Professional Documents
Culture Documents
(Public P.S.)
1. Groups and Ghadir Investment Co. (Public P.S.) consolidated balance sheets and Groups Income and Cash Flow Statements for the financial year ended on 1388/9/30 (21/12/2009) along with Accompanying Explanatory Notes No. 1 to 44, which were prepared and approved by the Company's board of director, were audited by this audit firm. The responsibility of the integrity of the consolidated financial statements lies with the board of directors. The duty of this firm is to comment on the financial statements based on the audit and to comply with duties set forth by Articles 148 and 242 as well as other legal requirements set forth by the Commercial Law, contents of companys Articles of Association.
2. Except with the limitations mentioned in Paragraph 3, 6 to 8 of the present report, the audit was performed in accordance with the audit standards. These standards require this firm to plan and execute the audit in a manner that a marginal assurance against the absence of significant misrepresentation (distortion) in the financial statements. Audit includes random examination of evidence supporting figures and information mentioned in financial statements. Audit also includes evaluation of accounting principles, practices, and main assessments by the Company's board of directors and general examination of financial statements. This firm believes that the audit provides a reasonable basis for comments. 3. The prepayment heading of the Group and the Company's, as described in Note 10-3 accompanying the financial statements comprises 110 billion Rials tax prepayments. The mentioned amount includes 456 billion Rials tax withheld from the Company's dividend and 346 billion Rials corporate tax provision of 1375 (1996-97) to 1381 (2002-03). During the financial year being reported, the Company attempted to obtain the tax receipts concerning the payments of dividend by the investee companies and has succeeded to receive the tax receipt for 255 billion Rials. Determination of possible adjustments arising from this issue will be pending the receipt of the tax payment receipt of 201 billion Rials remaining dividends and the terms for the return of the net tax prepayments for the mentioned years. 4. Goodwill heading totaling 3,388 billion Rials, as described in (Note 13), and minority interest totaling 3,212 billion Rials (Note 29) and also goodwill of
affiliated companies (Note 14-1) were recorded based on the subsidiaries and affiliated companies' book value of assets and liabilities when acquired. In accordance with accounting standards concerning goodwill and subsidiaries' goodwill must be measured based on recognizable assets and liabilities' net fair value on the date acquired. Due to the absence of evidence concerning the determination of affiliated companies and subsidiaries' recognizable assets and liabilities' net fair value when acquired, determination of the impact of any required adjustment on the financial statements is not feasible. On the other hand, 1,260 billion Rials of the acquired goodwill balance is for the purchase of shares of Construction Development International Co., which is mainly resulting from the difference of the fair value of Tehran High-rise and its book value. Recording of the difference is incompliance with the accounting standards and must be recorded on under the relevant heading and in proportion to the units of the high-rise sold in to the profit & loss account. Considering that most of the units were sold, the devaluation provision must be considered to the relevant goodwill; however, presently the determination of the exact amount of devaluation is not feasible.
5. Although 51% of Pardis Petrochemical (Private J.S.) belongs to the Company and most of its board members are from the Group's subsidiaries, Pardis Petrochemical financial statements were not consolidated in the Group's consolidated financial statements. Determination of the financial impacts arising from such practice is not presently feasible. 6. The financial statements of Sepahan Cement Co., Shargh Cement Co. and Kordestan Cement Co. which were qualified for consolidation ends on the end of Esfand (March 20) and their audited mid-period financial reports (first 2 quarters ending Sept. 22) were used for consolidation. Determination of the financial impacts arising from such practice is not presently feasible and shall be pending the preparation of their audit report.
7. Market value of some the Companys long-term investments in companies enlisted with TSE (Note 14-2) is in total 316 billion Rials less than their final cost. Market value of some of the Group's other long-term investment is 427 billion Rials less than their cost. Justifying that the intrinsic value of the mentioned investments are more than that listed on the TSE Price Board, the Company did not consider any devaluation provision. Moreover, the Company's portion of
shareholders' equity of Amir Kabir Petrochemical, which is presented under other investments in the shares of other companies (Note 14-2-1), is 100 billion Rials less than its final cost. The assurance for disregarding such investment devaluation provision is subject to evidence supporting the intrinsic value of the mentioned investments. 8. Financial statements of Al Masader Jabal Ali Co. which is consolidated in the Group financial statements and has 151 billion Rials in assets and 365 billion Rials in revenue as well as the mid-period financial statements of some affiliated companies (Note 14-1-5) that are the basis for net worth were not audited. Hence, determination of whether adjustments are required is not feasible for us. 9. Except for the impact cases mentioned in Paragraphs 4, 5 and also except for the possible adjustments that would be required in the absence of limitations mentioned in the Paragraphs 3, 6, & 8 it is the opinion of this firm that the audited financial statements indicate that Companys financial status at the end of financial year ended on 1388/9/30 (21/12/2009) as well as operation results and cash flow for the same period with respect to significant aspects, according to accounting standards, are presented appropriately. 10. Based on Cabinet Decree No. 33068/T192976 dated 1386/11/28 (17/2/2008) and Amendment No. 41050T/136316 dated 1387/7/24 (15/10/2008) pertinent to the exchange rate difference of L/C financing for period prior to 1374 (1995-96) and considering Guideline No. 87/65564 dated 1387/10/1 (21/12/2008) issued by Central Bank of Iran (CBI) and the Tax Affair Organization's Resolution No. 110994 dated 1387/10/30 (19/1/2009) regarding the execution of the mentioned Decree tax exemption was granted on payment of foreign currency exchange rate difference between the official and the floating (market) rate. In order to benefit from the mentioned opportunity for the machinery imported prior to 1374 (1995-96), Kordestan Cement Co. (a Group's subsidiaries) adjusted its accounts after receiving authorization from the official accountants. The relevant adjustments resulted in 126 billion Rials of tax prepayment (set off by 135 billion Rials prepayment tax and 9 billion Rials tax provision for 2008-09) and 4 billion Rials return from fixed assets' account (set off by 63 billion Rials fixed assets and 59 billion Rials depreciation provision) and 122 billion Rials accumulated profit. The approval of the mentioned adjustments was not approved by the executing bank and CBI was not finalized; therefore, accounting for such adjustments will be pending the approval of the CBI and the executing bank.
11. The contents of Article 240 of the Amended Commercial Law pertaining to the payment of dividend within 8 months from the date of Ordinary General Assembly Meeting was not observed. Moreover, the shareholders' rights were not uniformly upheld. 12. The regulations set forth by the Direct Taxation Act concerning deduction and payment of taxes levied on salaries and benefits were not observed in some cases. 13. Some information were delivery late or were not delivery to the Security Exchange Organization (SEO), which presents a violation of SEO regulations.
14. Transactions mentioned in Note 42-2 as the parent company's total transactions subject to Article 129 of Amended Commercial Law during the financial year presented by the board were reviewed. It is our opinion that all said transactions were conducted in accordance to the Law.
15. The Board of Directors report on Group and the Companys activities and general status was prepared for presentation to the Annual General Assembly was reviewed. Considering the reviews, this audit firm did not find any significant event leading to any discrepancy between the information provided in the aforementioned report and the relevant documentation presented by the board.
