st - AGRANI INSURANCE

21st

ANNUALREPORT

2020

Company EthosLetter of Transmittal 04Notice of the 20th Annual General Meeting 05Corporate Information 06Award & Recognition 07Membership Affiliation 07Credit Rating Report 08Forward Looking Statement 09

Corporate ObjectivesValues & Structure1.01 Vision & Mission 121.02 Overall strategic objects 121.03 Core values and code of conduct 131.04 Profile of the Company 141.05 Key Operating & Financial Data 151.06 Organization Chart 171.07 Corporate Chronicle 181.08 Products & Services 181.09 Branch Offices 191.10 Profile of Head of Branches 20

Board of Directors & Management2.01 Brief Resume of the Directors 262.02 Chairman’s Statement 302.03 Directors Report 332.04 Profile of the CEO 372.05 CEO’s Discussion & Analysis 382.06 Profile of the DMD 402.07 Profile of Head of Departments 412.08 Corporate Operational Team 442.09 Management Committee 44

Sustainability Reporting3.01 Corporate Social Responsibility Initiatives (CSR) 463.02 Environment related Initiatives 463.03 Environmental & Social Obligations 463.04 Integrated Reporting 473.05 Human Resource Development 473.06 Human Capital 483.07 Human Resource Accounting 493.08 Company’s Contribution Towards its Staff 503.09 Regulatory Review 503.10 National Integrity Strategy 513.11 Investor Friendly Information 513.12 AICL Sustainability Reporting 51

Information aboutCorporate Governance4.01 Board of Directors, Chairman and CEO 54 4.02 Board Meeting & Other Committee Meetings Attendance 544.03 Pattern of Shareholding 554.04 Ethics and Compliance 554.05 Report on the Activities of Audit Committee 564.06 Nomination & Remuneration Committee 564.07 Corporate Governance & Compliance Report 574.08 Compliance Report on CGC 594.09 Website Information 69 4.10 Management Review and Responsibility 694.11 Summary of Quarterly Reports 694.12 Summary of Accounts (Segment/Class-wise Operating Profit) 704.13 Report on Going Concern 714.14 Directors’ Responsibility Statement 724.15 Certification of the CEO & CFO 734.16 Clients’ Complaints & Communication 74

Information aboutStakeholders & Investors5.01 Communication to Shareholders 765.02 Shareholding Position 765.03 Paid-up Capital Growth 775.04 Number of Shareholders 775.05 Equity Statistics 775.06 Market Share Price 785.07 Market Capitalization of Shares 78

Risk Management & Control Environment6.01 Risk Management Framework 806.02 Risk Mitigation Methodology 816.03 Disclosure of Risk Reporting 81

Graphical Presentation7.01 Segment Information 847.02 Horizontal & Vertical Analysis 857.03 Financial Position Analysis 87

Statement of Value Addedand Its Distribution8.01 Value Added Statement 908.02 Market Value Added Statement 918.03 Contribution to National Exchequer 928.04 Market Share Position of Insurance Business 94

Auditors Report& Financial Statements11.01 Auditors Report to the Shareholders 11011.02 Statement of Financial Position/ Balance Sheet and relevant schedules 11411.03 Income Statement/Profit and Loss Account 115 11.04 Profit & Loss Appropriation Account 11511.05 Consolidated Revenue Account 11611.06 Fire Revenue Account 11711.07 Marine Revenue Account 11811.08 Motor Revenue Account 11911.09 Miscellaneous Revenue Account 12011.10 Statement of Changes in Equity 12111.11 Statement of Cash Flows 12211.12 Notes to the Financial Statements 12311.13 Classified Summary of Assets 140

Other Events12.01 Event Highlights 14112.04 Proxy Form 147

Specific Areasfor Insurance Sector9.01 Claims management and details of outstanding claims (IBNR & IBNER) with ageing thereof 96

9.02 Disclosures pertaining to Solvency Margin 97

9.03 Accounting ratios pertaining to insurance sector 99

9.04 Review of assets quality 100

9.05 Investment Profile 101

Additional Disclosures10.01 Global Reporting Initiative (GRI) 10410.02 Report on Claims settlement 10410.03 Internal Audit Report 10510.04 Report on Online Business System 105 10.05 Report on Reinsurance 10610.06 Report on Pre-Survey Risk Inspection 10610.07 Financial Calendar 107

ToAll the Shareholders,Bangladesh Securities and Exchange CommissionDhaka Stock Exchange LimitedInsurance Development and Regulatory Authority (IDRA)

Sub: Submission of Annual Report for the year ended 31 December 2020

Dear Sir (s):

We are pleased to present the Annual Report of Agrani Insurance Company Limited together with the Audited Financial Statements for the year ended 31 December 2020 for your kind information and record. The report and Audited Financial Statement prepared in accordance with applicable laws and regulations.

Sincerely yoursFor Agrani Insurance Company Ltd

Md. Mofizur RahmanActing Company Secretary

LETTER OFTRANSMITTAL

21ST ANNUAL REPORT 202004

NOTICE OF THE21stANNUAL GENERAL MEETING

Notice is hereby given to all members of Agrani Insurance Company Limited that the 21st Annual General Meeting of the company will be held on 28 April 2021 at 11.00 am. The AGM will be held virtually by using digital platform to transact the following agenda:

1. To consider and adopt the Director’s Report & Auditors’ Report and Audited Financial Statements of the company for the year ended 31 December 2020.

2. To declare the Dividend for the year 2020.

3. To elect the Directors.

4. To consider appointment of Independent Director.

5. To consider appointment of statutory auditors for the year 2021 & to fix their remuneration.

6. Appointment of compliance auditor & to fix their remuneration.

By order of the Board of Directors

Md. Mofizur Rahman Registered Office Acting Company Secretary 90/1, Motijheel C/A, Dhaka

14 April, 2021

Notes:

1. The Record date was April 06, 2021. Shareholder whose names would appear in the member’s register of the company on the record date will be eligible to attend the meeting and qualify for dividend.

2. Pursuant to the Bangladesh Securities and Exchange Commission’s Order SEC/SRMIC/94-231/25 dated 8 July 2020 and BSEC/CMRRCD/2009-193/08 dated 10 March 2021 and BSEC’s letter No. SEC/SRMIC/94-231/91 dated March 31, 2021 the AGM will be held digital/online platform.

3. A Shareholder is entitled to participate and vote at this virtual AGM, may appoint a Proxy to participate and vote. The proxy form, a specimen of which is enclosed, duly filled, signed and stamped at Tk.20 (Revenue stamp) must be sent through email to [email protected] not later than 48 hours before commencement of AGM.

4. Shareholders bearing BO ID are requested to update their respective BO ID with 12 digits taxpayer’s Identification Number (e-TIN) through their Depository Participants (DP) failing which, Income Tax at source will be deducted from payable Dividend @15% instead of @10% as per amended income Tax Law.

5. The soft copy of the Annual Report-2020 will also be available of the Company’s website at :www.agraniinsurance.com

AGRANI INSURANCE COMPANY LTD. 05

CORPORATEINFORMATION

The company is listed with Dhaka Stock Exchange Ltd., as a Publicly Traded Company. The company carries its insurance activities through 21 Branches spread across the country.

Registered name of the CompanyAGRANI INSURANCE COMPANY LTD.

Registered OfficeCity Centre (Level-17)90/1, Motijheel C/A, Dhaka-1000Phone: (PABX)- 55111007-11, Fax: 88-02-55111012E-mail: [email protected]. www.agraniinsurance.com

Date of Incorporation 14 March 2000

Date of Registration from the Chief Controller of Insurance 3 April 2000

Commencement of Business 3 April 2000

Listing with Dhaka Stock Exchange (DSE) 5 March 2005

Authorized Capital5,00,00,000 ordinary shares of Tk. 10.00 each 500,000,000

Paid-up Capital30,244,686 ordinary shares of Tk. 10.00 each 302,446,860

Jamuna Bank Ltd 024 032 0000 853 1302 74243

Dutch Bangla Bank Ltd 191 120 158 0902 71094

BASIC Bank Ltd 131 601 0000 437 0551 53649

NAME OF BANKS STD A/C No. Routing No.

PREMIUM DEPOSIT ACCOUNTS


Chairman Quazi Sakhawat Hossain (Lintoo)

Chief Executive Officer (CEO) Md. Azharul Islam

Chief Financial Officer Badal Chandra Rajbangshi FCS, FCA

Head of Internal Audit & Compliance Rajib Mazumder

Acting Company Secretary Md. Mofizur Rahman

Auditors M/s. G. Kibria & Co., Chartered Accountants

Legal Advisors Md. Sakhawat Hossain, Advocate, Supreme Court of Bangladesh

ICMAB BEST CORPORATE AWARD-2016AGRANI INSRANCE COMPANY LTD.

THIRD POSITIONCATEGORY: GENERAL INSURANCE

MEMBERSHIPAFFILIATION

ICMAB Award-20163rd position in the ICMAB Best Corporate Award for the year 2016

BIABangladesh Insurance Association

BAPLC

Bangladesh Association ofPublicly Listed Companies

AWARD ANDRECOGNITION


24 November, 2020

Chief Executive Officer Agrani Insurance Company Limited City Centre (Level-17), 90/1, Motijheel C/A, Dhaka-1000

Subject: Credit Rating of Agrani Insurance Company Limited

Dear Sir,

We are pleased to inform you that Alpha Credit Rating Limited (AlphaRating) has affirmed the following rating to Agrani Insurance Company Limited.

Date of Valid Till Rating Long Term Short Term Outlook Declaration Action

24 November, 23 November, Surveillance AA ST-2 Stable 2020 2021

The rating may be changed or revised prior to expiry, if warranted by extraordinary circumstances in the management, operations and/or performance of the entity rated.

We, Alpha Credit Rating Limited, while assigning this rating to Agrani Insurance Company Limited, hereby solemnly declare that:

(i) We, Alpha Credit Rating Limited as well as the analysts of the rating have examined, prepared, finalized and issued this report without compromising with the matters of our conflict of interest, if there be any; and

(ii) We have complied with all the requirements, policy and procedures of these rules as prescribed by the Bangladesh Securities and Exchange Commission in respect of this rating.

We hope the rating will serve the intended purpose of your organization.

With Kind Regards,

Riyadh M. Hossain MBA (USA)Chief Risk Officer

This letter forms an integral part of the credit rating report.

HIG

H RI

SK

MEDIUM RISK LOW RISK

D

C

CC

CCC B BB BBB A AA AA

A

ALPHARATING


CREDIT RATINGREPORT

Basically, forward looking statement is considered as one of the most important factors of the annual report of a company. This is a strategic statement to focus the company’s future activities on the basis of consequences of current activities of the management of the company obviously in line with policies and decisions taken by its Board of Directors.

AICL had a few unpleasant memories in the recent past. With a view to eradicating those memories it has changed its policy and has appointed experienced and qualified personnel in the second position of the corporate management. With a view to restore goodwill the new management has conceived a new vision for the company- “Be the leading insurer of Bangladesh enhancing prompt but ethical services to the insured and meeting up stakeholders’ interest.” Thus, the new management has set its objectives to establish a congenial corporate environment in the company in its all the sectors gradually with a view to ensuring ethics in business and providing prudent and

prompt non-life insurance business services to the insured with transparency in transaction.

AICL is hopeful to think and act with optimism to earn a handsome amount of premium gradually in the years to come although its turnover in the recent past was not much bigger. AICL wishes that with the strong hands of IDRA the non-life insurance market would find a stability of transparent insurance business market where the insured would ask for insurance service to mitigate the risk of their property and of course they would not run after unethical rebates from their given premium. Thus the span of insurance service would increase and the insurance industry would be able to contribute a handsome figure of over 4% to the country’s GDP as was targeted in the Bima Niti. The new management with its fresh outlook would take appropriate measures complying the insurance rules and regulations and directions of IDRA it certainly would earn goodwill and establish itself as a significant insurer of the country’s insurance market.

FORWARD LOOKING STATEMENT


CORPORATE OBJECTIVESVALUES & STRUCTURE



Be the leading insurer of Bangladesh enhancing prompt but ethical services to the insured and meeting up stakeholders’ interest.

VISION

MISSION1. To provide safeguards to the insured’s property through proper risk assessment with varied range of insurance products.

2. To settle quick claims to the insured in case of exigencies ensuring documentation properly.

3. To create awareness among the potential insured in every walks of life.

4. To set and ensure governance excellence in the company.

5. To abide by the applicable rules and regulations while ensuring insurance services.

6. To safeguard interest of the employees with congenial work atmosphere.

7. To safeguard interest of the insurance agents, brokers, surveyors and suppliers.

8. To ensure payment of proper revenues to the Government.

9. To ensure proper return to the investors.

OVERALLSTRATEGICOBJECTIVES

• Retain leadership position in the market.

• Explore opportunities by introducing new products and diversifying current product

portfolio gradually.

• Pursue continuous improvement and technological advancement.

• Enhance corporate capabilities and motivation through skill enhancement, management development and reward programs.

COREVALUES

Agrani’s core values comprise of the following 7 key components:

Clients first: Clients are always our first priority. We take care of them as they are our business partners. We treat all clients with warmth and respect. We understand their needs and try our level best to manage their expectations.

Integrity:Conduct business with ethics, dignity, fairness and transparency.

Efficiency:We focus both on external and internal training programs to increase our efficiency level in order to deliver world class operational and financial performance.

Quality:We ensure quality both in terms of products and services. We are always open to new ideas for raising the bar.

Service:We strive to add more values to our service that we provide to our clients and stakeholders.

Team Work:We strongly promote and believe in teamwork. We teach and encourage our people to improve their performance and professionalism.

Transparency:We are focused on the highest level of transparency in providing accurate and timely information about our performance and financial results to meet the expectations of our client as well as shareholders.

CODE OFCONDUCT

This code of conduct is based on the values of the company. The purpose is to ensure that all employees, managers and executives of Agrani Insurance Company Limited (AICL), will act in accordance with these values and principles. The code is designed to give a broad and clear understanding of the conduct expected from all of our employees everywhere we do business.

AICL is committed to conduct its business in ethical, legal and responsible manner. AICL, therefore, has established this social responsibility. Code of Conduct as an application is committed to ensuring that this code is respected in all its facilities, all over Bangladesh.


PROFILE OFAGRANI INSURANCE COMPANY LTD.

Agrani Insurance Company Limited (AICL) is a prominent non-life insurance company in Bangladesh. The company has specialized in underwriting Fire, Marine Hull, Marine Cargo, Motor, Engineering, Miscellaneous, etc.

Authorized and paid-up capital:The authorized capital of the company is Tk. 500 million while paid-up capital has been increased to Tk. 302.45 Million.

