Audit and Financial Reporting Requirements

Listed Public Companies

Listed public companies are required to circulate to shareholders quarterly and annual financial statements. They are also required to file copies with the stock exchanges and Securities and Exchange Commission of Pakistan (SECP). The quarterly reports for first and third quarter must be circulated/ filed within one month of the close of the quarter and annual reports are due within four months of the financial year-end. Second quarter reports are due within two months of the end of quarter. The SECP may, for good reason, grant an extension of up to two months for submitting annual reports.

The mandated financial year-end is 30 September for manufacturers of sugar. The financial year-end for banks and insurance companies is 31 December. All other companies must have a financial year-end of 30 June, unless an exemption is obtained from the Central Board of Revenue.

Annual financial statements, together with information regarding shareholders and directors, must be filed with the Registrar of Joint Stock Companies within 45 days of the annual shareholders' meeting. The annual financial statements must be audited, and second quarter financial statements must be reviewed by auditors.

Directors' report to the shareholders on the company's state of affairs, recommendations for dividend, and other matters should be attached to the financial statements, but these need not be audited. A report on status of compliance with the code of corporate governance must accompany annual financial statements and such status should be reviewed by the auditors.

Listed public companies are also required to submit a statement showing the pattern of shareholdings at the date of the annual financial statements. This need not be audited. Reports must be in English. The companies with subsidiaries are also required to publish consolidated financial statements. Printed reports are made available, without exception, to all shareholders, banks, financial institutions, government agencies, and the financial press. The companies may avail the option of putting their financial statements on the web after obtaining shareholders approval in a general meeting.

Every company is required to keep proper accounting records with respect to all sums of money received or expended by the company, all purchases and sales by the company, and assets and liabilities of the company. Waiver of reporting requirements are available, upon application to the SECP, when a company can prove that reporting certain information is either impractical or not in its interest.

Tax Returns

Tax returns must be filed annually with the Income Tax Department by 30 September with financial year ending between 01 July and 31 December and by 31 December with financial year ending between January 1 and June 30. The Deputy Commissioner of Income Tax (DCIT) on sufficient cause may extend the date for filing of return for aggregate period of 15 days from the due date. Extensions beyond 15 days can only be allowed by the DCIT with the approval of the Commissioner of Income Tax. Returns must include the same financial statements as those in statutory reports. The financial statements supporting the return must be audited.

A depreciation schedule containing all particulars prescribed under the income tax rules is required to be submitted with the return. Returns must be in English. It is not possible to file on a consolidated basis.

• Public Unlisted and Private Companies
• Foreign, Private and Nationalized Banks
• Non-Banking Financial Institutions
• Listed Insurance Companies

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