 (48,475) 17,286 (37,262) (70,735) (107,997) (24,174) 118,898 (66,342 ) 52,556 (17,166 ) (29,348 ) (46,514 ) 10,238 228,749 (94,911) 133,838 (11,909) (61,519) (73,428) 25,736 1,386 21,244 22,630 (8,354) (20,324) (28,678) 14,385 414,794 (188,484) 226,310 (74,691) (181,926) (256,617) 26,185 161,368 5,864 (67,651) 125,766 (2,119) 123,647 * During the period, few outstanding claims have been declared as no-loss resulting in favourable claim expense and negative recoveries. December 31, 2018 (Audited) 25. Segment assets Segment assets of General Takaful Operations - Operator's Fund Unallocated assets Unallocated assets of General Takaful Operations - Operator's Fund 630,613 332,846 650,355 4,902 694 1,907 Segment liabilities Segment liabilities of General Takaful Operations - Operator's Fund Unallocated liabilities Unallocated liabilities of General Takaful Operations - Operator's Fund 515,718 272,203 531,863 2,512 356 978 190,638 1,804,452 149 7,652 1,423,903 46,396 3,282,403 155,904 1,475,688 76 3,922 462,204 2,030 1,943,844 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES IFRS 13 defines fair value as an exit price. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: 22
  19. Habib Insurance Company Limited Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly observable Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable Following are the assets which are either measured at fair value or for which fair value is only disclosed and is different from their carrying value: As at September 30, 2019 (Unaudited) Loans & Other Other Total receivables financial financial assets liabilities (Rupees in ‘000) Availablefor-sale Held to Maturity 817,329 1,480 –00 –00 –00 –00 –00 –00 –00 –00 817,329 1,480 –00 –00 –00 –00 –00 00 20,559 839,368 276,171 –00 –00 –00 –00 –00 126,043 925,824 394,579 –00 –00 –00 –00 –00 10,906 –00 –00 –00 –00 –00 276,171 126,043 925,824 394,579 10,906 –00 276,171 21,413 1,467,859 17,493 28,399 –00 –00 59,465 2,629,292 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 (607,752) (4,116) (281,903) (170,289) (607,752 ) (4,116 ) (281,903 ) (170,289 ) –00 276,171 –00 1,467,859 –00 28,399 (4,197) (1,068,257) (4,197 ) 1,543,540 Financial assets measured at fair value Fair value measurement using Level 1 Level 2 Level 3 Investments Equity securities Mutual Funds 817,329 1,480 Financial assets not measured at fair value Debt Securities Loans and other receivable Insurance / reinsurance receivables Reinsurance recoveries against outstanding claims Cash and bank balances Total Assets of Window Takaful Operations - Operator’s Fund Financial liabilities measured at fair value Outstanding claims including IBNR Premium received in advance Insurance / reinsurance payables Other creditors and accruals Total Liabilities of Window Takaful Operations - Operator’s Fund –00 –00 –00 –00 0 –00 839,368 23 267,290
  20. Habib Insurance Company Limited Availablefor-sale Held for Maturity As at December 31 , 2018 (Audited) Loans & Other Other Total receivables financial financial assets liabilities Fair value measurement using Level 1 Level 2 Level 3 (Rupees in ‘000) Financial assets measured at fair value Investments Equity securities Mutual Funds 1,069,937 59,919 –00 –00 –00 –00 –00 –00 –00 –00 1,069,937 59,919 –00 –00 –00 –00 –00 70,763 –00 –00 –00 –00 –00 110,522 932,311 406,143 –00 –00 –00 –00 –00 102,396 –00 –00 –00 –00 –00 70,763 110,522 932,311 406,143 102,396 1,069,937 59,919 Financial assets not measured at fair value Debt Securities Loans and other receivable Insurance / reinsurance receivables Reinsurance recoveries against outstanding claims Cash and bank balances Total Assets of Window Takaful Operations - Operator’s Fund 20,695 –00 7,652 25,701 –00 54,048 1,150,551 70,763 1,456,628 128,097 –00 2,806,039 –00 –00 –00 –00 0 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 (543,938) (424) (222,570) (166,118) –00 –00 –00 (2,552) 1,150,551 70,763 1,456,628 128,097 (935,602) Financial liabilities measured at fair value Outstanding claims including IBNR Premium received in advance Insurance / reinsurance payables Other creditors and accruals Total Liabilities of Window Takaful Operations - Operator’s Fund 24 (543,938 ) (424 ) (222,570 ) (166,118 ) (2,552 ) 1,870,437 69,322
