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NOTES TO AND FORMING
PART OF THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
201
PAKISTAN OILFIELDS LIMITED
Actuarial gain and losses arising from experience adjustments and change in actuarial
assumptions are charged or credited to equity in other comprehensive income in the period
in which they arise.
Past service costs are recognized immediately in statement of profit or loss.
Since both are complementary plans, combined details and valuation for pension plan and
gratuity plan are given in note 40.
(ii) Separate approved contributory provident funds for management and non-management
employees for which contributions are made by the Company and the employee at the rate of
10% of basic salary.
CAPGAS
The subsidiary is operating a non funded gratuity plan for management and non-management
employees. The liability for gratuity plan is provided on the basis of actuarial valuation conducted as
at June 30, 2020 using the "Project Unit Credit Method".
4.11 Trade and other payables
Liabilities for trade and other payables are carried at cost which is the fair value of the consideration
to be paid in future for goods and services received.
4.12 Contingent liabilities
A contingent liability is disclosed when the Group has a possible obligation as a result of past
events, whose existence will be confirmed only by the occurrence or non-occurrence, of one or
more uncertain future events not wholly within the control of the Group; or the Group has a present
legal or constructive obligation that arises from past events, but it is not probable that an outflow of
resources embodying economic benefits will be required to settle the obligation, or the amount of
the obligation cannot be measured with sufficient reliability.
4.13 Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and impairment
losses except for freehold land and capital work in progress, which are stated at cost.
Depreciation is provided on straight line method at rates specified in note 14.1 to the financial
statements. Depreciation is charged on additions from the month the asset become available for
the intended use upto the month in which these are derecognized.
Maintenance and normal repairs are charged to income as and when incurred. Major renewals and
improvements are capitalized and the assets so replaced, if any, are retired. Gains and losses on
derecognition of assets are included in income currently.