1389/1/18 (7/4/2010)
Ghadir Investment Co. (Public Joint Stock) Consolidated Balance Sheet As at December 21st, 2009
21/12/2009 Million Rls Current Assets: Cash Short-term Investments Trade Accounts & Notes Receivable Other Accounts & Notes Receivable Inventory Orders & Prepayments Total Current Assets Non-current Assets: Tangible Fixed Assets Intangible Assets Goodwill Long-term Investments in Affiliated Companies Other Long-term Investments Other Assets Total Non-current Assets 5 6 7 8 9 10 523,682 1,074,140 8,040,317 598,359 2,450,664 1,264,174 13,951,336 (Revised) 21/12/2008 Million Rls 325,494 1,274,600 4,674,787 478,511 2,782,013 497,915 10,042,320 21/12/2009 Million Rls Current Liabilities: Trade Accounts & Notes Payable Other Accounts & Notes Payable Advances Received Tax Provision Payable Dividend Financial Facilities Received Total Current Liabilities Non-current Liabilities: Long-term Accounts & Notes Payable Long-term Financial Facilities Received Provision for Employees Work Termination Benefits Total Non-current Liabilities Total Liabilities 16 17 18 19 20 21 1,631,755 1,194,961 778,306 442,539 2,540,800 4,116,379 10,704,740 158,397 4,673,012 168,898 5,000,307 15,705,047 (Revised) 21/12/2008 Million Rls 990,013 1,127,996 470,952 453,452 1,853,890 3,403,963 8,300,266 186,269 3,050,484 214,940 3,451,693 11,751,959
Assets
Note
Note
11 12 13 14 14 15
22 21 23
24
6,075,000
6,075,000
Assets
Note
Liabilities & Shareholders' Equity Shares of the Parent Company in Ownership of Subsidiary Companies Legal Reserve Capital Reserve Other Reserves Difference in Retained Foreign Exchange Retained Profit Total Shareholders Equity of Parent Company Minority Interest Total Shareholders Equity Total Liabilities & Shareholders Equity
Note 24 25 26 27 28 29
21/12/2009 Million Rls (64,229) 819,383 4,425,276 301,994 40,401 4,380,382 15,978,207 3,211,555 19,189,762 34,894,809
(Revised) 21/12/2008 Million Rls (86,126) 805,654 4,303,479 318,953 38,965 3,368,907 14,824,832 2,812,115 17,636,947 9,388,906
Total Assets
34,894,809
29,388,906
Ghadir Investment Co. (Public Joint Stock) Consolidated Profit (Loss) Statement For the Year Ended December 21st, 2009
(Revised) For the Year Ended December 21st, 2008 Million Rls 7,034,139 (4,254,332) 2,779,807 1,086,349 (429,914) (496,452) (976,741) 3,031,076 35 36 (862,791) 123,832 (738,959) Profit before Calculating Group's Share from Profit of Affiliated Companies Group's Share from Profit of Affiliated Companies Profit before Tax Tax Net Profit Minority Interest from Net Profit EPS (Earnings Per Share) Rls (926,366) 2,939,790 (618,338) 398,495 (219,843)
Note
For the Year Ended December 21st, 2009 Million Rls Million Rls 8,003,745 (4,496,807) 3,506,938
Net Sales & Income from Services Rendered Cost Price of Goods Sold & Services Rendered Gross Profit Income from Operating Investments Sales, Administrative & General Expenses Net Other Operating Incomes & Expenses Operating Profit Financial Expenses Net Other Non-operating Incomes & Expenses
30 31
32 33 34 (472,739) (504,002)
482,879
2,274,117
2,719,947
14
Statement of Consolidated Retained Profit (Loss) Net Profit Retained Earnings at the beginning of the Fiscal Year Prior Years Adjustments Retained Earnings at the beginning of the Year Adjusted 3,443,177 4,301,500 37 (128,578) 4,172,922 4,078,002 1,874,065 3,487 1,877,552
Note
For the Year Ended December 21st, 2009 Million Rls Million Rls 7,616,099
Allocable Profit Profit Allocation: Legal Reserve Capital Reserve Other Reserves Ratified Dividend
(Revised) For the Year Ended December 21st, 2008 Million Rls 5,955,554 (104,674) (328,253) (1,349,705) (1,782,632) 4,172,922 804,015 3,368,907
25 26 27
Minority Interest from Retained Earnings Retained Profit at the End of the Year
29
925,571 4,380,382
Ghadir Investment Co. (Public Joint Stock) Consolidated Comprehensive Profit (Loss) Statement For the Year Ended December 21st, 2009
For the Year Ended December 21st, 2009 Million Rls 3,443,177 28 1,436 3,444,613 (128,578) 3,316,035 788,839 (Revised) For the Year Ended December 21st, 2008 Million Rls 4,078,002 11,303 4,089,305 3,487 4,092,792 745,376
Note
Net Profit Exchange Difference of Assets & Liabilities of Independent Foreign Unit Comprehensive Profit of the Fiscal Year Prior Years Adjustments Recognized Comprehensive Profit from the Prior Year Report Minority Interest from Comprehensive Profit of the Fiscal Year
37
Ghadir Investment Co. (Public Joint Stock) Consolidated Cash Flows Statement For the Year Ended December 21st, 2009
For the Year Ended December 21st, 2009 Million Rls Operating Activities: Net Cash Inflow from Operating Activities Return on Investments & Paid Interest for Financing: Received Profit of Banking Deposits & Other Short-term & Long-term Investments Profit Paid for Financial Facilities Dividend Paid to Minority Shareholders Dividend Paid to Shareholders of the Parent Company Net Cash Outflow from Return on Investments & Paid Profit for Financing Income Tax: Income Tax Paid Investment Activities: Funds Paid for Purchasing Tangible Fixed Assets Funds Paid for Acquiring Long-term & Short-term Investments Funds Earned from Sales of Tangible Fixed Assets Funds Paid for Acquiring Intangible Assets Funds Paid for Acquiring Other Assets Net Cash Outflow from Investment Activities Net Cash Outflow before Financing Activities Financing Activities: Decrease (Increase) in Shares of the Parent Company in Ownership of the Subsidiary Companies Financial Facilities Received Payment of the Original of the Financial Facilities Net Cash Inflow from Financing Activities 38 1,168,805 (Revised) For the Year Ended December 21st, 2008 Million Rls 3,347,355
Note
(1,431,073)
(907,553)
(240,860)
(125,556)
10
Note
(Revised) For the Year Ended December 21st, 2008 Million Rls (78,683) 404,177 325,494 178,612
Net Increase (Decrease) in Cash Cash Balance at the beginning of the Year Cash Balance at the End of the Year Non-cash Transactions 39
11
Ghadir Investment Co. (Public Joint Stock) Consolidated Balance Sheet As at December 21st, 2009
21/12/2009 Million Rls Current Assets: Cash Short-term Investments Trade Accounts & Notes Receivable Other Accounts & Notes Receivable Prepayments Total Current Assets Non-current Assets: Fixed Tangible Assets Intangible Assets Long-term Investments Other Assets Total Non-current Assets 5 6 7 8 10 99,577 130,028 6,522,088 231,903 112,636 7,096,232 11 12 14 15 4,391 702 10,389,342 2,628,313 13,022,748 (Revised) 21/12/2008 Million Rls 64,831 191,682 4,518,535 240,626 111,104 5,126,778 6,129 520 10,018,382 2,555,082 12,580,113 21/12/2009 Million Rls Current Liabilities: Trade Accounts & Notes Payable Other Accounts & Notes Payable Advances Received Tax Provision Payable Dividend Financial Facilities Received Total Current Liabilities Non-current Liabilities: Financial Facilities Received - Long-term Provision for Employees Work Termination Benefits Total Non-current Liabilities Total Liabilities Shareholders Equity: Capital (6,075 million of Rls1000 Shares, Fully Paid) Legal Reserve Capital Reserve Other Reserves Retained Earnings Total Shareholders Equity Total Liabilities & Shareholders Equity 16 17 18 19 20 21 23,007 83,087 2,001,318 511,137 2,618,549 170,323 3,405 173,728 2,792,277 6,075,000 607,500 4,425,276 281,846 5,937,081 17,326,703 20,118,980 (Revised) 21/12/2008 Million Rls 7,757 158,243 1,330,609 435,152 1,931,761 268,569 2,602 271,171 2,202,932 6,075,000 67,500 4,303,479 281,846 4,236,134 15,503,959 17,706,891
Assets
Note
Note
21 23
24 25 26 27
Total Assets
20,118,980
17,706,891
12
Ghadir Investment Co. (Public Joint Stock) Profit (Loss) Statement For the Year Ended December 21st, 2009
(Revised) For the Year Ended December 21st, 2008 Million Rls 3,354,957 (35,745) 7,545 (26,052) 3,502,491 35 36 (151,430) (9,567) (160,997) 3,341,494 3,341,494 550 Flow of Retained Profit (Loss) Account Net Profit Retained Earnings at the beginning of the Fiscal Year Prior Years Adjustments Retained Earnings at the beginning of the Year Adjusted Allocable Profit Profit Allocation: Legal Reserve Capital Reserve Ratified Dividend Retained Profit at the End of the Year 3,341,494 4,307,038 37 (70,904) 4,236,134 7,577,628 25 26 (121,797) (1,518,750) (1,640,547) 5,937,081 3,167,888 2,188,048 78,538 2,266,586 5,434,474 (19,587) (328,253) (850,500) (1,198,340) 4,236,134 (28,200) 3,326,757 (143,151) (15,718) (158,869) 3,167,888 3,167,888 521
Note
For the Year Ended December 21 , 2009 Million Rls Million Rls 3,528,543
st
Income from Investments Sales, Administrative & General Expenses Net Other Operating Incomes & Expenses Operating Profit Financial Expenses Net Other Non-operating Incomes & Expenses Profit before Tax Tax Net Profit Earnings Per Share (EPS) Rls
32 33 34 (69,121) 43,069
Since the Comprehensive Income Statement is limited to the profit and prior years adjustments of the period, the Comprehensive Income Statement is not presented. Accompanying notes are an integral part of these financial statements.
