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Lipjan, Kosovo
and
Independent Auditors Report
1
Contents
Page
Independent auditors report 3
Statement of financial position 5
Statement of comprehensive income 6
Statement of changes in equity 7
Statement of cash flows 8
Notes to financial statements 9-24
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Sejdi Kryeziu 15, kati 3
Lagjja Pejton
10 000 Prishtina, Kosovo
info@bakertillykosovo.com
www.bakertillykosovo.com
Opinion
We have audited financial statements of Beta Sh.p.k. (the Company), which comprises the statement of
financial position as at 31 December 2016, and the statement of comprehensive income, statement of
changes in equity and cash flow statement for the year then ended, and notes to the financial statements,
including a summary of significant accounting policies.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial
position of the Company as at 31 December 2016, and its financial performance and its cash flows for the
year then ended in accordance with International Financial Reporting Standards (IFRSs).
Basis Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditors Responsibilities for the Audit of the
Financial Statements section of our report. We are independent of the Company in accordance with the ethical
requirements that are relevant to our audit of the financial statements in Kosovo, and we fulfilled our
other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide a basis for our opinion.
Responsibilities of Management and Those Charged with Governance for the Financial
Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with IFRSs, and for such internal control as management determines is necessary to enable
the preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
In preparing the financial statements, management is responsible for assessing the Companys ability to
continue as going concern, disclosing, as applicable, matters relating to going concern and using the going
concern basis of accounting unless management either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Companys financial reporting process.
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Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Companys internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of managements use of going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Companys ability to continue as going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our
auditors report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of auditors report. However, future events or conditions may cause the Company to
cease to continue as a going concern.
We communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
Lulzim Berisha
Statutory Auditor
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Beta Sh.p.k.
Statement of financial position as at December 31, 2016
(amounts in Euro)
Notes As at As at
December 31, 2016 December 31, 2015
Assets
Non-current assets
Property, plant and equipment 4 2,908,700 2,838,472
Total non-current assets 2,908,700 2,838,472
Current assets
Inventories 5 1,121,437 2,080,020
Trade receivables and other receivables 6 4,800,435 3,238,578
Requests and prepayments 7 801,640 369,787
Cash and Cash Equivalents 8 11,281 28,928
Total current assets 6,734,794 5,717,314
Non-current liabilities
Borrowings- noncurrent portion 10 199,291 130,779
Total non-current liabilities 199,291 130,799
Current liabilities
Trade payables and other payables 11 167,278 1,322,846
Borrowings current portion 10 7,503,549 5,403,539
Total current liabilities 7,670,827 6,726,385
These financial statements were authorized, approved and signed on behalf of the management on March
10, 2017.
______________________
Shabi Drmaku
Chief Executive Officer Commented [P3]: Executive Director
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Beta Sh.p.k.
Statement of profit and loss and other comprehensive income for the year ended December 31,
2016
(amounts in Euro)
Expenses
Personnel expenses 14 (253,608) (214,810)
General Operational and Administrative expenses 15 (162,646) (290,754)
Depreciation expenses 6 (177,330) (156,272)
Total Expenses (593,583) (661,836)
The accompanying notes from 1 to20of the financial statements form an integral part of these financial Commented [P5]: Harmonize me faqet me duket se eshte 24?
statements
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Beta Sh.p.k.
Statement of Changes in Equity for the year ended December 31, 2016
(amounts in Euro)
The accompanying notes from 1 to 20 of the financial statements form an integral part of these financial Commented [P6]: Njesoj si me lart?
statements
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Beta Sh.p.k.
Statement of cash flows for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
Notes
Year ended Year ended
31 Decmeber 31 December
2016 2015
I. Cash flows from (used in) operating activities
Profit (loss) of the year 74,755 62,961
Adjustments for:
Depreciation 4 177,330 156,272
Increase/(decrease) in trade and other receivables 6,7 (1,993,711) (293,192)
Increase/(decrease) in trade and other payables 11 (1,155,568 684,707
Increase/(decrease) in inventory 5 958,583 (1,279,368)
Cash generated from operations (2,013,366) (731,580)
Net cash from (used in) operating activities (I) (1,938,611) (668,619)
The accompanying notes from 1 to 20 of the financial statements form an integral part of these financial
statements
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
1. GENERAL
Beta Sh.pk" is a limited liability company registered in Kosovo with address St. Sadik Shala at Lipjan.
