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CAPITAL OIL PLC
ACCOUNT FOR THE YEAR ENDED
31ST DECEMBER, 2015
CAPITAL OIL PLC
ACCOUNTS FOR THE YEAR ENDED 31ST DECEMBER, 2015
CONTENTS PAGE
CORPORATE INFORMATION 2
AUDITORS REPORT 3-4
RESPONSIBILITY FOR ANNUAL FINANCIAL STATEMENTS 5
SIGNIFICANT ACCOUNTING POLICIES 6-15
STATEMENT OF FINANCIAL POSITION 16
STATEMENT OF COMPREHENSIVE INCOME 17
STATEMENT OF CHANGES IN EQUITY 18
CASH FLOW STATEMENT 19
NOTES ON THE ACCOUNT 20-30
FIVE YEARS FINANCIAL SUMMARY 31
1
CAPITAL OIL PLC
ACCOUNTS FOR THE YEAR ENDED 31ST DECEMBER, 2015
CORPORATE INFORMATION
DIRECTORS
Dr. J N Taiwo Chairman
Jerome Ikhine Managing Director
Amos Otuata Executive Director
Eromosele Omodiagbe Director
Mr. Sina Alimi Director
REGISTERED OFFICE 43, Adeniyi Jones Avenue,
Ikeja.
P. O. Box 7254, Ikeja
SECRETARY
Bluechip Nominees
AUDITORS
Egunjobi Adegbite & Co
(Chartered Accountants)
9, Turton Street,
Yaba.
BANKERS
First Bank Of Nigeria Plc
Heritage Bank Ltd
Zenith Bank Plc
Guaranty Trust Bank Plc
Sterling Bank Plc
Gideon Trust Microfinance Bank Ltd
Covenant Microfinance Bank Ltd
First City Monument Bank Plc
United Bank For Africa Plc
2
Egunjobi, Adegbite& Co. 9, TURTON STREET, YABA
(CHARTERED ACCOUNTANTS) G.P.O. BOX 7625
LAGOS, NIGERIA
TEL: 774-4149, 08029420037
Email address: [email protected]
OTHER OFFICES: KADUNA AND IBADAN
REPORT OF THE INDEPENDENT AUDITORS
TO THE MEMBERS OF CAPITAL OIL PLCReport of the Financial Statements
We have audited the accompanying financial statements of Capital oil Plc, for the year ended
31st
DECEMBER 2015, set out on pages 6 to 31 which have been prepared on the basis of
significant accounting policies on page 6-15 and other explanatory notes.
Directors’ Responsibility for the Financial Statements
The Directors are responsible for the preparation and fair presentation of these financial
statements in accordance with Financial Reporting Council Of Nigeria Act No 6, the International
Financial Reporting Standards and with the requirements of the Companies and Allied Matters
Act, CAP C20 LFN, 2004. This responsibility includes: designing, implementing and maintaining
internal control relevant to the preparation and fair presentation of the financial statements that
are free from material misstatements, whether due to fraud or error, selecting and applying
appropriate accounting policies, and making accounting estimates that are reasonable in the
circumstances.
Auditor’s Responsibility
Our responsibility is to express an independent opinion on these financial statements based on
our audit. We conducted our audit in accordance with International Standards On Auditing.
Those standards require that we comply with ethical requirements and plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor’s
judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation and fair presentation of the
financial statements 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
entity’s internal control. An audit also includes evaluating the appropriateness of accounting
We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
3
OPINIONIn our opinion, the financial statements give a true and fair view of the state of affairs of the
Company’s financial position as at 31st
December, 2015 in accordance with International
Financial Reporting Standards, Financial Reporting Council Of Nigeria Act No 6, 2011 and the
Companies and Allied Maters Act, CAP C20 LFN, 2004.
Report on other Legal Requirements.
The Companies and Allied Matters Act, CAP C20 LFN, 2004 requires that in carrying out our
audit we consider and report to you on the following matters, We confirm that:
i) We have obtained all the information and explanations which to the best of our
knowledge and belief were necessary for the purpose of our audit.
ii) In our opinion, proper books of account have been kept by the Company; and
iii) The Company’s balance sheet and profit and loss account are in agreement
with the books of account.
(CHARTERED ACCOUNTANTS)
OLUSOJI ADEBANJO
LAGOS, NIGERIA.
Date:11 th MARCH, 2016.
FRC/2015/ICAN/00000003240
4
CAPITAL OIL PLC
ACCOUNTS FOR THE YEAR ENDED 31ST
DECEMBER 2015
RESPONSIBILITY FOR ANNUAL FINANCIAL STATEMENTS
The Companies and Allied Matters Act and the Company and other Financial Institutions Act
1991, require the Directors to prepare financial statements for each financial period that give a
true and fair view of the state of financial affairs of the Company at the end of the period and
of its profit or loss. The responsibilities include ensuring that the Company:
1. Keeps proper accounting records that disclose, with reasonable accuracy, the financial
position of the Company and comply with the requirements of the Companies and Allied Matter
Act 2004;
11. Establishes adequate internal controls to safeguard its assets and to prevent and detect
fraud and other irregularities; and
111. Prepares its financial statements using suitable accounting policies supported by
reasonable and prudent judgements and estimates,that are consistently applied.
The directors accept responsibility for annual financial statements, which have been prepared
using appropriate accounting policies supported by reasonable and prudent judgments and
estimates, in conformity with,
. International Financial Reporting Standards;
. The requirements of the Companies and Allied Matters Act.
