NATIONAL ASSET LEASING CORPORATION LIMITED
ANNUAL REPORTS 2003
Contents
Company Information
Notice of Annual General Meeting
Report of the Director's
Six Year's Key Financial & Operating Ratios
Pattern of Shareholding
Statement of Compliance with best Practices of Corporate Governance
Auditor's Review Report to the Members on Statement of Compliance With best practices of Code of Corporate Governance
Auditor's Report
Balance Sheet
Profit & Loss Account
Cash Flow Statement
Statement of Changes in Equity
Notes to the Financial Statements
Company Information
Board of Directors		Mr. Shamim 1. Junejo		Chairman
		Dr. Khalid Iqbal		Director
		Mr. M.A. Rehmani		Director
		Syed Naveed Zaidi		Director
		Mr. Azhar Tariq Khan		Director
		Mr. Sohail All		Director
		Mr. Rana M. Abu Obaida		Chief Executive Officer
Audit Committee		Mr. Shamim 1. Junejo		Chairman
		Mr. Azhar Tariq Khan		Member
		Mr. M.A. Rehmani		Member
Company Secretary		Syed Haider Zaidi
Bankers		Allied Bank of Pakistan Limited
		Habib Bank Limited
		National Bank of Pakistan
Auditors		M/s. M. Yousuf Adil Saleem & Co.
		Chartered Accountants
		Cavish Court, A-35, Block 7/8
		KCHSU, Shahrah-e-Faisal
		Karachi
Legal Advisor		M/s. Mansoor Ahmed Khan & Co.
		Advocates & Solicitors
		F-2/3, Block 8, Kehkashan
		KDA Scheme 5, Clifton
		Karachi
Share Registrar		M/s. Noble Computer Services (Pvt) Ltd.
		14, Banglore Town Housing Society
		Shahrah-e-Faisal, Karachi
Registered Office		301-302, Mohammad Gulistan Khan House
		82-East, Fazal-ul-Haq Road
		Blue Area, Islamabad
Head Office		309, Anum Empire
		Block 7/8, KCHSU
		Shahrah-e-Faisal, Karachi
		Ph: 4527246, 4529224 & 4529225
		Fax: (92-21) 4527232
		E-mail: natlease@fascom.com
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the Thirteenth Annual General Meeting of National Asset Leasing Corporation
Limited will be held, on Wednesday October 29, 2003 at 11.30 A.M. at its registered office 301-302,
Mohammad Gulistan Khan House, Fazal-ul-Haq Road, Blue Area, Islamabad to transact the following
business:
ORDINARY BUSINESS
1.   To confirm the Minutes of Twelfth Annual General Meeting held on October21,2002.
2.   To receive, consider and adopt the Audited Accounts for the year ended June 30,2003 together with
Directors' and Auditors' Report thereon.
3.  ToappointAuditorsandtofixtheirremunerationfortheyear July01,2003 to June30,2004.The present
Auditors, M/s. M.Yousuf Adil Saleem & Co., Chartered Accountants, retire and being eligible, offer
themselves for reappointment.
4.   To transact any other business with the permission of the Chair.
By Order of the Board
Islamabad: October 06, 2003
Syed HaiderZaidi
Company Secretary
Notes:
1.   The Register of Members of the Company will remain closed from 21th October 2003 to 28th October
2003 (both days inclusive) and no transfer of shares will be made during the period the register is closed.
2.   A member entitled to attend and vote at the General Meeting is entitled to appoint another member as
his/her proxy to attend and vote on his/her behalf.
3.    Instrument appointing proxy and the Power of Attorney or other authority under which it is signed or a
notarially certified copy of the Power or authority must be deposited at the Registered Office of the
Company at least 48 hours before the time of the meeting.
4.   CDC Shareholders entitled to attend and vote atthis meeting, must bring with them their National Identity
Cards/Passports in original along with Participants ID Numbers and their Account Number to prove
his/her identity, and in case of proxy, must enclose an attested copy of his/her NIC or Passport,
representatives of Corporate members should bring the usual documents required for such purpose.
5.   Shareholders are requested to notify any change in address immediately.
IN THE NAME OF ALLAH, MOST GRACIOUS, MOST MERCIFUL
REPORT OF THE DIRECTORS
FOR THE YEAR ENDED JUNE 30, 2003
The Board of Directors is pleased to present its 13th Annual Report together with the audited financial
statements for the year ended June 30, 2003. The financial statements annexed to this report, present fairly
its state of affairs, the result of its operations, cash flows and changes in equity. Proper books of account have
been maintained. Appropriate accounting policies have been consistently applied in preparation of financial
statements and accounting estimates are based /on reasonable and prudent judgement. International
Accounting Standards, as applicable in Pakistan, have been followed in preparation of financial statements
and any departure therefrom has been adequately disclosed.
FINANCIAL RESULTS & REVIEW OF OPERATIONS
As informed earlier the Company ceased to operate as a leasing company following suspension / cancellation
of leasing license by the Securities & Exchange Commission of Pakistan due to our failure to raise the capital
of the company to Rs200.0 million as required under Leasing Rules. As a result, the management reduced its
expenses substantially and made all efforts to settle the debts through assignment of receivables. Your
directors are pleased to confirm that the lenders to the company, considering the serious financial problems of
the company, granted substantial concession and remission in the form of waivment of fee, mark-up etc.,
which helped your company to convert the operational losses into a profit of RsO.73 million, despite the fact
that a large amount of loss was incurred due to settlement of leases for assignment of rentals to the lenders.