"Beta" SH.PK. Consists of the company and its wholly owned subsidiaries "" Beta Sh.pk ". The main
activity of" Beta Sh.pk "is Wholesale and Retail Trade in the domestic and foreign markets. The Director
and the Permanent Employee (Average 40 Employee) managed the daily operations of "Beta Sh.pk"
during 2016.
In the current year, the Company has applied a number of amendments to IFRSs issued by the
International Accounting Standards Board (IASB) that are mandatorily effective for an accounting period
that begins on or after 1 January 2016.
The Company has applied these amendments for the first time in the current year. The amendments
clarify that and entity need not to provide a specific disclosure required by an IFRS if the information
resulting from that disclosure is not material, and give guidance on the bases of aggregating and
disaggregating information for disclosure purposes. However, the amendments reiterate that an entity
should consider providing additional disclosures when compliance with the specific requirement in IFRS
is insufficient to enable users of financial statements to understand the impact of particular transactions,
events and conditions on the entitys financial position and financial performance.
As regards the structure of the financial statements, the amendments provide examples of systematic
ordering or grouping of the notes.
The application of these amendments has not resulted in any impact on the financial performance or
financial position of the Company.
The Company has applied these amendments for the first time in the current year. The amendments to
IAS 16 prohibit the entities from using a revenue-based depreciation method for items of property, plant
and equipment. The amendments to IAS 38 introduce a rebuttable presumption that revenue is not a
appropriate basis for amortization of an intangible asset. This presumption can only be rebutted in the
following two limited circumstances.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
The application of these amendments has had no impact on the Companys financial statements as the
Company is not engaged in agriculture activities.
The amendments to IFRS 5 introduce specific guidance in IFRS 5 for when entity reclassifies an asset (or
disposal) group) from held to sale to held to distribution to owners (or vice versa). The amendments
clarify that such a change should be considered as a continuation of the original plan of disposal and
hence requirements set out in IFRS 5 regarding the change of sale plan do not apply. The amendments
also clarifies the guidance for when held-for-distribution accounting is discontinued.
The amendments to IFRS 7 provide additional guidance to clarify whether a servicing contract is
continuing involvement in a transferred asset for the purpose of the disclosures required in relation to
transferred assets.
The amendments to IAS 19 clarify that the rate used to discount post-employment benefit obligations
should be determined to reference to market yields at the end of the reporting period on high quality
corporate bonds. The assessment of the depth of the market for high quality corporate bonds should be
at the currency level (i.e. the same currency as the benefits are to be paid). For currencies for which there
is no deep market in such high quality corporate bonds, the market yields at the end of the reporting
period on government bonds denominated in that currency should be used instead.
The application of these amendments has had no effect on the Companys financial statements.
3.1 Standards, amendments and interpretations to existing standards that are not yet effective
At the date of authorization of these financial statements, certain new standards, and amendments to
existing standards have been published by the IASB that are not yet effective, and have not been adopted
early by the Company. Information on those expected to be relevant to the Companys financial
statements is provided below.
Management anticipates that all relevant pronouncements will be adopted in the Companys accounting
policies for the first period beginning after the effective date of the pronouncement. New standards,
interpretations and amendments not either adopted or listed below are not expected to have a material
impact on the Companys financial statements.
Management has started to assess the impact of IFRS 9 but is not yet in a position to provide quantified
information.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
IFRS 9 is effective for annual reporting periods beginning on or after 1 January 2018.
IFRS 15 presents new requirements for the recognition of revenue, replacing IAS 18 Revenue, IAS 11
Construction Contracts, and several revenue-related Interpretations. The core principle of IFRS 15 is
that an entity should recognize revenue to depict the transfer of promised goods or services to customers
in an amount that reflects the consideration to which the entity expects to be entitled in exchange for
those goods or services.
IFRS 15 is effective for annual reporting periods beginning on or after 1 January 2018.
IFRS 16 Leases
IFRS 16 will replace IAS 17 and three related Interpretations. IFRS 16 introduces a comprehensive model
for the identification of lease arrangements and accounting treatments for both lessors and lessees. IFRS
16 distinguishes leases and service contracts on the basis of whether an identified asset is controlled by a
customer. Distinctions of operating leases (off balance sheet) and finance leases (on balance sheet) are
removed for lessee accounting, and is replaced by a model where a right-of-use asset and corresponding
liability have to be recognized for all leases by lessees (i.e. all on balance sheet) except for short-term
leases and leases of low value assets.
