Page 209 - Pakistan Oilfield Limited - Annual Report 2022

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Annual Report 2022

3.2 The above standards, amendments to approved accounting standards and interpretations are not
likely to have any material impact on the Group's financial statements.
Other than the aforesaid standards, interpretations and amendments, IASB has also issued the
following standards and interpretation, which have not been notified locally or declared exempt
by the SECP as at June 30, 2022:

- IFRS 1 (First Time Adoption of International Financial Reporting Standards)
- IFRS 17 (Insurance Contracts)
- IFRIC 12 (Service concession arrangements)

3.3 The Securities and Exchange Commission of Pakistan (SECP) through S.R.O. 1177 (I)/2021 dated
September 13, 2021, in partial modification of its previous S.R.O. 985(1)/2019 dated September 2,
2019, has notified that in respect of companies holding financial assets due from the Government
of Pakistan (GoP) in respect of circular debt, the requirements contained in IFRS 9 with respect
to application of expected credit loss (ECL) model shall not be applicable till June 30, 2022,
provided that such companies shall follow relevant requirements of IAS 39 'Financial Instruments:
Recognition and Measurement' in respect of above referred financial assets during the exemption
period. The Group has assessed that the above does not have any significant impact on its financial
statements.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

4.1 Basis of measurement
These financial statements have been prepared under the historical cost convention except as
otherwise disclosed in the respective accounting policy notes.

4.2 Basis of consolidation
The consolidated financial statements include the financial statements of POL and its subsidiary
CAPGAS with 51% holding (2021: 51%).

a) Subsidiary
Subsidiaries are all entities (including structured entities) over which the Group has control. The
Group controls an entity when the Group is exposed to, or has right to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power over
the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the
Group. They are deconsolidated from the date that control ceases.

The assets and liabilities of subsidiary company have been consolidated on a line by line basis and
the carrying value of investments held by the parent company is eliminated against the subsidiary
shareholders' equity in the consolidated financial statements.

Material intra-group balances and transactions have been eliminated.
Non-controlling interests are that part of the net results of the operations and of net assets of the
subsidiary attributable to interests which are not owned by the parent company. Non-controlling
interest are presented as a separate item in the consolidated financial statements.