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FASFIN

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FASFIN 09-Dec-2020

(Continuation news of FASFIN): as receipt in the statement of cash flows. On the other hand, interest paid shown in statement of cash flows is overstated by Tk. 8.8 (eight point eight) Crore as this interest is just accrued and charged in Books of accounts and no impact was in the company's cash flows. The corresponding error may be in Borrowing from other bank & financial institution and provision for expenses in Statement of cash flows. Emphasis of Matter (cont.14)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): Tk. (141,788,089) and Tk. (5.67) respectively instated of current disclosed net of Tk. (44, 923,414) and EPS of Tk. (1.80) respectively. 10. The interest on margin loan and other income (e.g. interest on FDR, portfolio management fee) of Tk. 9.66 (nine point six six) Crore and Tk. 5.38 (five point three eight) Crore respectively was just charged and accrued to the margin loan account and receivable of FDR interest, which has been shown (cont.13)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): Tk. 0.25 (point two five) Crore as "Interest on Margin Loan" and ?Portfolio Management fee" respectively. The recoverability of margin loan with negative equity and interest charged thereon is very poor. So, charging the interest and portfolio management fee on Margin loan with negative equity of Tk. 9.91 Crore is overstated the income of the company for the year. If such income does not consider then loss for the year and EPS would be (cont.12)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): However, the Bangladesh Securities and Exchange Commission directive no. BSEC/CMRRCD/2009-193/196 is required to make provision five equal quarterly instalment starting from December 31, 2019. So, the company is required to maintain provision of Tk. 29.51 (twenty percent or one instalment out of five). 9. During the year, the company had charged to negative equity holder of Tk. 9.66 (nine point six six) Crore and (cont.11)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): as provision for margin loan. The short fall of required margin loan provision is Tk. 147.53 (one forth seven point fifty three). If the whole impairment is adjusted in financial statements then Net Asset Value (NAV) would be Tk. 127.54 (one hundred seven point five four) Crore and NAV per share would be Tk. (51.02) (Taka negative fifty one point zero two) Instead of disclosed NAV per share of Tk. 8 (Taka eight). (cont.10)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): the company is required to make provision or written off the long outstanding unsecured loan, which is not less than of Tk. 156.5 Crore as of December 31, 2019. The paragraph 5.4.4 of IFRS 9: Financial Instrument requires to written off the entire or part of the financial assets (margin loan with negative equity), which is not recoverable. The company has just maintained of Tk. 8.97 (eight point nine seven) Crore (cont.9)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): to bank through the entity but bank didn't respond on our request. 8. The margin loan balance with negative equity of the company is Tk. 157.8 Crore as of December 31, 2019. The company has no other security over this margin loan except margin loan holders' share portfolio. The market value of portfolio of negative equity holders is just of Tk. 1.3 Crore. There is a significant doubt of collectability of said unsecured loans. As such, (cont.8)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): FID Circular No. 06 dated 06 November, 2003 and FID Circular No. 02 dated 10 November, 2004. The company should maintain Reserve, 2.5% on 'Term or Fixed Deposit'. But company couldn't maintain such provision which is violation of circular. 7.During our audit we did not obtain third party confirmation in respect bank balance, FDR balance and loan balance through third party confirmation. Though we sent the letter of request (cont.7)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): Moreover, the poor price of that is sign of impairment as per IAS 36 Impairment of Assets. But no such impairment teat was taken place. Consequently, the asset and profit for the year are overstated. 5. At the year end, the current account balance with subsidiary company (Fas Capital Management Ltd.) does not agree due to unrecognized liability of TK 35 lakh by the company. 6. According to Financial Institution Regulations 1994 and (cont.6)

FASFIN 09-Dec-2020

(Continuation news of FASFIN): asset held for sales" which was classified as non-current asset held for sale in the year 2010 (nine year ago). No disposal yet taken place since then due to not receiving of minimum offer price as mentioned in the financial statements. The IFRS 05 Non-current Assets Held for Sale and Discontinued Operations requires to sold out the noncurrent asset within one year form the date of classification as "Non-current asset held for sales". (cont.5)

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