Fifth Schedule

FIFTH SCHEDULE

(See section 225)

DISCLOSURE REQUIREMENTS AS TO FINANCIAL STATEMENTS

OF NON-LISTED COMPANIES AND THEIR SUBSIDIARIES

PART I

GENERAL REQUIREMENTS

I. The companies other than listed companies and their subsidiaries shall follow the applicable Financial Reporting Framework as defined in Third Schedule, in regards to financial statements as are notified for the purpose in the official Gazette by the Commission, under section 225 of the Companies Act, 2017;

II. The disclosure requirements, as provided in this schedule, are in addition to the disclosure requirements prescribed in applicable Financial Reporting Framework [1][notified by the Commission] and shall be made in the notes to the accounts unless specifically required otherwise;

III. In addition to the information expressly required to be disclosed under the Act and this schedule, there shall be added such other information as may be necessary to ensure that required disclosure is not misleading;

IV. Any word or expression used herein but not defined in the Act and/or Fourth Schedule shall have the same meaning as under the applicable Accounting Framework.

V. The following shall be disclosed in the financial statements namely:

1. General information about the company comprising the following:

(i) geographical location of all business units including mills/plant;

(ii) the capacity of an industrial unit, actual production and the reasons for shortfall;

(iii) number of persons employed as on the date of financial statements and average number of employees during the year [2][… ]; and

(iv) [3][Name of associated companies or related parties or undertakings, with whom the company had entered into transactions or had agreements and/or arrangements in place during the financial year, along with the basis of relationship describing common directorship and percentage of shareholding;

Explanations: Definition of related party as per Financial Reporting Framework shall be considered for the disclosure requirements;]

2. In respect of associated companies, subsidiaries, joint ventures or holding companies incorporated outside Pakistan, [4][with whom the company had entered into transactions or had agreements and/or arrangements in place during the financial year,] name of undertaking, registered address and country of incorporation shall be disclosed;

3. [5][deleted]

4. [6][deleted]

5. In cases, where company has given loans or advances or has made investments (both short term and long term) in foreign companies or undertakings, name of the company or undertaking along with jurisdiction where it is located shall be disclosed.

PART II

REQUIREMENTS AS TO STATEMENT OF FINANCIAL POSITION

6. Following items shall be disclosed as separate line items on the face of the [7][statement of financial position];

(i) revaluation surplus on property, plant and equipment;

(ii) long term deposits and prepayment;

(iii) unpaid dividend;

(iv) unclaimed dividend; and

(v) cash and bank balances.

Fixed Assets

7. Where any property or asset acquired with the funds of the company, is not held in the name of the company or is not in the possession and control of the company, this fact along with reasons for the property or asset not being in the name of or possession or control of the company shall be stated; and the description and value of the property or asset, the person in whose name and possession or control it is held shall be disclosed;

8. Land and building shall be distinguished between freehold and leasehold.

9. Forced sale value shall be disclosed separately in case of revaluation of property, plant and equipment or investment property;

10. In the case of sale of fixed assets, if the aggregate book value of assets exceeds [8][five million rupees, following particulars of each asset, which has book value of five hundred thousand rupees or more] shall be disclosed, —

(i) cost or revalued amount, as the case may be;

(ii) the book value;

(iii) the sale price and the mode of disposal (e.g. by tender or negotiation);

(iv) the particulars of the purchaser;

(v) gain or loss; and

(vi) relationship, if any of purchaser with company or any of its directors.

Long Term Investments

11. [9][deleted].

Long Term Loans and Advances

12. With regards to loans and advances to directors, following shall be disclosed:

(i) the purposes for which loans or advances were made; and

(ii) reconciliation of the carrying amount at the beginning and end of the period, showing disbursements and repayments;

13. In case of any loans or advances obtained/provided, at terms other than arm’s length basis, reasons thereof shall be disclosed;

14. In respect of loans, advances to associates there shall be disclosed:

(i) the name of each associate and related parties;

(ii) the terms of loans and advances;

(iii) the particulars of collateral security held, if any;

(iv) the maximum aggregate amount outstanding at any time during the year calculated by reference to month-end balances;

(v) provisions for doubtful loans and advances; and

(vi) loans or advances written off, if any.

