| Element List |
Explanation |
| Reason for increase (decrease) in net profit for current year compared to last year |
The increase in net profit during the current year is mainly due to an increase in revenues of approximately SAR 9 million, as a result of increase in Advertising sector revenues by SAR 3.2 million and Distribution sector by SR 7.6 million after the restructuring and expansion of the sales team, along with decrease in Books and Retail sector revenues by around SAR 1.8 million, in addition to the decrease in general and sales expenses by about SAR 3.4 million and the decrease in the Zakat provision by SAR 3.2 million. This net profit increase was partially offset by a net decrease in other income of SAR 1.5 million, a decrease of SAR 3.5 million in other income from settlement of advertising lease contracts after receiving the final settlement on some contracts, in return other revenues from service fees, settlement of credit balances and provisions no longer required increased by around SAR 2 million. Cost of sales increased by around SAR 10 million due to the increase in Distribution sector cost of sales of around SAR 4 million as a result of the increase in sales, an increase in Advertising sector cost of sales of around SAR 7.2 million as a result of an increase in advertising site rental cost and accruals to provide for the risk of increased rental charges, Cost of sales for Bookstores and Retail sector decreased by SAR 1.1 million as a result of the drop in sales. During the previous year, the Company recognised around SAR 1.1 million as gain from disposal of it's stake in Ad Art Median Company (a subsidiary). The Company's share of the profits of the associates decreased by approximately SAR 1.7 million, in addition to an increase in financial expenses by SAR 0.9 million. |
| Type of the external auditor's opinion |
Qualified opinion |
| External auditor's report containing reservation |
The Auditor 's Report includes the following qualifications: As disclosed in note (7) We have not been able to determine the impact of the non-issuance of the financial statements of the associate and the Group did not recognize any profits or losses on investment in United Advertising Limited Company for the years ended 2018, 2017, 2016 and 2015 and the Group did not recognize any profits or losses on investments in Tihama Contemporary Media Company and Tihama New Media Company for the year ended 2018, and the Group relied on the management accounts prepared by the management of the associates in recording the share of results from the associate JWalter Thompson MENA Company. Accordingly, and we were unable to obtain adequate and appropriate audit evidence directly or through alternative audit procedures to determine the Group's share of the change in net assets of the entity invested in. Accordingly, we are unable to determine whether any changes to the consolidated financial statements are necessary. As disclosed in note (3/2/5) The consolidated financial statements include an investment in a subsidiary company, International Advertising Services Limited, whose financial statements have not been consolidated as its financial statements have not been issued since the year 2012 due to seizure of the company's operations as of 16 November 2011. We have not been able to obtain sufficient and appropriate audit evidence directly or through alternative audit procedures to determine the effect of this matter on the correctness of the disclosed consolidated financial statements. Accordingly, we are unable to determine whether any changes to the consolidated financial statements are necessary. Significant uncertainty relating to continuity as a going concern : We would like to draw attention to note (2/4) to the consolidated financial statements and liquidity management, as explained in note (2/4) these events or circumstances indicate a material uncertainty, It may cast serious doubt that the company's ability to remain as a going concern, and our opinion on this matter has not been modified. The Auditor 's Report draws the attention to the following: We would like to draw the attention to note (22) in the condensed consolidated Financial statements which states that Tihama Modern Bookstores Company and Tihama International Advertising Company have not submitted Zakat declarations since formation, in addition Istidama International Real Estate Company has not submitted its Zakat declarations for the years since 2013. The management of the subsidiaries have made provisions for Zakat annually. |
| Reclassifications in annual financial results |
The Group has early adopted International Financial Reporting Standard IFRS (16) Leases as from 1 April 2018 using the full retroactive application methodology. Consequently, the cumulative effect of the adoption of IFRS 16 was recognized as an adjustment to the opening balance of accumulated losses, accordingly certain changes have been made in the Company's financial statements in the measurement, presentation and disclosure method for the current and comparative periods in accordance with the accounting policies adopted and in accordance with the requirements of the International Financial Reporting Standards adopted in Saudi Arabia, in addition certain comparative amounts have been reclassified to conform to the current year presentation. |
| Additional Information |
Earnings per share for the current year were calculated on the net profit attributable to equity holders of the parent company of SAR 5.2 million based on the weighted average number of shares issued as of 31 March 2019 of 7,500,000 shares, the earnings per share for the comparative year was calculated on the net profit attributable to equity holders of the parent company of SAR 3.2 million based on the weighted average number of shares issued as of 31 March 2018 of 7,767,857 shares, on 13 April 2017 the share capital was reduced by canceling 7,500,000 shares, the number of shares issued after the reduction was 7,500,000 shares. Accumulated losses amounted to SAR 11.5 million and 15.3% of share capital as of 31 March 2019. |
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