We are pleased to confirm that the outstanding liabilities of a Commercial Bank and a NBFC were fully repaid
during the year under review. No new business was undertaken during the year under review. Since the most
of the leases have matured hence the gross revenue decreased to Rs.0.84 million from Rs.1.23 million as
compared to last year, but the same was covered by reducing the administrative expenses from Rs.5.32
million of last year to Rs.4.47 million during the fiscal year 2003.
The operating results for the year under review are given below:
Gross revenue			RsO. 84 million
Administrative charges			Rs4.47 million
Financial charges			Rs2.47 million
Reversal of mark-up etc. as per settlement of
liabilities less loss caused due to settlement
of lease for assignment of rentals to the
lenders			Rs7. 38 million
Net Profit forthe year*			RsO. 73 million
*  unrealised gain on remeasurement of investments
amounting to Rs.3.5 million has not been included above
The Comparative statement for last 6 Years of key financial and operating data is annexed.
As stated above, the Company could not declare any dividend / bonus for the year under review.
During the year, six meetings of the Board of Directors were held and all the Directors except Mr. Sohail Ali
attended the meeting. Mr. Sohail Ali remained out of country throughout the year.
FUTURE OUTLOOK
We are making all efforts for the merger of your leasing company with a financially solvent leasing company
and hopefully the matter will be finalized soon. We also discussed our plan with the Executive Director of
Securities & Exchange Commission of Pakistan, who advised to pursue investors for the investment in
the Equity of the Company in order to consider the restoration of licence and accordingly investors have
been approached and hopefully a revival plan for increasing the equity through merger and injection of
fresh funds will be submitted to SECP very soon.
CODE OF CORPORATE GOVERNANCE
Your Directors have implemented the code as required and there has been no material departure from it. The
Audit Committee and Executive Committee have also been established.
\
GOING CONCERN ASSUMPTION & FUTURE PROSPECT
The Company has earned a net profit of Rs.0.73 million during the year (2002: Loss of Rs.0.91 million) and its
accumulated losses up to June 30, 2003 amounted to Rs.91.37 million (2002: Rs.91.96 million) and after
including the unrealised gain on the remeasurement of investments amounting to Rs2.91 million, the net
equity of the Company has increased to Rs. 16.87 million (2002: Rs. 12.66 million). The Company has not paid
the overdue amounts to financial institutions as specified in notes 5.2,6.1,6.3,10.4,17.1 & 17.2 to the financial
statements. The Management negotiating with a Leasing Company and Potential Investors for merger and
enhancement of equity. As regards the deposits of Rs43.98 million placed with an associated investment
bank, the management of the investment bank has successfully negotiated with Army Welfare Trust (AWT-
Askari Bank) and Habib Bank Limited to participate in the enhancement of capital of the bank. NALC will also
convert their entire deposit plus profit into equity jointly with AWT and HBL subject to approval by Securities &
Exchange Commission of Pakistan (SECP). Necessary approvals of the Directors and members have
already been obtained in the last AGM of NALC. In view of above, the stuck up amounts now seems to be
recoverable in the form of shares of AIBL. The Company has repaid / settled loans of Rs.10.82 million during
the year under review through the sale of TFCs and rentals received by them. Furthermore, the management
is in trie process of negotiating the settlement of remaining above-mentioned overdue loans.
Auditors have qualified their Audit Report due to non-provisioning in respect of the following items:
a)         Deposits with Asset Investment Bank Limited
B)         Amount receivable from various lessees.
c)         Reversal of accrued mark-up and non accrual of mark-up on loans.
Management considers that in view of the negotiation with various lenders and borrowers and process of
restructuring / rescheduling of Company's assets as well as liabilities, substantial amount of such provision
will not be required. Further in view of significant progress made in restructuring of associated undertaking i.e.
Asset Investment Bank Limited with Habib Bank Limited and Army Welfare Trust (AWT) in the participation of
enhancement of Capital of Investment Bank. Based on that, management consider that at this stage there is
no need to make any provision against above assets. However in the interest of transparency and full
disclosure, management has given all significant facts in respect of Assets and Liabilities and related
uncertainly.
SYSTEM OF INTERNAL CONTROLS
The Board has established a system of Internal Controls that is considered sound in view of the Company's
nature of business and its size. The Board has also established mechanisms for on going monitoring of the
Internal Control to ensure its effective implementation. Further, due to difficulties in the financial position of the
Company, there is no appropriate segregation of duties, however such factors has'been overcome by direct
supervision of a full time Director.
AUDITORS' REPORT
As regard the auditors' remarks/qualification regarding inadequate provision and unrealised finance income,
we feel that the amounts mentioned therein are recoverable and in case of our failure in recovery, the amount
will be fully covered through provisions. The company has suspended all the accruals of profit as required
under Leasinq Companies Rules.
The reservation of the Auditors in respect of the investment of funds with Asset Investment Bank Limited,
an associated company of National Asset Leasing Corporation Limited, have already been explained
above.
The reversals of profit in all the cases are justified as per corresponds/agreements signed between your
company and the lenders.
PATTERN OF SHAREHOLDING
The pattern of shareholding as at June 30,2003 is annexed to this report.
There was no trading in shares by any Director, Chief Executive Officer, Chief Financial Officer, Company
Secretary and their spouses and minor children.
AUDITORS
The auditors M/s. M. Yousuf Adil Saleem & Co., Chartered Accountants retire and offer themselves for re-
appointment.
ACKOWLEDGEMENT
The Board likes to place on record their deep appreciation of the efforts put and dedication shown by all
personnel of the company.
Your Directors express their gratitude to lenders and regulatory bodies for their support.
For and on behalf of
NATIONAL ASSET LEASING CORPORATION LTD.
Islamabad: October06,2003                                                                                RANA M. ABU OBAIDA