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NOTES TO AND FORMING
PART OF THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
198
PAKISTAN OILFIELDS LIMITED
3.2
Further, the following new standards and interpretations have been issued by the International
Accounting Standards Board (IASB), which are yet to be notified by the Securities and Exchange
Commission of Pakistan (SECP), for the purpose of their applicability in Pakistan:
IFRS 1 First-time Adoption of International Financial Reporting Standards
IFRS 17 Insurance contracts
3.3
The following interpretations issued by the IASB have been waived off by SECP:
IFRIC 12 Service concession arrangments
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
4.1 Basis of measurement
These financial statements have been prepared under the historical cost convention except as
otherwise disclosed in the respective accounting policies notes.
4.2 Basis of consolidation
The consolidated financial statements include the financial statements of POL and its subsidiary
CAPGAS with 51% holding (2019: 51%).
a)
Subsidiary
Subsidiaries are all entities (including structured entities) over which the Group has control. The
Group controls an entity when the Group is exposed to, or has right to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power over the
entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group.
They are deconsolidated from the date that control ceases.
The assets and liabilities of subsidiary company have been consolidated on a line by line basis and
the carrying value of investments held by the parent company is eliminated against the subsidiary
shareholders' equity in the consolidated financial statements.
Material intra-group balances and transactions have been eliminated.
Non-controlling interests are that part of the net results of the operations and of net assets of the
subsidiary attributable to interests which are not owned by the parent company. Non-controlling
interest are presented as a separate item in the consolidated financial statements.
b)
Associates
Associates are all entities over which the Group has significant influence but not control, generally
accompanying a shareholding of between 20% and 50% of the voting rights. Investment in
associates are accounted for using the equity method of accounting. Under this method, the
investment is initially recognized at cost, and the carrying amount is increased or decreased to
recognise the investor's share of the profit or loss of the investee after the date of acquisition. The
Group's investment in associates includes goodwill identified on acquisition.