13
Ghadir Investment Co. (Public Joint Stock) Cash Flows Statement For the Year Ended December 21st, 2009
For the Year Ended December 21st, 2009 Million Rls Operating Activities: Net Cash Inflow from Operating Activities Return on Investments & Paid Interest for Financing: Profit Paid for Financial Facilities Dividend Paid to Shareholders of the Company Net Cash Outflow from Return on Investments & Profit Paid for Financing Investment Activities: Funds Paid for Purchasing Tangible Fixed Assets Funds Paid for Acquiring Intangible Assets Net Cash Outflow from Investment Activities Net Cash Inflow before Financing Activities Financing Activities: Financial Facilities Received Repayment of the Original Financial Facilities Received Net Cash Outflow from Financing Activities Net Increase in Cash Cash Balance at the beginning of the Year Cash Balance at the End of the Year Non-cash Transactions 38 441,313 (Revised) For the Year Ended December 21st, 2008 Million Rls 371,196
Note
(104,881) (237,077)
(141,302) (84,965)
(341,958)
(226,267)
14
Ghadir Investment Co. (Public Joint Stock) Notes to the Financial Statements For the Year Ended December 21st, 2009
1. History of Activities
1.1. Generalities The Group consists of Ghadir Investment Company Public Joint Stock (Parent Company) and its subsidiary companies. Ghadir Investment Company Public Joint Stock was established on 16 October 1991 and was registered with Companies and Industrial Ownership Registration Department in Tehran under No.86180 with the initial name of Bank Saderat Investment Co. (Private Joint Stock). The Company changed into public joint stock on 19 December 1995 and accepted in Tehran Stock Exchange on 17 March 1996. According to ratification of the Extra Ordinary General Assembly dated October 11th, 1999, the end of the financial year of the Company changed from September 22nd to December 21st of every year. The headquarters of the Company located in Tehran. 1.2. Main Activities According to Article 2 of the Articles of Association, the main activities of the Company include the following items: A) Establish, participation (legal) in capital, purchase of shares, reconstruction, renovation and launch of all types of companies and institutes within or outside of the Country, sales of shares, assignment of companies shares or liquidation of them B) Preparation of investee companies in order to enter stock market C) Using financial facilities and credits of banks and credit institutes D) Subscribing shares and doing transactions related to domestic or foreign shares and securities E) Providing required services for companies in the following cases: Services and consulting in the fields of production, new investments, development, completion, planning & budgeting, providing financial & credit resources, issuance, approve and accept of any guarantee or commitment, marketing & designing management systems for easing & increasing their efficiency through consultation or establishing company or institution F) Issuance of participation bonds
15
G) Execution of all legal operations which are useful for realization of the Companys objectives directly or indirectly or it is necessary for implementation of the subject of the Company 1.3. Employment Status The average number of permanent and interim employees during the reported year is as follows:
Group 21/12/2009 Person Permanent Employees Interim & Contracting Employees 2,368 1,990 21/12/2008 Person 2,901 2,224 Parent Company 21/12/2009 21/12/2008 Person Person 23 22 18 29
4,358
5,125
45
47
Decrease in number of personnel of the Group companies, is mainly related to assignment of shares of Abgineh Co. and its exclusion from consolidation.
16
under account heading of Shares of Parent Company in Ownership of Subsidiary Companies as a reduction of the shareholders' equity. 3.4. The financial year of most of subsidiary companies ends at September 22nd. The financial statements of the mentioned companies apply in consolidation the same way. In case of any event in a way that it considerably affects the consolidated financial statements until the date of preparation of financial statements of the Parent Company, its effects take into consideration through applying required adjustments in items of mentioned subsidiary companies financial statements. In addition, regarding those affiliated and subsidiary companies that their fiscal year ends at March 20th of every year, their middle period financial statements used in the consolidation until September 22nd. It is note-worthy that their performance for one year period ended September 22nd use in consolidation.
Liable to Consolidation
Special Value Cost Price (Minus the Reserve for Perpetual Reduction in Investment Value)
Current Investments: Investments Rapidly Transacted in the Market Other Current Investments Income Recognition Method: Least Cost Price and Net Sales Value of Total Investments Least Cost Price and Net Sales Value of Each Investments Least Cost Price and Net Sales Value of Total Investments Least Cost Price and Net Sales Value of Each Investments
17
Consolidated of Group
Parent Company In Time of Profit Approval by the General Meeting of Shareholders of the Investee Company (till the approval date of financial statements) In Time of Profit Approval by the General Meeting of Shareholders of the Investee Company (till the approval date of financial statements) In Time of Profit Approval by the General Meeting of Shareholders of the Investee Company (till the approval date of financial statements) In Time of Profit Approval by the General Meeting of Shareholders of the Investee Company (till the date of Balance Sheet)
Liable to Consolidation
In Time of Profit Approval by the General Meeting of Shareholders of the Investee Company (till the approval date of financial statements)
In Time of Profit Approval by the General Meeting of Shareholders of the Investee Company (till the date of Balance Sheet)
4.2. Inventory Inventory of goods and materials are evaluated at minimum finished cost and net sales value of individual items and similar group of items. In case of excess finished cost compared to net sales value, the difference is recorded as inventory devaluation provision. Finished costs of inventories are calculated by application of following methods:
Method Raw Materials & Packaging Work in Progress Finished Goods Spare Parts Weighted Average Annual Weighted Average Annual Weighted Average Weighted Average
4.3. Tangible Fixed Assets 4.3.1. Tangible fixed assets are entered into accounts based on the cost prices. Upgrading costs and costs of fundamental repairs which cause considerable increase in the capacity or remaining life span of the fixed assets or improve the quality of their output considerably are considered capital costs and are amortized in the remaining life span of the relevant assets. The
18
maintenance and trivial repairs costs whose purpose is maintaining or revival of expected economic interests of the commercial unit (in proportion to evaluated standard function) are considered current costs and are entered into profit and loss account of the period. 4.3.2. Depreciation of the fixed tangible assets considering estimated life span of the relevant assets calculated in following methods and with following rates in compliance with Depreciation Bylaw of Article 151 of Direct Taxation Act passed on March 1988 and its later amendments:
Asset Building Installments Machineries Furniture Tools Motor Vehicles Depreciation Rate 7%,8% & 10% 12%, 13% & 15 years 10%, 10 & 15 Years 10 Years 4 Years 25%, 30% & 35% Method of Depreciation Declining Declining & Straight Line Declining & Straight Line Straight Line Straight Line Declining
In respect of the fixed assets acquired and used during the month the depreciation is calculated from the beginning of the following month and entered into accounts. When a depreciable asset, while being ready for being used, is not used because of work stop or any other reasons, its depreciation for that period is 30% of the depreciation rates given in the above table. 4.4. Financing Costs Except the costs that are directly ascribable to acquired "qualified assets", the financing costs are considered as cost of the year. 4.5. Foreign Exchange 4.5.1. Foreign currency monetary items at the date of balance sheet and nonmonetary items which have been entered at historical cost prices in terms of the type of the foreign currency are changed at the exchange rate at the date of the transaction. The differences resulted from settlement or exchanging the foreign currency are identified as revenue or cost of the period. 4.5.2. All assets and liabilities of the independent foreign units are changed at the exchange rate at the date of balance sheet and the revenues and costs are changed at the rate which is average of the rates during the period. All differences resulted from changing are classified in the headings of the shareholders' equity and reflected in comprehensive profit and loss statement. If the independent foreign unit is sold the differences resulted from changing are transferred to accumulated profit and loss account directly.
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4.6. Provision for Employees' Work Termination Benefit Provision for employees' work termination benefit is calculated based on the last month's fixed salary and continuous benefits of one year multiplied by the years of service and are entered into accounts. 4.7. Goodwill The accounting of the combination of trade units are done based on purchasing method. Excess of cost price of acquiring investment in liable-toconsolidation subsidiary companies and the affiliated companies which are liable to net value method in comparison to the share of the group from net book value of their recognizable liabilities and assets at the time of acquisition is recognized as goodwill and amortized within 10 years in direct line method. The goodwill resulted from acquiring affiliated companies are reflected in the consolidated balance sheet as part of long-term investment book value in affiliated companies. 4.8. Capital Reserve Profit from selling shares available in companys portfolio reflects in capital reserve account. Capital reserve may not be distributed among shareholders and can be used for capital increase. Only in exceptional cases, for continuation of profitability process, the company may distribute up to 20% of the amount that have been transferred to capital reserve in the same year to shareholders upon recommendation of the Board of Directors and approval of the Ordinary General Assembly.
5. Cash
Group 21/12/2009 21/12/2008 Million Rls Million Rls 5,758 3,077 496,065 277,009 2,774 2,652 435 18,650 0 523,682 101 42,364 291 325,494 Parent Company 21/12/2009 21/12/2008 Million Rls Million Rls 233 202 99,064 64,629 28 99,577 64,831
Note Cash in Hand Bank Balance Petty Cashes Notes under Collection Short-term Banking Deposits Securities
5-1
20
5.1. The balance of bank account includes Rls29,966 million that is equivalent to the foreign currencies of the Group companies (mainly Almasader Jabal Ali, Motojen & Shargh Cement companies).
