Investor Presentaiton
ANNUAL REPORT
PP
Private Power and Infrastructure Board
ANNUAL REPORT
Private Power and Infrastructure Board
2020
2019
NOTE
(Rupees in thousand)
NOTE
2020
2019
(Rupees in thousand)
13
PROVISION AGAINST PERFORMANCE GUARANTEES ENCASHED
Spencer Powergen Company of Pakistan Limited
13.2
41,046
41,046
14.2.2 The amounts recognized in income and expenditure account are
as follows:
Star Energy Venture Pakistan Limited
13.3
78,400
78,400
Liberty Power Tech Limited
Star Power Generation Company Limited
Kotli Hydropower Project
Gujranwala Energy Limited
13.1 Movement of provision against performance guarantees encashed
23,500
23,500
Current service cost
13.4
450,910
439,520
13.5
84,125
82,000
168,250
164,000
846,231
828,466
Net interest cost
14.2.3 Movement in statement of financial position
Opening liability
Expense for the year
Charged to other comprehensive income
27,720
4,762
26,715
5,503
20
32,482
32,218
Balance at the beginning
Exchange loss
Balance at the end
828,466
650,398
17,765
178,068
846,231
828,466
Contributions paid
Liability to be recognized in the statement of financial position
51,732
111,886
32,482
32,218
(14,761)
(9,784)
(29,298)
(82,588)
40,155
51,732
13.2
13.3
13.4
13.5
Based on order of Islamabad High Court dated 4 April 2013, PPIB had to pay the amount of performance guarantee of
Rupees 33 million along with profits amounting to Rupees 24.51 million. PPIB may be required to pay further amount of
Rupees 41.046 million as per contempt petition vide order dated 20 March 2019 of Islamabad High Court filed by Spencer
Powergen Company of Pakistan Limited which was challenged by the PPIB in Apex court of Pakistan where the matter is
pending adjudication.
In June 1999, Star Energy Venture Pakistan Limited filed a writ petition before Sindh High Court challenging the
encashment of performance guarantee by PPIB and PPIB may be required to pay the said amount.
Star Power Generation Company Limited has filed a writ petition before Sindh High Court challenging the encashment of
performance guarantee by PPIB and PPIB may be required to pay the said amount.
In April 2010, PPIB issued LOS to Mira Power Limited for the establishment of 100 MW Hydropower project on the
Poonch River, near Kotli located in the territory of the State of Azad Jammu and Kashmir (AJ & K). Due to failure to
achieve financial close on the specified date i.e. 29 April 2013, the performance guarantee was encashed on 29 May
2013. As per the agreement of agency between PPIB and AJ & K Council, "The Authorized Agent (PPIB) shall transfer to
the Principal (AJ & K Council), full amount of bank guarantee and bid bond following their encashment in the event of
default by sponsors or project company less any actual legal expenses incurred by the Authorized Agent". In case the
PPIB's act of encashment of performance guarantee is not contested at court of law then after three years this amount
shall be payable by PPIB to AJ & K Council.
13.6 The provision mentioned above are being carried on the basis of management's assessment of related cases. Further,
PPIB is also defending its views before the High Court in connection with the above cases filed by the aforesaid entities.
14.2.4 Based on the actuarial valuation a contribution of Rupees 29.634 million is expected to be paid to the defined benefit plan
during the year ending 30 June 2021.
14.2.5 Changes in the present value of defined benefit obligation are as follows:
Present value of defined benefit obligation at beginning
Current service cost
Interest cost
Benefits paid
Benefits due but not paid
Remeasurement of defined benefit obligation
Present value of defined benefit obligation at 30 June
14.2.6 Changes in the fair value of plan assets are as follows:
Fair value of plan assets at beginning
Expected return on plan assets
Contributions to the fund
Benefits paid
Benefits due but not paid
Remeasurement of plan assets
2020
2019
(Rupees in thousand)
322,670
311,247
27,720
26,715
44,577
26,665
(12,365)
(11,042)
(18,894)
(25,817)
(12,021)
356,785
322,670
270,938
199,361
39,815
21,162
29,298
82,588
(12,365)
(11,042)
(18,894)
(11,056)
(2,237)
Fair value of plan assets at 30 June
316,630
270,938
14.2.7 Composition of plan assets as a percentage of total plan assets of defined gratuity plan are as follows:
2020
2019
NOTE
(Rupees in thousand)
14
STAFF BENEFITS
2020
2019
2020
2019
%
%
(Rupees in thousand)
Leave encashment
Gratuity
14.1
23,779
24,065
14.2
40,155
51,732
63,934
75,797
14.1 Movement of provision for leave encashment is as follows:
Balance at the beginning
24,065
21,752
Bank balances
NIT units
Term deposit receipts
Others
Payables
7.25
1.11
14.03
1.77
22,943
3,524
38,026
4,783
93.44
0.52
(2.32)
100
88.86
2.31
(6.97)
295,849
240,755
100
1,644
(7,330)
316,630
6,267
(18,893)
270,938
Expense for the year
20
16,588
16,382
Payments made during the year
Balance at the end
(16,874)
23,779
(14,069)
2020
2019
24,065
14.2 Gratuity
14.2.8 Principal actuarial assumptions used in the actuarial valuation are as follows:
Discount rate
8.50%
14.25%
Future salary increase
8.50%
14.25%
The latest actuarial valuation was carried out as at 30 June 2020, using the projected unit credit method. The amounts
recognized in financial statements are determined as follows:
Expected return on plan assets
14.25%
9.00%
Withdrawal Rates
Age-Based
2020
2019
Mortality Rates
NOTE
(Rupees in thousand)
14.2.1 The amounts recognized in the statement of financial position
are as follows:
Adjusted SLIC
2001-2005
Setback 1
Year
Age-Based
Adjusted SLIC
2001-2005
Setback 1 Year
Present value of defined benefit obligation
Fair value of plan assets
14.2.5
14.2.6
356,785
(316,630)
40,155
322,670
(270,938)
51,732
167
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