  21. Habib Insurance Company Limited 26 . CORRESPONDING FIGURES Corresponding figures have been rearranged and reclassified, wherever necessary, to facilitate comparisons. 27. GENERAL 27.1 Figures in these condensed interim financial statements for the quarters ended September 30, 2019 and September 30, 2018 have not been subjected to limited scope review of the auditors. 27.2 Figures have been rounded off to the nearest Thousand Rupee. 28. DATE OF AUTHORISATION FOR ISSUE These condensed interim financial statements have been authorised for issue on October 31, 2019 by the Board of Directors of the Company. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 25 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  22. Habib Insurance Company Limited Financial Statements Window Takaful Operations
  23. Habib Insurance Company Limited Condensed Interim Statement of Financial Position (Unaudited) as at September 30, 2019 Note ASSETS Investments - mutual funds Other receivables including Qard-e-Hasna to PTF Takaful / retakaful receivable Retakaful recoveries against outstanding claims Deferred Wakala expense Deferred commission expense Taxtion - payments less provision Prepayments Cash and bank Advances 5 6 9 11 10 8 7 Total assets September 30, 2019 (Unaudited) December 31, 2018 (Audited) Operator’s Participants’ Operator’s Participants’ Fund Takaful Fund Aggregate Fund Takaful Fund Aggregate (Rupees in '000) (Rupees in '000) 20,559 21,413 –00 –00 –00 3,200 1,007 1,350 17,493 600 –00 –00 31,444 6,628 7,786 –00 –00 16,537 26,583 –00 20,559 21,413 31,444 6,628 7,786 3,200 1,007 17,887 44,076 600 20,695 7,652 –00 –00 –00 –00 –00 –00 25,401 300 –00 –00 14,561 297 3,922 1,255 21 9,088 6,260 –00 20,695 7,652 14,561 297 3,922 1,255 21 9,088 31,661 300 65,622 88,978 154,600 54,048 35,404 89,452 50,000 3,665 –00 –00 –00 –00 50,000 3,665 –00 50,000 (2,947 ) 521 –00 –00 –00 50,000 (2,947 ) 521 53,665 –00 53,665 47,574 –00 47,574 EQUITIES AND LIABILITIES RESERVES ATTRIBUTABLE TO OPERATORS’ FUND (OPF) Statutory Fund Accumulated surplus / (deficit) Available-for-sale reserve WAQF / PARTICIPANT’S TAKAFUL FUND (PTF) Ceded money Accumulated deficit –00 –00 500 (6,910 ) 500 (6,910) –00 –00 500 (1,689 ) 500 (1,689 ) –00 (6,410 ) (6,410) –00 (1,189 ) (1,189 ) –00 –00 –00 7,786 –00 –00 –00 4,171 –00 10,359 31,145 2,831 –00 3,652 1,117 25,011 21,274 –00 10,359 31,145 2,831 7,786 3,652 1,117 25,011 25,445 –00 –00 –00 –00 3,922 –00 –00 –00 2,030 522 1,614 15,687 1,568 –00 3,000 50 8,239 6,435 –00 1,614 15,687 1,568 3,922 3,000 50 8,239 8,465 522 Total liabilities 11,957 95,389 107,346 6,474 36,593 43,067 Total fund and liabilities 65,622 88,979 154,601 54,048 35,404 89,452 Balance of WAQF / PTF LIABILITIES PTF underwriting provisions Outstanding claims including IBNR Unearned contribution reserve Unearned retakaful commission Unearned Wakala Fee Qard-e-Hasna Contribution received in advance Takaful / retakaful payable Other creditors and accrual Payable to Habib Insurance Company Limited Contingencies and commitments 9 8 10 11 12 The annexed notes from 1 to 17 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 28 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  24. Habib Insurance Company Limited Condensed Interim Statement of Comprehensive Income (Unaudited) for the nine months ended September 30, 2019 Three months period ended Sept. 30, Note Participants’ Takaful Fund Net takaful contribution Net takaful claims Wakala fee 8 9 11 Underwriting result Profit on bank accounts 2019 2019 (Unaudited) (Unaudited) (Rupees in ' 000) 2,989 (3,960) (4,042) 11,971 (9,117) (9,245) (5,013) (6,391) 444 Deficit for the period (4,4569) Other