6. Short-term Investments
Group 21/12/2009 21/12/2008 Million Rls Million Rls Parent Company 21/12/2009 21/12/2008 Million Rls Million Rls
Note Investments Rapidly Transacted in the Market: Shares of Rapidly Transacted Companies in the Market Participation Bonds Investment in Shares of Other Companies Bonds of Investment Fund Investment Deposits held with Banks Plans, Projects & Properties Expensive Metals (Platinum)
6-1
631,090
663,275
88,646
112,351
6-2
90,804 721,894
88,646 15,008
112,351 65,456
6-3
68,360
790,254 22,899
872,685 -
103,654 12,499
177,807 -
13,875 130,028
13,875 191,682
21
6.1. Group investments in shares of rapidly transacted companies in the market describes as follows:
21/12/2009 Investee Company No. Cost Price Million Rls Accepted in TSE Oroumieh Cement Behbahan Cement Fan Avaran Petrochemical Pars Vegetable Oil Doroud Cement Saipa Bank Pasargad Iran Refractory Products Ardebil Cement Khazar Cement Boroujerd Textile Hegmatan Cement Esfahan Mobarakeh Steel Kalsimin Esfahan Oil Refinery Esfahan Petrochemical Mazandaran Textile Khark Petrochemical Chador Malou Saipa Diesel Informatics Services Pension Investment Omid Investment Arak Petrochemical Other Provision for Value Decrease 12,129,091 2,816,773 3,544,737 19,253,243 3,067,453 9,948,571 64,877,692 2,849,923 713,852 25,073,416 14,685,612 12,757,708 3,774,191 268,068 2,710,000 1,989,210 12,825,214 717,121 250,000 4,538,618 477,825 1,588,851 2,037,09 484,000 79,624 64,697 24,938 48,929 39,645 17,839 64,877 11,295 22,152 85,631 19,303 12,768 11,304 2,686 18,165 10,302 13,282 10,753 2,677 12,481 6,650 2,944 6,663 3,842 158,438 751,885 (120,795) 631,090 660,697 Market Value Million Rls 53,465 33,017 16,559 28,013 22,627 12,963 97,608 5,492 14,300 59,241 10,574 30,044 6,433 1,969 15,255 4,653 10,311 8,279 2,120 4,634 6,087 2,415 6,087 1,103 207,499 660,697 21/12/2008 Cost Price Million Rls 76,634 61,469 57,254 49,701 37,289 26,883 62,412 22,678 22,152 21,544 19,303 19,220 17,014 16,779 108 14,538 13,283 12,726 12,682 10,939 8,343 7,052 7,986 5,054 184,057 787,100 (123,825) 663,275
22
6.1.1. Investment of the Parent Company in shares of the listed companies includes the following items:
21/12/2009 Cost Price Million Rls 48,911 13,272 19,303 6,760 17,839 6,650 2,565 2,420 5,112 3,842 26,011 152,685 Provision for Value Decrease (64,039) 88,646 21/12/2008 Cost Price Million Rls 48,911 13,272 19,33 6,760 10,042 6,606 2,565 2,420 4,417 3,781 11,383 28,138 18,792 176,390 (64,039) 112,351
Investee Company Pars Vegetable Oil Mazandaran Textile Boroujerd Textile Iran Poplin Saipa Informatics Services Saipa Diesel Behpak Industrial Khark Petrochemical Arak Petrochemical Iran Refractory Products Fan Avaran Petrochemical Other
No. 19,245,715 12,805,214 14,685,612 2,899,324 9,948,571 477,825 455,132 568,949 320,500 484,000
Market Value Million Rls 28,002 10,295 10,574 2,885 12,963 6,036 467 619 3,744 1,103 21,003 97,691 97,691
Ghadir Industry & Capital Development Co. Shargh Cement Co. Kordestan Cement Co. Eetezad Ghadir Co. Ghadir Trade & Management Services Co. Construction International Group Companies Other
6.2.1. Purchased participation bonds related to guarantee of banks deposits and Governments civil projects (1 year to 5 years) and its profit rate is mainly 16% and 17% per year.
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12 7 4
4,075,472 5,082,433
12,480,000 4,000,000
19,375,000
550 92,270
24
Note Notes Receivable Subsidiary Companies Affiliated Companies Customers Rials Customers Foreign Exchange Balance of Share Sales Installments Other Investee Companies Other Provision for Doubtful Debts 7-1 7-2 7-2
7.1. The balance of notes receivable of the Parent Company mainly relates to current portion of checks received from Mr. Mahboubian for selling shares of Azar Glass Industries Co., Mr. Delfani for selling shares of Sabz Investment Co., Sarouj International Co. for selling shares of Asiaye Aram Co., Behshahr Development Industries for selling shares of Saramad Ghadir Co. and Mr. Yousef Afshar for selling shares of Shahdab Co. In addition, the amount of Rls 175,511 million of received checks from Mr. Mahboubian, Mr. Delfani and Mr. Afshar under the title of long-term notes receivable have been reflected in other assets. 7.1.1. The balance of Groups notes receivable mainly related to Rls1,085,712 million current portion of checks received of Construction Development International Co. from purchasers of Tehran Tower apartments, Yas Tower and other construction projects. In addition, Rls388,089 million long-term portion of checks received from purchasers have been reflected in other assets.
25
7.2. Debt balance of the Parent Company from subsidiary, affiliated and other investee companies is as follows:
Parent Company 21/12/2009 Accounts inTotal between Million Rls Million Rls 103,973 12,357 274,300 164,663 398,000 944,300 73,380 154,800 26,879 718,793 154,357 73,293 257,868 103,099 274,300 1,789 390,630 3,345,521
21/12/2008 Total Million Rls 70,472 237,000 446,500 75,114 48,000 37,621 308,700 42,786 24,977 701,250 70,281 5,304 2,068,005
Dividend Million Rls Subsidiary Companies: Almasader Jabal Ali Ghadir Trade & Industrial Zarrin Persia Motojen Kalaye Sepehr Pars Shargh Cement Ghadir Capital & Industry Development Ghadir Management Services Eetezad Ghadir Investment Construction Development International Sepahan Cement Alvand Ghadir Development Investment Other Affiliated Companies: Behshahr Industries Development Pardis Petrochemical (Ghadir Urea & Ammoniac) Zagros Petrochemical Bahman Group Kavir Tire Iran Alloy Steel Other Other Companies: Maroun Petrochemical Fan Avaran Petrochemical 164,663 398,000 944,300 73,380 154,800 26,879 614,820 142,000 73,293 257,868 103,099 1,789 2,954,891
46,718 1,164,000
119,000 11,988
26
Parent Company 21/12/2009 Accounts inTotal between Million Rls Million Rls 3,611 0 36,063 170,662
Note Notes Receivable Personnel Debts Group Companies Mr. Khayyam Bashi National Petrochemical Industries Co. Mazandaran Textile Co. Deposits Receivable Dividend, Participation Bonds & Banking Deposits Other Provision for Doubtful Debts
8.1. Debt balance from Mr. Khayyam Bashi related to debt of Vasepari Sepehr Pars Company for the remaining amount of returning Esfahan Keshavarz Blvd. project to the seller. Until the date of preparation of this report, Rls10 billion of the mentioned amount have been settled. 8.2. Debt balance of the Parent Company from National Iranian Petrochemical Industries Company related to tax of share transfer of Zagros Petrochemical, Maroun and Arvand companies which have been paid by the Company.
27
9. Inventory
Group Note Finished Goods Work in Progress Raw Materials, Packaging & Construction Equipments Spare Parts Projects under Construction Constructed Units Properties Other Provision for Value Decrease of Inventories 21/12/2009 Million Rls 112,307 73,443 319,429 9-2 9-3 9-4 350,577 1,154,330 118,784 273,968 49,568 2,452,406 (1,742) 2,450,664 21/12/2008 Million Rls 195,670 78,082 413,795 279,902 1,496,832 106,881 51,686 175,627 2,798,475 (165,462) 2,782,013
9.1. Inventory of materials and goods at the date of balance sheet has been sufficiently covered by insurance against probable hazards. 9.2. The balance of projects under construction completely related to construction projects under completion of Construction Development International Co. (mainly Tehran Tower, Yas Tower, Saadi Project, Erfan Residential Project, Narenjestan 2 Projects and Marjan Kish). Tehran Tower which located in Kordestan Street has been purchased from A.S.P Company according to purchasing contract dated March 19th, 2003 and the construction management of the project abandoned to the same company as management contractor based on the contract dated December 20th, 2002. Physical progress of the project until 22nd September 2009 in residential units and shops is 100% and in triplex units is 99.5%. Tehran Tower project has 126,026 useful square meters (include 555 residential units, 23 shops and one restaurant). Until the end of September 2009, 539 units of the mentioned tower have been sold. 9.3. The existing units are completely related to Construction Development International Group companies and mainly related to constructed apartments built by Bagh Misheh Housing Co. and Azarbaijan Construction Co. 9.4. The existing properties related to lands owned by Construction Development International Group and Bagh Misheh which have been purchased for implementation of construction projects.
