Annual Report 2012 - Lahore Stock Exchange

Financial Notes2012 2011- Discount rate 13% 14%- Expected increase in eligible salary 12% 13%- Average expected remaining working life time 14 years 15 yearsThe Company's policy with regard to actuarial gains/ losses is to follow minimum recommendedapproach under IAS 19.Defined contribution schemeProvident fundThe Company introduced contributory provident fund from 01 July 2011 for all employees.Equal monthly contributions to the fund at the rate of 10% of basic salary are made by theCompany and the employees.5.15 Earned leavesThe Company accounts for compensated absences on the basis of unavailed earned leave balanceof each employee at the end of the year, upto maximum of 90 days. Employees joining LSE after30 June 2011 are entitled for Leave Fare Assistance instead of Leave Encashment.5.16 Leave fare assistanceEmployees joining after 01 July 2011 are entitled for leave fare assistance (LFA) equivalent to15 earned days gross salary during each year. Employees who join or leave during the year andthus serve for less than the full year will be entitled to a pro rata amount based on the number ofmonth’s service during the year. LFA will be payable only in case an employee avails leaves.5.17 Cash and cash equivalentsFor the purpose of cash flow statement, cash and cash equivalents comprise cash in hand andbalances at bank.5.18 Revenue recognitionRevenue is recognized when following criteria is met:• The amount of revenue can be measured reliably;• It is probable that the economic benefits associated with the transaction will flow to theentity; and• The cost incurred for the transaction and the cost to complete the transaction can bemeasured reliably.114LAHORE STOCK EXCHANGE