Lanka Bangla Finance Limited

Compliance with BAS, IAS& IFRS

Report 2013& 2012
Basis of Accounting
Financial Statements of Lanka Bangla have been prepared under historical cost convention
following accrual basis of accounting and in compliance with the requirements of Companies
Act 1994, Bangladesh Accounting Standards( B A S ), Bangladesh Financial Reporting Standards
(BFRS) and Financial Institution Act 1993.

Separate Books of Accounts

The company maintains separate office and books of accounts for the merchant banking
operation as required under the regulations of Bangladesh Securities and Exchange Commission.

Merchant Banking Operation

Revenues are recognized on accrual basis. Merchant Banking income are recognized from the
trading of shares, dividend from the holding of shares, commission on share trading by
customers and interest on loan. Dividend income from the holding of shares is recognized on
declaration basis.

Profit or Loss on Sale of shares

P r o f it or loss arising from the sale of shares is accounted for on cash basis.

Borrowing Costs
Borrowing costs are recognized as expenses in the period in which they are incurred in
accordance with benchmark treatment of BAS 23.

Revenue Recognition
As per BAS 18, revenue is recognized when it is expected that the economic benefits associated
with the transaction will flow to Company and the amount of revenue and the cost incurred or to
be incurred in respect of the transaction can be measured reliably.

Accounting for Leases

Books of accounts for leasing operation has been prepared following the criteria of Bangladesh
Accounting Standard 17 (BAS 17) under Financing Method since assets leased out to customers
under lease agreements transfer substantially all the risks and rewards associated with the
ownership of the assets, other than legal title, to customers and all leases are full payout leases.
In accordance with BAS 17 the aggregate lease receivables including the unguaranteed residual
value throughout the primary lease term are recorded as gross receivable while the excess of
gross receivable over acquisition cost including the interest during period of acquiring lease
assets constitutes the unearned lease income. The unearned income is recognized as revenue over
the lease period generating a constant rate of return over lease period.

Fixed Assets

Freehold assets are recognized at cost of acquisition less accumulated depreciation with
impairment losses, if any, in compliance with the benchmark treatment of BAS 16 "Property,
Plant and Equipment

Environmental Disclosure FOR GSP Finance

Environment Related Initiatives

Lanka Bangla takes environmental stewardship ahead of each year realizing the present
generations responsibility to the future. By adopting Environmental Risk Management (ERM)
Guidelines for Banks and Financial Institutions in Bangladesh, Lanka Bangla closely monitors
the environmental impact of every steps and effectively mitigates any risks arise thereon

CSR FOR GSP Finance for 2013 & 2012

Corporate Social
Responsibility (CSR)
Corporate Social Responsibility has always been an integral part of Lanka Banglas culture and
the cornerstone of our core values of good corporate citizenship. We believe our business
financing is to not only tie with the business progress but also with the development of the
overall economic growth that drives the development of the national at large. We believe our
success lies in the stewardship in Triple Bottom Line for sustainability. This believes is
reflected on our Mission and our day to day business operation. In this document on Corporate
Social Responsibility Report - we are proud to share how actions support our mission to
encompass economic, social and ecological value to our stakeholders.
Supporting Education of Underprivileged Brilliant Students

We are inspired to a knowledge based society. In Bangladesh ,we continued to support

underprivileged brilliant students who are fighting against darkness to enlighten the society .We
are awarding scholarship to such kind of poor but meritorious students, who obtained GPA-5 in
SSC & HSC Examination, every year since 2009 and by 2013 our contributions and
commitments is total BDT 2,544,000.00 to 70 (seventy)students. We are committed to support
them till completion of their Post Graduation. And the number of student will beaded in every
year.
ECD (Early Childhood Development) education programs

We have extended our hands to two organizations too which are organizing informal education
programs in the slum areas of Dhaka City Corporations. Eminence is operating some ECD (Early
Childhood Development) education programs for the underprivileged children in slum areas to
support them keeping education track. We have provided Eminence an amount of one years
operating cost to run one ECD Centre in 2012. CCP Foundation also operating same kind of
informal education for the underprivileged children in Slum area of Uttar, we also support their
one years operating cost for the centre.
Helping Victims of Natural Calamities

Bangladesh remains the most vulnerable to the impacts of climate change and gets affected in
natural calamities, like flood, cold wave etc. almost every year. When our countrymen get
affected in calamities we support the affected communities by extending relief to the victims and
their loved ones. This year we distributed 2,000 pcs blankets to the underprivileged peoples of
Rangpur, Kurigram & Lalmonirhat.
Support to Boost Up Children for Better Future

LB Foundation have organized Art Camp for the School Children under the slogan of Borner
Uthsashe Bangla Amar in Chittagong in 2013 to boost up their thinking capacity which will
help them to be more vigilant in education and lead to a brighter future. LB foundation provided
BDT 140,013 to organize the program. LB Foundation has a plan to initiate such programs in
future on regular basis.
Prime Minister Relief fund (Rana Plaza)

At Lanka Bangla, we also raised our hands to support the victims of Rana Plaza, at Savar, Dhaka.
We provided BDT2,500,000.00 to PM relief fund.

Audit report FOR Lanka Bangla Finance for 2013& 2012

Opinion
In our opinion, the Financial Statements have been prepared in accordance with Bangladesh
Accounting Standards (BAS)and Bangladesh Financial Reporting Standards (BFRS) give a true
and fair view of the state of the affairs of the Company as of December 31, 2013 and of the
results of its operations and its cash flows for the year ended and comply with the Companies
Act 1994, Securities and Exchange Commission Rule 1987, Dhaka Stock Exchange Rule 1954,
Chittagong Stock Exchange Rule 1995 and other applicable laws and regulations.

Report on Other Legal and Regulatory Requirements

We also report that;
a) We have obtained all the information and explanations which to the best of our knowledge and
belief were necessary for the purpose of our audit and made due verification thereof;
b) In our opinion proper books of account as required by law have been kept by the company so
far as it appeared from our examination of those books;
c) The companys Statement of Financial Position, Statement of Comprehensive Income and
Statement of Cash Flow dealt with by the report are in agreement with the books of accounts;

Performance Analysis for Lanka Bangla Finance 2013&2012:

Basic earnings per share (EPS) disclosure under BAS-33

31-dec-2013

31-dec-2012

Net profit for the year

6290127

14612151

Weighted average number of ordinary share

50000000

50000000

Basic earnings per share

12.58

29.22

Earnings per Share (EPS):

Basic earnings per share (EPS)

Net profit after Tax
Number of Ordinary Shares Outstanding (Note: 44.01)
Earnings per Share (EPS)

484,752,512
192,501,400
2.52

259,683,745
192,501,400
1.35

Earnings per Share have been calculated in accordance with BAS-33: Earnings per Share
(EPS).

D/P ratio for Lanka Bangla

31-dec-2013
Dividend
Net income
D/P Ratio

31-dec-2012

3,670,843

11,535,926

6290127

14612151

35.00

25.31

Net asset value per Share

Total Asset
Total liabilities

31-dec-2013

31-dec-2012

4712317250
(3135217200)

2975741216
(1960019521)

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Number of share outstanding

Net asset value per Share
Net profit margin % For GSP
Net profit margin % for 2013 16.13
Net profit margin % for 2012 22.78

Return on assets for GSP

Return on asset for 2013
Return on asset for 2012

2.14
2.97

1577100050

1015721695

111750053
14.11

54247599
18.72