. Financial Reporting Council Of Nigeria Act.
The directors are of the opinion that the financial statements give a true and fair view of the
state of the financial affairs of the Company and of their profit for the period. The directors
further accept responsibility for the maintenance of accounting records that may be relied upon
in the preparation of financial statements, as well as adequate systems of internal financial
control.
Nothing has come to the attention of the directors to indicate that the Company will not remain
a going concern for at least twelve months from the date of approval of the financial
statements.
Chairman Managing Director/CEO
FRC/2014/CIBN/00000010020 FRC/2014/NIM/00000010021
5
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
1 The following is a summary of the significant accounting policies adopted by the
company in the preparation of these accounts.
2 Significant Accounting policies
The following were the significant accounting policies applied in the preparation of this
account. These policies have been consistently applied unless stated otherwise.
2.1 The accounts was prepared in accordance with
a. International Financial Reporting Standards as issued by the International
Accounting Standards Board (IASB) and the interpretations issued issued by the
International Financial Reporting Interpretations committee .
b. Reqiurements of Companies and Allied Matters Act of Nigeria and the Financial
reporting Council act of Nigeria.
2.2 Turnover
Turnover comprises of sales to customers and service rendered to customers.
Turnover is stated at the invoice amount and is exclusive of value added taxation.
2.3 Cost of sales
When inventories are sold, the carrying amount of those inventories is recognised
as an expense in the period in which the related revenue is recognised. The
amount of any write-down of inventories to net realisable value and all losses of
inventories are recognised as an expense in the period the write-down or loss
occurs. The amount of any reversal of any write-down of inventories, arising from
an increase in net realisable value, is recognised as a reduction in the amount of
inventories recognised as an expense in the period in which the reversal occurs
The related cost of providing services recognised as revenue in the current period
is included in cost of sales.
2.4 Finance Income
Finance Income is made up of interest income in short -term deposits with bank,
dividend income, changes in the fair value of financial assets at fair value through profit or
loss and foreign exchange gains.
6
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
Interest income on short-term deposit is recognised by reference to the principal outstanding
at the effective interest rate applicable, which is the rate that exactly discounts estimated
future cash receipts through the expected life of the financial asset to that assets net carrying
amount on initial recognition.
2.5 Borrowing costs
Borrowing costs that are directly attributable to the acquisition, construction or
production of a qualifying asset are capitalised as part of the cost of that asset
until such time as the asset is ready for its intended use. The amount of borrowing
costs eligible for capitalisation is determined as follows:
The Actual borrowing costs on funds specifically borrowed for the purpose of
obtaining a qualifying asset less any temporary investment of those borrowings.
The Weighted average of the borrowing costs applicable to the entity on funds
generally borrowed for the purpose of obtaining a qualifying asset. The borrowing
costs capitalised do not exceed the total borrowing costs incurred.
The capitalisation of borrowing costs commences when:
The expenditures for the asset have occurred;
Theborrowing costs have been incurred, and
The activities that are necessary to prepare the asset for its intended use or sale
are in progress.
Capitalisation is suspended during extended periods in which active development
is interrupted.
Capitalisation ceases when substantially all the activities necessary to prepare the
qualifying asset for its intended use or sale are complete.
All other borrowing costs are recognised as an expense in the period in which they
are incurred.
2.5 Foreign currency transactions
A foreign currency transaction is recorded, on initial recognition in Nairas, by applying to the
foreign currency amount the spot exchange rate between the functional currency and the
foreign currency at the date of the transaction.
At the end of the reporting period:
Foreign currency monetary items are translated using the closing rate;
Non-monetary items that are measured in terms of historical cost in a foreign currency are
translated using the exchange rate at the date of the transaction; and
Non-monetary items that are measured at fair value in a foreign currency are translated
using the exchange rates at the date when the fair value was determined.
Exchange differences arising on the settlement of monetary items or on translating monetary
items at rates different from those at which they were translated on initial recognition during
the period or in previous financial statements are recognised in profit or loss in the period in
which they arise. 7
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
When a gain or loss on a non-monetary item is recognised to other comprehensive income
and accumulated in equity, any exchange component of that gain or loss is recognised to
other comprehensive income and accumulated in equity. When a gain or loss on a
non-monetary item is recognised in profit or loss, any exchange component of that gain or
loss is recognised in profit or loss.
Cash flows arising from transactions in a foreign currency are recorded in Nairas by applying
to the foreign currency amount the exchange rate between the Naira and the foreign
currency at the date of the cash flow.
2.6 Property, plant and equipment
The cost of an item of property, plant and equipment is recognised as an asset when:
It is probable that future economic benefits associated with the item will flow to the
company; and the cost of the item can be measured reliably.
Property, plant and equipment is initially measured at cost.
Costs include costs incurred initially to acquire or construct an item of property, plant and
equipment and costs incurred subsequently to add to, replace part of, or service it. If a
replacement cost is recognised in the carrying amount of an item of property, plant and
equipment, the carrying amount of the replaced part is derecognised.
The initial estimate of the costs of dismantling and removing the item and restoring the site
on which it is located is also included in the cost of property, plant and equipment, where .
the entity is obligated to incur such expenditure, and where the obligation arises as a result
of acquiring the asset or using it for purposes other than the production of inventories
Major spare parts and stand by equipment which are expected to be used for more than one
period are included in property, plant and equipment. In addition, spare parts and stand by
equipment which can only be used in connection with an item of property, plant and
equipment are accounted for as property, plant and equipment.
