COMBINED ANALYSIS OF THE COMPANIES IN THE MUTUAL FUND INDUSTRY

ANALYSIS ON THE BASIS OF ACCOUNTING POLICIES: 1) JAHANGIR SIDDIQUI &CO LIMITED

Auditors Opinion Basis of Measurement Unqualified opinion, that is, financial reporting and financial representation done by the company is free from any material error. The financial statements have been prepared under the historical cost convention; except for financial assets at fair value through profit or loss, available for sale investments and derivative financial instruments which are stated at fair value. 1)Return on Defence Saving Certificates (DScs) and Special Saving Certificates (SSCs) are accounted for using the effective interest rate method. 2) income from Term Certificates (TFSs), government securities, reverse repurchase transaction and loans and advances are recognized at rate of return implicit in the instrument/arrangement on a time proportion basis. 3) profit on bank deposits and rental income is recognized on an accrual basis. 4) dividend income on equity investment is recognized when the right to receive the same is established. 5) capital gains or losses on sale of investment are recognized in the period in which they arise. 6) underwriting commission is recognized when agreement is executed. Take-up commission is recognized at the time the commitment is fulfilled. 7) consultancy and advisory fee, commission on foreign exchange dealings and government securities, etc. are recognized as and when earned. Depreciation is charged to the profit and loss account by applying the straight-line method.

Revenue Recognition

Depreciation

2)MCB CASH MANAGEMENT OPTIMIZER LIMITED

Auditors Opinion Basis of Measurement Unqualified opinion, that is, financial reporting and financial representation done by the company is free from any material error. The financial statements have been prepared using the historical cost

convention. Investments classified as financial assets at fair value through profit and loss are carried at fair value under the approved accounting standards. Revenue Recognition 1. Income on government securities and bank deposits (including term deposit receipts) is recognized on an accrual basis. 2. Profit on bank deposits is recognized on an accrual basis. 3. Income on issue and purchase of units is recognized when the units are issued and redeemed at the transaction date. 4. Realized capital gains / (losses) arising on sale of investments are included in the income statement on the date at which the transaction takes place. 5. Unrealized gains /or (losses) arising on remeasurement of investments classified as 'financial assets at fair value through profit or loss' category are included in the income statement in the period in which they arise. Reducing balance method is used to charge depreciation of assets over their useful life Unqualified opinion, that is, financial reporting and financial representation done by the company is free from any material error. The financial statements have been prepared under the historical cost convention; short-term investments have been measured at fair value Following are the sources of revenue: 1. Brokerage, advisory fees, commission and other income are accrued as and when due except for profit on Sukuk bonds which is recognized on receipt basis. 2. Dividend income on equity investments is recognized, when the right to receive the same is established. 3. Gain or losses on sale of investment are recognized in the period in which they arise. 4. Underwriting commission is recognized when the agreement is executed. Take-up commission is recognized at the time commitment is fulfilled. 5. Consultancy, advisory fee and service charges are recognized as and when earned. 6. Unrealized capital gains/losses arising from marking to market of investments classified as financial assets at fair value through profit and loss-held for trading are included on profit and loss account in the period in which they arise. Reducing balance method is used to charge depreciation of assets over their useful life

Depreciation

3) INVEST AND FINANCE SECURITIES LIMITED

Auditors Opinion Basis of Measurement Revenue Recognition

Depreciation

4) ARIF HABIB SECURITIES LIMITED

Auditors Opinion Basis of Measurement Unqualified opinion, that is, financial reporting and financial representation done by the company is free from any material error. These unconsolidated financial statements have been prepared under the historical cost convention except for certain investments which are carried at fair value. MANAGEMENT / ADVISORY FEE Management / advisory fee is calculated on a daily / monthly basis by charging specified rates to the net asset value. PROCESSING AND OTHER RELATED INCOME These are recognized once the services are provided to unit holders in connection with their investments in the open end schemes managed by the company. MARK-UP / INTEREST INCOME Mark-up / interest income is accrued on a time proportion basis, by reference to the principal outstanding at the effective interest rates applicable. Depreciation is charged to income by applying the straight line method except for office premises which is depreciated applying the reducing balance method.

Revenue Recognition

Depreciation