d Ftl Annual Report 2014

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CONTENTS

Page No.

Vision and Mission Statements ................................................................................................... 01

Core Values ................................................................................................................................ 02

Corporate Information ................................................................................................................. 03

Directors Report to the Shareholders ......................................................................................... 05

Shariah Review Report ................................................................................................................ 10

Auditors Report to the Members ................................................................................................. 11

Financial Statements ................................................................................................................... 13

Statement of Directors ................................................................................................................. 61

Certificate of Appointed Actuary .................................................................................................. 62

Pattern of Shareholding ............................................................................................................... 63

Notice of Annual General Meeting ............................................................................................... 65

Proxy Form ..................................................................................................................................


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Corporate InformationAs on December 31, 2014


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Group / Alternative Distribution


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Insurer

254,393,851

179,748,721

(434,142,572)

(39,266,403)

(24,305,569)


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49%


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Through SRO 16(I)/2012 issued on January 09, 2012 by the SECP the minimum solvency requirement

for Insurance/Takaful companies have been significantly increased, alongside the Rules also provided

an option that Insurance/Takaful may opt to maintain the increased solvency in aggregate.

As a newly established Shariah Compliant Takaful Company with minimal surpluses in its statutory fund,

your Board had naturally decided to maintain the solvency in aggregate and applied for the grant of

permission to maintain aggregate solvency margin through letter No. SEC/12-08/31 dated August 8,

2012. In response to the application SECP has called up an undertaking by the board, certified copy of

the minutes which were duly provided and we are awaiting SECPs response.

There is precedent in the market, where SECP has accommodated Company(ies) in the sector on

solvency matter and it is likely that DFTL would also be obliged. DFTL has got only one Waqf, therefore,

it is appropriately justified to calculate aggregate solvency for that one Waqf; instead two separatesolvencies for each fund. The external auditors and actuary confirm that DFTL is complaint, if aggregate

solvency is calculated for the Waqf.

Subsequent to the balance sheet date on April 30, 2014, the Shareholders Fund had transferred an

investment of Rs.10 million as Qard-e-Hasna in its Group Family Takaful Fund to comply with solvency

requirement under Insurance Ordinance, 2000.

The Auditors of the Company has also highlighted the matter in their Auditors Report to the Member

and detail of transaction has been disclosed in Note 29 to the Financial Statements for the year ended

December 31, 2014.

Except for the above matter, there have been no material changes since December 31, 2014 to date

of this report and the Company has not entered into any material commitment during this period which

would adversely affect the financial position of the Company.

Karachi, May 08, 2015 Chief Executive Officer


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SHARIAH REVIEW REPORT

We have conducted the Shariah Compliance Review of Dawood Family Takaful Limited (the

Company) for the year ended December 31, 2014.

The Shariah Compliance Review principally involves review of the Companys compliance with

the Shariah principles throughout the year including examination of annual financial statements

prepared by the management of the Company.

In our opinion and to the best of our knowledge and belief, the transactions undertaken and the

policies followed by the Company during the year and the financial statements of the Company

for the year ended December 31, 2014 were in compliance with Shariah principles.

Date: April 02, 2015Karachi

Prof. Mufti Munib-ur-Rehman

Chairman

Mufti Syed Sabir Hussain

Member

Mufti Syed Zahid Siraj

Member


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AUDITORS' REPORT TO THE MEMBERS

We have audited the annexed financial statements comprising of:

i) balance sheet;

ii) profit and loss account;

iii) statement of comprehensive income;

iv) statement of cash flows;

v) statement of changes in equity;vi) revenue account;

vii) statement of contributions;

viii) statement of claims;

ix) statement of expenses; and

x) statement of investment income

of Dawood Family Takaful Limited(the Company) as at 31 December 2014together with

notes forming part thereof, for the year then ended.