28
10-1
10-2 10-3
110,291 -
110,291 -
10-4
592,748
10-5 10-6
10.1. Other foreign orders include Rls72,909 million and Rls13,473 million, balance of two opened letters of credit through Kaspian Foulad Ghadir Co. for purchase of 46,660 tons of slab and two opened letters of credit by Ghadir Trade & Management Services Co. for import of meat from Brazil and home appliances from Turkey, respectively. 10.2. Prepayment balance of purchasing raw materials and construction equipments mainly related to Motojen, Shargh Cement and Sepahan Cement companies. 10.3. Tax prepayment include Rls110,291 million tax prepayment of the Parent Company and Rls125,708 million tax prepayment of the Kordestan Cement Co. Tax prepayment of the Parent Company include Rls456 billion as deducted tax from dividend of the Company after clearing with Rls346 billion tax provision. I addition, tax prepayment of Kordestan Cement Co. have been considered as retained profit in the accounts based on ratification dated February 17th, 2008 of the Board of Ministers and instruction dated December 22nd, 2008 of the Central Bank of Iran regarding changes in foreign exchange
29
rate of import machineries finance and in order to enjoy benefits of the mentioned ratifications. 10.4. Prepayment to car manufacturing companies related to funds paid by the Vasepari Sepehr Pars Co. to Iran Khodro, Iran Khodro Diesel, Bahman Khodro and Sapco for providing car in order to assign them to clients in the framework of hire purchase contracts. 10.5. Prepayment for purchasing goods and services mainly related to paid on-accounts to second hand contractors through Construction Development International Group companies. 10.6. Prepayment to Middle East Bank related to Almasader Company.
30
Balance at 21/12/2008
Balance at 21/12/2009
Balance at 21/12/2008
Balance at 21/12/2009
Balance at 21/12/2009
Balance at 21/12/2008
Land Building & Installments Motor Vehicles Machineries Tools Other Properties Furniture & Equipments Total Assets under Completion Capital Orders & Prepayments Capital Items in Inventory Total
89,188 833,055 101,167 1,756,729 50,517 70,969 78,070 2,979,695 1,679,595 297,738 328,637 5,285,665
61,077 (6,381) (3,089) (147,729) (1,925) 4,036 (435) (94,446) 13,594 (202,969) (120,816) (404,637)
159,986 865,901 102,201 1,636,897 53,507 78,965 80,520 2,977,977 2,644,163 185,450 229,500 6,037,090
159,986 625,638 40,174 1,061,078 25,532 41,215 20,049 1,973,672 2,644,168 185,450 229,500
89,188 634,559 42,902 1,228,003 24,746 18,382 43,456 2,081,236 1,679,595 297,738 328,637 4,387,206
898,460
177,785
(3,228)
(68,711)
1,004,305
5,032,785
- Adjustments amount mainly related to assets of Abgineh Production Company which have been sold in the current year.
31
11.2. Table of cost price and accumulated depreciation of tangible fixed assets of the Parent Company is as follows:
Cost Price Million Rls Assets Added during the Fiscal Year 34 53 87 87 (1) (1,159) (1,160) Accumulated Depreciation Million Rls Book Value Million Rls
Balance at 21/12/2008
Balance at 21/12/2009
Balance at 21/12/2008
Balance at 21/12/2009
Balance at 21/12/2009
Balance at 21/12/2008
Land, Building & Installments Furniture & Equipments Electronic Calculation Machines Motor Vehicles Total Capital Prepayments Total
(1)
11.3. Adjustments and transfers of cost price and accumulated depreciation of different titles of fixed assets include removing balance at the beginning of the fiscal year of fixed tangible assets of Abgineh Co. due to abandoning shares of the mentioned company by the Group in the current fiscal year and removing it from consolidation.
32
11.4. Balance of assets under completion and capital orders & prepayments based on the Group companies is as follows:
21/12/2009 Assets Capital under Orders & Completion Prepayments Million Rls Million Rls 1,860,575 40,872 684,817 67,224 19,710 146 2,283 1,321 8,087 2,644,163 52,329 13,436 59,923 11,639 7,251 185,450 21/12/2008 Assets Capital under Orders & Completion Prepayments Million Rls Million Rls 1,386,181 12,408 203,326 67,224 16,461 146 2,472 2,016 1,471 298 1,679,595 177,919 25,240 54,207 11,505 13,093 2,208 1,158 297,738
Note
Shargh Cement Sepahan Cement South Aluminum Kordestan Cement Shahid Bahonar Board Construction Motojen Abgineh Other
11.4.1. Assets under completion and capital orders and prepayments of Shargh Cement Co. related to cost price of development project of unit 4 of the plant with the capacity of 3,400 tons of clinker per day. 11.4.2. Assets under completion and capital orders and prepayments of Sepahan Cement Co. related to expenditures of constructing new production line of producing clinker (include amounts paid for establishing building and purchase and installing machineries and equipments as well as other expenditures of phase 3). This project utilized after the reported financial year. 11.5. Balance of capital items in the inventory mainly related to Sepahan Cement Co. (include Rls53,977 million and Rls129,870 million cost price of machineries and equipments of clinker production line and machineries and equipments of plant optimization, respectively). 11.6. Groups fixed tangible assets have insurance coverage up to Rls3,086 billion and the Parent Company up to Rls13 billion, against probable hazards such as fire, flood and earthquake. 11.7. A part of buildings, installations and machineries of the Group companies held with banks that gave financial facilities.
33
209
209
702
520
13. Goodwill
Note Cost Price: Balance at the beginning of the Year Acquired Goodwill during the Year Abandoned Goodwill during the Year Transfer from Goodwill due to Acquiring Affiliated Companies Balance at the End of the Year Less: Accumulated Depreciation Balance at the beginning of the Year Depreciation of the Year Adjustments Goodwill Depreciation of Abandoned Share during the Year Transfer from Goodwill Accumulated Depreciation due to Acquiring Affiliated Companies Balance at the End of the Year Provision for Value Decrease 21/12/2009 Million Rls 5,425,181 13-1 13-2 14,686 (20,968) 0 5,418,899 21/12/2008 Million Rls 3,118,164 559,627 (80,464 1,827,854 5,425,181
13-3
34
13.1. Acquired goodwill during the fiscal year mainly related to acquiring shares of Kordestan and Sepahan Cement companies by the Group (mainly through Ghadir Capital & Investment Co.). 13.2. Decrease in balance of goodwill during the fiscal year mainly related to abandoning shares of Abgineh Co. (total share of the Group) and Motojen by the Parent Company. 13.3. Provision for value decrease at the end of the previous fiscal year related to provided provision by Ghadir Capital & Industry Development Co. as the increase in cost price of acquired share of Sepahan Cement Co. compare to its market value which have been returned through increase in market value of the mentioned company in the reported fiscal year.