Major inspection costs which are a condition of continuing use of an item of property, plant
and equipment and which meet the recognition criteria above are included as a replacement
in the cost of the item of property, plant and equipment. Any remaining inspection costs
from the previous inspection are derecognised.
Property, plant and equipment is carried at cost less accumulated depreciation and any
impairment losses.
8
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
Property, plant and equipment is carried at cost less accumulated depreciation and any
impairment losses except for Revalued Assets which is carried at revalued amount being the
fair value at the date of revaluation less any subsequent accumulated depreciation and
subsequent accumulated impairment losses.
Property, plant and equipment is carried at revalued amount, being the fair value at the date
of revaluation less any subsequent accumulated depreciation and subsequent accumulated
impairment losses.
Revaluations are made with sufficient regularity such that the carrying amount does not differ
materially from that which would be determined using fair value at the end of the reporting
period.
When an item of property, plant and equipment is revalued, any accumulated depreciation at
the date of the revaluation is restated proportionately with the change in the gross carrying
amount of the asset so that the carrying amount of the asset after revaluation equals its
revalued amount.
When an item of property, plant and equipment is revalued, any accumulated depreciation at
the date of the revaluation is eliminated against the gross carrying amount of the asset and
the net amount restated to the revalued amount of the asset.
Any increase in an asset’s carrying amount, as a result of a revaluation, is recognised to other
comprehensive income and accumulated in the revaluation surplus in equity. The increase is
recognised in profit or loss to the extent that it reverses a revaluation decrease of the same
asset previously recognised in profit or loss.
Any decrease in an asset’s carrying amount, as a result of a revaluation, is recognised in profit
or loss in the current period. The decrease is recognised in other comprehensive income to
the extent of any credit balance existing in the revaluation surplus in respect of that asset.
The decrease recognised in other comprehensive income reduces the amount accumulated
in the revaluation surplus in equity.
The revaluation surplus in equity related to a specific item of property, plant and equipment
is transferred directly to retained earnings when the asset is derecognised.
The revaluation surplus in equity related to a specific item of property, plant and equipment
is transferred directly to retained earnings as the asset is used. The amount transferred is
equal to the difference between depreciation based on the revalued carrying amount and
depreciation based on the original cost of the asset.
Property, plant and equipment are depreciated on the over their expected useful lives to
their estimated residual value. 9
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
Property, plant and equipment is carried at cost less accumulated depreciation and any
impairment losses.
Property, plant and equipment is carried at revalued amount, being the fair value at the date
of revaluation less any subsequent accumulated depreciation and subsequent accumulated
impairment losses. Revaluations are made with sufficient regularity such that the carrying
amount does not differ materially from that which would be determined using fair value at
the end of the reporting period.
Any increase in an asset’s carrying amount, as a result of a revaluation, is credited to other
comprehensive income and accumulated in the revaluation surplus in equity. The increase is
recognised in profit or loss to the extent that it reverses a revaluation decrease of the same
asset previously recognised in profit or loss.
Any decrease in an asset’s carrying amount, as a result of a revaluation, is recognised in profit
or loss in the current period. The decrease is debited in other comprehensive income to the
extent of any credit balance existing in the revaluation surplus in respect of that asset.
The useful lives of items of property, plant and equipment have been assessed as follows:
Item Average useful life Rate
Leasehold Stations 50 2%
Head office Building including Freehold Stations 50 2%
Motor Vehicle 5 20%
Plant & Machinery 5 20%
Gas Plant 50 2%
Furniture Fittings & Equipment and computer machines 5 20%
The residual value, useful life and depreciation method of each asset are reviewed at the end
of each reporting period. If the expectations differ from previous estimates, the change is
accounted for as a change in accounting estimate.
Each part of an item of property, plant and equipment with a cost that is significant in relation
to the total cost of the item is depreciated separately.
The depreciation charge for each period is recognised in profit or loss unless it is included in
the carrying amount of another asset.
The gain or loss arising from the derecognition of an item of property, plant and equipment is
included in profit or loss when the item is derecognised. The gain or loss arising from the .
derecognition of an item of property, plant and equipment is determined as the difference
between the net disposal proceeds, if any, and the carrying amount of the item
10
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
Assets which the company holds for rentals to others and subsequently routinely sell
as part of the ordinary course of activities, are transferred to inventories when the rentals
end and the assets are available-for-sale. These assets are not accounted for as non-current
assets held for sale. Proceeds from sales of these assets are recognised as revenue. All cash
flows on these assets are included in cash flows from operating activities in the cash flow
statement.
2.7 Inventories
Inventories are measured at the lower of cost and net realisable value on the first-in-first-out
basis.
Net realisable value is the estimated selling price in the ordinary course of business less the
estimated costs of completion and the estimated costs necessary to make the sale.
The cost of inventories comprises of all costs of purchase, costs of conversion and other costs
incurred in bringing the inventories to their present location and condition.
The cost of inventories of items that are not ordinarily interchangeable and goods or services
produced and segregated for specific projects is assigned using specific identification of the
individual costs.
The cost of inventories is assigned using the formula. The same cost formula is used for all
inventories having a similar nature and use to the entity.
When inventories are sold, the carrying amount of those inventories are recognised as an
expense in the period in which the related revenue is recognised. The amount of any
write-down of inventories to net realisable value and all losses of inventories are recognised
as an expense in the period the write-down or loss occurs. The amount of any reversal of any
write-down of inventories, arising from an increase in net realisable value, are recognised as
a reduction in the amount of inventories recognised as an expense in the period in which the
reversal occurs.