It is the responsibility of the Companys management to establish and maintain a system of

internal control and prepare and present the financial statements in conformity with the

approved accounting standards as applicable in Pakistan and the requirements of the Insurance

Ordinance, 2000 (XXXIX of 2000) and the Companies Ordinance, 1984 (XLVII of 1984). Our

responsibility is to express an opinion on these statements based on our audit.

We conducted our audit in accordance with the auditing standards as applicable in Pakistan.

Those standards require that we plan and perform the audit to obtain reasonable assurance

about whether the financial statements are free of material misstatement. An audit includes

examining, on a test basis, evidence supporting the amounts and disclosures in the financial

statements. An audit also includes assessing the accounting policies used and significant

estimates made by management, as well as, evaluating the overall financial statementpresentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion:

(a) proper books of account have been kept by the Company as required by the Insurance

Ordinance, 2000, and the Companies Ordinance, 1984;


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-: 2 :-

(b) the financial statements together with the notes thereon have been drawn up inconformity with the Insurance Ordinance, 2000, and the Companies Ordinance,1984, and accurately reflect the books and records of the Company and are furtherin accordance with accounting policies consistently applied, except for the changesin accounting policies as stated in notes 5.1 and 5.2 to the financial statementswith which we concur;

(c) the financial statements together with the notes thereon present fairly in all materialrespects, the state of the Companys affairs as at 31 December 2014, its loss,comprehensive loss, cash flows and changes in equity for the year then ended inaccordance with approved accounting standards as applicable in Pakistan and

give the information required to be disclosed by the Insurance Ordinance, 2000and the Companies Ordinance, 1984;

(d) the apportionment of assets, liabilities, revenue and expenses between two ormore funds has been performed in accordance with the advice of the appointedactuary; and

(e) zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of1980), was deducted by the Company and deposited in the Central Zakat Fundestablished under Section 7 of that Ordinance.

We draw attention to note 29 to the accompanying financial statements which states thatthe Company had a shortfall of Rs.9.3 million in the Group Family Takaful Fund as at 31December 2014 in the solvency margin required under the Insurance Ordinance, 2000.

Our opinion is not qualified in respect of the above matter.

Chartered Accountants

Audit Engagement Partner: Shabbir Yunus

Date: 08 May, 2015

Karachi


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30


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PROFIT AND LOSS ACCOUNTFOR THE YEAR ENDED DECEMBER 31, 2014


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STATEMENT OF COMPREHENSIVE INCOMEFOR THE YEAR ENDED DECEMBER 31, 2014


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STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED DECEMBER 31, 2014


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STATEMENT OF CASH FLOWSFOR THE YEAR ENDED DECEMBER 31, 2014


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REVENUE ACCOUNTFOR THE YEAR ENDED DECEMBER 31, 2014

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REVENUE ACCOUNTFOR THE YEAR ENDED DECEMBER 31, 2014


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STATEMENT OF CONTRIBUTIONSFOR THE YEAR ENDED DECEMBER 31, 2014


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STATEMENT OF CLAIMSFOR THE YEAR ENDED DECEMBER 31, 2014


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STATEMENT OF EXPENSESFOR THE YEAR ENDED DECEMBER 31, 2014


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STATEMENT OF INVESTMENT INCOMEFOR THE YEAR ENDED DECEMBER 31, 2014


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NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED DECEMBER 31, 2014


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treaties



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derivative.



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approved.



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08 May, 2015by the Board of Directors of the Company.



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Statement of DirectorsAs per the requirement of Section 46(6) and Section 52(2) of the Insurance Ordinance, 2000

Section 46(6)

a) In our opinion the annual statutory accounts of Dawood Family Takaful Limited, set out in the

forms attached to the statement have been drawn up in accordance with the Ordinance and

any rules made there under;

b) Dawood Family Takaful Limited has at all times in the year complied with the provisions of the

Ordinance and the Rules made there under relating to paid-up capital, solvency and reinsurance

arrangements, with exception of solvency in Group Family Takaful Fund, which complied with

the provisions of the Ordinance and the Rules at all times in the year except for specifically

on December 31, 2014.