IFRS 16 is effective from periods beginning on or after 1 January 2019. Management is yet to fully assess
the impact of the Standard and therefore is unable to provide quantified information.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
iii. Depreciation
Depreciation is charged to the statement of comprehensive income by using the straight line methodover
the estimated useful lives of each part of an item of property and equipment from the first day of the
month following the month of acquisition. Land is not depreciated.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
3.5 Inventories
Inventories are stated at the lower of cost and net realizable value. Cost comprises direct cost related with
inventories and those overhead costs that have been incurred in bringing the inventories to their present
location and conditions. Net realizable value (NRV) represents the estimated selling price for inventories
less all estimated costs of completion and costs necessary to make the sale.
The cost of inventories is calculated based on the average cost method. Appropriate allowance for write
downs is recognized in the profit and loss when there is objective evidence that the NRV is lower than
the cost.
3.9 Leasing
Leases are classified as finance lease whenever the terms of the lease transfer substantially all the risks and
rewards of ownership to the lease. All other leases are classified as operating leases.
Assets held under financial lease are initially recognized as assets of the Group at their fair value at the
inception of the lease or, if lower, at the present value of the minimum lease payments. The
corresponding liability to the lessor is included in the financial position as a finance lease obligation.
Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to
achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are
recognized immediately in profit or loss, unless they are directly attributable to qualifying assets, in which
case they are capitalized. Contingent rentals are recognized as expenses in the period in which are
incurred.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
In the event that lease incentives are received to enter into operating leases, such incentives are
recognized as liability. The aggregate benefit of incentives is recognized as a reduction of rental expense
on a straight-line basis, except where another systematic basis is more representative of the time pattern
in which economic benefits from the leased asset are consumed.
3.10 Borrowings
Borrowings are initially recognized at fair value. Subsequent to initial recognition, loans and borrowings
are stated at amortized cost and any difference between cost and redemption value is recognized in the
statement of comprehensive income over the period of the borrowings using the effective interest
method.
Revenue from sales of goods is recognized when all the following conditions are satisfied:
The Company has transferred to the buyer the significant risks and rewards of ownership of the
goods;
The Company retains neither continuing managerial involvement to the degree usually associated
with the ownership nor effective control over the goods sold;
The amount of the revenue can be measured reliably;
It is probable that the economic benefits associated with the transaction will flow to the
Company; and
The costs incurred or to be incurred in respect of the transaction can be measured reliably.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use,
the estimated future cash flows are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount
of the asset is reduced to its recoverable amount. An impairment loss is recognized immediately in profit
and loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is
treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the
carrying amount that would have been determined had no impairment loss been recognized, unless the
relevant assets is carried at a revalued amount, in which case the reversal of the impairment loss is treated
as a revaluation increase.
The amount of impairment loss recognized is the difference between the assets carrying amount and
present value of estimated future cash flows discounted at current market rate of return for a similar
financial asset.
In the case of trade receivables, the carrying amount is reduced through the use of an impairment
allowance. When a trade receivable is considered unrecoverable, it is written off against the impairment
allowance. Subsequent recovery of trade receivables written off are credited against the impairment
allowance.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
A provision is recognized if the Company has a present obligation (legal or constructive) as a result of a
past event, it is probable that an outflow of resources embodying economic benefits will be required to
settle the obligation; and a reliable estimate can be made of the amount of the obligation.
The income tax charge in the income statement for the year comprises current tax and changes in
deferred tax. Current tax is calculated on the basis of the expected taxable profit for the year using the tax
rates in force at the balance sheet date. Taxable profit differs from profit as reported in the income
statement because it excludes items of income or expense that are taxable or deductible in other years and
it further excludes items that are never taxable or deductible. Taxes other than income taxes are recorded
within operating expenses.
Deferred tax is recognized on differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax base used in the computation of taxable profit and are
accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognized for
all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable
that taxable profits will be available against which deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the
extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the
asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is
settled or the asset realized. Deferred tax is charged or credited to profit or loss, except when it relates to
items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets against current tax liabilities and when they relate to income taxes levied by the same taxation
authority and the Company intends to settle its current tax assets and liabilities on a net basis.
The key assumptions concerning the future, and other key sources of estimation uncertainty at the
balance sheet date, that have a significant risk of causing a material adjustment to the carrying amount of
assets and liabilities within the next financial year, are discussed below:
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
17
Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
5. INVENTORIES
Stocks are measured at the lower of cost and net realizable value. The cost of stocks is based on the
weighted average principle and includes all purchase costs, translation costs and other costs associated
with putting the stocks in the current country and conditions.