Board of Directors: The Board of Agrani Insurance Company Limited has been constituted with 12 Directors as per section 76 (1) of Insurance Act 2010 and notification of Bangladesh Securities and Exchange Commission. The Board of AICL is as follows:

10 Sponsor Directors and 02 Independent Directors.

Listing:The company was listed with Dhaka Stock Exchange Ltd., on 5 March 2005.

Credit Rating:As a consequence of the good financial performance, improving solvency position, diversified investment port-folio, high claim paying ability, strong IT infrastructure and experienced top management team, Alpha Credit Rating Ltd, Sadharan Bima Bhaban-2 (8th Floor), 139 Motijheel C/A, Dhaka-1000, has rated Agrani Insurance Company Ltd "AA" for

the year 2019 on 24 November 2020 valid up to Novermber 23, 2021.

Underwriting of risk:

AICL with its expert senior underwriters can assess the potential risks and underwrite it with smallest possible time to cover the risk of the insured. While underwriting any risk AICL maintains the norms of insurance prudently and follows the rules & regulations of Insurance Development & Regulatory Authority (IDRA).

Claim Settlement:

Efficient and timely settlement of claim is Agrani’s commitment to the insured and it follows a structured policy for settlement of claims. Upon receipt of intimation of claim from a client, it instantly inspects the affected properties and files “The First-Hand Report” to the Claims Department and immediately deputes an independent licensed surveyor for assessing the quantum of loss for speedy settlement of claim.

Re-Insurance:

For handing insurance of technological and multidimensional projects and placement of re-insurance in the world market, insured needs support of multinational insurance Brokers. The company has taken out necessary re-insurance protection from Sadharan Bima Corporation at home and some other reputed foreign re-insurers for the full Protection of risk of our clients’ property and interests.


KEY OPERATINGAND FINANCIAL DATA 2020 2019 2018 2017 2016 2015Par�culars

(Figures in Million Taka)

Financial Posi�on Authorised share capital (Taka in million) 500.00 500.00 500.00 500.00 500.00 500.00Paid-up capital 302.45 302.45 288.04 274.33 266.34 253.66Reserve & con�ngent accounts 245.31 223.44 199.62 185.41 189.96 164.77Shareholders funds 547.76 525.89 487.66 459.74 456.29 418.42Current liabili�es 302.23 295.53 304.06 261.61 234.12 210.33Total assets 849.99 821.42 791.72 721.35 690.41 628.75Property, plant & equipments 151.92 163.38 165.56 170.31 170.10 160.83Investments 477.23 482.64 482.08 470.66 489.99 440.43Current assets: 321.05 303.52 273.31 212.06 163.88 150.72Accounts receivable (Amount due from other 307.79 295.01 267.72 204.09 156.90 142.48persons & sundry debtors) Investories (Sta�onery & Stamp) 3.77 1.74 1.87 2.68 2.46 3.73Net current assets 1.35 8.05 (30.75) (49.55) (70.24) (59.61)Cash & cash equivalents 277.45 277.45 271.83 256.51 277.11 235.23Net assets 547.76 525.89 487.66 459.74 456.29 418.42Opera�onal Performance Gross premium income (turnover) 352.49 423.20 383.01 372.36 407.06 357.57Re-insurance ceded 128.30 230.92 184.06 198.56 213.86 171.86Net premium income 224.20 192.28 198.95 173.80 193.20 185.71Net commission earned on Re-insurance ceded 27.00 21.95 25.03 23.20 22.00 18.96Commission Paid 43.61 51.98 47.42 48.51 54.69 47.97Management expenses 98.52 90.06 66.00 62.23 66.16 57.40Net claims 28.47 15.33 48.84 49.55 30.02 26.90Reserve for un-expired business 10.26 (3.92) 11.02 (10.56) 4.05 12.69Underwri�ng profit/(loss) 70.35 60.78 50.70 47.28 60.27 40.75Interest income 17.82 17.27 14.34 15.83 18.52 19.83Investment & dividend income 9.07 0.28 7.07 18.11 5.75 0.95Other income 2.62 1.74 0.87 1.26 1.07 0.91Non-Opera�ng Income 29.51 19.28 22.28 35.20 25.34 21.69Un-allocatable Expenses 28.18 32.10 17.79 16.94 12.91 11.35Non-Opera�ng Expenses 28.18 32.10 17.79 16.94 12.91 11.35Profit/(loss) before tax 71.68 47.97 55.19 65.54 72.70 51.09Current tax provision (a�er defered tax adjustment) 19.56 9.75 13.54 16.47 22.14 20.85Net profit/(loss) a�er tax 52.12 38.22 41.64 49.07 50.56 30.24Profit before interest, deprecia�on & tax 66.85 44.48 49.90 58.64 61.26 37.43Cash flow from opera�ng ac�vi�es 70.34 (21.46) 17.73 (15.62) 55.00 34.89Earnings per share (EPS) a�er tax 1.72 1.26 1.45 1.79 1.90 1.19Profitability and Performance Ra�os: Gross profit margin ra�o (%) 20.33 11.33 14.41 17.60 17.86 14.29Opera�ng income ra�o (%) 19.96 14.36 13.24 12.70 14.81 11.40Net profit/net income margin ra�o (a�er tax )(%) 14.78 9.03 10.87 13.18 12.42 8.46Return on assets ra�o (%) 6.13 4.65 5.26 6.80 7.32 4.81Return on equity ra�o (%) 9.51 7.27 8.54 10.67 11.08 7.23Opera�ng cash flow to net profit ra�o (%) 134.97 (56.14) 42.57 (31.82) 108.79 115.37Earnings per share before tax (Taka ) 2.37 1.59 1.92 2.39 2.73 2.01


24 November, 2020

Chief Executive Officer Agrani Insurance Company Limited City Centre (Level-17), 90/1, Motijheel C/A, Dhaka-1000

Subject: Credit Rating of Agrani Insurance Company Limited

Dear Sir,

We are pleased to inform you that Alpha Credit Rating Limited (AlphaRating) has affirmed the following rating to Agrani Insurance Company Limited.

Date of Valid Till Rating Long Term Short Term Outlook Declaration Action

24 November, 23 November, Surveillance AA ST-2 Stable 2020 2021

The rating may be changed or revised prior to expiry, if warranted by extraordinary circumstances in the management, operations and/or performance of the entity rated.

We, Alpha Credit Rating Limited, while assigning this rating to Agrani Insurance Company Limited, hereby solemnly declare that:

(i) We, Alpha Credit Rating Limited as well as the analysts of the rating have examined, prepared, finalized and issued this report without compromising with the matters of our conflict of interest, if there be any; and

(ii) We have complied with all the requirements, policy and procedures of these rules as prescribed by the Bangladesh Securities and Exchange Commission in respect of this rating.

We hope the rating will serve the intended purpose of your organization.

With Kind Regards,

Riyadh M. Hossain MBA (USA)Chief Risk Officer

This letter forms an integral part of the credit rating report.

Financial Posi�on 2020 2019 2018 2017 2016 2015

(Figures in Million Taka)

Liquidity ra�os: Current ra�o (�mes) 1.00 1.03 0.90 0.81 0.70 0.72Quick ra�o (�mes) 0.99 1.02 0.89 0.80 0.69 0.70External liability ra�o 35.56 35.98 38.40 36.27 33.91 33.45Return on shareholders fund a�er tax (%) 9.51 7.27 8.54 10.67 11.08 7.23Net opera�ng cash flow per share Taka 2.33 (0.71) 0.62 (0.57) 2.07 1.38Opera�ng ra�os: Risk Reten�on ra�o (%) 63.60 45.43 51.94 46.67 47.46 51.94Net claims ra�o (%) 12.70 7.97 24.55 28.51 15.54 14.48Accounts receivable on turnover ra�o 87.32 69.71 69.90 54.81 38.54 39.85Net assets turnover ra�o 155.39 124.27 127.32 123.47 112.10 117.02Financial Ra�o: Cash dividend per share ( %) 5% 10% 0% 5% 7% 5%Stock dividend paid per share (%) 5% 0% 5% 5% 3% 5%Total dividend paid per share (%) 10% 10% 5% 10% 10% 10%Earnings per share (Taka ) a�er tax 1.72 1.26 1.45 1.79 1.90 1.19Market price per share 35.60 26.00 17.30 20.60 24.00 17.00Price Earnings ra�o (P/E)=(MPPS/EPS) 20.66 20.57 11.97 11.52 12.64 14.26Dividend Payout ra�o: (Dividend per share/EPS*100) 58.03 79.13 34.58 55.91 52.68 83.88Dividend yield ra�o: (DPS/MPPS*100) 2.81 3.85 2.89 4.85 4.17 5.88Net Assets Value 547.76 525.89 487.66 459.74 456.29 418.42Net Assets Value per share (Book Value) = (Equity/No. of shares) 18.11 17.39 16.93 16.76 17.13 16.50Solvency Informa�on Debt to equity ra�o (�mes) 0.55 0.56 0.62 0.57 0.51 0.50Debt to assets ra�o (�mes) 0.36 0.36 0.38 0.36 0.34 0.33Required Solvency Margin 51.00 67.80 49.76 49.31 52.67 46.23Available Solvency Margin 337.22 352.79 319.65 317.09 330.42 282.54Solvency Margin ra�o (�mes) 6.61 5.20 6.42 6.43 6.27 6.11Investable Assets Quality Total investment 502.80 482.63 482.08 470.66 489.99 440.43Cash at bank (STD & CD Account) 51.41 34.73 69.54 41.19 37.98 36.51Fixed deposit receipts 243.75 242.25 200.25 213.05 236.00 196.50Share Investment 56.56 52.01 56.02 57.47 54.32 56.9610-year BGTB 25.00 25.00 25.00 25.00 25.00 25.00Building property 126.08 128.65 131.27 133.95 136.69 125.47Other informa�on Number of shares outstanding (In million) 30.24 30.24 28.80 27.43 26.63 25.37Branch Offices 28 28 29 32 29 35No. of shareholders as at December 3,606 3,319 2,832 2,748 2,976 6,011Number of Employees as at December 304 287 328 335 327 421


Key Operating and Financial Data


ORGANIZATIONCHART

Dhaka Central BranchBagmara Branch


PRODUCTAND SERVICES

Fire Insuranceo Fire Insurance (Including Allied Perils)o Industrial All Risks (IAR)o Fire Insurance (Power Plant Opera�onal Package Insurance)o Fire Insurance Dwelling, House and Contentso Fire Insurance Hotel Combined

Marine Cargo Insuranceo Marine Cargo Insurance transit by Steamer or Powered Vessel

(Import/Export)o Marine Cargo Insurance transit by Rail/Lorry/Truck

(Import/Export)o Marine Cargo Insurance transit by Inland Rail or Road Conveyanceo Marine Cargo Insurance transit by Inland Cargoes (water borne)o Marine Cargo Insurance transit by Air Cargo (Import/Export)

Marine Hull Insurance

Engineering Insuranceo Machinery Insurance (Machinery Breakdown)o Deteriora�on of Stock (DOS)o Boiler and Pressure Vessel (BPV)o Electronic Equipment Insurance (EEI)o Erec�on All Risks (EAR)o Contractor’s All Risks (CAR)o Engineering Insurance Consequen�al Losso Contractor’s Plant & Machinery Insurance (CPM)

Motor Insurance (Comprehensive/Act Liability)o Motor Insurances for Commercial Vehicleo Motor Insurances for Private Vehicleo Motor Insurances for Motor Cycle/Scootero Motor Trade Policy

Miscellaneous & Accident Insuranceo Burglary & House Breaking Insuranceo Cash In Safe (CIS)o Cash in Transit (CIT)o Cash on Counter (COC)o People Personal Accident (PPA)o Workmen’s Compensa�on (WC)o Business Interrup�ono Fidelity Guarantee Insuranceo Health Insuranceo Personal Accident (PA)o Travel Insurance (All kinds)o Public Liability (PL) Third Party Liabilityo Professional Liabilityo Money Insuranceo Bankers Blanket Bond (BBB) Insurance

CORPORATECHRONICLEPar�culars DatedDate of Incorpora�on of the Company March 14, 2000Commencement of Business April 03, 2000Date of Registra�on from the Chief Controller of Insurance April 03, 2000Publica�on of prospectus December 15, 2004Subscrip�on Opened January 09, 2005Subscrip�on Closed January 13, 2005Listed with Dhaka Stock Exchange Ltd (DSE) March 05, 2005First Trading of share on DSE March 05, 2005Authorized Capital increase 20 crore to 50 crore June 26, 2011ICMAB Best Corporate Award (3rd posi�on) January 28, 2018


BRANCHOFFICEDhaka Central BranchCity Centre (Level-17)90/1 Mo�jheel C/A, Dhaka-1000Phone: (PABX)- 55111007-11

Mo�jheel BranchPaltan Tower (2nd Floor)87, Purana Paltan Line, Paltan, Dhaka-1000.Mobile : 01717-128887

Local OfficeSaiham Sky View Tower 45, Bijoy Nagar (16th Floor), Dhaka-1000.Tel: 8391571-4

Dilkusha Branch 44, Dilkusha C/A, Dhaka-1000.Tel : 9558991

Kakrail Branch Rokeya Mansion36, Purana Paltan Lane (6th Floor), Dhaka-1000.Tel : 58313924, Mob : 01727-346530

Manikgonj Branch Harali Mansion (1st Floor)Bus Stand (Oposite of WAPDA),Manikgonj.Tel : 02-7711592, Mob : 01711-425535

Jamalpur BranchNew College Road (Shafi Miah Bazar)Jamalpur, Mobile: 01918-893669

Tangail Branch Yeasir Super MarketVictoria Road (1st Floor), Tangail.Mob : 01720-809505

Mymensingh Branch36, Baro Bazar, MymensinghTel : 091-66223, Mob : 01711-687787

Jubilee Road Branch Wazhico Tower (3rd Floor)263, Jubilee Road, Cha�agramTel : 031-2855149Mob : 01819-394799

Kadamtoli Branch1, Postar Par, DT RoadDoniala Para, Cha�agram.Tel : 031-721498

Laldighi BranchOrion Tower, 1 No. K.B. Aman Ali Road, LaldighiU�arpar, Cha�agramMob : 01819-339309Tel : 031-2851281

Maijdee Court BranchChowdhury Villa (3rd Floor)Main Road, New Bus Stand, Maijdee CourtNoakhali.