c) As at December 31, 2014, Dawood Family Takaful Limited continues to be in compliance with

provisions of the Ordinance and the Rules made there under relating to paid-up capital,

solvency and reinsurance arrangements, with exception of solvency in Group Family Takaful

Fund. In 2012, the Company had applied for the permission to maintain solvency margin in

aggregate, but still the matter is pending. The Company is solvent on aggregate basis howeverconsidering the solvency of each statutory fund separately, the Group Family Takaful Fund

of the Company had shortfall of Rs.9.3 million as at December 31, 2014. Therefore, to meet

the solvency requirements, on April 30, 2015, Shareholders Fund has transferred an investments

of Rs.10 million as Qard-e-Hasna in its Group Family Takaful Fund.

Section 52(2) (c)

d) In our opinion, the Shareholders Fund (SHF) and the Individual Family Takaful Statutory Fund

of Dawood Family Takaful Limited complies with the Solvency requirements of the Insurance

Ordinance, 2000, and the Insurance Rules, 2002. However, the Group Family Takaful Fund

of the Company had shortfall of Rs.9.3 million to meet the solvency requirements. Therefore,on April 30, 2015, Shareholders fund has transferred an investments of Rs.10 million as Qard-

e-Hasna in its Group Family Takaful Fund.


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I, Shujat Siddiqui, of Akhtar & Hasan (Private) Limited, being an Actuary duly qualified under the

terms of the Insurance Ordinance, 2000, and being the Appointed Actuary of Dawood Family Takaful

Limited, do hereby certify as under:

(a) that in my opinion, the participants liability included in the Companys balance sheet as at31 December 2014 has been determined in accordance with the provisions of the Insurance

Ordinance; and

(b) the Shareholders Fund (SHF) and the Individual Family Takaful Statutory Fund comply

with the solvency requirements of the Insurance Ordinance as at 31 December 2014, while

the Group Family Takaful Statutory Fund had a deficit amounting to Rs 9.3 million. I have

been informed by the Company that a Qard-e-Hasna amounting to Rs 10 million was made

on 30 April 2015 by the Shareholders Fund to the Group Family Takaful Statutory Fund.

Shujat Siddiqui, MA, FIA, FPSA

Appointed Actuary

8 May 2015th

Ce r t i fi ca t e u n d e r S e c t io n 5 2 (2 )

o f t h e In s u r a n c e O rd i n a n c e , 2 00 0


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Number of Total Number

Shareholders From To of Shares Held

8 101 - 500 4,000

12 501 - 1,000 12,000

21 1,001 - 5,000 61,000

7 5,001 - 10,000 57,500

2 10,001 - 15,000 28,000

3 15,001 - 20,000 59,500

1 25,001 - 30,000 30,000

1 35,001 - 40,000 40,0009 45,001 - 50,000 450,000

1 65,001 - 70,000 70,000

1 75,001 - 80,000 80,000

10 95,001 - 100,000 999,990

2 120,001 - 125,000 246,000

1 130,001 - 135,000 135,000

2 145,001 - 150,000 300,000

6 195,001 - 200,000 1,200,000

1 225,001 - 230,000 230,000

3 245,001 - 250,000 750,000

1 255,001 - 260,000 257,000

4 295,001 - 300,000 1,200,000

1 320,001 - 325,000 325,000

8 495,001 - 500,000 4,000,000

1 695,001 - 700,000 700,000

2 995,001 - 1,000,000 2,000,000

1 1,995,001 - 2,000,000 2,000,000

1 2,720,001 - 2,725,000 2,722,500

1 3,495,001 - 3,500,000 3,500,000

1 3,915,001 - 3,920,000 3,919,000

1 4,980,001 - 4,985,000 4,983,5001 6,060,001 - 6,065,000 6,064,000

1 6,465,001 - 6,470,000 6,466,010

1 7,395,001 - 7,400,000 7,400,000

1 11,245,001 - 11,250,000 11,250,000

1 13,455,001 - 13,460,000 13,460,000

118 75,000,000

Pattern of Shareholding as on December 31, 2014

Shareholdings


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Categories of Shareholders as on December 31, 2014

