Page 234 - Pakistan Oilfield Limited - Annual Report 2022

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PAKISTAN OILFIELDS LIMITED

Notes to and Forming Part of the -
Consolidated Financial Statements

For the year ended June 30, 2022

17.4 The carrying value of investment in National Refinery Limited at June 30, 2022 is net of impairment
loss of Rs 5,790,702 thousand (2021: Rs 3,808,877 thousand). The Group has assessed the
recoverable amount of the investment in National Refinery Limited based on higher of Value In Use
(VIU) and fair value (level 1 in the fair value hirerarchy - qouted market price as at June 30, 2022).
VIU is based on a valuation analysis carried out by an external investment advisor engaged by
the management. VIU has been assessed on discounted cash flow based valuation methodology
which assumes gross profit margin of 5.74% (2021: 2.71%), a terminal growth rate of 4.0% (2021:
4.0%) and weighted average cost of capital of 17.51% (2021: 20.05%).

17.5 Based on a valuation analysis carried out by the management, the recoverable amount of
investment in Attock Petroleum Limited exceeds its carrying amount. The recoverable amount
has been estimated based on a value in use calculation. These calculations have been made on
discounted cash flow based valuation methodology which assumes an average gross profit margin
of 5.83% (2021:4.46%), a terminal growth rate of 4.0% (2021: 4.0%) and a capital asset pricing model
based discount rate of 20.51% (2021: 16.51%).
2022 2021
Rupees ('000)
18. LONG TERM LOANS AND ADVANCES, CONSIDERED GOOD

Long term loans and advances to employees 57,715 58,285
Less: Amount due within twelve months, shown
under current loans and advances - note 22 28,125 21,139
29,590 37,146
18.1 Loans and advances to employees are for general purpose and for house rent advance which are
recoverable in up to 60 and 36 equal monthly installments respectively and are secured by an
amount due to the employee against provident fund. These loans and advances are interest free.
These do not include any amount receivable from the Chief Executive and Directors. These loans
have not been discounted, as the impact is considered insignificant.
2022 2021
Rupees ('000)
19. STORES AND SPARES

Stores and spares - note 19.1 6,422,316 5,299,071
Less: Provision for slow moving items - note 19.3 667,913 639,575
5,754,403 4,659,496

19.1 Stores and spares include:
Share in joint operations operated by the Group 684,310 627,650
Share in joint operations operated by others
(assets not in possession of the Group) 1,687,046 1,670,815
2,371,356 2,298,465
19.2 Stores and spares include stores and spares in transit of Rs 760,285 thousand (2021: Rs 88,503
thousand).