Khulna Branch Chamber Mansion (5th Floor)5,KDA C/A, Khulna.Tel : 041-811861, Mob : 01786-480799

Jeshore Branch7, Islam Market (2nd Floor)Garikhana Road, JashoreTel: 0421-62822, Mob: 01748-930964

Kaligonj BranchIslamia Library (1st Floor)Bazar Road, Modhugonj BazarKaligonj, JhenaidahMob: 01818-242197

Bagura BranchJhowtola, BaguraMob: 01713-939219

Bagmara BranchVhabanigonj Bazar, College More,Sha� Super Marker (1st Floor)Bagmara, RajshahiMob:01712-945522

Rangpur BranchNear Bhaban (2nd Floor) Nearest Salak Pump Sta�on Road, RangpurMob: 01731-241166

Dinajpur BranchZabed Super Market (1st Floor)Sta�on Road, Kotowali, DinajpurMob: 01772-858499

Sylhet BranchSylmart Complex (3rd Floor)Baruth Khana, East Zinda Bazar, SylhetTel: 0821-715522Mob: 01711-376245


PROFILE OFHEAD OF BRANCHES

Mohasin SiddiqueeIn-charge, Jubilee Road Branch

Mr. Siddiquee, after obtaining M.Com degree from the Chittagong University, started his career with Central Insurance Co. Ltd. in 1998. He joined Agrani Insurance Co. Ltd. In 2005 as Sr. Vice President. Presently, he is holding the position of Additional Managing Director and leading the Jubilee Road Branch, Chattogram, as its In-charge. He participated a training program on Risk Management conducted by Bangladesh Insurance Academy. He is associated with Lionism.

Md. Rustom Ali (Ripon)In-charge, Jamalpur Branch

Mr. Md. Rustom Ali (Ripon), an MBA, after completion of his education joined Desh General Insurance Co. Ltd., as AGM and In-charge of Jamalpur Branch. Thereafter, he joined Agrani Insurance Company Ltd., in 2007 as Vice President & In-charge of Jamalpur Branch. At present, he is holding the position of Dy. Managing Director & In-charge of Jamalpur Branch, Jamalpur.

Md. Anwar Hossain MunshiIn-charge, Uttara Branch

Mr. Md. Anwar Hossain Munshi after completion his Graduation joined Karnaphuli Insurance Company Ltd., in 1988 as an Officer. Thereafter, he joined Agrani Insurance Company Ltd., on 1 November 2001 as Sr. Vice President (Dev.). At present, he is holding the position of Dy. Managing Director & In-charge of Uttara Branch, Dhaka.

Md. Enamul HaqueIn-charge, Local Office

Mr. Md. Enamul Haque, after completing of his education joined with Karnaphuly Insurance Co. Ltd. in 1990. Since then he joined Agrani Insurance Company Ltd. in 2000, as Officer. At present, he is holding the position of Asstt. Managing Director and Incharge of Local Office.


PROFILE OF HEAD OF BRANCHES

Abdul Malek BeghIn-charge, Laldighi Branch

Mr. Abdul Malek Begh, joined Agrani Insurance Company Ltd in 2015 as Sr. Executive Vice President and Head of Laldighi Branch. He has a long experience in insurance industry about 24 years. Started his career with Janata Insurance Co. Ltd in 1996. At present, he is holding the position of Asstt. Managing Director and Incharge Laldighi Branch.

Ashim Kumar RoyIn-charge, Banani Corporate Branch

Mr. Ashim Kumar Ray, after completing of his education joined with Agrani Insurance Co. Ltd. in 2001 as Sales Executive. At present, he is holding the position of Executive Vice President and Incharge of Banani Corporate Branch, Dhaka.

Md. Mukhlesur RahmanIn-charge, Dinajpur Branch

Mr. Md. Mukhlesur Rahman, joined Agrani Insurance Company Ltd in 2014 as Asstt. Vice President and Head of Dinajpur Branch. He has a long experience in insurance industry about 28 years. At present, he is holding the position of Vice President and Incharge of Dinajpur Branch.

Atul Chandra DasIn-charge, Dhaka Central Branch

Mr. Atul Chandra Das after completion of his academic education then he joined Janata Insurance Company Limited in Head Office, Dhaka as an Officer Grade-2 in 1994. Then he joined Pioneer Insurance Company in 1998 and after then he joined Agrani Insurance Company Limited in Head Office, Dhaka in 2000 and he is continuing his job to Agrani Insurance Company Limited till now and at present, he is holding the position a Senior Vice President and Incharge, Dhaka Central Branch. He participated various training program of Non-Life Insurance related from Bangladesh Insurance Academy.



Nazmul Hoque ChowdhuryIn-charge, Kadamtoli Branch

Mr. Nazmul Hoque Chowdhury, joined Agrani Insurance Company Ltd in 2011 as Executive Officer of Kadamtoli Branch. At present, he is holding the position of Vice President and Incharge of Kadamtoli Branch.

Ishtiak AhmedIn-charge, Sylhet Branch

After completing of his education Mr. Ishtiak Ahmed, joined Agrani Insurance Company Ltd. in 2007, as Asstt. Manager. At present, he is holding the position of Vice President and Incharge of Sylhet Branch.

Md. Sharif UddinIn-charge, Mymensingh Branch

Mr. Sharif joined Agrani Insurance Company Ltd in 2013 as Sr. Principal Officer of Mymensingh Branch. At present, he is holding the position of Sr. Asstt. Vice President and Incharge of Mymensingh Branch.

Md. Khalilur RahmanIn-charge, Tangail Branch

After completing of his education Mr. Khalilur Rahman, joined Agrani Insurance Company Ltd. in 2008, as Asstt. Principal Officer. At present, he is holding the position of Sr. Asstt. Vice President and Incharge of Tangail Branch.



Md. Abu Bokar SiddikIn-charge, Bogura Branch

Mr. Abu Bokar Siddik, joined Agrani Insurance Company Ltd in 2013 as Assistant Vice President of Bogura Branch. At present, he is holding the position of Asstt. Vice President and Incharge of Bogura Branch.

Md. Rafiqul IslamIn-charge, Motijheel Branch

After completing of his education Mr. Md. Rafiqul Islam, joined Bangladesh National Insurance Company Ltd in 2002 as Assistant Manager. Since then he joined Agrani Insurance Company Ltd in 2009 as Assistant Principal Officer. At present, he is holding the position of Asstt. Vice President and Incharge (C.C.) of Motijheel Branch.

Md. Jahir UddinIn-charge, Maijdee Court Branch

Mr. Md. Jahir Uddin joined Agrani Insurance Company Ltd in 2000 as Assistant Accounts Officer of Maijdee Court Branch. At present, he is holding the position of Asstt. Vice President and Incharge of Maijdee Court Branch.

Sk. Abid AliIn-charge, Khulna Branch

Mr. Abid Ali, after completing of his education joined with Reliance Insurance Co. Ltd. in 1990 and Progoti Insurance Co. Ltd in 2016. Since then he joined Agrani Insurance Company Ltd. in 2018, as Sr. Principal Officer. At present, he is holding the position of Sr. Principal Officer and Incharge of Khulna Branch.



Nazmul HossenIn-charge, Bagmara Branch

Mr. Nazmul Hossen, completion of MBS (Accounting) from Dhaka College. he joined Agrani Insurance Company Ltd in 2018 as Principal Officer. At present, he is holding the position of Principal Officer and Incharge of Bagmara Branch.

Md. Humayun KabirIn-charge, Kaligonj Branch

Mr. Humayun Kabir joined Agrani Insurance Company Ltd in 2013 as Executive Officer of Jeshore Branch. At present, he is holding the position of Assistant Principal Officer and Incharge of Kaligonj Branch.

Md. Abu Taher MiaIn-charge, Rangpur Branch

Mr. Md. Abu Taher Mia, joined Agrani Insurance Company Ltd in 2016 as Executive Officer of Rangpur Branch. At present, he is holding the position of Asstt. Principal Officer and Incharge of Rangpur Branch.

Md. Iqbal HossainIn-charge, Jeshore Branch

Mrs. Ratna ChakrabortyIn-charge, Manikgonj Branch Mr. Ratna Chakraborty after completion of his education joined Agrani Insurance Company Ltd as Computer Operator in 2010. At present she is holding the position of Executive Officer, Manikgonj Branch.


BOARD OF DIRECTORS &MANAGEMENT


BRIEF RESUMEOF THE DIRECTORS

Quazi Sakhawat Hossain (Lintoo)Chairman

Quazi Sakhawat Hossain (Lintoo) is a sponsor director of the Agrani Insurance Company Ltd. He has been elected Chairman of the Company in 2018. Mr. Hossain obtained MSC degree and is a successful businessman with versatile business expposure in Bangladesh. Mr. Hossain is also the Chairman of MCO Trading Int. (Pvt.) Ltd.

Zaker Ahmed, FCAVice Chairman

Mr. Zaker Ahmed FCA is one of the sponsors of the Agrani Insurance Company Ltd. Mr. Ahmed is a senior Chartered Accountant and a fellow member of the Institute of Chartered Accountants of Bangladesh (ICAB). Mr. Ahmed is the Managing Partner of M/s. Ahmed Zaker & Co, Chartered Accountants. Mr. Ahmed is also a successful businessman. He is the Chairman of Jamil Eye & General Hospital, Radiant Shipyard Ltd and also the Managing Director of S.S. Foods Ltd.

Md. Shahbaz Hossain KhanDirector

Mr. Md. Shahbaz Hossain Khan, a Sponsor Director of the company, is a Lawyer by profession. After obtaining LLM degree he started practicing in the Bangladesh Supreme Court. At present he is a Director of Rose Securities Ltd & Bangladesh Mutual Securities Ltd and Member of Dhaka Stock Exchange Ltd. He is also associated with a number of socio-cultural organizations.

BRIEF RESUME OF THE DIRECTORS


Rezaul Huq KhanDirector

Mr. Rezaul Huq Khan is one of the sponsors of the Company. Mr. Khan is a commerce graduate. He is the Managing Director of M/s. Sarban International Limited and M/s. Sarban Import Ltd, with a sound business background relating to medical accessories. He concentrated on indenting business in Bangladesh. He is also associated with socio- cultural activities. He obtained B.Com degree.

Mahmudul HoqueDirector

Mr. Mahmudul Hoque is one of the sponsors of the Company. He was a veteran freedom fighter of Bangladesh. He has concentrated on ready-made garments business through his enterprises. He is the Chairman of M/s. Shams D Wears Limited, M/s. MHC Fashions (Pvt.) Ltd, M/s. MHC (Pvt.) Limited, M/s. MHC Apparels (Pvt.) Ltd, M/s. MHC Wears (Pvt.) Ltd, M/s. Shams D Apparels Ltd and M/s. OMAS Packaging Ltd. Mr. Hoque obtained his M.S.S. degree in Social Science and has been engaged in socio-cultural activities.

Md. Mustafizur RahmanDirector

Mr. Rahman is a leading business personality in the field of manufacturing of plastic goods. He has diversified business across the country. Mr. Rahman is involved with plastic goods manufacturing and exporting business. He is the Chairman & Managing Director of Ms. B.H.T. Industries Limited, M/s. Dhaka Beijing Dyeing & Weaving Industry Ltd. He obtained M.Com degree. His contributions toward socio-cultural and charitable activities are quite remarkable.



Dr. Md. Mustahidur RahmanDirector

Mr. Rahman obtained his MBBS degree and has concentrated on the field of medical services. He is the Managing Director of M/s. Multiplus Industries Limited and M/s. Polybagh Manufacturing Company Limited which are manufacturing and exporting plastic products in Bangladesh.

H.M. Ibrahim M.PDirector

Mr. H.M. Ibrahim, a Member of Parliament (MP) of the Govt. of the Peoples Republic of Bangladesh. He is the Managing Director of M/s. Royal Dresses International (Pvt.) Ltd, Director, MNS Telecom, Faruque Computer, Millennium Shippers & Traders, Venus Shipping Agencies Ltd, Inland Marry time Shippers, Blooming Dale Oil Co. Ltd, A Class Ltd, and also Proprietor of Royal Fashion and Aamra Kojon.

Abdul Kader KhanDirector

Mr. Abdul Kader Khan is one of the sponsors of the Company. Mr. Khan holds a Bachelor of Arts degree. He has concentrated on high-power gas line business in his enterprises. He is a Director of M/s. Dhaka Gas Services Ltd.



Md. Mahbub AlamDirector

Mr. Md. Mahbub Alam is one of the sponsors of the Company. Mr. Alam is an Electrical Engineer. After completion of his education he started business. He is the Chairman of M/s. Barobi Holdings Ltd, M/s. Barobi International Ltd, M/s. Barobi Resort Ltd, M/s. Barobi Agro Ltd. Mr. Alam is the Managing Director of Western Maritime Academy.

Ahmed JamalIndependent Director

Mr. Ahmed Jamal is an Independent Director on the Board of Agrani Insurance Company Ltd. He has been appointed Independent Director in the 129th Board of Directors Meeting held on 21/03/2020. Mr. Jamal is basically a businessman and the Proprietor of M/s. Allied Enterprise and former Director of Federation of Bangladesh Chambers of Commerce & Industry (FBCCI).

Omar FarooqIndependent Director

Mr. Omar Farooq is an MBA from (UTS) University of Technology Sydney, Australia. After completion of his education he started business. He is an Independent director of Agrani Insurance Co. Ltd. Mr. Farooq is the Director of Mosharaf Group, Abir Poultry Hatchery & Process Limited, Panama Composite Textile Mills Ltd, Chairman of Continental Spinning Mills Ltd, Abir IT Ltd. Managing Director of O.N Spinning Mills Ltd and Proprietor of M/S. O.F. Enterprise, M/S. Nibir Trade International. He is a Member Gulshan Club Ltd and Dhaka Club Ltd.


CHAIRMAN’SSTATEMENT

CHAIRMAN’S STATEMENT


DEAR SHAREHOLDERS

With the mercy of the Almighty it is with great pleasure that amid of dreadful COVID-19 destruction all over the world we welcome you to the 21st Annual General Meeting of Agrani Insurance Company Ltd (AICL). We are very much grateful to Almighty Allah who ultimately bestowed mercy on us with the least casualty by COVID-19.

BUSINESS STRATEGY AND POSITIVE FUTURE OUTLOOK

It was a horrible year when life threatening pandemic was taking thousands of lives every day and human society had been so helpless and sought the mercy of Allah only. The world saw lockdown in its most of the countries. The business had been stopped for a number of months which affected almost all the countries. However, with our brave staff members in the company we could run the wheel of the company even there were every risk of lives of the employees. We could pay the regular salary and bonuses to them and government revenues on time.

AGRANI’S ROLE

Amid the life threat AICL followed the rules, regulations and circulars of IDRA strictly. It always respects the decisions of IDRA and endeavors to perform any directions from IDRA without hesitation. AICL is also in line with the gentleman agreement of BIA which was helpful in the COVID driven unstable market of insurance business and it was not going to underwrite deliberately the renewal business of other insurers. If by any means any business is underwritten it is ready to cancel the documents and refund the premium to the insured as per law but in some cases AICL lost some business to other companies.

IDRA

In 2020 Insurance Development & Regulatory Authority (IDRA) tried to implement the agency commission regulations to wipe out the illegal commission practice in the non-life insurance sector. But it had been deferred several times for many unseen causes. However, IDRA withdrew the commission from non-life insurance sector.