Note
Quota from Profit of Affiliated Companies Quota from Profit of Zagros Petrochemical from Acquiring Date until Remarkable Influence Date Goodwill Depreciation
35
1,399,006
14.1.2. Investment additions in shares of affiliated companies related to participation in capital increase of Iran Alloy Steel Co. acquiring shares of Behshahr Development Industries and Dashtestan Cement companies as well as adjustment of cost price investment in shares of Pardis Petrochemical Co. 14.1.3. Transfer from other long-term investments related to transfer of cost price of investment in shares of Zagros Petrochemical Company due to enjoying remarkable influence in the mentioned company (selection of one board member by the Group) in the reported year. 14.1.4. Abandoning shares of affiliated companies in the reported fiscal year mainly related to assigning all shares of Kerman Steel Co. and a part of shares of Bahman Co. 14.1.6. Group investment in shares of listed companies describe as follows:
21/12/2009 Cost Price Million Rls 298,653 222,881 72,109 84,524 24,117 139,193 841,477 21/12/2008 Cost Price Million Rls 298,653 220,174 130,319 83,350 22,629 62,340 817,465
No. of Shares Arak Petrochemical Karoun Cement Khazar Cement Darab Cement Hegmatan Cement Other 48,144,041 26,435,236 15,659,390 13,700,010 5,007,563
Market Value Million Rls 109,672 206,369 30,916 77,021 11,451 117,678 553,107
Maroun Petrochemical Khouzestan Cement Amir Kabir Petrochemical Pars Aryan Investment Novin Capital Provision Gharb Petrochemical Morvarid Petrochemical Zagros Petrochemical Other
21/12/2008 Million Rls 751,790 654,543 119,439 92,204 80,000 35,000 170,000 1,333,719 120,737
36
2,010,875
3,357,432
14.1.8. Balance of plans and projects at the date of balance sheet completely related to the Parent Company and describes as follows:
21/12/2009 Million Rls Pardis Petrochemical Ghadir Iranian Iron & Steel Project Morvarid Petrochemical Petrochemical Projects 14-1-81 1,073,745 44,000 85,000 1,202,745 21/12/2008 Million Rls 1,149,007 51,472 1,200,479
Note
14.1.8.1. Based on the conducted contract between Ghadir Investment Co. and National Petrochemical Industries Co., 51% of Assaluyeh Urea & Ammoniac Production project assigned to Ghadir Investment Co. The abovementioned project includes two units with the capacity of 1,100,000 tons of Urea and Ammoniac per year, each unit. The first unit has been utilized in 2007/08. The afore-mentioned amount is the retained paid for 51% of the Companys quota. 14.1.9. Other long-term investments related to Groups companies investments in properties and construction projects are as follows:
Note Almasader Jabal Ali Co. Construction Development International Group Other Companies 14-1-9-1 14-1-9-2 21/12/2009 Million Rls 784,217 332,061 22,825 1,139,103 21/12/2008 Million Rls 535,946 25,511 561,457
14.1.9.1. Investments of Almasader Jabal Ali Co. in construction projects related to IB Tower, Jaddaf and Ammar projects. 14.1.9.2. Investments of Construction Group in properties mainly related to maintained lands for construction through Baghmisheh Co. 14.2. Long-term investments of the Parent Company are as follows:
21/12/2009 Other Companies Million Rls 21/12/2008 Accepted Other in TSE Companies Million Million Rls
37
Rls Subsidiary Companies Affiliated Companies Other Companies Plans & Projects 1,205,480 702,178 192,741 3,672,952 2,144,032 1,269,214 1,202,745 2,100,399 8,288,943 4,878,432 2,846,210 1,461,955 1,202,745 10,389,342
Rls 1,141,269 655,484 112,685 3,666,498 653,290 2,588,677 1,200,479 1,909,438 8,108,944
Other Companies Million Rls 21/12/2009 Ghadir Capital & Industry Development Zagros Petrochemical Pardis Petrochemical (Ghadir Urea & Ammoniac) Maroun Petrochemical Eetezad Ghadir Investment Sarouj Boushehr International Iran Alloy Steel Co. Amir Kabir Petrochemical Morvarid Petrochemical Novin Capital Provision Almasader Jabal Ali Ghadir Trade & Industrial Ghadir Iranian Iron & Steel Pars Aryan Investment Ghadir Management Services Kavir Tire Other 2,849,200 1,333,719 1,149,530 751,790 495,000 299,590 244,353 119,439 170,000 80,000 74,737 72,999 104,000 79,481 54,000 47,149 363,956 8,288,943 21/12/2008 2,849,200 1,333,719 1,149,517 751,790 495,000 299,590 147,984 119,439 170,000 80,000 74,737 72,999 104,000 66,234 54,000 50,746 289,989 8,108,944
38
14.3. Details of Groups subsidiary companies based on holding and direct investments of the Parent Company are as follows:
% of Investment Parent Group Company 100 100 76 76 76 99 66 80 100 -
Company Ghadir Management Services Bank Saderat Printing Shahid Bahonar Board Araz Gol Gonbad Golestan Wood Industries International Ghadir Trade Development International Kaspian Foulad Ghadir Trade KSP Co. Construction Development International ASP Baghmisheh Housing Behsan Pars (Nasr Construction) Azarbaijan Construction Waste Water Industry Development Sarpanah Fars Pars Sazeh Construction & Engineering Peyman Ghadir Consulting Engineers Kish Royaye Zendegi Sivan Rahsaz Tisa Kish
Location Iran Iran Iran Iran Iran Iran Iran United Arab Emirates Iran Iran Iran Iran Iran Iran Iran
Main Activity Financial & Consulting Services Printing Services Production of Chip Board Agricultural Products Wood Industries Trade Services Trade Services Trade Services Sell & Purchase of Land, Building & Investment Construction Operations Construction Operations Construction Operations Construction Operations Production of Concrete Pipes Providing Land & Consulting Construction Road Making & Construction Activities Technical Consulting & Engineering Services Construction Operations Road Making Operations Construction Operations
95 95 95 95 58 51 94
22 -
Iran
94
Iran
94
40
72 95 73 -
39
Company Development of Narenjestan Hotel & Building Sakht Beton Pre-fabricated Parts Motojen Momtaz Electric Payvar Andish Sepahan Cement Sepahan Cement Investments Shargh Cement Shargh Cement Products Shargh Coal Mines Direct Investments: Ghadir Capital & Industry Development Kordestan Cement Daryaban Jonoub Eetezad Ghadir Investment Ghadir Trade & Industry Almasader Jabal Ali Karamad Systems South Aluminum Vasepary Sepehr Pars Azar Investment Day Investment Zarrin Persia Investment Alvand Ghadir Development Investment Arman Equipping & Resources Management Sepehr Iranian Insurance Services
Location Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran
Main Activity Construction Operations Production of Concrete Prefabricated Parts Production of Electrical Engines Production of Electrical Engines Parts Rendering Industrial Services Cement Production Investment, Sell & Purchase of Shares Cement Proiduction Production of Cement Production Exploitation of Mines
Iran Iran Iran Iran Iran Dubai Iran Iran Iran Iran Iran Iran Iran Iran Iran
Investment in Cement Industry & Other Industries Cement Production Marine Services Investment Investment & Trade Services Trade Services Designing Systems Aluminum Production Technical & Marketing Services Investment Investment Investment Investment Investment Insurance Services
40
Location Behshahr Development Industries Bahman Production Group Shahid Ghazi Serum Making Iran Kish Card Ney Riz Cement Sarouj Boushehr Kerman Steel Iran Alloy Steel Kavir Tire Bank Saderat Brokerage Ghadir Automobile Leasing Iran Bearing Pardis Petrochemical Zagros Petrochemical Dashtestan Cement Ghadir Iranian Iron & Steel Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran Iran
Main Activity Investment, Sell & Purchase of Shares Automobile Production Production of Human & Animal Serums Credit Card Services Cement Production Cement Production Production of Steel Products Production of Alloy Steel Products Production of Automobile Tires Stock Brokerage Services Credit Services Production of Bearing Petrochemical Products Petrochemical Products Cement Production Production of Steel Products
14.4.1. Despite belonging of 51% shares of Pardis Petrochemical Co. (Ghadir Urea & Ammoniac) to the Group, due to lack of control, the mentioned investment classified in investment in affiliated companies. 14.4.2. Applying special value method to those companies that investment in them are less than 20% is due to having remarkable influence in the investee company.
41
15.1. Long-term portion of accounts and notes receivable based on Group companies is as follows:
Group 21/12/2009 21/12/2008 Million Rls Million Rls 175,511 112,744 866,014 23,205 2,019,105 5,287 3,089,122 725,259 16,462 1,167,824 2,022,289
Note Parent Company Construction Development International Group Motojen Vasepary Sepehr Pars Co. Daryaban Jonoub 7-1 15-1-1
15.1.1. Long-term portion of accounts and notes receivable of Construction Development International Group companies include Rls388,089 million checks received from purchasers of constructed units. 15.1.2. Long-term portion of debt form Group companies include; debt form Zarrin Persia companies (for sales of 499.9 million shares of Construction Development International Co.) and Ghadir Trade & Industry (for sales of 250 million shares of Construction Development International Co.). The decision is to use these amounts for capital increase of the two mentioned companies in the next two years. 15.3. Land and properties based on Group companies are as follows:
Group 21/12/2009 21/12/2008 Million Rls Million Rls 18,256 297,904 23,724 76,013
42
Other Companies
34,795 76,775
13,578 387,495
15.3.1. The balance of land and properties of Vasepary Sepehr Pars Co. at the end of the previous fiscal year include Rls249,467 million cost price of Esfahan Keshavarz Blvd. project, Rls27,658 million cost price of Esfahan Motahhari property and Rls20,779 million cost price of 4 residential apartments and stores in Tehran Tower. Esfahan Keshavarz Blvd. project and Esfahan Motahhari property mainly assigned in the reported year and Rls75,822 million earned profit reflected in Sales & Income from Rendered Services.