Comprehensive income Nine months period ended Sept. 30, 1,170 (5,221) –00 Total comprehensive loss for the period –00 (4,569) (5,221) Wakala fee Net commission Management expenses Other expenses Investment income Profit on bank balances 4,042 (44) (567) (1,134) 310 345 9,245 106 (1,960) (3,955) 1,229 1,947 Profit before taxation 2,952 6,612 –00 –00 2,952 6,612 –00 –00 2,952 6,612 Operator’s Fund Income tax expense Profit after tax for the period Other comprehensive income Total comprehensive income for the period The annexed notes from 1 to 17 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 29 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  25. Habib Insurance Company Limited Condensed Interim Statement of Changes in Fund (Unaudited) for the nine months ended September 30, 2019 Statutory Fund Balance as at January 1, 2019 Profit for the period Operator’s Fund Available-for- Accumulated sale reserve (deficit) / surplus (Rupees in ' 000) Total 50,000 521 (2,947) 47,574 –00 –00 6,612 6,612 –00 (521) –00 (521) 50,000 –00 3,665 Other comprehensive income Less: Net gain transferred to profit and loss on disposal of investments Balance as at September 30, 2019 53,665 Participants’ Takaful Fund Accumulated Ceded money surplus / Deficit Total (Rupees in ' 000) Balance as at January 1, 2019 500 (1,689) (1,189) Deficit for the period –00 (5,221) (5,221) Balance as at September 30, 2019 500 (6,910) (6,410) The annexed notes from 1 to 17 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 30 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  26. Habib Insurance Company Limited Condensed Interim Cash Flow Statement (Unaudited) for the nine months ended September 30, 2019 Operator’s Fund Participants‘ September 30, Takaful Fund 2019 Aggregate (Rupees in ' 000) Operating Cash flows (a) Takaful activitives Contribution received Retakaful contribution paid Claims paid Retakaful and other recoveries received Commission paid Commission received Net cash inflows from takaful activities –00 –00 –00 –00 (2,862) 5,229 2,367 38,553 (17,918) (7,432) 729 –00 –00 13,932 38,553 (17,918) (7,432) 729 (2,862) 5,229 16,299 (13,185) 5,064 (8,121) (13,185) (10,818) 5,064 18,996 (8,121) 8,178 2,066 657 20,746 (20,559) 1,327 –00 –00 –00 3,393 657 20,746 (20,559) 2,910 1,327 4,237 Net cash flows from all activities Cash and cash equivalents at beginning of year (7,908) 25,401 20,323 6,260 12,415 31,661 Cash and cash equivalents at end of period 17,493 26,583 44,076 Reconciliation to profit and loss account Operating cash flows Profit / return received Dividends received Capital gain Increase in assets other than cash Increase in liabilities (10,818) 2,066 657 572 8,652 5,483 18,996 1,327 –00 –00 30,120 (55,664) 8,178 3,393 657 572 38,772 (50,181) 6,612 (5,221) 1,391 (b) Other operating activities Other operating (payments) / receipts Net cash flows from other operating activities Total cash flows from operating activities Investment activities Profit / return received Dividend received Proceeds from investments Payments for investments Total cash flows from investing activities Profit after taxation Attributed to: Operator’s Fund Participarts’ Takaful Fund 6,612 (5,221) 1,391 The annexed notes from 1 to 17 form an integral part of these condensed interim financial statements. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 31 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer
  27. Habib Insurance Company Limited Notes to the Condensed Interim Financial Statements for the nine months ended September 30 , 2019 (Unaudited) 1. STATUS AND NATURE OF BUSINESS 1.1 Habib Insurance Company Limited (the Operator) was incorporated in Pakistan in 1942 as a public limited company under the Companies Ordinance, 1984 (now Companies Act, 2017) to carry on general insurance business. The Operator was allowed to work as Window Takaful Operator on July 18, 2018 by Securities and Exchange Commission of Pakistan (SECP) under SECP Takaful Rules, 2012 to carry on General Window Takaful Operations (WTO) in Pakistan. The Operator is listed at Pakistan Stock Exchange Limited. The registered office of the Operator is situated at Habib Square, M.A. Jinnah Road, Karachi. 1.2 The Operator transferred statutory fund of Rs. 50 million in a separate bank account for the Window Takaful Operations as per the requirement of circular 8 of 2014. The Operator has formed a Waqf for Participants’ Fund by executing the Waqf deed dated June 12, 2018 and deposited a cede money of Rs. 0.5 million. The cede money is required to be invested in Shari’ah compliant remunerative instrument which may be used to acquire immovable Waqf property if Shari’ah and law so warrants. Waqf Deed governs the relationship of Operator and participants for management of takaful operations, investments of participants’ funds and investments of the Operator’s funds approved by the shari’ah advisor of the Operator. The Operator commenced activities of WTO on October 01, 2018, therefore, no comparative information is given in these financial statements. 2. BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE These condensed interim financial statements have been prepared in line with the format issued by the SECP through Insurance Rules, 2017, and SECP Circular No. 25 of 2015 dated July 09, 2015. These 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. These condensed interim financial statements have 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 comprise of: International Accounting Standard (IAS) 34, Interim Financial Reporting, issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017 and provisions of and directives issued under the Companies Act, 2017, the Insurance Ordinance, 2000, Insurance Rules, 2017, Insurance Accounting Regulations, 2017 and Takaful Rules, 2012. Where the provisions of and directives issued under the Companies Act, 2017, Insurance Ordinance, 2000, Insurance Rules, 2017, and Insurance Accounting Regulations, 2017, and Takaful Rules, 2012 differ with the requirements of IAS 34, the provisions of and directives issued under the Companies Act, 2017, Insurance Ordinance, 2000, Insurance Rules, 2017, and Insurance Accounting Regulations, 2017, and Takaful Rules, 2012 have been followed. This condensed interim financial statements reflect the financial statements reflect the financial position and results of operations of both the Operator's Fund and Participants' Takaful Fund in a manner that the assets, liabilities, income and expenses of the Operator and Participants' Takaful Fund remain separately identifiable. In terms of the requirements of the Takaful Rules 2012, read with SECP Circular No. 25 of 2015 dated July 09, 2015, the assets, liabilities and profit and loss and other comprehensive income of the Operator's Fund have been presented as a single line item in the balance sheet and statement of comprehensive income of the Operator respectively. 32
  28. Habib Insurance Company Limited This condensed interim financial statements does not include all the information and disclosures required in the annual financial statements . Accordingly these condensed interim financial information should be read in conjunction with the Operator's annual financial statements for the year ended December 31, 2018. 2.1 Basis of measurement These condensed interim financial statements have been prepared under the historical cost convention except investments which are carried at fair value. 2.2 Functional and presentation currency These condensed interim financial statements are presented in Pak Rupees which is also the Operator’s functional currency. All financial information presented in Pak Rupees has been rounded to nearest Thousand Rupees, unless otherwise stated. 