Shareholder's Number of Number of Percentage

Category Shareholders Shares Held

Directors, Chief Executive Officer

and their spouse and minor child 12 5,887,000 8%

Modaraba 1 7,400,000 10%

Banks and Financial Institutions 5 31,032,500 41%

Other Companies 12 7,769,000 10%

Foreign Company 1 6,064,000 8%

General Public - Local 83 10,131,000 14%

- Foreign 1 500 0%

Others 3 6,716,000 9%

118 75,000,000 100%

Detail of Shareholders

Associated companies and related parties

BRR Guardian Modaraba 7,400,000 9.87%

First Dawood Investment Bank Limited 13,460,000 17.95%

Dawood Capital Management Limited 2,722,500 3.63%

Dawood Equities Limited 3,919,000 5.23%

27,501,500

Shareholders holding 10% or more

First Dawood Investment Bank Limited 13,460,000 17.95%The Bank Of Khyber 11,250,000 15.00%

24,710,000


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Company Secretary


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May 30, 2015


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Head Office:1701-A, Saima Trade Towers, I.I. Chundrigar Road, Karachi-74000

UAN: 111-DFT-786 (111-338-786) Fax: (92-21) 3227-7188

Country WideBranch NetworkGulshan Branch (Karachi)FL 3/9, Block No 3, Scheme-24,Gulshan-e-Iqbal, Karachi.Phone : (+92 21) 34970576-80Fax : (+92 21) 34970575

Bahadurabad Branch (Karachi)Office No 302 & 303 3rd Floor, MeriumsComplex, Bahadurabad Karachi.Phone : (+92 21) 34145441-6

Hyderabad BranchPlot -325, 2nd Floor, Block C Unit VII,Latifabad-Hyderabad.Phone : (+92 22) 3865326-7 3865330-1Fax : (+92 22) 3865318

Sukkur Branch1st Floor, City Survey No. B-3403/2/M/4,Workshop Road, Near Hira Medical Center,Sukkur.Phone : (+92 71) 5615751-3

Larkana BranchGround Floor, Near Shaheed ShahnawazChildern Park, LarkanaPhone : (+92 74) 4040383-6

MirpurKhas Branch1st Floor, City Survey # 716 & 718 TourabadUmerKot Road Above Faisal Bank, MirpurKhasPhone : (+92 23) 3876127-28Fax : (+92 23) 3876129

Nawabshah BranchPlot B-599, 2nd Floor, Above Askari BankKatchery Road NawabshahPhone : (+92 244) 366295-97Fax : (+92 244) 366296

Tando Adam Branch1st Floor Al Rahim Plaza Above Bank AlfalahHyderabad Road Tando AdamPhone : (+92 23) 5576113-15Fax : (+92 23) 5576112

Gulberg Branch (Lahore)1st Floor, Burj Bank Building, 57-B, HussainChowk, Gulberg-III, Lahore.Phone : (+92 42) 111- 338-786Fax : (+92 42) 35772618

Pioneer Branch (Lahore)2nd Floor, Burj Bank Building, 57-B,Hussain Chowk, Gulberg-III, Lahore.Phone : (+92 42) 111- 338-786Fax : (+92 42) 35772618

Royal Branch (Lahore)2nd Floor, Burj Bank Building, 57-B, HussainChowk, Gulberg-III, Lahore.Phone : (+92 42) 111- 338-786Fax : (+92 42) 35772618

Shaheen Branch (Lahore)

Falcon Branch (Lahore)E-26, 3rd Floor, Paradise Centre,Walten Road, LahorePhone : (+92 42) 36688253-57Fax : (+92 42) 36626290