UNIFIED MESSEGING PLATFORM (UMP)

IDRA introduced Unified Messaging Platform (UMP) with a view to ensuring the existence and validity of the insurance policies and covernotes and to prevent the terrorist financing through insurance. Your company paid TK. 929,872 to IDRA against UMP scheme. IDRA is in the continuous process to developing the premium tariff. In addition to the above, IDRA has been working to establish a very congenial atmosphere.

BIA

With a view to protecting the business volume of each non-life insurance company, Bangladesh Insurance Association (BIA) with the leadership of its president has come to a consensus again that the renewal business of one company shall not be underwritten by any other company and by any means if one company does it which shall be given back to the original

company. With some exceptions this agreement has been working good and would be applicable till the introduction of regulation for Agency Commission.

PERFORMANCE OF THE COMPANY

The financial year 2020 was a mixed result of traditional business environment for seven months till July and five months from August to December after implementation of historic decision of controlling the minimum number of bank accounts to run a non-life insurance company. IDRA’s regular monitoring in the field is very much essential to ensure proper implementation by each and every non-life insurance company regarding excess commission and credit business.

DIVIDEND

Given the results achieved this year while keeping a view of the future, the Board of Directors has recommended a cash dividend of 5% and a stock dividend of 5% subject to approval of the shareholders in the 21st AGM.

REGULATORY LANDSCAPE

Insurance Regulatory & Development Authority (IDRA) has been working relentlessly for bringing up discipline in the non-life insurance sector and has issued a number of circulars regarding the issue. But for some unavoidable circumstances activities of those were deferred for few times. In the mean time IDRA is also with the intention to formulate a uniform salary structure in the non-life insurance sector. However, we believe that those circular would be able to ensure the interest of the non-life insurance companies. All the interested parties from non-life insurance sector should assist IDRA for quick but positive results.

CORPORATE GOVERNANCE

The governance systems we have in Agrani Insurance to ensure that the Board and the Company to be accountable for responsibility towards employees, shareholders, customers and the community as a whole. We are working to safeguard the rights of our stakeholders with adequate protection for individual whistleblowers. Agrani Insurance has adopted the Corporate Governance Code notified by the Bangladesh Securities and Exchange Commission dated 3 June 2018. It is mentioned here that there is a conflict between primary law and BSEC CG Code regarding number of independent directors. Agrani Insurance sought to the BSEC for clearing the issue but no response came as yet. However, we would follow the instruction from the BSEC on the issue when we get it from them.

CORPORATE SOCIAL RESPONSIBILITY STRATEGY

Corporate Social Responsibility (CSR) has become integral part of business strategy of every corporate house and we would execute our CSR activities in view of ensuring sustainable environment for the generation to come. The management as part of its CSR activities in the year under review during lock down for COVID-19 took necessary health safety measures for the safeguard of our employees who were doing public interaction related works providing them personal protection

equipment (PPE), face shield, KN95 masks, hand sanitizers, disinfection spray, spray machine and also food support to some of the employees and some labors who were needy as they did not have work at that time.

BSEC DIRECTORATE

We had to reconstruct the Board of Directors honoring the BSEC Circular No: whereby it was stipulated that every director shall hold at least 2% of paid-up share capital. For this, we did not have any directors from the public subscribers as none of those shareholders hold at least 2% share to become a Director from amongst the public subscribers which lead to non-compliance to the provisions of our primary Act i.e., the Insurance Act, 2010.

FINANCIAL REPORTING COUNCIL, BANGLADESH

The Financial Reporting Council (FRC), an independent government regulatory body under the Financial Reporting Act (FRA) 2015. It is an organization under the aegis of the Ministry of Finance. The FRC will regulate accounting, reporting, auditing and actuarial professions in Bangladesh. The Council main objects as defined in the FRA 2015 are: (i) to promote the provision of high quality reporting of financial and non-financial information by public interest entities; (ii) to promote the highest standards among licensed auditors; (iii) to enhance the credibility of financial reporting and (iv) to improve the quality of accountancy and audit services. AICL welcomes the FRC and assures that it will cooperate with the FRC to actualize its objectives. As per Circular of FRC we have written back the forfeited portion of Provident Fund Tk. 1,322,309 as income of the company as at 31 December 2020.

APPRECIATION

I take this opportunity to thank my colleagues on the Board for their openhanded support and for placing their trust in me. The Management team and the staff of the Company have shown continuing commitment not bending from ethical standards while serving for the clients. Special mention must be made of the Chairman of IDRA, the Members, Executive Directors and all other staff for contributions made towards ensuring sustainability of the insurance industry of Bangladesh. The President of Bangladesh Insurance Association has played tremendous role in establishing of a congenial atmosphere especially for the non-life insurance sector facilitating to ensure application of historical steps taken by the IDRA and also to mitigate the grievances of some of the insurers through repeated sittings which really deserves appreciation. I express my gratitude to our honorable shareholders and valued customers for placing their faith in our ability to add value to their investments. I am confident that with the changed scenario of the Bangladesh Insurance Industry Agrani Insurance Company Ltd would steadily establish a strong position in the non-life insurance sector in the years to come.

Quazi Sakhawat Hossain (Lintoo) Chairman

14 March 2021


REPORT OF THE BOARD OF DIRECTORS OF AGRANI INSURANCE COMPANY LIMITED

FOR THE YEAR ENDED 31 DECEMBER 2020

DEAR SHAREHOLDERS

The Directors have great pleasures in presenting the 21st Annual Report with the Audited Financial Statements of the company for the year ended 31 December 2020.

GLOBAL ECONOMY SCENARIO

As per the review of the World Bank the global economic output is recovering from the collapse triggered by COVID-19, it will remain below pre-pandemic trends for a prolonged period. The pandemic has exacerbated the risks associated with a decade-long wave of global debt accumulation. It is also likely to steepen the long-expected slowdown in potential growth over the next decade. In his Foreword, World Bank Group President David Malpass notes that “Making the right investments now is vital both to support the recovery when it is urgently needed and foster resilience. Our response to the pandemic crisis today will shape our common future for years to come. We should seize the opportunity to lay the foundations for a durable, equitable, and sustainable global economy.” The global economy is projected to grow at 3.5 percent in 2019 and 3.6 percent in 2020. Amid exceptional uncertainty, the global economy is projected to grow 5.5 percent in 2021 and 4.2 percent in 2022. Many countries, particularly low-income developing economies, entered the crisis with high debt that is set to rise further during the pandemic.

BANGLADESH ECONOMY

As per Asian Development Bank September 2020 review the GDP growth of Bangladesh for the year 2018 was 7.9%, in 2019 it was highest 8.2%, in 2020 affected by pandemic COVID-19 it was 5.2 and in 2021 it would be slight higher at 6.8%. In 2020 in the South Asian region Bhutan & Nepal had positive growth 2.4% and 2.3% respectively. Pakistan, Afghanistan, Srilanka, India and Maldives had negative growth of 0.4%, 5.0%, 5.5%, 9.0% and 20.5% respectively. South Asia’s average growth in 2020 was (6.8%) whereas Bangladesh alone had highest GDP growth of 5.2% at the same period.

INSURANCE MARKET SCENARIO

The insurance market of Bangladesh especially non-life insurance sector has seen a number of circulars from its Regulatory Authority IDRA with a view to bringing in discipline and a congenial atmosphere in the industry. Bangladesh Insurance Association and Bangladesh Insurance Forum are also playing positive rules to support the IDRA. The non-life insurance sector has been facing a problem as it has a huge number of 46 private insurers and 1 state-owned corporation to find tough competition among the insurers. The insured in Bangladesh non-life sector are not ready to accept insurance as a positive tool to safeguard their properties rather most of them were habituated to get rebate from the insurers. Therefore, it is so urgent from all concerned with non-life insurance to take effective measures to make the potential insured understand that insurance is not only cost bearing but it’s an important tool and a part and parcel of our daily life. We are still far behind to

conceive fair practice of insurance matters. However, with the appropriate & strong measures of IDRA and whole hearted cooperation from the stakeholders of non-life insurance, we may expect a very congenial atmosphere in the insurance sector with a view to achieving “the Sonar Bangla”, the dream of our national leader Bangabandhu Sheikh Mujibur Rahman starting from the “Mujib Borsho”.

CREDIT RATING

Agrani Insurance Company Limited, as you know, is rated “AA” by the Alpha Credit Rating reflecting company’s very high claim paying ability, prudent -financial management, good solvency, diversified investment portfolio, sound liquidity and experienced top management. The rating helps the company to negotiate better terms with the reinsurers abroad.

RISKS MANAGEMENT

Agrani Insurance has always been responsive of the risk factors inherent in the insurance industry. With a view to keeping the risks at a tolerable level it identifies, monitors and reviews the risks inherent in every policy or covernote underwritten, continues updating of data base for information and takes corrective and or preventive measures to safeguard the stakeholders’ interest.

BUSINESS PERFORMANCE

The year under review was the most fearful and homebound due to life threatening pandemic COVID-19. The worldwide economic activities got locked on the spreading of this dreadful virus. People left their business centre and stayed at home to save the lives from the virus. The overall business performance of the country was severely hampered. The non-life insurance sector in 2020 lost Tk. 3,500 million. Your company was not out of this dilemma. However, the members of the staff of Agrani Insurance in spite of the severe life threat have kept the business running and you will be happy to learn that your company earned a gross premium income of Tk. 352.49 million against Tk. 423.20 million in 2019 registering a declining growth of 16.71% only. With a view to protecting the insured with adequate reinsurance coverage, the net premium of the company stood at Tk. 224.20 million against Tk. 192.28 million in 2019.

FIRE INSURANCE BUSINESS

AICL wrote fire insurance business with a gross premium income of Tk. 122.40 million against Tk. 167.87 million in 2019. After ceding of the re-insurance premium, the net premium of the Fire Department amounted to Tk. 63.81 million. The Company earned an underwriting loss of Tk. 4.62 million from its fire insurance business as against Tk. 15.19 million losses in 2019.

MARINE INSURANCE BUSINESS

The gross premium income from marine insurance business increased to Tk. 149.15 million from Tk. 127.16 million in 2019, yielding a net premium of Tk. 108.25 million, after re-insurance cession. The Company earned an underwriting profit of Tk. 40.56 million against Tk. 41.83 million in 2019 after making necessary provision for claims, both paid and intimated.

MOTOR AND MISCELLANEOUS INSURANCE BUSINESS

In Motor, the gross premium income decreased to Tk. 43.53 million from Tk. 72.85 million in 2019. The profit from Motor insurance business also rose to Tk. 30.61 million from Tk. 29.00 million in 2019. Premium income from Miscellaneous insurance business rose to Tk. 37.43 million from Tk. 55.32 million in 2019. We earned a profit of Tk. 3.80 million in 2020 against Tk. 5.94 million in 2019.

INCOME FROM INVESTMENT

Interest income derived from banks and non-banking financial institutions increased to Tk. 17.82 million from Tk. 17.27 million in 2019. The dividend income increased to Tk. 2.64 million from Tk. 1.58 million in 2019. In addition to this dividend, we earned a profit of Tk. 0.49 million through trading of shares against Tk. 1.97 million in 2019.

COMPANY’S VEHICLES: USAGE & MAINTENACE

In compliance with the direction no: 5 of Circular No: Bi:U:Ni:Ka/GAD/1003/2011-554 dated 24 April 2015 by the Insurance Development and Regulatory Authority (IDRA) we confirm that the Company’s total expenses relating to usage and maintenance of its vehicles in 2020 was Tk. 1.15 million. The total number of vehicles was 14 of which total cost was Tk. 16.05 million and the written down value as at 31 December 2020 was Tk. 9.26 million.

PROFIT AND LOSS ACCOUNT

The salient features of profit and loss account of the Company are given below:

Gross Premium 352,493,591 423,198,765

Net Premium 224,195,667 192,276,426

Underwriting profit 70,345,714 60,781,330

Interest income 17,822,397 17,270,671

Dividend income 2,664,980 1,580,696

Profit before tax 71,680,440 47,969,666

Provision for tax 17,081,894 9,749,434

Divisible profit 30,345,363 30,893,019

DIVIDEND

Subject approval of the Annual General Meeting from the retained earnings/divisible profit of 2020 the Board of Directors of the company recommended a cash dividend of 5% and a stock dividend of 5% against 10% cash dividend in 2019.

ASSETS

The assets of the company increased to Tk. 849.97 million from Tk. 821.42 million in 2019. The value of the assets was increased by 3.4% from previous year.

DIRECTORS

Sponsor Directors:

According to the Articles of Association of the company, the following directors retire at the 21st Annual General Meeting and being eligible they offer themselves for re-election:

1. Mahmudul Hoque 2. Zaker Ahmed, FCA 3. Rezaul Huq Khan4. Quazi Sakhawat Hossain (Lintoo)

Directors from Public Subscribers:

In accordance with the provisions of Insurance Act, 2010 and the Articles of Association of the company half of the total number of sponsor directors shall be the directors from public

subscribers. In practice due to imposition of BSEC Notification dated 21 May 2019 “Each director other than independent director of any listed company shall hold minimum 2% (two percent) shares of the paid-up capital, otherwise there shall be casual vacancy of director:

Provided that any company or institution shall hold minimum 2% (two percent) shares of the paid-up capital of any listed company for nominating any individual against each position of director, otherwise there shall also be a casual vacancy of director.”

The public subscriber directors and institutional directors of AICL who had below 2% shares of the paid-up capital of the company, their position as directors, had already been vacated and could not be filled in as no shareholders from public subscribers and institution individually had 2% of the paid-up capital of the company.

STATUTORY AUDITORS

Pursuant to Section 210 of the Companies Act 1994 and the BSEC guidelines the company’s statutory auditors M/s. G. Kibria & Co, Chartered Accountants, retire and being eligible offer their services for another year as they qualify for reappointment. A resolution will be placed at the AGM for their re-appointment.

REPORTING & COMPLIANCE AUDITORS

As per Corporate Governance Code 9(2) of BSEC Notification dated 3 June 2018, the compliance auditors of the company M/s. Atik Khaled Chowdhury, Chartered Accountants, have consented to continue in office and being eligible, automatically qualify for reappointment. A resolution will be placed at the AGM for their re-appointment.

PROSPECTS FOR 2021

Respecting the insurance laws Agrani Insurance would go forward to establish itself among the insurers to whom the inured may keep faith. Insurance Development & Regulatory Authority (IDRA) has already been in the process to restructuring the existing system of insurance market scenario amidst the unseen but strong negative agents to obstruct the long awaiting development. Through circular No: 75 it is going to convert the development officers to insurance agent effecting huge reduction in the expenses of management of the insurance companies. We hope that IDRA’s measures would work positively and AICL would find a congenial atmosphere in the non-life insurance sector. With the invention of COVID-19 vaccine and its application worldwide may have a control over the virus and the world economy including Bangladesh economy would get momentum and AICL would also expect to grow accordingly.