2.3 Standards, interpretations and amendments to published accounting and reporting standards that are effective in the current period There are certain other new standards and interpretations of and amendments to existing accounting standards that have become applicable for accounting periods beginning on or after January 01, 2019. These are considered either to not be relevant or not to have any significant impact on the these condensed interim financial statements. 2.4 Standards, interpretations and amendments to published accounting and reporting standards that are not yet effective in the current period Amendment to IFRS 4 ‘Insurance Contracts’ - Applying IFRS 9 ‘Financial Instruments with IFRS 4 addresses issue arising from the different effective dates of IFRS 9 and the forthcoming new standard IFRS 17 ‘Insurance Contracts’. The amendments introduces two alternative options for entities issuing contracts within the scope of IFRS 4, notably a temporary exemption and an overlay approach. The temporary exemption enables eligible entities to defer the implementation date of IFRS 9. The overlay approach allows an entity applying IFRS 9 from July 01, 2018 onwards to remove from profit or loss the effects of some of the accounting mismatches that may occur from applying IFRS 9 before IFRS 17 is applied. The Company has determined that it is eligible for the temporary exemption option since the company has not previously applied any version of IFRS 9 , its activities are predominantly connected with insurance as the percentage of the total carrying amount of its liabilities connected with insurance relative to the total carrying amount of all its liabilities is greater than 90 percent and the company doesn't engage in significant activities unconnected with insurance based on historical available information. Under the temporary exemption option, the company can defer the application of IFRS 9 until the application IFRS 17. To determine the appropriate classification of financial assets under IFRS 9, an entity would need to assess the contractual cash flows characteristics of any financial asset. Indeed, the contractual terms of the financial asset give rise, on specified dates, to cash flows that are solely payments of principal and interest on the principal amount outstanding (“SPPI”) i.e. cash flows that are consistent with a basic lending arrangement. In a basic lending arrangement, consideration for the time value of money and credit risk are typically the most significant elements of interest. IFRS 9 defines the terms “principal” as being the fair value of the financial asset at initial recognition, and the “interest” as being compensation for (i) the time value of money, and (ii) the credit risk associated with the principal amount outstanding during a particular period of time. The tables below set out the fair values as at the end of reporting period and the amount of change in the fair value during that period for the following two groups of financial assets separately: a) financial assets with contractual terms that give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding, excluding any financial asset that meets the definition of held for trading in IFRS 9, or that is managed and whose performance is evaluated on a fair value basis, and 33
  29. Habib Insurance Company Limited b ) all other financial assets. Financial assets Cash and bank* Investment in mutual funds - available for sale Other receivables* Total September 30, 2019 (Unaudited) Fail the SPPI test Pass the SPPI test Change in Carrying Cost less Change in Fair value unrealized value Impairment unrealized gain or loss gain or loss during the during the period period (Rupees in '000) 44,076 –00 –00 –00 –00 20,559 –00 –00 –00 –00 21,413 –00 21,413 –00 –00 64,635 –00 21,413 21,413 –00 September 30, 2019 (Unaudited) Gross carrying amounts of debt instruments that pass the SPPI test AAA AA+ A+ Unrated (Rupees in '000) Loans and other receivables* –00 –00 –00 21,413 * The carrying amount of these financial assets measured applying IAS 39 are a reasonable approximation of their fair values. 