2.8 Trade and other receivables
Trade receivables are measured at initial recognition at fair value, and are subsequently
measured at amortised cost using the effective interest rate method. Appropriate allowances
for estimated irrecoverable amounts are recognised in profit or loss when there is objective
evidence that the asset is impaired. Significant financial difficulties of the debtor, probability
that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency
in payments (more than 30 days overdue) are considered indicators that the trade receivable
is impaired. The allowance recognised is measured as the difference between the asset’s
carrying amount and the present value of estimated future cash flows discounted at the
effective interest rate computed at initial recognition.
11
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
The carrying amount of the asset is reduced through the use of an allowance account, and the
amount of the loss is recognised in profit or loss within operating expenses. When a trade
receivable is uncollectable, it is written off against the allowance account for trade
receivables. Subsequent recoveries of amounts previously written off are credited against
operating expenses in profit or loss.
2.9 Trade and other payables
Trade payables are initially measured at fair value, and are subsequently measured at
amortised cost, using the effective interest rate method.
2.10 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term
highly liquid investments that are readily convertible to a known amount of cash and are
subject to an insignificant risk of changes in value. These are initially and subsequently
recorded at fair value.
2.11 Bank overdraft and borrowings
Bank overdrafts and borrowings are initially measured at fair value, and are subsequently
measured at amortised cost, using the effective interest rate method. Any difference
between the proceeds (net of transaction costs) and the settlement or redemption of
borrowings is recognised over the term of the borrowings in accordance with the company’s
accounting policy for borrowing costs.
2.12 Tax
2.12.1 Current tax assets and liabilities
Current tax for current and prior periods is, to the extent unpaid, recognised as a liability.
If the amount already paid in respect of current and prior periods exceeds the amount due
for those periods, the excess is recognised as an asset.
Current tax liabilities (assets) for the current and prior periods are measured at the amount
expected to be paid to (recovered from) the tax authorities, using the tax rates (and tax laws
) that have been enacted or substantively enacted by the end of the reporting period.
2.12.2 Deferred tax assets and liabilities
A deferred tax liability is recognised for all taxable temporary differences, except to the
extent that the deferred tax liability arises from the initial recognition of an asset or liability
in a transaction which at the time of the transaction, affects neither accounting profit nor
taxable profit (tax loss).
12
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
A deferred tax asset is recognised for all deductible temporary differences to the extent that
it is probable that taxable profit will be available against which the deductible temporary
difference can be utilised. A deferred tax asset is not recognised when it arises from the
initial recognition of an asset or liability in a transaction at the time of the transaction, affects
neither accounting profit nor taxable profit (tax loss).
A deferred tax asset is recognised for the carry forward of unused tax losses and unused WHT
credits to the extent that it is probable that future taxable profit will be available against
which the unused tax losses and unused WHT credits can be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to
the period when the asset is realised or the liability is settled, based on tax rates
(and tax laws) that have been enacted or substantively enacted by the end of the reporting
period.
2.12.3 Tax expenses
Current and deferred taxes are recognised as income or an expense and included in profit or
loss for the period, except to the extent that the tax arises from:
A transaction or event which is recognised, in the same or a different period, to other
comprehensive income.
Current tax and deferred taxes are charged or credited to other comprehensive income if
the tax relates to items that are credited or charged, in the same or a different period, to
other comprehensive income.
Current tax and deferred taxes are charged or credited directly to equity if the tax relates to
items that are credited or charged, in the same or a different period, directly in equity.
2.13 Leases
A lease is classified as a finance lease if it transfers substantially all the risks and rewards
incidental to ownership. A lease is classified as an operating lease if it does not transfer
substantially all the risks and rewards incidental to ownership.
2.13.1 Finance leases - lessor
The company recognises finance lease receivables in the statement of financial position.
Finance income is recognised based on a pattern reflecting a constant periodic rate of return
on the company’s net investment in the finance lease.
13
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
2-13.2 Finance leases – lessee
Finance leases are recognised as assets and liabilities in the statement of financial position
at amounts equal to the fair value of the leased property or, if lower, the present value of the
minimum lease payments. The corresponding liability to the lessor is included in the
statement of financial position as a finance lease obligation.
The discount rate used in calculating the present value of the minimum lease payments is the .
The lease payments are apportioned between the finance charge and reduction of the
outstanding liability.The finance charge is allocated to each period during the lease term so
as to produce a constant periodic rate on the remaining balance of the liability.
2.13.3 Operating leases - lessor
Operating lease income is recognised as an income on a straight-line basis over the lease term.
Initial direct costs incurred in negotiating and arranging operating leases are added to the
carrying amount of the leased asset and recognised as an expense over the lease term on the
same basis as the lease income.
Income for leases is disclosed under revenue in profit or loss.
2.13.4 Operating leases – lessee
Operating lease payments are recognised as an expense on a straight-line basis over the
lease term. The difference between the amounts recognised as an expense and the
contractual payments are recognised as an operating lease asset. This liability is not
discounted.
Any contingent rents are expensed in the period they are incurred.
Provisions and contingencies
Provisions are recognised when:
Ÿthe company has a present obligation 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 obligation.
The amount of a provision is the present value of the expenditure expected to be required to
Where some or all of the expenditure required to settle a provision is expected to be
reimbursed by another party, the reimbursement shall be recognised when, and only when,
it is virtually certain that reimbursement will be received if the entity settles the obligation.