Eagle Branch (Lahore)E-26, 3rd Floor, Paradise Centre, Walten Road,LahorePhone : (+92 42) 36688253-57Fax : (+92 42) 36626290

Gujrat BranchDawood Center, Opp. UBL, G.T Road, GujratPhone : (+92 53) 3538073-6 3538078-3538085Fax : (+92 53) 3538088

Chenab Branch (Gujrat)Dawood Center, Opp. UBL, G.T Road, GujratPhone : (+92 53) 3538073-6 3538078-3538085Fax : (+92 53) 3538088

Kharian Branch1st Floor, Above NIB Bank, G.T Road, Kharian.Phone : (+92 53) 7602180-94-96

Faisalabad Branch

871-B 2nd Floor, Hassan Arcade Peoples ColonyNo.1, Chen Road FaisalabadPhone : (+92 41) 8554212-8554113-114vttFax : (+92 41) 8554117

Lyallpur Branch871-B 1st Floor Hassan Arcade Peoples ColonyNo.1, Chen Road FaisalabadPhone : (+92 41) 8554212-8554113-114Fax : (+92 41) 8554117

Jhang Branch1st Floor, Sunny Heights, Church Road,Saddar, Jhang.Phone : (+92 47) 7626648-49Fax : (+92 47) 7626691

Mandi Bahauddin Branch2nd Floor, Qasim Plaza, Phalia Road,

Mandi, Bahauddin.Phone : (+92 54) 6502311-13Fax : (+92 54) 6502314

Sargodha Branch1st Floor, Nizami Centre, Club Road,Shama Chowk, SargodhaPhone : (+92 48) 3768774-76Fax : (+92 48) 3768773

Sahiwal Branch3rd Floor, Saeed Centre,Fareed Town Road, Sahiwal.Phone : (+92 40) 4221531-33Fax : (+92 40) 4221534

Multan Branch1st Floor, Khawar Centre, 92-Nusrat Road,SP Chowk Multan Cantt Multan

Bahawalpur Branch2nd Floor, 1-A, Muhammadia Colony,Noor Mehal Road, BahawalpurPhone : (+92 62) 2887680-5

Sialkot Branch1st Floor, Opposite by Jamia Naumania Rizvi,near Shaheen CNG, Shahab Pura Road,SialkotPhone : (+92 523) 3550471-74

Rahimyar Khan Branch15-A, 2nd Floor, Model Town, Shahi Road,Rahim Yar KhanPhone : (+92 68) 5880191-94

Islamabad Branch1st Floor Shalimar Plaza 99-West Blue AreaIslamabadPhone : (+92 51) 2814401-15Fax : (+92 51) 2814411

Rawalpindi Branch2nd Floor, B-414, Satellite Town,Rawalpindi.Phone : (+92 51) 4571841-49Fax : (+92 51) 4571851

Adiyala Rawalpindi Branch2nd Floor, Abdullah & Brothers Plaza,Khawaja Corporation, Adiyala Road,RawalpindiPhone : (+92 51) 5187167-68

Peshawar BranchOffice No 4,5,6&7, 4th Floor, Syed's Towers,Opp. Income Tax Office, University Road,Peshawar.Phone : (+92 91) 5846617-20Fax : (+92 91) 5846614

Peshawar Cantt Branch2nd Floor, Jasmine Arcade, Fakhar-e-Alam Road,Peshawar CanttPhone : (+92 91) 5275055

Mardan BranchPoshak Centre Shaheen Market, Bank Road,MardanPhone : (+92 93) 7870300-01Fax : (+92 93) 7870302

Abbotabad BranchFirst Floor, Haidri Plaza,Near ArmiBurn Hall College, Mansehra Road,Mandian Abbotatad.Phone : (+92 992) 383216,383178Fax : (+92 992) 383191

Swat BranchFirst 1st Floor Shahzad Plaza Makan BaghSaidu Sharif Road Mingora SawatPhone : (+92 946) 723972-721502Fax : (+92 946) 721503

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