CORPORATE AND FINANCIAL REPORTING

Agrani Insurance has complied with all the requirements of Corporate Governance Code as required by the Bangladesh Securities & Exchange Commission. Accordingly, the Directors are pleased to confirm the following:

(a) The financial statements together with notes thereon have been prepared in conformity with the Companies Act, 1994, Insurance Act, 2010 and in some applicable cases Insurance Act, 1938 and Securities & Exchange Commission Rules, 1987. These statements present fairly its state of affairs, the result of its operations, cash flows and changes in equity.

(b) Proper books of account of the Company have been maintained.

(c) Appropriate accounting policies have been consistently applied in preparation of the financial statements and the

accounting estimates are based on reasonable and prudent judgment.

(d) International Accounting Standards, as applicable in Bangladesh, have been followed in preparation of the financial statements.

(e) The system of internal control is sound in design and has been effectively implemented and monitored.

(f) There are no significant doubts about the company's ability to continue as a going concern.

(g) No bonus share or stock dividend has been declared as interim dividend;

(h) There are no extraordinary activities in the reported period;

(i) The gross premium income of the Company was reduced by 16.71% due to the effect of pandemic COVID-19 for which national holidays were declared by the Government of Bangladesh and in the non-life sector around Tk. 3,500illion gross premium was reduced as reported by IDRA.

BOARD MEETING ATTENDANCE

During the year, seven Board Meetings were held. The attendance of the Directors is shown in Page # 54.

PATTERN OF SHAREHOLDING

Pattern of shareholding as per clause 1.5(xxiii) of BSEC Notification No: the BSEC Notification No: BSEC/CMRRCD/2006-158/207/Admin/80 dated 03 June 2018 is shown in Page # 55.

KEY OPERATING AND FINANCIAL DATA

The company’s summarized key operating and financial data for the last five years are shown on Page # 15.

RELATED PARTY TRANSACTIONS

Related Party Transactions, as per clause 1.5(vi) of BSEC Notification No: BSEC/CMRRCD/2006-158/207/Admin/80 dated 3 June 2018, are shown in Page # 137.


Brief resume of the Directors, as per clause 1.5(xxiv) of BSEC Notification No: BSEC/CMRRCD/2006-158/207/Admin/80 dated 3 June 2018, are shown in Page # 26.

BRIEF MANAGEMENT’S DICUSSION AND ANALYSIS SIGNED BY THE CHIEF EXECUTIVE OFFICER

The brief management’s discussion and detailed analysis of the Company’s position and operations along with discussion of changes in the financial statements signed by the Chief Executive Officer is placed in Page # 38.

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER AND THE CHIEF FINANCIAL OFFICER TO THE BOARD OF DIRECTORS

The Chief Executive Officer and Chief Financial Officer have performed their duties as per the rules, responsibilities and duties as prescribed by the board. The report is placed in Page # 73.

INTERNAL CONTROL SYSTEM DISCLOSURE

The Board of Directors takes the responsibility for the oversight of AICL’s insurance business and management including risk management and putting up internal controls. The Directors state that the systems of internal control are sound and have been implemented and monitored effectively.

REPORT ON THE ACTIVITIES OF THE AUDIT COMMITTEE

Pursuant to the clause 5(7) of the BSEC Notification No: BSEC/CMRRCD/2006-158/207/Admin/80 dated 3 June 2018, the activities of the Audit Committee have been shown in Corporate Governance Chapter Page # 56.

NOMINATION AND REMUNERATION COMMITTEE (NRC)

The Board of Directors constituted a four-member Nomination and Remuneration Committee (NRC) as a sub-committee of the Board to comply with the BSEC notification dated 03 June 2018. The Committee shall assist the Board in formulation of the nomination criteria or policy for determining qualifications, positive attributes, experiences and independence of Directors and top-level executives. Pursuant to the clause 6(2) of the BSEC Notification No: BSEC/CMRRCD/2006-158/207/Admin/80 dated 3 June 2018, the activities of the Nomination and Remuneration Committee have been shown in Corporate Governance Chapter.

CORPORATE GOVERNANCE COMPLIANCE REPORT

The Board of Directors of Agrani Insurance Company Limited is committed to adopting the highest governance standards and improving those standards as required protecting the interest of stakeholders and policy holders of the company. The Board continues to provide direction to the management, approve strategic decision and policies to attain predetermined goals and objectives of the company. Certificate from auditors on compliance with the conditions as per clause 7(1) of the BSEC Notification No: SEC/CMRRCD/2006-158/207/Admin/80 dated 3 June 2018 is shown in Page # 60. Pursuant to the clause 9(3) of BSEC Notification No: BSEC/CMRRCD/2006-158/207/Admin/80 dated 3 June 2018, the Company’s Corporate Governance Compliance status has been attached in Page # 57.

ACKNOWLEDGEMENT

We thank all our valued clients, shareholders and well-wishers for their continuous support and cooperation. Shareholders’ constructive deliberations at the AGM and also at other times as well have been very useful. To them and to the growing number of our well-wishers we offer our profound thanks. We also appreciate the help and cooperation that we have received from the various Ministries, Bangladesh Bank and other banks, financial institutions, the Registrar of Joint Stock Companies and Firms, Dhaka Stock Exchange, Central Depository Bangladesh Limited, Bangladesh Securities & Exchange Commission (BSEC), Financial Reporting Council, Bangladesh and Bangladesh Insurance Association (BIA). The Insurance Development & Regulatory Authority (IDRA) and its staff have always been very helpful and we seek their continuous cooperation and guidance to run the affairs of Agrani Insurance smoothly. We would like to express our sincere thanks to all of them for extending their helpful hands. We also thank all the members of our staff at the head office and branches for their loyalty and devotion, whose relentless drive, continual energy and accelerated skills have helped the company to reach its present position.

FOR THE BOARD OF DIRECTORS

Dated, Dhaka QUAZI SAKHAWAT HOSSAIN (LINTOO) 14 March 2021 CHAIRMAN

DIRECTORSREPORT


BDT 2020 BDT 2019

DIRECTORS REPORT



DEAR SHAREHOLDERS




BANGLADESH ECONOMY





CREDIT RATING


RISKS MANAGEMENT
















Gross Premium 352,493,591 423,198,765

Net Premium 224,195,667 192,276,426


Interest income 17,822,397 17,270,671





DIVIDEND


ASSETS


DIRECTORS

Sponsor Directors:








STATUTORY AUDITORS




PROSPECTS FOR 2021




































ACKNOWLEDGEMENT





DIRECTORS REPORT



DEAR SHAREHOLDERS




BANGLADESH ECONOMY





CREDIT RATING


RISKS MANAGEMENT
















Gross Premium 352,493,591 423,198,765

Net Premium 224,195,667 192,276,426


Interest income 17,822,397 17,270,671





DIVIDEND


ASSETS


DIRECTORS

Sponsor Directors:








STATUTORY AUDITORS




PROSPECTS FOR 2021




































ACKNOWLEDGEMENT




PROFILEOF THE CEO


Md. Azharul IslamChief Execu�ve Officer (CEO)

With around thirty years insurance experience and exper�se Mr. Md. Azharul Islam has been appointed as the new Chief execu�ve Officer (CEO) of Agrani Insurance Company Ltd. On 5 August 2020 he got the approval of the Insurance Development & Regulatory Authority (IDRA) with effect from 2 May 2020 �ll 1 May 2023 for a three-year term.

Mr. Md. Azharul Islam, an MBA, did his Masters (Mass Communica�on & Journalism) from the University of Dhaka. Soon a�er his Masters Exam he joined HIID/ESEPP project under Bangladesh Planning Commission. Then he joined United Insurance Company Ltd-A Company of which ul�mate major shareholding was M/s. Camellia Plc, U.K. Mr. Islam cemented his insurance knowledge in United Insurance- first genera�on non-life insurance company in Bangladesh about 12 years in different capaci�es in business development a�er obtaining

adequate knowledge of insurance business underwri�ng of all classes including training at home and abroad in customer rela�onship and risk management.

Mr. Islam joined in Agrani Insurance Company Ltd in July 2003 as Sr. Vice President in the Business Development Department. He had been the Senior Addi�onal Managing Director of Mo�jheel Branch of the company before taking the Current Charge of the Chief execu�ve Officer on 18 January 2020. Mr. Islam had been awarded with the best producer every year since his joining AICL.

Mr. Azharul has been associated with a good number of socio-cultural organiza�ons including an educa�onal ins�tu�on in Dhaka. In view of gathering knowledge of mul� cultural people of the world Mr. Islam traveled many countries like the U.K., Malaysia, Singapore, Thailand, Bhutan, India, Nepal, Pakistan & the Kingdom of Saudi Arabia.


CEO’S DISCUSSION& ANALYSIS

Honorable Shareholders,

I would like to extend greetings from the Agrani Insurance Company Ltd. I welcome you to the 21st Annual General Meeting with a brief discussion and analysis on the financial statements of the company for the year 2020. We completed year 2020 with huge risk of personal lives due to outbreak of pandemic COVID-19. With heavy heart I inform you that we lost one our best business development executives namely late S M Kamal Uddin, Assistant Managing Director, Jubilee Road Branch and many other executives suffered a lot from this dreadful virus. In that situation we people came to office and kept the business cycle of the company amid life threatening risk. We are grateful to the Almighty that even with the all adverse situations we could make some profit for you meeting up all regular expenses and paying due VAT and tax to the Government.

Bangladesh Insurance Association (BIA), an influential organization in the insurance market, has kept the “Gentleman Agreement” active over the year 2020 to refrain from underwriting of renewal insurance business of other non-life insurers with some exceptions. The government has also given importance to insurance sector to make it a significant industry to increase contribution to the country’s gross domestic products and declaring 1 March as the Insurance Day for Bangladesh remembering the first day in insurance by the father of the Nation Bangabandhu Sheikh Mujibur Rahman. It makes us proud that the father of the nation was associated with insurance sector and inspired people to be united to fight against the then Pakistan Government with a view to achieving the independence of Bangladesh.

Global Economic Scenario

The pandemic has intensified the risks associated with a decade-long wave of global debt accumulation. It is also likely to steepen the long-expected slowdown in potential growth over the next decade. World Bank Group President David Malpass noted that making the right investments is very much inevitable to support the recovery when it is urgently needed and foster elasticity. The global economy is projected to grow at 3.5 percent in 2019 and 3.6 percent in 2020. Amid exceptional uncertainty, the global economy is projected to grow 5.5 percent in 2021 and 4.2 percent in 2022. Many countries, particularly low-income developing economies, entered the crisis with high debt that is set to rise further during the pandemic.

Bangladesh Economy

As per Asian Development Bank (ADB) September 2020 review the GDP growth of Bangladesh for the year 2018 was 7.9%, in 2019 it was highest 8.2%, in 2020 affected by pandemic COVID-19 it was 5.2 and in 2021 it would be slight higher at 6.8%. In 2020 in the South Asian region Bhutan & Nepal had positive growth 2.4% and 2.3% respectively. Pakistan, Afghanistan, Srilanka, India and Maldives had negative growth of 0.4%, 5.0%, 5.5%, 9.0% and 20.5% respectively. South Asia’s average growth in 2020 was (6.8%) whereas Bangladesh alone had highest GDP growth of 5.2% at the same period. Even then non-life insurance sector was drastically affected in 2020.

CREDIT RATING


RISKS MANAGEMENT


2020 key financial indicators

In spite of COVID-19 affected economy we could carry on our business with the dedicated employees of the company registered a declining growth of 16.71%. Our most premium generating business classes are Fire, Marine, Motor and Miscellaneous. AICL was trying to underwrite business in all classes.

Particulars BDT-2020 BDT-2019 Growth

Gross Premium 352,493,591 423,198,765 (16.71)%

Net Premium 224,195,667 192,276,426 16.60%

Underwriting profit 70,345,714 60,781,330 15.74%

Interest income 17,822,397 17,270,671 3.19%

Dividend income 2,664,980 1,580,696 68.60%

If we analyze divisional segment of our business performance we find that Dhaka division and Chottogram division cover major concentration of AICL gross premium income. The divisional segment of AICL gross direct premium concentration in 2020 is as follows:

Division Business Concentration

Dhaka 65.96%

Chottogram 21.84%

Khulna 1.76%

Mymensingh 4.27%

Rajshahi 1.31%

Rangpur 2.91%

Sylhet 0.51%

Barisal 1.44%

Total 100.00%

Developing human capital

AICL in the has recruited some experienced persons in the year under review with a view to develop the human capital arranging adequate in house training on the job to the existing staff and also arranging training by external resources. This would be ongoing process till the ensuring of quality services to the insured and to the stakeholders as well. The members of the staff of the company are the significant resources and human capital who run the company keeping it on the right track amid the limited resources.

Contribution to national exchequer

In spite of COVID-19 driven insurance business scenario and several directives from the Insurance Development & Regulatory Authority (IDRA) that slowed down the consistency of the usual flow of premium to the company, Agrani Insurance with its committed staff members, have been ensuring payment of appropriate amount of revenue to the Government including VAT, taxes, stamps and other source taxes during the year amounting to Tk. 60.69 million against Tk. 65.77 million in 2019.

I would like to deliver my sincere thanks to the Hon’ble Chairman and the members on the Board of AICL for their sensible vision, valuable participation and patronage and the prudent management team with sound & expert knowledge in operating insurance business for the commitment in accelerating and implementing our business strategy, over and above, in the mission of rebuilding AICL in the positive direction.

We believe in our accumulate efforts of all will certainly bring a better future for all associated with the Agrani family.

Thanking you all

Md. Azharul IslamChief Executive Officer

CEO’S DISCUSSION & ANALYSIS



Badal Chandra Rajbangshi FCS, FCADeputy Managing Director

Mr. Badal Chandra Rajbangshi FCS, FCA, joined Agrani Insurance Company Limited as the Deputy Managing Director and Chief Financial Officer (CFO) basically in the second position of the Corporate Management on 9 July 2019.

Prior to joining AICL Mr. Rajbangshi was the Chief Financial Officer, Prime Insurance Company Ltd, where he served for more than three years and a half. Before joining Prime Insurance, Mr. Rajbangshi built up his career in non-life insurance sector joining United Insurance Company Limited on 15 April 2004 as the Head of Finance & Accounts but with further responsibility to manage the Internal Audit Department, the Board Affairs and the Share Department. He got additional responsibility of the Company Secretary after obtaining the associate certificate from the Institute of Chartered Secretaries of Bangladesh (ICSB) in 2007. Earlier Mr. Rajbangshi worked as the Finance Coordinator in Canadian Resource Team–a Canadian Executive Agency of CIDA for around six years.