The reimbursement shall be treated as a separate asset. The amount recognised for the
reimbursement shall not exceed the amount of the provision.
14
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER, 2015
SIGNIFICANT ACCOUNTING POLICIES
Provisions are not recognised for future operating losses.
If an entity has a contract that is onerous, the present obligation under the contract shall be
recognised and measured as a provision.
A constructive obligation to restructure arises only when an entity:
Has a detailed formal plan for the restructuring, identifying at least:
a. the business or part of a business concerned;
b. the principal locations affected;
c. the location, function, and approximate number of employees who will be compensated for
terminating their services:
d. the expenditures that will be undertaken; and
e. when the plan will be implemented; and
Has raised a valid expectation in those affected that it will carry out the restructuring by
starting to implement that plan or announcing its main features to those affected by it.
After their initial recognition contingent liabilities recognised in business combinations that
are recognised separately are subsequently measured at the higher of:
`
The amount that would be recognised as a provision; and
The amount initially recognised less cumulative amortisation.
Contingent assets and contingent liabilities are not recognised. Contingencies are disclosed in
note .
# 2.14 Retirement Benefit And Gratuity Scheme
2.14.1 The company operates contributory retirement benefits scheme for its
Permanent staff based on the provisions of the New Pension Reform Act, amended
2014 .The scheme is funded by contributions from Employees through payroll
deductions while the company's contribution is charged to the profit
and loss account. The rates applicable for each party is 8% Employees and
10% company, of the staff total emoluments.
2.14.2 The company also operates a gratuity scheme for its permanent
Nigerian staff .
The gratuity payable to staff upon retirement or resignation, are accrued
for over the service lives of management and non-management staff
of the company, and their terminal remunerations.
15
CAPITAL OIL PLC
STATEMENT OF FINANCIAL POSITION AS AT 31ST DECEMBER, 2015
ASSETS NOTES 31/12/15 31/12/14
N N
NON- CURRENT ASSETS
Property Plant & Equipment 1 1,212,566,772 1,236,463,056
Software 1.1 810,542 0
Total Non-Current Assets 1,213,377,314 1,236,463,056
CURRENT ASSETS
Inventories 2 13,102,979 7,164,789
Trade & Other receivables 3 363,178,321 407,663,982
Prepayments 4 7,786,899 15,177,398
Cash and Cash Equivalents 5 48,499,176 33,238,368
432,567,374 463,244,537
TOTAL ASSETS 1,645,944,688 1,699,707,593
EQUITY AND LIABILITIES
EQUITY
Issued Share Capital 6.5 1,464,394,325 1,464,394,325
Share Premium 6.6 3,036,209,766 3,036,209,766
Treasury Shares 6.4 (2,642,200,000) (2,642,200,000)
Accumulated Loss 7 (1,098,044,323) (1,036,192,435)
Equity attributable to Owners of
the company 760,359,768 822,211,656
NON CURRENT LIABILTIES
Borrowing 8 621,147,042 605,708,132
Deffered Tax Liabilties 9 110,164,600 110,164,600
Total Non Current Liabilities 731,311,642 715,872,732
CURRENT LIABILITIES
Bank Overdraft 5 30,656 30,660
Trade Payables 10 26,055,918 26,055,918
Other Payables and accruals 10.1 53,766,101 64,314,524
Current Income tax payable 11 74,420,603 71,222,103
Total Current Liabilties 154,273,277 161,623,205
Total Equity And Liabilities 1,645,944,688 1,699,707,593
DEAC. JEROME IKHINE MR. AMOS OTUATA
MANAGING DIRECTOR/CEO EXECUTIVE DIRECTOR FINANCE
FRC/2014/NIM/00000010021 FRC/2014/ICAN/00000010022
16
CAPITAL OIL PLC
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31ST DECEMBER, 2015
Notes 31/12/15 31/12/14
N N
Revenue 1,132,722,975 2,106,210,044
Cost of Sales (968,707,874) (1,895,773,422)
Gross Profit 164,015,101 210,436,622
Administrative Expenses 12 (154,821,145) (196,915,752)
Selling & Distribution Expenses 13 (54,890,083) (50,965,460)
Other Income 14 3,104,579 1,675,450
Profit From Operating Expenses (42,591,548) (35,769,140)
Finance income 15 3,160,000 3,000,100
Finance cost 16 (16,721,840) (80,466,263)
Profit Before Tax (56,153,388) (113,235,303)
Taxation 11.1 (5,698,500) (17,926,064)
Income(Net of tax) (61,851,888) (131,161,367)
Profit After/ (loss) Tax (61,851,888) (131,161,367)
17
CAPITAL OIL PLC
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31ST DECEMBER, 2015
Share Capital Share Premium Treasury Share Retained Earning Total
₦ ₦ ₦ ₦ ₦
Balance As At 1st January, 2015 1,464,394,325 3,036,209,766 (2,642,200,000) (1,036,192,435) 822,211,656
Changes In The Year (61,851,888) (61,851,888)
Prior Year Adjustment
Total Comprehensive Income