Current Assets

15. In respect of debts/receivables from associates there shall be disclosed:

(i) the name of each associate and related party;

(ii) the maximum aggregate amount outstanding at any time during the year calculated by reference to month-end balances;

(iii) receivables, that are either past due or impaired, along with age analysis distinguishing between trade debts, loans, advances and other receivables;

(iv) debts written off as irrecoverable distinguishing between trade debts and other receivables;

(v) provisions for doubtful or bad debts distinguishing between trade debts, loans, advances and other receivables; and

(vi) justification for reversal of provisions of doubtful debts, if any;

16. Provision, if any, made for bad or doubtful loans and advances or for diminution in the value of or loss in respect of any asset shall be shown as a deduction from the gross amounts;

Share Capital and Reserves

17. Capital and revenue reserves shall be clearly distinguished. Any reserve required to be maintained under the Act shall be separately disclosed. Any legal or other restrictions on the ability of the company to distribute or otherwise apply its reserves shall also be disclosed for all kind of reserves maintained by the company;

18. In respect of issued share capital of a company following shall be disclosed separately;

(i) shares allotted for consideration paid in cash;

(ii) shares allotted for consideration other than cash, showing separately shares issued against property and others (to be specified);

(iii) shares allotted as bonus shares; and

(iv) treasury shares;

[10][18 A. Discount on issue of shares shall be shown separately as a deduction from share capital in the statement of financial position and the statement of changes in equity (if applicable);]

19. Shareholder agreements for voting rights, board selection, rights of first refusal, and block voting shall be disclosed.

Non-Current Liabilities

20. Amount due to associated company shall be disclosed separately;

Current Liabilities

21. Following items shall be disclosed as separate line items;

(i) payable to provident fund [11][, contributory pension fund or any other contributory retirement fund];

(ii) deposits, accrued liabilities and advances;

(iii) loans from banking companies and other financial institutions other than associated company;

(iv) loans and advances from associated company, sponsors and directors along with purpose and utilization of amounts; and

(v) loans and advances shall be classified as secured and unsecured.

22. [12][In the case of provident fund, contributory pension fund or any other contributory retirement fund, maintained by the company a statement that, investments in collective investment schemes, listed equity and listed debt securities out of aforementioned funds have been made in accordance with the provisions of section 218 of the Act and the conditions specified thereunder;]

23. In respect of security deposit payable, following shall be disclosed:

(i) bifurcation of amount received as security deposits for goods/services to be delivered/provided, into amounts utilizable for company business and others;

(ii) amount utilized for the purpose of the business from the security deposit in accordance with requirements of written agreements, in terms of section 217 of the Act; and

(iii) amount kept in separate bank account;

Contingencies And Commitments

24. In describing legal proceedings, under any court, agency or government authority, whether local or foreign include name of the court, agency or authority in which the proceedings are pending, the date instituted, the principal parties thereto, a description of the factual basis of the proceeding and the relief sought.

PART III

[13][REQUIREMENTS AS TO STATEMENT OF PROFIT OR LOSS]

25. Following items shall be disclosed as deduction from turnover as separate line items;

(i) trade discount; and

(ii) sales and other taxes directly attributable to sales.