Mr. Rajbangshi did his SSC from Sholla High School & College and secured 2nd Position in Dhaka Board and completed HSC from Dhaka College, Dhaka. He completed B.Com (Hon’s) and M. Com in Accounting from the University of Dhaka and also completed a 3-year Articleship period from KPMG Rahman Rahman Huq, Chartered Accountants. He is a fellow member of the Institute of Chartered Accountants of Bangladesh (ICAB) and also a fellow member of the Institute of Chartered Secretaries of Bangladesh (ICSB). He is a regular faculty of the Institute of Chartered Accountants of Bangladesh (ICAB). During his 25 years of career he has been in non-life insurance for over 16 years when he underwent various training courses at home and abroad, workshops and seminars and showed brilliant performance in diverse areas of insurance under different capacities.

Mr. Rajbangshi is the Members of Standing & other Committees of ICAB namely Quality Assurance Board (QAB) and Members Issues, Services & Welfare Committee (MISWC). Mr. Rajbangshi participated in the sports program from School to University and won many prizes. He is fond of sporting, travelling and also singing. He has also been associated with socio cultural activities.

PROFILE OF THEDEPUTY MANAGING DIRECTOR


PROFILE OFHEAD OF DEPARTMENTS

Md. Mahbub HasanSEVP (U/W & Branch Control)

Mr. Mahbub, as Associates of BIA, after completion of his post-graduation from the Dhaka University joined Purabi General Insurance Company Ltd., in 1989. At present he is holding the position of Sr. Executive Vice President and Head of Underwriting & Branch Control. Before joining AICL, he served in Rupali Insurance Company Ltd., as an Assistant General Manager. He participated various training programs on Claims, R/I, & Specialized Underwriting, Money Laundering, etc.

Md. Humayun KabirEVP (PRO)

Mr. Md. Humayun Kabir joined Agrani Insurance Company Ltd. on 1 March 2000, Manager, Public Relation Department. At present he has been working in Company as Executive Vice President (EVP) in the Public Relation Department.

Dilip Kumar GhoshSVP (Finance & Accounts)

Mr. Dilip did his Master in Management. After completion of education he joined Agrani Insurance Company Limited in July 2000 in the Finance & Accounts Department. Presently, he is holding the position of Sr. Vice President of Finance and Accounts Department of the Company. He attended various training program on financial and tax related matters.


PROFILE OF HEAD OF DEPARTMENTS

Rajib MujumderVice President (Audit)

Mr. Rajib Mazumder completed CA Articleship on 2 February 2017 from MABS & J Partners Chartered Accountants (A member firm of Nexia International) and passed CA Professional Stage-Certificate Level under The Institute of Chartered Accountants of Bangladesh (ICAB) in May-June 2017. He started his job career with the Thermax Group as a senior officer (Finance & Accounts) in December 2017. He joined Agrani Insurance Company Ltd as Vice President (Audit) on 2 February 2020. In his Articleship period he has audited various multinational and national manufacturing organizations, various banks e.g, Agrani Bank Ltd, Bangladesh Development Bank and Investment Corporation of Bangladesh (ICB). He also carried out audits in insurance namely Sadharan Bima Corporation (SBC), Jibon Bima Corporation (JBC), Nitol Insurance Company Ltd etc and gathered practical experience. He attended various training programs on International Financial Reporting Standards and Income Tax Ordinance.

Md. Syeedur Rahman SAVP (Claims)

Mr. Md. Syeedur Rahman after completion of his graduation from National University started his career with Bangladesh National Insurance Co. Ltd. in 1999. He joined Agrani Insurance in 2002 as Principal Officer of Claims and Re-insurance Department. Presently, he is holding the position of Sr. Asstt. Vice President and Head of Claims Department. Mr. Rahman has participat-ed various professional training courses on Insurance.

SK. Atiar RahmanSAVP (Admin)

Sk. Atiar Rahman is an M.Sc in Zoology in Dhaka University. Started his career he had been serving in Eastern Insurance Co. Ltd since 1994 as Principal Officer in Administration Department. He joined Agrani Insurance Company Limited since 2012 as SPO (Admin). Presently, he is holding the position of SAVP in Administration & HR Department. He participated in various training programs from Bangladesh Insurance Academy.


PROFILE OF HEAD OF DEPARTMENTS

Manik RatanSAVP (Establishment dept.)

Mr. Manik did his Master of Business Administration (MBA). After completion of education he joined Agrani Insurance Co. Ltd. in September 2000 in the Establishment Department. Presently, he is holding the position of Sr. Asstt. Vice President of Establishment Department of the Company.

Mohammad YousufSEO (Information & Technology Dept. )

Mr. Yousuf did his BSC in Computer Science Engineering. After completion of education he joined Agrani Insurance Company Ltd. in February 2014 in the Information Tecnology Department. Presently, he is holding the position of Senior Executive Officer of Information Tecnology Department of the Company. He attended various training program on tencnology related matters.

Md. Mofizur RahmanSAVP (Share and Investment) &Acting Company Secretary

Mr. Md. Mofizur Rahman, after completing of his education joined with Prime Insurance Company Ltd. in 2003. Since then he joined Agrani Insurance Company Ltd. in 2006, as Sr. Executive Officer. At present, he is holding the position of Sr. Asstt. Vice President & Acting Company Secretary.


Md. Azharul Islam Chief Executive Officer

Badal Chandra Rajbangshi FCA, FCS Deputy Managing Director Chief Financial Officer

Md. Mahbub Hasan Senior Executive Vice PresidentUnderwriting and Branch Control

Dilip Kumar Ghosh Senior Vice President Finance and Accounts Division

Rajib Majumder Vice President Audit & Inspection Division

Md. Syeedur Rahman Senior Asstt. Vice PresidentClaims Division

Md. Mofizur RahmanSenior Asstt. Vice President, Share & Investment Division andActing Company Secretary

Manik RatanSenior Asstt. Vice President Establishment Division

Sk. Atiar RahmanSenior Asstt. Vice PresidentAdministration Division

Mohammad YousufSenior Executive OfficerInformation & Tecnology Division

As per Insurance Act, 2010 and related regulations the most important and responsible person of an insurance company is the Chief Executive Officer (CEO). AICL has recently formed the Management Committee to ensure core risk management practice and compliance and also to look after any complex issues within the purview of day to activities keeping the Chief executive Officer in the Chair.

Composition of Management Committee:

SL# Name Designation Status in MANCOM1 Md. Azharul Islam Chief Executive Officer Chairman

2 Badal Chandra Rajbangshi FCA, FCS DMD & CFO Vice Chairman

3 Md. Mahbub Hassan SEVP, U/W & BCD Member

4 Dilip Kumar Ghosh SVP & Head of Finance & Accounts Member

5 Atul Chandra Das SVP & In-charge, Dhaka central Branch Member

6 Rajib Mazumdar VP & Head of Audit Member

7 Sk. Atiar Rahman SAVP & Head of HR & Admin Member

8 Manik Ratan SAVP & Head of Establishment Member

9 Md. Mofizur Rahman SAVP & Acting Company Secretary Member

10 Md. Yousuf SEO & Head of IT Member

Management Committee is responsible for designing, implementing and maintaining internal control system relevant to the preparation and fair presentation of financial statement that are free from material misstatements, whether due to fraud or error, selecting and applying appropriate accounting policies, and making accounting estimates that are reasonable in the circumstances.

The MANCOM is responsible to the Board of Directors for its activities.

CORPORATEOPERATIONAL TEAM

MANAGEMENTCOMMITTEE


SUSTAINABILITYREPORTING


Sustainability reporting enables organizations to consider their impacts of wide range of sustainability issues, enabling them to be more transparent about the risks and opportunities they face. A sustainability report focuses its economic, environmental and social impacts caused by its everyday activities. A sustainability report also presents the organization's values and governance model, and demonstrates the link between its strategy and its commitment to a sustainable global economy.

Sustainability reporting can help organizations to measure, understand and communicate their economic, environmental, social and governance performance, and then set goals, and manage change more effectively. A sustainability report is the

key platform for communicating sustainability performance and impacts–whether positive or negative.

Sustainability reporting can be considered as non-financial reporting; triple bottom line reporting, corporate social responsibility (CSR) reporting, and more. It is also an intrinsic element of integrated reporting; a more recent development that combines the analysis of financial and non-financial performance. These are released by companies/organizations of all types, sizes and sectors, from every corner of the world. Thousands of companies across all sectors have published reports that reference the GRI Standards. AICL is gradually moving towards the CSR.

Environmental Conservation Initiative forSustainable Development

Philosophy of EcoISD

Human Security Capacity Development inEnvironment Efforts to Global Warming

Pollution Control

Fresh Water Issues

Conservation ofNatural Environment

Active Integration ofEnvironmental Conservation

Japan’s Leading Role

Cooperation under Broadand Comprehensive

Frame works

Application of JapaneseExperience and

Scientific Knowledge

Ownership & Partnership

Pursuit of EnvironmentalConservation &

Development

Action PlansPrinciples of EnvironmentalConservation

In practice AICL has recently committed to take necessary measures to save the environment.

Natural capital is the world’s stocks of natural assets which include geology, soil, air, water and all living things. It is from this natural capital that humans derive a wide range of services, often called ecosystem services, which make human life possible. The most obvious ecosystem services include the food we eat, the water we drink and the plant materials we use for fuel, building materials and medicines. There are also many less visible ecosystem services. Even less visible are cultural ecosystem services such as the inspiration we take from wildlife and the natural environment

With financial capital, when we spend too much, we run up debt, which if left unchecked can eventually result in

bankruptcy. With natural capital, when we draw down too much stock from our natural environment, we also run up a debt which needs to be paid back, for example by replanting clear-cut forests, or allowing aquifers to replenish themselves after we have abstracted water. If we keep drawing down stocks of natural capital without allowing or encouraging nature to recover, we run the risk of local, regional or even global ecosystem collapse.

We, on behalf of AICL, would take necessary program to distribute plants among the pupil or persons who can make those large trees in view of production huge oxygen thus reduce the excessive presence of carbon in the environment.

CORPORATE SOCIALRESPONSIBILITY INITIATIVES (CSR)

ENVIRONMENTRELATED INITIATIVES

ENVIRONMENTAL& SOCIAL OBLIGATIONS


INTEGRATEDREPORTING

HUMAN RESOURCEDEVELOPMENT

Global Reporting Initiative (GRI) and the International Federation of Accountants (IFAC) collaborated to launch International Integrated Reporting Council (IIRC) in 2010. IIRC is a global coalition of regulators, investors, companies, standard setters, the accounting profession and NGOs. It promotes communication about value creation by establishing integrated reporting and thinking within mainstream business practice as the norm in the public and private sectors.

Integrated Reporting (IR) is a more holistic form of reporting.

Aims to address limitations of current reports and develop long-term business strategy.

IR is practiced on a mandatory basis in South Africa and Brazil.

IR aims to build on reporting developments to provide a more holistic form of reporting the value created by a business, by considering non-financial resources such as human, social and intellectual capitals as well as financial capital. Active consideration of how these capitals impact on the business, and on society generally, requires integrated thinking to ensure all business functions (e.g. sustainability, strategy, human resources, operations), not just the finance function, are involved in identifying and collecting data for these capitals, and looking at their connectivity – and how value creation affects the business now and in the future.

Value Creation Process:

An essential concept of the value creation process is the proposition that companies should expand their reporting beyond the stewardship of financial capital, to include all the resources they use as inputs to their business activities. The IIRC uses the term "capitals" to denote these various resources, with six capitals identified: financial; manufactured; intellectual;

human; social and relationship; and natural. IR focuses from meeting short-term financial goals, to developing a long-term business strategy, which not only makes a commitment to social and environmental issues, but also to sustainable businesses and society.

Guiding Principles underpin the preparation of an integrated report, informing the content of the report and how information is presented. There are seven principles listed in International IR Framework: (i) Connectivity of information; (ii) Stakeholder relationships; (iii) Materiality; (iv) Conciseness; (v) Reliability and completeness & (vi) Consistency and comparability.

Six capitals: The capital concept here is a ‘flow’ concept while an organization’s financial capital is increased when it makes profit, human capital increased by training but the related training costs reduce its financial capital. The six capitals mean six categories which are –

1. Financial capital includes financing obtained from equity, debt or operations;

2. Manufactured capital includes buildings, equipment and infrastructure;

3. Intellectual capital includes intellectual property, systems, knowledge and protocols;

4. Human capital includes people’s competencies, capabilities and experience, their motivations to innovate;

5. Social and relationship capital includes the relationships with communities, stakeholders, shared norms and common values and behaviors;

6. Natural capital includes all renewable and non-renewable environmental resources such as clean air, water, land, minerals and forests.

AICL is developing its Human Resources recruiting quality and expert human resources for consistent HR management practices. The goal is for every staff member to experience employment with AICL irrespective of its location. AICL has been establishing a unique team in view of achieving the best performance to serve the insured and to meet up the requirement of the stakeholders.

Shared Values: (i) To apply HR policy for all staff; (ii) To ensure integrity and responsibility;(iii) To ensure professionalism and teamwork while providing services and (iv) To grow by ourselves taking every challenges by us.

HR Mission: (i) To create corporate culture; (ii) To appointing right person to the right job and (iii) To develop sustainable growth.

HR Vision: To become the HR Management Leader gradually.

Performance Evaluation: Evaluate performance fairly and objectively, considering not only the goals achieved, but also the competencies demonstrated to get the job done.

Total Rewards: Reward colleagues competitively and appropriately in alignment with their contributions to AICL’s growth and success.

Talent Management: Assess the capabilities and career path of each colleague to place the right person in the right job.

Learning and Development: Provide ongoing learning and development opportunities to help each colleague enhance his/her knowledge, skills and experience and improve his/her capability to impact achievement of the Corporate Vision.

Employee Profile: To develop the profile of each employee motivating towards right activities.

Salary Policy: HR Management of Administration department evaluates & fix the salary of the employees based on their performance. No scope to discrimination of salary irrespective to male & female employees. Pay scale/salary structure is fixed time to time as per the Nomination & Remuneration Committee finally approved by the Board.

Benefits to employees: Group life insurance

Transport facility to senior staff

Transport facility to senior development executives

Driver’s allowance

Garage rent allowance

Incentive bonus

Festival bonus

House rent allowance

Conveyance allowance

Medical allowance

Entertainment allowance

Personal loan facility

Yearly performance appraisal

Training & development opportunities

Mobile allowance with mobile phone set including internet connection

Service benefits on retirement: Provident fund

Gratuity

Earned leave encashment

Final settlement of the employees is done within the shortest possible time.

Total employee, Employee status & Gender ratio: AICL has 228 employees. Out of which 37 are female and 250 are male which reflects a balanced ratio of male & female employees ensuring women’s empowerment to a considerable extent. Participation of women/female is equally noticeable/visible as well as important in Board of Directors and Management.