For The Year 1,464,394,325 3,036,209,766 (2,642,200,000) (1,098,044,323) 760,359,768
Payment Of Dividend
Balance As At 31st December, 2015 1,464,394,325 3,036,209,766 (2,642,200,000) (1,098,044,323) 760,359,768
18
CAPITAL OIL PLC
CASH FLOW STATEMENT
FOR THE YEAR ENDED 31ST DECEMBER, 2015
2015 2014
CASH FLOW FROM OPERATING ACTIVITIES NOTE N N
cash flow from ordinary activities
Receipts from customers 1,155,493,891 2,107,917,202
Other Income 6,264,579 4,675,550
Payment to Employees/Services (1,141,863,222) (2,172,860,677)
Tax Paid (2,500,000) -
Net Cashflow from operating activities 22 17,395,247 (60,267,925)
Cashflow on Investing Activities
Adjustment to paid up capital 0 0
Purchase of fixed assets (851,500) (26,453,810)
Proceeds from sale of Leasehold Land 0 50,000,000
Investments 0
Cashflow From Financing Activities
Medium Term Loan
Bank Interest & Similar Charges (16,721,845) (80,466,262)
Net (increase)/Decrease in Liquid funds (178,097) (117,187,997)
Opening Cash & Bank Balances (572,500,424) (455,312,427)
Closing Cash & Bank Balances (572,678,522) (572,500,424)
REPRESENTED BY:
Closing Cash & Bank Balances 48,499,176 33,238,368
Closing Borrowing (621,147,042) (605,708,133)
closing Bank Overdraft Balances (30,656) (30,660)
(572,678,522) (572,500,424)
19
CAPITAL OIL PLC
FOR THE YEAR ENDED 31ST DECEMBER,2015
NOTES ON THE ACCOUNTS
Note 1
1.1 The movement of these accounts during the year were as follows:
Plant
Machinery Equip. Freehold/ Motor Work
Head Office Leasehold And Furniture & Leasehold Vehicle In Computer Gas Plant
PROPERTY PLANT & EQUIPMENT Building Land Equipment Fittings Stations Progress Machines Total
COST N N N N N N N N N N
Balance 1st January,2015 264,300,000 80,022,270 72,929,596 10,760,447 635,275,019 8,800,000 236,768,206 4,475,596 19,023,550 1,332,354,684
Additions 0 170,000 189,000 434,500 58,000 0 851,500
Reclassification 0 (992,500) 992,500 0
Reclassification(Others) (992,500) (992,500)
Disposal 0 0 0 0 0
Balance at 31st Dec,2015 264,300,000 80,192,270 73,118,596 11,194,947 635,275,019 8,800,000 235,775,706 4,533,596 19,023,550 1,332,213,684
DEPRECIATION
Balance At 1st Jan,2015 0 0 34,993,612 2,832,110 53,000,652 1,320,000 0 3,092,504 652,750 95,891,628
Charge For The Year 0 0 6,787,577 2,195,374 12,194,002 1,760,000 0 619,822 380,467 23,937,242
Disposal 0 0 0 0 0 0 0
reclassification (181,958) (181,958)
Balance At 31st Dec,2015 0 0 41,781,189 5,027,484 65,194,654 3,080,000 0 3,530,368 1,033,217 119,646,912
NET BOOK VALUE
At31st December,2015 264,300,000 80,192,270 31,337,407 6,167,463 570,080,365 5,720,000 235,775,706 1,003,228 17,990,333 1,212,566,772
At31st December,2014 264,300,000 80,022,270 37,935,984 7,928,337 582,274,367 7,480,000 236,768,206 1,383,092 18,370,800 1,236,463,056
1.2 The company's leasehold and freehold service stations were revalued on 5th october,1992 by Mark Odu & Co on the basis of open
market value. The surplus on revaluation and the accumulated depreciation amounting to N8,239,851 have been credited to retained earnings account.
1.3 The plant , machinery and equipment were revalued on 17th August,1995 by Jide Taiwo & Co on the basis of open market value.The surplus
on revaluation amounting to N5,794,941 have been credited to retained earnings .
1.4 The companies leasehold and freehold stations were revalued on 1st November,1999 by Mark Odu & Co on the basis of current open market value.
The surplus on revaluation amounting to N9,964,814 have been credited to retained earnings.
1.5 The leasehold and freehold stations were revalued on the 3rd September,2003 by Onakanmi & Partners on the basis of open market value.The surplus on
revaluation amounting to N17,384,327 have been credited to retained earnings.
20
CAPITAL OIL PLC
NOTES FOR THE YEAR ENDED 31ST DECEMBER, 2015
31/12/15 31/12/14
1.1 Software
The movement is as follows
Balance 1/1/15 - 0
Addition 992,500 0
Disposal - 0
Balance 31/12/15 992,500 -
Amortization
Balance 1/1/15 - 0
Charged in the year 181,958 0
Disposal - 0
Balance 31/12/15 181,958 -
Net Book Value 31/12/15 810,542 -
2 Inventory 31/12/15 31/12/14
N N
Finished Goods 4,885,979 4,097,421
GIT 8,217,000 3,067,368.00
13,102,979 7,164,789
3 Trade and Other receivables
Trade Receivables 303,954,422 326,725,337
Sundry Debtors 77,887,421 79,886,652
381,841,843 406,611,989
Impairment Allowance (20,312,302) 0
361,529,541 406,611,989
Staff Debtors 1,648,780 1,051,993
363,178,321 407,663,982
The company's allowance for impairment on bad debt and represents its estimate of
incurred losses in respect of trade debtors and other sundry debtors. The write off were specific debts which the
company considered irrecoverable. The provision for impairment represents customers balances which
could be recovered in the future.