3. SIGNIFICANT ACCOUNTING POLICIES AND RISK MANAGEMENT The significant accounting policies and method of computation adopted in preparation of these condensed interim financial statements are consistent with those followed in preparation of the annual financial statements of the Operator for the year ended December 31, 2018. 4. ESTIMATE AND JUDGEMENTS The preparation of the condensed interim financial statements 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 expenses. Actual results may differ from these estimates. The significant judgements made by management in applying the Operations' accounting policies and the key source of estimation uncertainity were the same as those that were applied to the annual financial statements as at and for the year ended December 31, 2018. 34
  30. Habib Insurance Company Limited 5 . 6. INVESTMENT IN MUTUAL FUNDS - OPERATOR’S FUND September 30, 2019 (Unaudited) Cost Impairment / Revaluation Carrying provision surplus value (Rupees in '000) Meezan Rozana Amdani Fund 20,559 –00 –00 20,559 First Habib Islamic Income Fund –00 –00 –00 –00 Cost –00 –00 –00 –00 20,174 –00 521 20,695 OTHER RECEIVABLES INCLUDING QARD-E-HASNA TO PTF September 30, 2019 (Unaudited) Note OPF PTF Total (Rupees in '000) Wakala fee Qard e Hasna Other receivables 6.1 December 31, 2018 (Audited) Impairment / Revaluation Carrying provision surplus value (Rupees in '000) December 31, 2018 (Audited) OPF PTF Total (Rupees in '000) 17,761 3,652 –00 –00 –00 –00 17,761 3,652 –00 4,652 3,000 –00 –00 –00 –00 4,652 3,000 –00 21,413 –00 21,413 7,652 –00 7,652 6.1 In accordance with the Takaful Rules, 2012, if at any point in time, assets in participant takaful fund are not sufficient to cover its liabilities, the deficit shall be funded by way of an interest free loan (Qard-e-Hasna) from Operator Fund. In the event of future surplus in the Participant Takaful Fund to which a Qard-e-Hasna has been made, the Qard-e-Hasna shall be repaid prior to distribution of surplus to participants. 7. CASH AND BANK Cash at bank - saving accounts September 30, 2019 (Unaudited) OPF PTF Total (Rupees in '000) December 31, 2018 (Audited) OPF PTF Total (Rupees in '000) 17,493 25,401 26,583 44,076 Three months period ended Sept 30, 8. 6,260 31,661 Nine months period ended Sept 30, 2019 2019 (Unaudited) (Unaudited) (Rupees in ' 000) NET TAKAFUL CONTRIBUTION - PTF Written gross contribution Add: Unearned contribution reserve opening Less: Unearned contribution reserve closing Contribution earned 14,857 32,971 (31,145) 16,683 54,370 15,687 (31,145) 38,912 Less: Reinsurance contribution ceded Add: Prepaid retakaful contribution opening Less: Prepaid retakaful contribution closing Retakaful expense 12,977 17,254 (16,537) 13,694 34,690 8,788 (16,537) 26,941 2,989 11,971 Net takaful contribution 35
  31. Habib Insurance Company Limited Three months period ended Sept . 30, 9. Nine months period ended Sept. 30, 2019 2019 (Unaudited) (Unaudited) (Rupees in ' 000) NET TAKAFUL CLAIMS EXPENSE - PTF Claims paid Add: Outstanding claims including IBNR closing Less: Outstanding claims including IBNR opening Claims expense Less: Add: Retakaful and other recoveries received Retakaful and other recoveries in respect of outstanding claims net of impairment - closing Less: Retakaful and other recoveries in respect of outstanding claims net of impairment - opening Retakaful and other recoveries revenue Net Takaful claims 2,883 10,359 (6,467) 6,775 7,432 10,359 (1,615) 16,176 68 729 6,628 6,628 (3,881) 2,815 (298) 7,059 3,960 9,117 1,643 3,207 (3,200) 1,650 5,805 1,255 (3,200) 3,860 1,597 2,840 (2,831) 1,606 5,229 1,568 (2,831) 3,966 10. NET COMMISSION INCOME - PTF Commission paid or payable Add: Deferred commission - opening Less: Deferred commission - closing Commission expense Less: Commission from reinsurers Commission received or receivable Add: Unearned retakaful commission - opening Less: Unearned retakaful commission - closing Commission from reinsurers Net commission income (44) 106 11. NET WAKALA FEE Gross Wakala Fee Add: Deferred wakala fee - opening Less: Deferred wakala fee - closing Net wakala fee 12. 