Annual Appraisal System:

Annual appraisal system of AICL is designed to serve as a tool that helps supervisors increase productivity, communicate expectations, establish goals for the coming year, and report the employee's success in meeting the past year's performance expectations.

Keeping a view in mind that good appraisal systems can meet the needs of both employer and employees:

• ensure that all employees fully understand the appraisal system

• have employee records, including appraisals, accessible to them

• be specific in the performance assessment rather than use generalities such as ‘poor attitude’

• include positive feedback about where an employee performs well

• train staff involved in giving appraisals.

Maternity Leave: As per AICL Policy, any confirmed employee (female) is eligible to get 6 months’ maternity leave with regular salary & allowances.

Sound, safety & healthy working environment: AICL and its Bard and Management do believe that safe, sound & healthy workplace is prerequisite for the sound and vibrant mentality for the employees to expedite the workforce to deliver the best services to the valued clients and other stakeholders.

Cultural events: AICL has started celebration of different programs and organizes cultural programs from the social & national commitment considering the social, ethical, moral and motivational value which encourages and develops brotherhood among the employees.

Prohibition of Child Labor: AICL never makes agreement or take any decision which may violate human rights. Apart from this, child labor is strictly prohibited. In addition, all other compliance issues are also properly maintained.

Sexual harassment policy: Sexual harassment is treated as a serious offense in the company and is followed with zero tolerance. AICL with its highly qualified and respected Management is a safe zone for female members of staff.

Standard grievance policy: Agrani Insurance Company Ltd. maintains a standard grievance policy with a view to settling any kind of unexpected or undesirable issues, dissatisfaction among the employees irrespective to permanent or contractual development employees. AICL maintains defined compensation packages for its employees both desk and development executives.

Anti-money laundering steps & training: AICL has always been aware and committed to AML approach and policy taken by Bangladesh Bank as well as the government. Nominated top executives of this company regularly participate in “CAMLCO conference” on anti-money laundering seminar.

Apart from this, we are also steadfast not to invest any amount of the organization to any terrorist or militant organizations.


AICL is developing its Human Resources recruiting quality and expert human resources for consistent HR management practices. The goal is for every staff member to experience employment with AICL irrespective of its location. AICL has been establishing a unique team in view of achieving the best performance to serve the insured and to meet up the requirement of the stakeholders.

Shared Values: (i) To apply HR policy for all staff; (ii) To ensure integrity and responsibility;(iii) To ensure professionalism and teamwork while providing services and (iv) To grow by ourselves taking every challenges by us.

HR Mission: (i) To create corporate culture; (ii) To appointing right person to the right job and (iii) To develop sustainable growth.

HR Vision: To become the HR Management Leader gradually.

Performance Evaluation: Evaluate performance fairly and objectively, considering not only the goals achieved, but also the competencies demonstrated to get the job done.

Total Rewards: Reward colleagues competitively and appropriately in alignment with their contributions to AICL’s growth and success.

Talent Management: Assess the capabilities and career path of each colleague to place the right person in the right job.

Learning and Development: Provide ongoing learning and development opportunities to help each colleague enhance his/her knowledge, skills and experience and improve his/her capability to impact achievement of the Corporate Vision.

Employee Profile: To develop the profile of each employee motivating towards right activities.

Salary Policy: HR Management of Administration department evaluates & fix the salary of the employees based on their performance. No scope to discrimination of salary irrespective to male & female employees. Pay scale/salary structure is fixed time to time as per the Nomination & Remuneration Committee finally approved by the Board.

Benefits to employees: Group life insurance

Transport facility to senior staff

Transport facility to senior development executives

Driver’s allowance


Incentive bonus

Festival bonus

House rent allowance

Conveyance allowance

Medical allowance

Entertainment allowance

Personal loan facility

Yearly performance appraisal

Training & development opportunities

Mobile allowance with mobile phone set including internet connection

Service benefits on retirement: Provident fund

Gratuity

Earned leave encashment

Final settlement of the employees is done within the shortest possible time.

Total employee, Employee status & Gender ratio: AICL has 228 employees. Out of which 37 are female and 250 are male which reflects a balanced ratio of male & female employees ensuring women’s empowerment to a considerable extent. Participation of women/female is equally noticeable/visible as well as important in Board of Directors and Management.

Annual Appraisal System:

Annual appraisal system of AICL is designed to serve as a tool that helps supervisors increase productivity, communicate expectations, establish goals for the coming year, and report the employee's success in meeting the past year's performance expectations.

Keeping a view in mind that good appraisal systems can meet the needs of both employer and employees:

• ensure that all employees fully understand the appraisal system

• have employee records, including appraisals, accessible to them

• be specific in the performance assessment rather than use generalities such as ‘poor attitude’

• include positive feedback about where an employee performs well

• train staff involved in giving appraisals.

Maternity Leave: As per AICL Policy, any confirmed employee (female) is eligible to get 6 months’ maternity leave with regular salary & allowances.

Sound, safety & healthy working environment: AICL and its Bard and Management do believe that safe, sound & healthy workplace is prerequisite for the sound and vibrant mentality for the employees to expedite the workforce to deliver the best services to the valued clients and other stakeholders.

Cultural events: AICL has started celebration of different programs and organizes cultural programs from the social & national commitment considering the social, ethical, moral and motivational value which encourages and develops brotherhood among the employees.

Prohibition of Child Labor: AICL never makes agreement or take any decision which may violate human rights. Apart from this, child labor is strictly prohibited. In addition, all other compliance issues are also properly maintained.

Sexual harassment policy: Sexual harassment is treated as a serious offense in the company and is followed with zero tolerance. AICL with its highly qualified and respected Management is a safe zone for female members of staff.

Standard grievance policy: Agrani Insurance Company Ltd. maintains a standard grievance policy with a view to settling any kind of unexpected or undesirable issues, dissatisfaction among the employees irrespective to permanent or contractual development employees. AICL maintains defined compensation packages for its employees both desk and development executives.

Anti-money laundering steps & training: AICL has always been aware and committed to AML approach and policy taken by Bangladesh Bank as well as the government. Nominated top executives of this company regularly participate in “CAMLCO conference” on anti-money laundering seminar.

Apart from this, we are also steadfast not to invest any amount of the organization to any terrorist or militant organizations.

HUMANCAPITAL

Human capital is an intangible asset and is just as valuable as a tangible asset. Human capital is entirely centered round a human. It is the knowledge, skill sets and intangible assets that add economic value to every human. A manager can use various measures to evaluate the economic value added by his staff.

Human capital is built upon investing in employees' skill sets and knowledge through higher education, seminar, on the job training, special training arranged both in house and external training as well and also workshops, a manager can calculate the investments made on human capital. It is very much possible to calculate the return of this investment for human capital. Managers can calculate the total profits a company generates before and after investing on its employees' capital.

AICL for the development of its human capital maintains a proper organizational chart and finds the gap, assesses the needs and employs right people in the right place and if finds any shortcomings it arranges required training, counseling, workshop to develop the human as capital of the company.

AICL has been in the process of developing its human capital by necessary training program both in-house and abroad and also nominating its employees to national and international conferences for developing skills of the employees to increase profitability of the company.


HUMAN RESOURCEACCOUNTING

Human resource accounting (HRA) is the process of discovering and measuring data about human resources and communicating this information to stakeholders. It involves measuring the costs incurred by organizations to recruit, select, hire, train, and develop human assets. It also involves measuring the economic value of people to the organization.

The valuation of human resources along with other assets is also required to find out the total cost of the company. AICL always realizes human resources accounting (HRA) as ‘accounting’ for people as an organizational resource. Skill development and learning of the employees are given massive importance in AICL. Training creates an impact that lasts beyond the end time of training itself. The focus is to develop skill and expertise, attain knowledge and knowhow that creates commitment among employees motivating them to incorporate their new skills and ideas back at work. To keep pace with the ever-changing globalized world, the company always enhances the knowledge and skills of its employees imparting various in-house and external trainings systematically and enhance their efficiency level. Like every year, the employees of Agrani Insurance have also participated in a number of training and workshop program in the year under review as follows:

Training-2020 Description Participants Local Accounting for Non-life 3 Insurance Executive

IT presentation 1

In-House On ‘Basic Course of 12 General Insurance’

AICL realizes that human capital can be more valuable to employers than physical assets in consideration of the time and expenses needed to hire, train and retain qualified staff. Thus we have focused:

Induction: Considering the facts, we organize induction program to provide new employees with information about the organization which helps them to perform their tasks effectively. By the induction program, a new employee becomes able to understand the followings:

V balanced information (job description) that is directly related to their role and back this up with extra information at a later stage;

V provide someone as a mentor who can provide additional information and answer questions; and/or provide formal follow-up after a few weeks;

V introduce new employees to their colleagues, explaining the role of key people, including those they will be working closely with;

V encourage new employees to ask questions;

V helps new employees to know where to go for help or with a complaint on any issue;

V ensures other employees understand appropriate behavior and communication expected of them;

V undertakes reasonable adjustments necessary, prior to the employee commencing work;

Provide training before the new employee starts work.

Training & development: We strive to provide all employees with career and personal skill development opportunities through trainings.

Trainee executives: We continuously recruit fresh graduates from reputed universities worldwide to participate in our trainee program. Upon joining our company, the trainees undergo a comprehensive in-house training program.

Experienced professionals: Continuous training is provided to all levels of employees to enable them to perform their jobs effectively and progress in their careers. We ensure that staff are developed to their fullest potential with the right level of authority, responsibility and skills; through training, both on-the-job and formal learning, job rotations, and mentoring form the work and learn experience in the company.

All staff members are given equal opportunities to receive relevant training based on their needs in accordance to four complementary aspects:

Succession planning: To support the growth of our business, we constantly look out for strong performers to be groomed into future leaders of AICL. Potential leaders undergo a comprehensive leadership Training program to prepare themselves to take on challenging roles within the company. To ensure that there is a ready pool of talents in the pipeline for holding leadership positions, the company continues to harvest talents through executive programs.

Reward and recognition/performer of the year: A good recognition and reward system provides employees fervor and enthusiasm. Employees feel a fair return for their efforts, motivated to maintain and improve their performance; they are also


COMPANY’S CONTRIBUTIONTOWARDS ITS STAFF

Employee benefits

AICL depends on its HR upon which the entire operation is ongoing. AICL values and respects all its members of the staff. AICL has a strong bondage among all its staff both senior and junior and it ensures the following facilities:

Pleasant work environment and corporate culture;

Equal opportunity

Performance oriented appreciation

Ensures long-term benefits

Need based in-house and abroad training

Transport facilities

Personal loan against salary

Group life insurance

Performance bonus

Annual performance appraisal

Opportunity to make solid insurance career

Festival bonuses

Contributory provident fund

Gratuity benefits

Mobile phone allowance

Driver allowance


Safe work environment ensuring gender equality

AICL ensures gender equality from recruitment to trainings. The HR policies have been formulated to ensure equal opportunity in all respects.

REGULATORYREVIEW

Agrani Insurance Company Ltd being incorporated under the Companies Act, 1994 and licensed from the office of the then chief controller of insurance (CCI) under the ministry of commerce according to the provisions of Insurance Act, 1938. When Insurance Act, 1938 was repealed in 2010 the Parliament enacted Insurance Act, 2010 and Insurance Development and Regulatory Authority Act, 2010 to administer the insurance industry of Bangladesh.

Segregation of life and non-life insurance business

Under the provisions of Insurance Act, 2010 no insurer is allowed to carry out life and non-life insurance business under an umbrella. In compliance with the provisions of law AICL is active only on non-life insurance business.

Compliance with Insurance Act, Rules and Regulations

AICL follows the rules and regulations applicable for non-life insurance companies. It also complies with the circulars issued by the Insurance Development and Regulatory Authority (IDRA) from time to time. AICL provides required information by IDRA giving them highest priority.

Compliance with other regulatory requirements

AICL also follows rules and regulations of all regulatory bodies like National Board of Revenue (NBR), Bangladesh Securities and Exchange Commission (BSEC), Dhaka Stock Exchange Ltd (DSE),

Financial Reporting Council of Bangladesh (FRC) and follows all other applicable laws of the land in performing non-life insurance business of the company. The corporate governance code introduced in 2018 has been a mandate of compliance and it’s a huge safeguard for the sustainability of the listed securities of Bangladesh.

Minimum stated capital

As per the Insurance Act, 2010, AICL has to increase its paid-up capital at least to Tk. 400 million. Considering the aspects of sustainability, AICL will gradually increase its paid-up capital to over Tk. 400 million from internal generation of resources issuing bonus shares to its shareholders in a number of years.

Reporting to Bangladesh Bank

AICL is regularly reporting to Bangladesh Bank about the regulatory requirement of reporting on suspicious transaction reports (STRs) with a view to combating against money laundering and financing of terrorism. It has been reporting to Bangladesh financial intelligence unit (BFIU) of Bangladesh Bank which is responsible for analyzing suspicious transaction reports (STRs), cash transaction reports (CTRs) & information related to money laundering (ML)/financing of terrorism (TF) received from reporting agencies & other sources and disseminating information/intelligence thereon to relevant law enforcement agencies.


NATIONAL INTEGRITYSTRATEGY (NIS)

With a view to achieving long-term development plan "Vision 2021" and medium-term development plan "Sixth Five-Year Plan" (2011–2015), the government of Bangladesh (GoB) considers it essential to improve governance, and particularly eradicate corruption. The GoB became a signatory nation to the United Nations convention against corruption in 2007. Using its accession to the United Nations Convention against Corruption as a motivation, the GOB formulated its national integrity strategy (NIS) on 18 October 2012.

NIS is a government's comprehensive strategy to promote good governance and achieve a corruption-free state and society. NIS has adopted a holistic approach to promote good governance, looking at an entire range of relevant institutions, including non-state institutions, while focusing relationship among them. The goal of the NIS matches one of the approaches in JICA's governance support to eliminate informal political interference to public administration, and contribute to the enhancement of accountability of the government through supporting improvement in the overall system,

capacity development of institutions and civil servants and improvement in the public service system.

Insurance Development and Regulatory Authority (IDRA) has already taken the initiative to implement NIS among the insurance companies both life and non-life. It convenes regular meetings at intervals and sends the proceedings to the insurance companies to follow that. It has also made it mandatory that every insurance company forms a NIS implementation committee in the head office with a focal person to implement strategic plan of integrity by the staff of the company with a view to ensuring institutional affairs, to develop expertise and integrity, to work on right to information, e-governance, innovation and easy service, transparency and accountability and reward for practicing integrity.

AICL has been following all the directions regarding national integrity strategy (NIS). There has been a designated committee for exercise of good practices integrity in the company. The Shuddhachar & Noitikota Committee sits and reports as per the TOR.