4 Prepayments
Insurance 7,786,899 96,065
Rent 0 5,173,000
Professional fees 0 150,000
lease Charges 0 9,758,333
0
7,786,899 15,177,398
5 Cash and Cash Equivalents
Cash on Hand 10,870 108,000
Bank Balances 48,488,299 33,130,368
48,499,169 33,238,368
Bank Overdraft 30,656 30,660
48,529,825 33,269,027
21
CAPITAL OIL PLC
NOTES FOR THE YEAR ENDED 31ST DECEMBER, 2015
6 Share Capital 31/12/15 31/12/14
6.1 Authorized N N
16,120,000,000 ordinary shares
of 25kobo each 4,030,000,000 4,030,000,000
6.2 Called Up Share Capital
5,857,577,300 units @ 25kobo each 1,464,394,325 1,464,394,325
6.3 Issued and Fully Paid
2,473,177,300 units @25kobo each 618,294,325 618,294,325
6.4 TREASURY SHARES
3,384,400,000 units @25k per share 846,100,000 846,100,000
Total Issued Share Capital 1,464,394,325 1,464,394,325
The 3,384,400,000 units of treasury shares at 25k per share currently held in
the following names:
True Bond Energy Ltd 1,380,000,000 1,380,000,000
Proven Financial Services Ltd 1,258,200,000 1,258,200,000
Warehoused Shares 746,200,000 746,200,000
3,384,400,000 3,384,400,000
These treasury shares were earlier issued but payments not received and now
warehoused as Treasury Shares. The company had sought the approval
of the security and exchange commission via a letter dated March 6th,2015
and are already in discussion with potential investors.
6.6 Share Premiun 3,036,209,766 3,036,209,766
7 Accumulated Loss N N
Balance brought Forward (1,036,192,435) (908,104,818)
Profit/(Loss) in the year (61,851,888) (131,161,367)
Prior Year Adjustment 0 3,073,750
Balance carried Forward (1,098,044,323) (1,036,192,435)
8 Borrowing
Secured 63,855,376 48,894,965
unsecured 557,291,666 556,813,167
621,147,042 605,708,132
The secured loan was a revolving one year loan granted by PAC Asset management at
the interest rate of 28%
The unsecured was a soft facilty giving by Living Faith World Outreach Centre to be held
as a preferred stock for one year only in favour of the church at a annual interest rate of 12.5%.
22
CAPITAL OIL PLC
NOTES FOR THE YEAR ENDED 31ST DECEMBER, 2015
31/12/15 31/12/14
9 Deferred Tax
Balance Brought forward 110,164,600 99,081,362
Charge in the year 0 11,083,238
Balance carried forward 110,164,600 110,164,600
10 Trade Payables 26,055,918 26,055,918
The sum of N26,055,918 was due to Index Petrolube Africa Ltd for supply of petroleum
products.
10.1 Other Payables and accruals
Sundry creditors 18,488,553 23,332,472
Accruals 35,277,548 40,982,052
53,766,101 64,314,524
11 Current Income Tax Payable
Balance Brought Forward 71,222,103 64,379,277
Provision for the year 5,698,500 6,842,826
Payment in the year (2,500,000) -
Balance Carried Forward 74,420,603 71,222,103
11.1 Taxation Comprehensive Income
Current Income Tax 5,698,500 6,842,826
Deferred Tax 0 11,083,238
5,698,500 17,926,064
12 Administrative Expenses
Salaries & Wages 36,258,792 49,758,922
Directors Emoluments 16,675,000 31,690,059
Transport and Travelling 4,126,733 5,459,018
Entertainment 1,049,510 1,088,050
Utilities 1,883,525 2,120,605
Printing & Stationeries 1,118,800 1,521,115
Medical Expenses 0 55,050
Donation & Gifts 0 324,000
Office Cleaning 1,157,760 1,439,210
Insurance 1,722,218 1,316,510
Security Expenses 1,048,000 1,715,399
Rent & Rates 5,295,852 7,027,630
Motor Running 430,895 248,930
Repairs & Maintenance 11,181,003 15,371,709
Licences & Registration 399,434 921,819
Fines & Penalty 150,000 979,590
Bad Debt 20,312,302 -
Professional Services 9,826,940 17,069,951
Auditors Fees 700,000 700,000
Depreciation 23,755,291 23,088,185
Amortization 181,950 -
Lease Charges 16,700,000 14,700,000
Disposal Account 0 20,000,000
Staff Training 847,140 320,000
154,821,145 196,915,752
13 Selling And Distribution Expenses
Advertising and Haulage Expenses 54,890,083 50,965,460
23
CAPITAL OIL PLC
NOTES FOR THE YEAR ENDED 31ST DECEMBER, 2015
31/12/15 31/12/14
N N
14 Other Income
Recovery of Bad Debts 349,579 0
Rent 2,355,000 1,675,450
Non refundable Deposit 400,000 0
3,104,579 1,675,450
15 Finance Income
Lease income 3,160,000 3,000,000
Interest Received 0 100
3,160,000 3,000,100
16 Finance Cost
Interest On loan 15,438,907 77,872,006
Bank Charges 1,282,932 2,594,257
16,721,840 80,466,263
17 PROFIT BEFORE TAX
Profit before tax is arrived at :
After Charging:
Depreciation on Fixed Asset 23,755,291 23,088,185
Auditors Remuneration 700,000 700,000
Directors Emoluments 16,675,000 31,690,059
And After Crediting
