subject financial statement analysis Act 450

Consolidated statement of financial position (All amounts in Kuwaiti Dinars unless otherwise stated) As at Note 2019 2018 Assets Non-current assets Property and equipment Intangible assets Right-of-use assets 7 6 3 72,529,057 711,338 697,144 73,937,539 73,389,643 711,350 74,100,993 Current assets Inventories Trade and other receivables Bank balances and cash 8 9 859,832 16,604,407 1,787,949 19,252,188 93,189,727 1,033,960 15,961,335 4,769,603 21,764,898 95,865,891 Total assets 10 Equity and Liabilities Equity Share capital Share premium Statutory reserve Foreign currency translation reserve Retained earnings Total equity 11 22,000,000 1,463,000 9,494,240 (30,262) 35,669,774 68,596,752 22,000,000 1,463,000 8,654,694 (13,941) 37,410,634 69,514,387 Liabilities Non-current liabilities Borrowings Lease liabilities Employees' end of service benefits 3,240,649 12 3 13 9,288,487 712,905 1,567,228 11,568,620 1,446,693 4,687,342 Current liabilities Trade and other payables Borrowings Lease liabilities 14 12 3 18,771,838 2,892,324 6,870,800 6,127,421 26,134 13,024,355 24,592,975 93,189,727 Total liabilities Total equity and liabilities 21,664,162 26,351,504 95,865,891 Consolidated statement of income (All amounts in Kuwaiti Dinars unless otherwise stated) Year ended 2019 December 2018 Note 15 16 29,594,584 (18,073,421) 17 4.1 (b) Revenue from contracts with customers Cost of providing services Cost of sale of equipment Cost of goods sold Gross profit General and administrative expenses Net impairment loss on financial assets Foreign exchange gain, net Other income Operating profit Finance costs Profit before directors' remuneration, contribution to Kuwait Foundation for Advancement of Sciences (KFAS), National Labour Support Tax (NLST) and Zakat Directors' remuneration KFAS NLST Zakat Profit for the year (63,584) 11,457,579 (2,595,129) (2,093,256) 332,492 1,817,851 8,919,537 (524,076) 41,961,348 (21,588,504) (218,182) (71,678) 20,082,984 (3,887,419) (585,564) 819,281 1,751,918 18,181,200 (347,110) 18 8,395,461 (60,000) (75,557) (258,013) (103,205) 7,898,686 17,834,090 (60,000) (160,520) (191,241) (186,712) 17,235,617 Consolidated statement of cash flows (All amounts in Kuwaiti Dinars unless otherwise stated) Year ended 31 December 2019 2018 Note 7,898,686 17,235,617 7 3.1 10,813,856 Operating activities Profit for the year Adjustments for: Depreciation Depreciation on right-of-use assets Finance costs Provision for employees' end of service benefits Net impairment loss on financial assets Unrealized exchange (gain) / loss on borrowings Gain on sale of subsidiary Gain on disposal of property and equipment 13 4.1 (b) 12 8,124,244 66,904 524,076 232,031 2,093,256 (189,433) 347,110 334,977 585,564 (287,485) (123,442) (1,398,328) 27,507,869 18 (1,377,799) 17,371,965 Changes in working capital: Trade and other receivables Inventories Trade and other payables Cash generated from operations Employees' end of service benefits paid Net cash generated from operating activities (2,733,259) 174,128 (11,901,202) 2,911,632 (111,343) 2,800,289 (454,959) (169,936) 4,740,307 31,623,281 (85,232) 31,538,049 13 7 Investing activities Purchase of property and equipment Proceeds from disposal of property and equipment Proceeds from sale of subsidiary net of cash disposed Net cash used in investing activities (9,217,049) 3,324,929 (14,554,504) 2,297,001 114,354 (12,143,149) (5,892,120) 12 Financing activities Dividends paid to Parent Company's shareholders Proceeds from borrowings Repayment of borrowings Lease liabilities paid Finance costs paid Net cash generated from/ (used) in financing activities (6,600,000) 1,621,004 (13,127,170) 12 3.1 (8,800,000) 14,387,319 (4,914,951) (59,236) (489,849) 123,283 (347,110) (18,453,276) Effect of foreign currency translation (13,106) (17,433) Net (decrease)/ increase in bank balances and cash Bank balances and cash at beginning of the year Bank balances and cash at end of the year (2,981,654) 4,769,603 1,787,949 924,191 3,845,412 4,769,603 9 QUESTION 1) (25 pts) Answer the followings. a) Calculate year to year change in KWD and in percentages for net cash generated from operating activities (3 pts), net cash used in investing activities (3 pts) and net cash generated/used in financing activities (3 pts), separately. b) What are the reasons of a negative net cash used for investing activities in 2018 (3 pts), and the reasons of a negative cash used for investing activities in 2019 (3 pts). Tell the reasons one by one clearly c) Considering the changes you calculated in (a), and overall picture in the table, evaluate the Statement of Cash Flows of the company (10 pts, min 100 words)