618,928
531,276
16-3
7,757 7,757
16.1. Balance of notes payable include Rls20,362 million notes payable of Kalaye Sepehr Pars Co., Rls35,215 million notes payable of Ghadir Capital & Industry Development Co. to Privatization Organization for purchasing shares of Dashtestan Cement Co. Rls54,718 million issued checks by Construction Group companies in favor of Shiraz Municipality for receiving construction licenses and surplus density of Saadi projects and Rls58,532 million balance of notes payable of Kordestan Cement Co. 16.2. Balance of foreign exchange liabilities include Rls88,382 million debt of Almasader Jabal Ali Co. to purchasers of goods and Rls118,350 million debt of Kaspian Foulad Ghadir for cost of purchased goods for sale. 16.3. Debt balance of Bank Saderat include Rls38,207 million debt of Construction Development International Co. for remaining of funds earned from sales of Banks apartments in Tehran Tower and Rls568,616 million debt
43
of Ghadir Trade & Management Services Co. to Bank Saderat for amount of opened letters of credit for purchasing goods.
17.1. Notes payable mainly related to checks paid by Group companies in favor of Tax Affairs Organization. 17.2. Debt balance to Kharazmi Investment Co. include Rls60,803 million and Rls23,076 million debt of Azar and Day Investment companies, respectively. In addition, Rls16,600 million is debt of Vasepary Sepehr Pars Co. 17.3. Debt balance to renters related to Vasepary Sepehr Pars Co. and mainly related to insurance and goods differences amounts and until preparation of these financial statements, the final confirmation have been issued.
44
Rials Advances Received Foreign Exchange Group Companies Sales in Advance of Apartments
1,020
18-1
615,593 778,306
155,443 470,952
83,087 83,087
18.1. Advances received of the Parent Company include amounts received from Ghadir Capital & Industry Development Co. for contract of selling shares of Sepahan Cement, Shargh Cement, Khazar Cement and Hegmatan Cement companies.
Balance at the beginning of the Year Tax Provision during the Year Adjustments of Tax Provision Paid during the Year Balance at the End of the Year
19.2. Summary of income tax situation of performance of the Parent Company from 1993/94 to 2002/03 described in note 12-2-1 and from last year until the date of balance sheet is as follows:
Fiscal Year Ended 21/12/2009 Million Rls Tax Declared Profit Declared Recognized Definite Paid Provision Balance 11,246 Fiscal Year Ended 21/12/2008 Million Rls Provision Balance 11,246 Definite & under Settlement
Fiscal Year
Recognition Method
21.12.1995
46,707
25,336
25,802
19,971
8,725
45
Fiscal Year Ended 21/12/2009 Million Rls Tax Declared Profit Declared Recognized Definite Paid Provision Balance 34,034
Fiscal Year
Recognition Method
22.09.1996
119,949
33,857
57,420
34,034
22.09.1997
204,33
57,501
133,391
56,891
56,891
56,891
22.09.1998
252,601
67,270
80,668
64,788
64,788
64,788
21.12.1999
21,035
300
1,017
779
779
779
21.12.2000
387,437
74,363
84,479
84,025
84,027
84,027
21.12.2001
704,743
76,188
89,246
89,218
89,218
89,218
3,898 -
14 22 258 4,667 -
14 22 233 4,200 -
4,911 345,894
Definite & under Settlement Definite & under Settlement Definite & under Settlement Definite & under Settlement Definite & under Settlement Definite & under Settlement Definite & under Settlement Definite & Settled Definite & Settled Definite & Settled Definite & Settled Definite & Settled Not Surveyed Not Surveyed
Tax Prepayments
(345,894) -
46
21/12/2009 Million Rls Parent Company: Subsidiary Companies Owned by Minority 2,001,318
539,482
523,281
2,540,800
1,853,890
2,001,318
1,330,609
Banks Domestic Banks Overseas Other Resources Long-term Portion of Financial Facilities Received
21.1.1. Financial facilities received from other resources include Rls87,443 million and Rls23,018 million debt balance of Almasader Co. as property loan and Rls41,840 million debt of Kaspian Foulad Ghadir for opened L/Cs, respectively. 21.2. Financial facilities received based on profit rate and commission is as follows:
21/12/2009 Group Parent Company Million Rls Million Rls 771,762 1,001,315 110,145 7,016,314 571,315 8,789,391 681,460
Group
47
2009 2010 2010 2011 3 Last Months of 1390 (2011) & after that
48
Land, Building & Machineries Check & Promissory Note In front of Other Assets (Shares & Banking Deposits)
22.1. Long-term portion of notes payable include Rls47,548 million notes payable to Privatization Organization for purchasing shares of Dashtestan Cement Co. and in tender dated November 18th, 2007. The related installments would be paid within 4 years. 22.2. Debt balance to Kharazmi Investment Co. related to Zarrin Persia Co. for transferring 5% debts of Ghadir Investment Co. for selling shares of Construction Development International Co. to the account of Kharazmi Investment Co. in line with decisions related to capital increase. 22.3. Foreign exchange debt balance to Hambulet Co. related to 10% remaining of cost of purchased production machineries by Sepahan Cement Co. from the mentioned company in the previous years. 22.4. Balance of foreign exchange bills related to Rial equivalent of 5.4 million Mark debt of Shahid Bahonar Board Co. for assignment bills for purchasing machineries from Germany Trepel Co. in the previous years.
49
Balance at the beginning of the Year Paid During the Year Provided Reserve Adjustments Balance at the End of the Year
23.1. Adjustments of provision in the reported year related to the balance of employees work termination benefit at the beginning of the year of Abgineh Co. which has been eliminated due to assignment of its shares and exclusion from consolidation.
24. Capital
The capital of the Parent Company amounted to Rls6,075 billion which includes 6,075 million common shares, with name (Rls1000 each). The last capital increase of the Company according to ratification of the Extra-ordinary General Assembly dated March 29th, 2007, was amounted to Rls1,012.5 billion (20%) from capital reserve and registered at Tehran Trade Institutes and Companies Registrar Office on July 1st, 2007. Composition of shareholders and their percent of ownership at the date of balance sheet are as follows:
No. of Shares Armed Forces Social Security Organization (Sata) Armed Forces Social Security Investment Armed Forces Insurance Funds Armed Forces Pension Fund Bank Saderat Iran Network Other Legal Entities Real Entities 364,530,000 953,667,255 911,250,000 911,250,000 1,600,711,060 1,033,992,144 299,599,541 6,075,000,000 % 6 16 15 15 26 17 5 100
24.1. Share of the Parent Company in ownership of sub companies at the date of balance sheet is as follows:
21/12/2009 No. of Shares Sepahan Cement Group Companies Ghadir Capital & Industry 10,315,000 1,020,000 Cost Price Million Rls 35,220 2,160 21/12/2008 Cost Price Million Rls 60,828 3,668
50
Development Co. Shargh Cement Eetezad Ghadir Investment Shahid Bahonar Board Other
Balance at the beginning of the Year Allocation from Allocable Profit Balance at the End of the Year
26.1. According to Article 52 of the Articles of Association of the Company, ratification of the Extra-ordinary General Assembly dated November 24th, 2008, the net profit from selling shares of the Companys portfolio shall be transferred to capital reserve account every year. After reaching half of the registered capital and receiving license from Tehran Stock Exchange, based upon suggestion of Board of Directors with ratification of Extra-ordinary General Assembly it can be changes into capital. Capital reserve may not be distributed among shareholders until the Company is operating. Only in exceptional cases, the company may transfer up to 20% of the amount that have been transferred to capital reserve in the same year to dividend account upon recommendation of the Board of Directors and approval of the Ordinary General Assembly of the shareholders.
51
52 (17,011) 301,994
(171) 318,953
281,846
281,846
Capital Legal Reserve Other Reserves Capital Increase On-account Retained Profit
52
30.1. Sales of land and properties include Rls2,284,217 million sales of Construction Group Companies (mainly sales of Tehran Tower apartments and other under implementation projects) and Rls75,822 million sales profit of properties (Esfahan Keshavarz Blvd. and Motahhari property projects) by Vasepari Sepehr Pars Co. 30.2. Return on sales and discounts mainly related to Sepahan Cement, Shargh Cement and Motojen. 30.3. Income from rendered services based on the Group companies is as follows:
Year Ended 21/12/2009 Million Rls 178,215 572 2,431 181,218 Year Ended 21/12/2008 Million Rls 51,445 5,582 2,808 59,835
30.4. Income from granted facilities related to income of Vasepary Sepehr Pars Co. which mainly include commission of granted facilities and conducted contracts with Saipa Diesel and Sapco.