Net realizable value is the estimated selling price in the normal course of business, minus the estimated
completion costs and the estimated costs that are required for the sale.
Stocks on 31 December 2016 and on 31 December 2015 are presented in the table below:
As at December 31 2016 2015
Inventories 1,121,437 2,080,020
Total 1,121,437 2,080,020
Most of the Accounts Receivable shown in the Statement of Financial Position are from the sale of sugar,
iron, fertilizers, etc from wholesale and retail sales by the affiliates of the Company.
* The company operates with some of the banks operating in the country:
At 31 December 2016; NLB had 3,146 Euro, TEB 14 Euro and PCB 4 Euro and 125 Euro.
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
9. SHARE CAPITAL
Capital Balance on December 31, 2016, in the amount of 1,773,375 Euros, consists of the Founding
Capital in the amount of 10,000 Euros, the share with a nominal value of 100 / share. Total paid-in
capital, while the shares are not publicly tradable from the reserve capital in the amount of EUR
1,688,622 and the retained earnings in the amount of EUR 62,961.
10. BORROWINGS
Current portion
Loans with commercial banks 2,913,255 1,800,000
Overdraft and Credit Line 4,515,042 3,556,966
Current portion Leasing 75,252 46,573
Total short-term loans 7,503,549 5,403,539
Non-Current portion
Loans 165,847 -
Non-current portion Leasing 33,444 130,779
Total long-term loans 199,291 130,779
TOTAL 7,702,840 5,534,318
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
12. REVENUES
For the year ended December 31 2016 2015
Revenues from the sale 23,584,202 14,347,105
Other business revenues 445,040 2,998,096
Extraordinary revenues 42,717 3,686
Total Revenues 24,071,959 17,348,887
13.COST OF SALES
For the year ended December, 31 2016 2015
Cost of goods sold 23,041,492 16,397,350
Total 23,041,492 16,397,350
14.PAYROLL EXPENSES
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
As per Law no. 05/L-029 On corporate income tax, effective from January 1, 2010, income tax rate has
been at the level of 10% for corporate entities.
Year ended Year ended
December 31, 2016 December 31, 2015
As at As at
31 December 2016 31 December 2015
Financial Assets:
Receivables and other accounts 4,800,436 3,238,578
Cash and Cash Equivalents 11,281 28,928
Financial Liabilities:
Trade and other payables 167,278 1,322,846
Borrowings current portion 7,536,993 5,403,539
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
e. Market risk
Foreign currency risk
The Company operates internationally and is exposed to foreign exchange risk arising from various
currency exposures primarily with respect to US Dollars. The Company does not use any instruments to
hedge the foreign exchange risk. The Companys Treasury is responsible for maintaining adequate net
position in each currency and in total. Its operations are monitored daily by the Companys management.
The Company undertakes transactions in both Euro and foreign currencies. The Company has not
entered into any forward exchange or embedded derivative transactions during the year ended December
31, 2016 and 2015.
Credit risk
The Company is subject to credit risk through its selling activities. In this respect, the credit risk for the
Company stems from the possibility that different counterparties might default on their contractual
obligations.
The amount of credit exposure in this regard is represented by the carrying amounts of the assets on the
balance sheet.
The carrying amount of financial assets recorded in the financial statements, which is net of impairment
losses, if any, represents the Companys maximum exposure to credit risk.
g. Liquidity risk
Liquidity risk arises in the general funding of the Companys activities and in the management of
positions. It includes both the risk of being unable to fund assets at appropriate maturity and rates and
the risk of being unable to liquidate an asset at a reasonable price and in an appropriate time frame to
meet the liability obligations.
At At
31 December 2016 31 December 2015
Inventory 1,121,437 2,080,020
Receivables and other accounts 4,800,436 3,238,578
Requests and other prepayments 801,640 369,787
Cash and Cash Equivalents 11,281 28,928
Total Current assets 6,734,794 5,717,314
Current liabilities
Trade and other payables 167,278 1,322,846
Borrowings current portion 7,503,549 5,403,539
Total Current liabilities 7,670,827 6,726,385
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Beta Sh.p.k.
Notes to the financial statements for the year ended December 31, 2016
(amounts in Euro, unless otherwise stated)
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