26. The aggregate amount of auditors’ remuneration, showing separately fees, expenses and other remuneration for services rendered as auditors and for services rendered in any other capacity and stating the nature of such other services. In the case of joint auditors, the aforesaid information shall be shown separately for each of the joint auditors;

27. In case, donation to a single party exceeds [14][10 per cent of company’s total amount of donation or Rs. 1 million, whichever is higher] name of donee(s) shall be disclosed and where any director or his spouse has interest in the donee(s) irrespective of the amount, names of such directors along with their interest shall be disclosed;

28. [15][…]

29. Complete particulars of the aggregate amount charged by the company shall be disclosed separately for the directors, chief executive and executives together with the number of such directors and executives such as:

(i) fees;

(ii) managerial remuneration;

(iii) commission or bonus, indicating the nature thereof;

(iv) reimbursable expenses which are in the nature of a perquisite or benefit;

(v) pension, gratuities, company’s contribution to provident, superannuation and other staff funds, compensation for loss of office and in connection with retirement from office;

(vi) other perquisites and benefits [16][…] stating their nature and, where practicable, their approximate money values; and

(vii) amount for any other services rendered.

30. In case of royalties paid to companies/entities/individuals following shall be disclosed:

(i) Name and registered address; and

(ii) Relationship with company or directors, if any.

[1] Deleted through SRO 1169(I)/2017 dated 07-11-2017. Before deletion it was:

“notified by the Commission”

[2] Deleted through SRO 888(I)/2019 dated 29-07-2019 and SRO 961(I)/2019 dated 23-08-2019. Before deletion it was:

“separately disclosing factory employees” 

[3] Substituted through SRO 1169(I)/2017 dated 07-11-2017. Before substitution it was:

“(iv) name of associated companies or related parties or undertakings along with the basis of relationship describing common directorship and/or percentage of shareholding;”

[4] Inserted through SRO 1169(I)/2017 dated 07-11-2017

[5] Deleted through SRO 888(I)/2019 dated 29-07-2019 and SRO 961(I)/2019 dated 23-08-2019. Before deletion it was:

“3. Summary of significant transactions and events that have affected the company‘s financial position and performance during the year;”  

[6] Deleted through SRO 1169(I)/2017 dated 07-11-2017. Before deletion it was:

“4. Particulars of major foreign shareholders, other than natural person, holding more than 5% of paid up capital of the company:

(i) names and address of beneficial owners and legal status along with the name of Chief Executive or Principal Officer or Authorized Agent;

(ii) name and particulars of Pakistani resident associated with such shareholder or entity, if any; and

(iii) detail of conditions and compliance status thereof, imposed by regulatory authorities in Pakistan/foreign jurisdiction for foreign investments, if any.

[7] Substituted through SRO 1169(I)/2017 dated 07-11-2017. Before substitution it was:

“financial statements”

[8] Substituted through SRO 888(I)/2019 dated 29-07-2019 and SRO 961(I)/2019 dated 23-08-2019. Before substitution it was:

“five hundred thousand rupees, following particulars of each asset” 

[9] Deleted through SRO 888(I)/2019 dated 29-07-2019 and SRO 961(I)/2019 dated 23-08-2019. Before deletion it was:

“11. A statement as to whether the Investments in associated companies or undertakings have been made in accordance with the requirements under the Act;”

[10] Inserted vide SRO No. 1169(I)/2017 dated 7th November 2017.

[11] Inserted vide SRO No. 1169(I)/2017 dated 7th November 2017.

[12] Substituted vide SRO No. 1169(I)/2017 dated 7th November 2017. Before substation it was:

“22. In the case of provident fund/provident fund trust, maintained by the company, a statement that, the investments in collective investment schemes, listed equity and listed debt securities out of provident fund/trust have been made in accordance with the provisions of section 218 of the Act and the Rules formulated for this purpose;” 

[13] Substituted heading “REQUIREMENTS AS TO PROFIT AND LOSS” vide SRO No. 888(I)/2019 dated 29th July, 2019.

[14] Substituted expression “Rs.500,000” vide SRO No. 888(I)/2019 dated 29th July, 2019.

[15] Omitted vide SRO No. 1169(I)/2017 dated 7th November 2017. The omitted clause (28) was read as under:

“28. Management assessment of sufficiency of tax provision made in the company‘s financial statements along with comparisons of tax provision as per accounts viz a viz tax assessment for last three years;”

[16] Omitted expression “ in cash or in kind” vide SRO No. 1169(I)/2017 dated 7th November 2017.