31-1 31-2
53
31-3
72,547 4,496,807
14,726 4,254,332
Note Direct Consumable Materials Direct Wage Production Overhead Unabsorbed Costs in Production Total Production Costs Increase in Under Production Inventory Extra Ordinary Wastes Cost Price of Produced Goods Purchase of Produced Goods Increase in Produced Goods Non-productive Consumptions & Adjustments Cost Price of Goods Sold 31-1-1 31-1-2 31-1-3 31-1-4
31.1.1. Decrease in cost of consumable materials in the reported fiscal year compare to the previous year was mainly due to decrease in cost of consumable materials in Motojen Co. and exclusion of Abgineh Co. from consolidation due to assignment. 31.1.2. Direct wage consist of the following items:
Year Ended 21/12/2009 Million Rls 217,157 13,782 11,467 18,419 260,825 Year Ended 21/12/2008 Million Rls 204,599 18,197 23,561 10,364 256,721
Salary, Wage & Benefits Insurance Premium (Employer Quota) Work Termination Benefits Other
Salary, Wage & Benefits Insurance Premium (Employer Quota) Employees Work Termination
54
Benefits Indirect Materials Depreciation Repair & Maintenance of Assets Electricity & Energy Property & Assets Insurance Premium Transport Other
31.1.4. The unabsorbed production expenses mainly related to Shargh Cement, Sepahan Cement and Shahid Bahonar Board companies. 31.2. Cost price of sold land and properties amounted to Rls1,044,862 million related to cost price of assigned properties through Construction Group which mainly related to cost price of sold units from Tehran Tower and other projects under implementation by Construction Development International Co. 31.3. Cost price of rendered services completely related to Construction Development International Group companies. 31.4. Comparison of sales and cost price of goods sold based on type of activities is as follows:
Year Ended 21/12/2009 Sales Cost Price Million Rls Million Rls Cement Industry Companies Almasader Jabal Ali Co. Motojen Group (Electrical Engines) Shahid Bahonar Board Co. Construction Development International Group Companies Ghadir Management Services Co. Bank Saderat Printing Co. Kaspian Foulad Ghadir Co. Glass Production Companies Karamad Systems Management Co. 2,461,388 364,807 708,037 38,798 1,098,220 314,677 562,210 28,802 Year Ended 21/12/2008 Sales Cost Price Million Rls Million Rls 2,229,268 505,408 730,766 59,494 1,125,931 435,584 597,283 41,039
65,581
160,178
117,156
82,941
55
4,990,941
3,379,398
4,836,714
3,380,586
56
Note Dividend of Subsidiary Companies Dividend of Affiliated Companies Dividend of Other Companies Total Profit from Sales of Investments Profit of Participation Bonds & Banking Deposits Other
32-1
32-2 32-3
372,878 372,878
32-4
59,652
4,668 1,086,349
3,528,543
3,354,957
32.1. Dividend of subsidiary companies liable to consolidation includes the following items:
Year Ended 21/12/2009 Million Rls Construction Development International Zarrin Persia Investment Almasader Jabal Ali Ghadir Trade & Industrial Ghadir Management Services Shargh Cement Motojen Eetezad Ghadir Investment Kalaye Sepehr Pars Ghadir Capital & Industry Development Sepahan Cement Other 226,312 497,800 79,262 261,000 122,000 16,112 38,388 67,320 120,800 439,876 45,105 489 1,914,464 Year Ended 21/12/2008 Million Rls 204,530 446,500 73,428 237,000 30,000 13,427 35,912 22,275 48,000 199,944 38,619 6,075 1,355,710
57
Behshahr Development Industries Bahman Production Group Pardis Petrochemical (Ghadir Urea & Ammonic) Zagros Petrochemical Iran Alloy Steel Co. Ghadir Automobile Leasing Shahid Ghazi Serum Making Kavir Tire Bank Saderat Brokerage Other
25,197 58,996 448,800 540,600 129,500 8,657 13,500 36,409 1,650 754 1,264,063
3,844 67,041 918,000 83,622 15,871 13,500 23,703 2,970 2,659 1,131,210
32.3. Dividend of other companies include Rls154,000 million dividend of Maroun Petrochemical Co., Rls730 million dividend of Industry & Mines Leasing, Rls9,538 million dividend of Pars Aryan Investment Co. and Rls25,288 million dividend of Fan Avaran Petrochemical Co. In addition, income of the Parent Company in the previous year as dividend of other companies include Rls680,000 million dividend of Zagros Petrochemical Co. Due to Group follow ups and having remarkable influence in the mentioned company, income of the Parent Company reflected in dividend of affiliated companies as dividend of the said company. 32.4. Profit from sales of investments based on seller companies is as follows:
Year Ended 21/12/2009 Million Rls 121,797 (5,960) (29,675) (150) (11,266) 74,746 (15,094) 59,652 Year Ended 21/12/2008 Million Rls 159,666 16,914 (9,384) (2,370) 916 165,742 25,458 191,200
Note Parent Company Ghadir Capital & Industry Development Co. Eetezad Ghadir Investment Co. Ghadir Trade & Industry Co. Other Net Recognized Profit (Loss) & Goodwill Accumulated Depreciation of Groups Abandoned Companies 32-4-1
58
Year Ended 21/12/2009 Investee Company Sales Million Rls 150,620 6,575 6,174 19,785 183,154 75,134 17,357 10,368 6,045 108,904 292,058 Cost Price Million Rls 65,010 7,759 4,324 26,115 1,454 104,662 40,141 10,395 11,025 3,597 441 65,599 17,261 Profit (Loss) Million Rls 85,610 (1,184) 1,850 (6,330) (1,454) 78,492 34,993 6,962 (657) 2,448 (441) 43,305 121,797
Year Ended 21/12/2008 Profit (Loss) Million Rls 5 42,053 (6,121) (4,531) (608) 30,798 118,715 15,185 368 (5,400) 128,868 159,666
Abgineh Motojen Construction Development International Shahdab Industry & Mine Leasing Other Sales Expenses B) Non-TSE Companies Sulfurine Carbonate Sodium Kerman Steel Industries Saramad Ghadir Investment Azar Glass Industries Other Sales Expenses
59
169,435 472,739
166,658 429,914
11,052 35,745
Note Goodwill Depreciation Unabsorbed Expenses in Production Profit (Loss) from Conversion of Operating Assets & Liabilities Dividend, Participation Bonds & Banking Deposits Increase (Decrease) in Investments Value Profit of Selling Shares in Installments Increase (Decrease) in Assets Value Other
13
8,169
(3,618)
1,767
4,388
1,433
2,053
(22,379)
4,957
39,322
9,480
39,322
9,480
34-1
2,314 43,069
(3,988) 7,545
34.1. Income from increase in assets value amounted to Rls9,606 million related to return of reflected provision in the previous year for value decrease of Construction Development Co. projects.
60
Other
174,537 862,791
49,030 618,338
46,549 151,430
1,849 143,151
35.1. Other financial expenses mainly related to Rls46,234 million and Rls80,296 million commission of purchasing shares in installments expenses by Sepahan Cement companies and Ghadir Capital & Industry Development as well as refinance expense of Vasepary Sepehr Pars Co.
Profit from Sales of Fixed Assets Profit of Participation Bonds & Baking Investment Deposits Dividend of Companies Adjustment of Investments Value Profit from Sales of Investments Loss from Foreign Exchange of Non-operating Assets & Liabilities Other
61
Amendment of Financial Expenses Amendment of the Balance of Ayandeh Saz Fund Account Amendment of the Balance of Investment in Affiliated Companies Retained Difference of Foreign Exchange Conversion Dividend Income Payable Dues Other
37.2. In order to presenting suitable outlook from financial situation and operation results, all relative comparative items in comparative financial statements have been amended and revised. Therefore, some comparative items are not same as financial statements of the previous years.
Operating Profit Depreciation of Fixed Tangible Assets Goodwill Depreciation Net Increase (Decrease) in Provision for Employees Work Termination Benefits Decrease in Short-term Investments Increase in Operating Accounts Receivable Decrease (Increase) in Inventory Decrease (Increase) in Orders & Prepayments Increase in Long-term Investments Increase (Decrease) in Operating Accounts Payable Increase (Decrease) in Advances Received Dividend Received from Affiliated Companies Other Incomes & Expenses
62
1,168,805
3,347,355
441,313
371,196
41.1.1. Granted guarantee by the Parent Company to banks related to loan guarantee of the Groups companies. 41.2. Capital Commitments Capital commitments of the Group companies are as follows:
Company Parent Company Committed Capital of Marjan Petrochemical Co. Sepahan Cement Completion of Product of 3,300 Tons/Day of Clinker Project Shargh Cement Completion of Production Line Unit 4 Other Companies Amount Million Rls 11,050 107,273 100,000 1,611 219,934
63
913,963
261,772
42.2. Transactions of the Parent Company with third parties subject of Article 129 of the Amended Commercial Code during the reported year is as follows:
Transaction Amount Million Rls Sata Investment Common Board Member Sales of Building 310,963 Debt (Credit) Balance at the End of the Year Million Rls (15,000)
Name
Type of Relationship
Transaction Description
334,149
1,518,750
64