Other Income 3,104,579 1,675,450
24
CAPITAL OIL PLC
NOTES FOR THE YEAR ENDED 31ST DECEMBER, 2015
18 DIRECTORS/EMPLOYEES EMOLUMENTS
The aggregate emoluments of the 31/12/15 31/12/14
Directors were N N
Sitting Allowance 325,000 1,845,000
Other Emoluments excluding
Pension Contribution 16,350,000 29,845,059
16,675,000 31,690,059
The Chairman's emoluments (excluding pension
contribution) totalled
110,000 460,000
The emoluments of the highest paid Director
amounted to (excluding pension
Contribution) 16,785,000 15,385,717
The table below shows the number of Directors
of the company (excluding the Chairman) whose
remuneration (excluding pension contributions)
in respect of services to the company fell within
the range shown below:
N N
10,000,000 to 20,000,000 1 1
30,000,000 to 40,000,000 0 0
19 EMPLOYEES
The table shows the numbers of employees
of the company who earned over N60,000 in
the year and which fell within ranges stated
below: 31/12/15 31/12/14
N N
200,001 - 400,000 7 3
400,001 - 600,000 13 3
600,001 - 800,000 3 15
800,001 - 1,000,000 3 4
1,500,000 & Above 9 12
35 37
20 STAFF COST PER PAYROLL
N N
Wages and Salaries 36,258,792 49,758,922
The average number of persons employed
by the company during the year were:
25
CAPITAL OIL PLC
NOTES FOR THE YEAR ENDED 31ST DECEMBER, 2015
31/12/15 31/12/14
21 EARNINGS PER SHARE
Earning per share calculated on basis of the
company's profit after taxation based on the
number of ordinary shares issued and fully paid
at the end of the year (0.03) (0.05)
22 RECONCILIATION OF NET INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
31/12/15 31/12/14
Net Income/(loss) After tax And Exraordinary N N
Item (61,851,888) (131,161,367)
Adjustment To Reconcile Net Income To Net
Cash Provided
Loss/(Profit) on Disposal 0 20,000,000
Depreciation 23,755,291 23,088,185
Amortization 181,958
Interest And Similar Charges 16,721,840 80,466,263
Prior Year Adjustment 0 3,073,750
Changes In Asset And Liabilities
(Increase)/decrease in stock (5,938,190) -6846240
(Increase)/Decrease In Debtors 51,876,161 35,041,716
Increase/(Decrease) In Trade Creditors
And Accruals (10,548,424) (101,856,296)
Increase In Deffered Tax Provision 3,198,500 6,842,826
Increase/(decrease) In Tax Provision 0 11,083,238
Sub Total 79,247,136 70,893,442
Net Cash Provided By Operating Activities 17,395,247 (60,267,925)
23 APPROVAL OF FINANCIAL STATEMENTS
The financial Statements were approved by the board of Directors of the company on the ….
26
CAPITAL OIL PLC
FIVE YEAR FINANCIAL SUMMARY
FOR THE YEAR ENDED 31ST DECEMBER, 2015
IFRS IFRS IFRS IFRS IFRS
2015 2014 2013 2012 2011
N N N N N
TURNOVER 1,132,722,975 2,106,210,044 2,967,933,461 1,901,955,774 1,296,513,497
Profit/(loss) before Taxation (56,153,388) (113,235,303) (459,321,150) 41,957,156 5,124,520
Taxation (5,698,500) (17,926,064) (16,208,957) (65,004,693) (58,656,900)
Profit/(loss) After Taxation (61,851,888) (131,161,367) (475,530,107) (23,047,537) (53,532,380)
Extra ordinary item 0 0 0 59,475,151 0
Profit After tax and Extra ordinary item (61,851,888) (131,161,367) (475,530,107) 36,427,614 (53,532,380)
Earning/(loss) per share (kobo) (0.03) (0.05) (0.05) 0.01 (0.02)
Net Asset per share (Kobo) 0.31 0.33 0.38 0.66 0.60
BALANCE SHEET AS AT 31ST DECEMBER
CAPITAL EMPLOYED
Share Capital 1,464,394,325 1,464,394,325 1,464,394,325 618,294,325 768,286,825
Share Premium 3,036,209,766 3,036,209,766 3,036,209,766 1,240,109,766 1,690,109,766
Treasury Shares (2,642,200,000) (2,642,200,000) (2,642,200,000)
Profit & Loss Account (1,098,044,323) (1,036,192,435) (908,104,818) (432,574,711) (608,743,721)
Total Capital Employed 760,359,768 822,211,656 950,299,273 1,425,829,380 1,849,652,870
ASSETS EMPLOYED
Fixed Assets 1,212,566,772 1,236,463,056 1,303,097,432 1,250,574,901 2,040,783,021
Software 810,542
Current Assets 432,567,374 463,244,537 557,001,141 876,121,595 209,411,106
Current Liabilities (154,273,277) (161,623,205) (256,614,640) (607,903,325) (339,828,748)
Loans (621,147,042) (605,708,132) (554,103,298) - (13,187,050)
Deffered Taxation (110,164,600) (110,164,600) (99,081,362) (92,963,791) (47,525,460)
Net Assets 760,359,769 822,211,656 950,299,273 1,425,829,380 1,849,652,870
27
0
50000000
1E+09
1.5E+09
2E+09
2.5E+09
3E+09
2015 2014 2013 2012 2011
TURNOVER
TURNOVER
-5E+08
-4E+08
-3E+08
-2E+08
-1E+08
0
10000000
2015 2014 2013 2012 2011
PROFITABILITY TREND
Profit/(loss) before Taxation
Taxation
Profit/(loss) After Taxation