3,585 8,243 (7,786) 13,109 3,922 (7,786) 4,042 9,245 CONTINGENCIES & COMMITMENTS There is no contingency and commitment as at September 30, 2019 (December 31, 2018: Nil). 13. TRANSACTIONS WITH RELATED PARTIES Related parties comprise of directors, major share holders, key management personnel, associated companies, entities with common directors and employee retirement benefit funds. The transactions with related parties are carried out at commercial terms and conditions. The transactions and balances with related parties are as follows: 36
  32. Habib Insurance Company Limited 13 .1 (Unaudited) September 30, 2019 (Rupees in '000) Operator’s Fund Transactions Associated companies Wakala fee charged during the period 9,245 Profit on bank accounts 1,947 (Unaudited) (Audited) September 30, December 31, 2019 2018 (Rupees in '000) Balances Associated companies Bank balances 17,493 25,401 (Unaudited) 13.2 September 30, 2019 (Rupees in '000) Participants’ Takaful Fund Transactions Associated companies - Contribution written 966 - Claim paid 2,681 - Profit on bank accounts 1,170 (Unaudited) (Audited) September 30, December 31, 2019 2018 (Rupees in '000) Balances Associated companies - Contribution due but unpaid - Claim outstanding - Bank balance 37 1,491 6,544 646 1,227 26,583 6,260
  33. Habib Insurance Company Limited 14 SEGMENT INFORMATION 14 .1 Participants’ Takful Fund Fire and property September 30, 2019 (Unaudited) Marine Motor Other and classes transport (Rupees in '000) Gross Written Contribution (inclusive of Administrative Surcharge) 23,232 9,149 20,481 1,508 54,370 Contribution earned Retakaful expense 16,468 (14,044) 7,999 (7,041 ) 13,825 (5,346) 620 (510) 38,912 (26,941) Net takaful contribution 2,424 958 8,479 110 11,971 Net underwriting income 2,424 958 8,479 110 11,971 Claim expense Retakaful and other recoveries revenue (5,291) 4,370 (1,963 ) 1,570 (7,596) 119 (1,326) 1,000 (16,176) 7,059 Net claims Wakala fee (921) (3,990) (393 ) (1,905 ) (7,477) (3,206) (326) (144) (9,117) (9,245) Underwriting result (2,487) (1,340 ) (2,204) (360) (6,391) Profit on bank balances 1,170 Loss before taxation (5,221) Segment assets Unallocated assets 10,416 5,060 8,745 392 Total assets 3,295 1,601 2,766 124 Total liabilities 7,786 4,171 11,957 Operator’s Fund Wakala fee Commission income Commission expense Management expenses 3,990 2,423 (2,174) (838) 1,905 1,373 (1,151 ) (330 ) 3,206 57 (428) (738) 144 113 (107) (54) 9,245 3,966 (3,860) (1,960) Underwriting result Investment income Profit on bank balances Other expenses 3,401 1,797 2,097 96 7,391 1,229 1,947 (3,955) Profit before taxation 6,612 Segment assets Unallocated assets 19,407 9,427 16,293 731 Total assets 45,858 43,120 88,978 Segment liabilities Unallocated liabilities 29,820 14,485 Total liabilities 15. 24,613 41,009 65,622 Segment liabilities Unallocated liabilities 14.2 Aggregate 25,035 1,123 70,463 24,925 95,388 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES IFRS 13 defines fair value as an exit price. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. 38
  34. Habib Insurance Company Limited All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy , described as follows, based on the lowest level input that is significant to the fair value measurement as a whole. Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly observable Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable Following are the assets which are either measured at fair value or for which fair value is only disclosed and is different from their carrying value: 15.1 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES Operator's Funds Availablefor-sale Held to Maturity As at September 30, 2019 (Unaudited) Loans & Other Other Total receivables financial financial assets liabilities Fair value measurement using Level 1 Level 2 Level 3 (Rupees in ‘000) Financial assets measured at fair value Investments Mutual Funds 20,559 –00 –00 –00 –00 20,559 –00 –00 –00 –00 –00 –00 21,413 –00 –00 –00 17,493 600 –00 –00 –00 21,413 17,493 600 20,559 –00 21,413 18,093 –00 60,065 –00 –00 –00 –00 (4,171) (4,171) 20,559 –00 21,413 18,093 (4,171) 55,894 Financial assets not measured at fair value Other receivables including Qard-e-Hasna to PTF Cash and bank balances Advances Financial liabilities measured at fair value Other creditors and accruals 39 20,559
  35. Habib Insurance Company Limited Operator 's Funds Availablefor-sale Held to Maturity As at December 31, 2018 (Audited) Loans & Other Other Total receivables financial financial assets liabilities Fair value measurement using Level 1 Level 2 Level 3 (Rupees in ‘000) Financial assets measured at fair value Investments Mutual Funds 20,695 –00 –00 –00 –00 20,695 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 7,652 –00 –00 –00 25,401 300 –00 –00 –00 –00 –00 –00 7,652 –00 –00 –00 25,401 300 20,695 –00 –00 33,353 –00 54,048 –00 –00 –00 –00 –00 –00 20,695 –00 –00 33,053 –00 54,048 Financial assets not measured at fair value Other receivables including Qard-e-Hasna to PTF Loans and other receivables Insurance / reinsurance receivables Reinsurance recoveries against outstanding claims Cash and bank balances Advances Financial liabilities measured at fair value Other creditors and accruals 40 20,695
  36. Habib Insurance Company Limited Participants ’ Takaful Fund Availablefor-sale Financial assets not measured at fair value Other receivables including Qard-e-Hasna to PTF Takaful / retakaful receivable Retakaful recoveries against outstanding claims Cash and bank balances Financial liabilities measured at fair value Outstanding claims including IBNR Qard-e-Hasna Contribution received in advance Takaful / retakalful payable Other creditors and accruals Held to Maturity As at September 30, 2019 (Unaudited) Loans & Other Other Total receivables financial financial assets liabilities (Rupees in ‘000) –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 31,444 6,628 26,583 –00 –00 –00 –00 –00 31,444 6,628 26,583 –00 –00 –00 64,655 –00 64,655 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 (10,359 ) (3,652 ) (1,117 ) (25,011 ) (21,274 ) (10,359) (3,652) (1,117) (25,011) (21,274) –00 –00 –00 64,655 (61,413 ) 3,424 41 Fair value measurement using Level 1 Level 2 Level 3
  37. Habib Insurance Company Limited Participants ’ Takaful Fund Availablefor-sale Financial assets not measured at fair value Takaful / retakaful receivable Retakaful recoveries against outstanding claims Cash and bank balances Financial liabilities measured at fair value Outstanding claims including IBNR Qard-e-Hasna Contribution received in advance Takaful / retakalful payable Other creditors and accruals Held to Maturity As at December 31, 2018 (Audited) Loans & Other Other Total receivables financial financial assets liabilities (Rupees in ‘000) –00 –00 –00 –00 –00 –00 –00 –00 –00 14,561 297 6,260 –00 –00 –00 14,561 297 6,260 –00 –00 –00 21,118 –00 21,118 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 –00 (1,614 ) (3,000 ) (50 ) (8,239 ) (6,435 ) (1,614) (3,000) (50) (8,239) (6,435) –00 –00 –00 21,118 (19,338 ) 1,780 42 Fair value measurement using Level 1 Level 2 Level 3
  38. Habib Insurance Company Limited 16 GENERAL 16 .1 Figures in these condensed interim financial statements for the nine months ended 30 Setpember 2019 have not been subjected to limited scope review of the auditors. 16.2 Figures have been rounded off to the nearest Thousand Rupee. 17 DATE OF AUTHORISATION FOR ISSUE These financial statements have been authorised for issue on October 31, 2019 by the Board of Directors of the Company. RAFIQ M. HABIB Chairman MANSOOR G. HABIB Director AUN MOHAMMAD A. HABIB Director 43 SHABBIR GULAMALI MURTAZA HUSSAIN Chief Executive Chief Financial Officer