INVESTORFRIENDLY INFORMATION

AICLSUSTAINABILITY REPORTING

AICL communicates with its investors through quarterly reports as required by the regulatory eg, BSEC through publication of those reports in the newspapers and also on line media and in its own website. As investor finds it risky to invest in the capital of a

non-life insurer as very often there might happen large claims that may change the whole scope of profitability scenario. So it is very important for non-life insurance to keep the investors updating.

The sustainable development goals are now global goals and are being strictly monitored by the United Nations (UN) to ensure sustainability reporting. The sustainable development goals have become global goals as no individual alone can achieve these goals.

Net profit after tax 52,116,617 38,220,233 41,643,104

Shareholders’ equity 547,760,746 525,888,836 487,668,603

ROE 9.51% 7.27% 8.64%

Particulars 2020 2019 2018

THE GLOBAL GOALSFor Sustainable Development


2030 Agenda for Sustainable Development- “As we embark on this great collective journey, we pledge that no one will be left behind. Recognizing that the dignity of the human person is fundamental, we wish to see the goals and targets met for all nations and peoples and for all segments of society. And we will endeavor to reach the furthest behind first.”

The 17 sustainable development goals (SDGs) to transform our world are:

In view of saving the global village everybody from every corner should think that the globe is for ours and to ensure the above goals whether by individual capacity, societal capacity, corporate capacity, local government, central government, nationally and internationally. Only then our loved planet will exist and the inhabitants will get safer lives. AICL would take appropriate measures to contribute in its capacity to ensure sustainable development goals gradually.

GOAL 1: No Poverty: Economic growth must be inclusive to provide sustainable jobs and promote equality

GOAL 3: Good Health and Well-being: Ensure healthy lives and promote well-being for all at all ages.

GOAL 2: Zero Hunger: The food and agriculture sector offers key solutions for development, and is central for hunger and poverty eradication.

GOAL 4: Quality Education: Obtaining a quality education is the foundation to improve people’s lives and sustainable development.

GOAL 6: Clean Water and Sanitation: Clean, accessible water for all is an essential part of the world we want to live in.

GOAL 5: Gender Equality: Gender equality is not only a fundamental human right, but a necessary foundation for a peaceful, prosperous and sustainable world.

GOAL 7: Affordable and Clean Energy: energy is central to nearly every major challenges and opportunity.

GOAL 9: Industry, Innovation and Infrastructure: Investments in infrastructure are crucial to achieving sustainable development.

GOAL 8: Decent Work and Economic Growth: Sustainable economic growth will require societies to create the conditions that allow people to have quality jobs.

GOAL 10: Reduced Inequality: To reduce inequalities, policies should be universal in principle, paying attention to the needs of disadvantaged and marginalized populations.

GOAL 12: Responsible Consumption and Production: To ensure sustainable consumption and production patterns.

GOAL 11: Sustainable Cities and Communities: the needs to be a future in which cities provide opportunities for all, with access to basic services, energy, housing, transportation and more.

GOAL 13: Climate Action: Climate change is a global challenge that affects everyone, everywhere.

GOAL 15: Life on Land: Sustainably manage forests, combat desertification, halt and reverse land degradation, halt biodiversity loss.

GOAL 14: Life below Water: Careful management of this essential global resource is a key feature of a sustainable future.

GOAL 16: Peace and Justice Strong Institutions: Access to justice for all, and building effective, accountable institutions at all levels.

GOAL 17: Partnerships to achieve the Goal: Revitalize the global partnership for sustainable development.


INFORMATION ABOUT CORPORATE GOVERNANCE


BOARD OF DIRECTORSCHAIRMAN & CEO

BOARD MEETING & OTHERCOMMITTEE MEETINGS ATTENDNCE

ChairmanQuazi Sakhawat Hossain (Lintoo)

DirectorsMd. Shahbaz Hossain KhanRezaul Huq KhanMahmudul HoqueMd. Mustafizur RahmanDr. Md. Mustahidur RahmanH.M. IbrahimAbdul Kader KhanMd. Mahbub Alam

Independent DirectorsAhmed JamalOmar Farooq

Chief Executive Officer (CEO) Md. Azharul Islam

During the year from 01.01.2020 to 31.12.2020.The attendance status ofall the meetings is as follows:

Vice ChairmanZaker Ahmed, FCA


PATTERN OFSHAREHOLDING

ETHICS ANDCOMPLIANCE

The Board of Directors of the Agrani Insurance Company Ltd has applauded the management of the company to comply with the applicable rules and regulations. The management has taken the issue seriously and it is trying to motivate all the officers of the company including its branch offices. The company is in the process of maintaining ethical standards gradually giving adequate knowledge among the members of its staff through training. Internal control measures are being tightened guarding against irregularities and unethical practices. AICL has espoused core values, commitments and code of conducts and ethical principles which are

being followed with strict compliances. The statement of ethics and fair business practices being approved by the Board of Directors are being circulated to all the directors and employees for their review and application.

AICL also follows an anti-fraud and anti-corruption program as per the guidelines of the regulatory authorities to prevent fraud and corruption in the business process of the company. The employees of all tiers are being trained on the issue to have a fair knowledge about their doings.

Independent Directors:

CEO, CFO, CS & Internal Auditors and their spouses and minor Children


REPORT ON THEACTIVITIES OF AUDIT COMMITTEE

The Audit Committee of the Agrani Insurance Company Ltd comprises of four Directors nominated by the Board of Directors. It operates according to the Terms of Reference approved by the Board and in compliance with the relevant provisions of the Bangladesh Securities and Exchange Commission Notification No. BSEC/CMRRCD/2006-158/207/Admin/80 dated 3 June 2018.

The members of the Committee are as follows:

1. Ahmed Jamal Chairman 2. Zaker Ahmed, FCA Member 3. Md. Shahbaz Hossain Khan Member 4. Quazi Sakhawat Hossain (Lintoo) Member 5. Omar Farooq Member 6. Md. Azharul Islam Chief Executive Officer

Audit Committee have held 3(three) meetings during the year 2020. The committee consulted the Chief Executive Officer, Chief Financial Officer, Head of Internal Audit and Compliance relevant heads of departments and branch managers as and when required. Secretary of the Board also performed as the Secretary to the Audit Committee and attended the Committee meetings.

Purpose of Audit Committee:

The role of the Committee is to co-operate with the Board in discharging responsibilities for financial as well as business discipline, financial reporting, corporate governance and internal control. The key responsibilities of Audit Committee are as under:

1. Review the effectiveness of internal audit function;

2. Review the findings and recommendations made by the Internal auditors;

3. Review the annual, half yearly and quarterly Financial Statements;

4. Review the auditing performance of external auditors and their audit reports;

5. Other matters as per terms of reference of the audit committee.

Functions carried out during the year:

The committee had overseen the financial reporting process, reviewed and monitored accounting policies and principals, internal control risk management process, hiring (appointment) and performance of the external auditors. The committee reviewed and examined the draft balance sheet, financial statement and recommended to place before the Board of Director for its consideration and approval.

The committee reviewed the quarterly and half-year financial statement of accounts for proper submission of the Board of Director.

The committee reviewed the adequacy of internal audit function and the integrity of financial statement of the company to ensure to that these reflect true and fair view of the company’s state of the affairs for the year ended 31st December, 2020 and did not find any material deviation, discrepancies or any adverse finding/observation in the area of reporting.

The committee reviewed the statement of significant related party transaction and statutory auditor’s observation on internal control.

Dated, Dhaka Ahmed JamalMarch 14, 2021 Chairman Audit Committee

NOMINATION ANDREMUNERATION COMMITTEE

The Nomination and Remuneration committee (NRC) is the sub-committee of the Board. The NRC shall assist the Board is formulation of the nomination criteria or policy for determining qualifications, positive attributes, experiences and Independence of directors and top level executive as well as a policy for formal process of considering remuneration of directors, top level executive.

The members of the Nomination and Remuneration Committee (NRC) are as follows:

1. Omar Farooq Chairman (Independent Director)

2. Quazi Sakhawat Hossain (Lintoo) Member

3. Md. Azharul Islam Chief Executive Officer

1(one) meeting were held during 2020.

The following matters were discussed in the meetings and decisions taken were communicated to the Board of Directors:

Review of the qualification of proposed Independent Directors of the Company.

To consider of contract of Mr. Md. Azharul Islam as Chief Executive Officer (CEO) of the Company for another three years with effect from 18 April 2020 subject to approval of the Insurance Development & Regulatory Authority (IDRA).

Dated, Dhaka Chairman14 March, 2021 Nomination and Remuneration Committee


As a public listed company, Agrani Insurance believes that the Board of Directors of the Company has a pivotal role to play in meeting all stakeholders’ interests. The Board and the

Management Team of Agrani Insurance are, as such, committed to maintaining effective Corporate Governance through a culture of accountability, transparency and well-versed policies and procedures to protect the interests of its shareholders and enhance long-term shareholder valu.

In line with the same, the Company has complied with the conditions as stipulated in the Corporate Governance Guidelines BSEC Notification No. BSEC/CMMRRCD/ 2006- 158/134/Admin/44: dated 07 August, 2012.

Composition of Board

Executive Committee Claims Committee Audit Committee Investment and Business Development Committee Nomination & Remuneration Committee

Executive Committee.

The Committee operates in accordance with the Charter approved by the Board. The names of the current members are:

1. Zaker Ahmed, FCA Chairman


3. Rezaul Huq Khan Member

4. Mahmudul Hoque Member

5. Dr. Md. Mustahidur Rahman Member

6. Md. Shahbaz Hossain Khan Member


The Executive Committee guides the management in achieving the Company’s Mission/Vision. The Committee ensures implementation of policies and other business proposals as per the approved policy of the Board.

Claims Committee

The Committee approves any claim exceeding Tk. 100,000.00. However, the Committee may if it is deemed necessary on the basis of significance of the matter refer to the board. The Chief Executive Officer (CEO) shall approve any claim not exceeding Tk. 100,000.00 in consultation with the Chairman of the Board. Names of the current members as follows:

1. Mahmudul Hoque Chairman


3. Zaker Ahmed, FCA Member

4. Rezaul Huq Khan Member


6. Ahmed Jamal Member


Audit Committee

The terms of reference of the Committee are aligned with the Code of Corporate Governance.

The Committee shall meet at least three times a year. The members of the Committee are:

1. Ahmed Jamal (Independent Director) Chairman




5. Omar Farooq (Independent Director) Member


The Committee is empowered to examine any matter in respect of financial affairs of the Company and to review all audit program, internal control systems and procedures, management information system, internal audit reports process, compliance with laws and regulations, etc. the Audit Committee takes initiatives to keep the Company away from any possible adversity.

Investment and Business Development Committee

The purpose of the Committee is to recommend to the board the business and investment policy.

The Committee also reviews the effectiveness of those policies and their implementation. The

Committee shall meet as and when required, the names of the current members are as under:

1. Mahmudul Hoque Chairman



4. Ahmed Jamal (Independent Director) Chairman


Nomination and Remuneration Committee (NRC)

The Committee shall assist the Board in formulation of the nomination criteria or policy for determining qualifications, positive attributes experience and independence of the Directors and top level executives. The Committee also discharges the responsibilities of the Board of Directors relating remuneration of Directors and top level executives. The Committee will meet as and when required to consider candidates for appointment as Directors and top level executive, the NRC conduct one meeting during the year. The members of the Committee are as under:

1. Omar Farooq Chairman (Independent Director)



CORPORATE GOVERNANCE& COMPLIANCE REPORT


ATIK KHALED CHOWDHURY00

ATIK KHALED CHOWDHURY

C H A R T E R E DA C C O U N T A N T S

C h a r t e r e d A c c o u n t a n t s

Hasan Court (1st Floor)23/1 Motijheel C/A

Dhaka-1000, BangladeshTel: 9553407, 9564972Fax: +88-02-7124940

e-mail : [email protected] : www.atikkhaled.com

Report to the Shareholders of Agrani Insurance Company Limited

on Compliance on the Corporate Governance Code

We have examined the compliance status to the Corporate Governance Code by Agrani Insurance Company Limited (Here-in-after is referred to as “the Company” for the year ended on 31 December 2020. This Code relates to the Notification No. BSEC/CMRRCD/2006-158/207/Admin/80 dated 03 June, 2018 of the Bangladesh Securities and Exchange Commission (BSEC)

Such compliance with the Corporate Governance Code is the responsibility of the Company. Our examination was limited to the procedures and implementation thereof as adopted by the Company’s Management in ensuring compliance to the relevant conditions of the Corporate Governance Code.

This is a scrutiny and verification and an independent audit on compliance of the conditions of the Corporate Governance Code as well as the provisions of relevant Bangladesh Secretarial Standards (BSS) as adopted by Institute of Chartered Secretaries of Bangladesh (ICSB) in so far as those standards are not inconsistent with any condition of this Corporate Governance Code.

We state that we have obtained all the information and explanations, which we have required, and after due scrutiny and verification thereof, we report that, in our opinion:

(a) The Company has complied with the conditions of the Corporate Governance Code as stipulated in the above mentioned Corporate Governance Code issued by the Commission or not complied (if not complied, specified non-compliances).

(b) The Company has complied with the provisions of the relevant Bangladesh Secretarial Standards (BSS) as adopted by the Institute of Chartered Secretaries of Bangladesh (ICSB) as required by this Code or not complied (if not compled, specified non-compliances).

(c) Proper books and records have been kept by the company as required under the Companies Act, 1994, the securities laws and other relevant laws and other relevant laws or not complied (if not compled, specified non-compliances and

(d) The Governance of the company is satisfactory or not satisfactory.

For Atik Khaled Chowdhury. Chartered Accountants

Place : Dhaka Md. Atikur Rahman FCADated : 14/03/2021 Managing Partner


Status of compliance with the conditions imposed by the Commission’s Notification No. SEC/CMRRCD/2006-158/207/Admin/80, dated 03 June 2018 issued under section 2CC of the Securities and Exchange Ordinance, 1969:

COMPLIANCEREPORT ON CGC


COMPLIANCE REPORT ON CGC


CORPORATE IT& WEBSITE INFORMATION

In the ultra-modern era of information technology none can place a foot step without the help of information technology. Accordingly, every business organization now-a-days is excessively dependent on information technology. For this, they might require business software, accounting software or integrated software of even with huge cost involved. Beside these, every business organization or a corporate house must have a website of its own containing all its business information including its products, management, directors, financial statements and links with various regulatory or government offices.

AICL has been operating an integrated software IIBS (Integrated Insurance Business System), which is integrated with Underwriting Module, Accounts Module, PF Module, Fixed Assets Module, Claims Module, HR Module, Payroll Module and Reinsurance Module and it is

web-based software. All of our branches and booth offices are online and controlled from Head Office to minimize costs and risks. AICL has a Corporate Web: www.agraniins.com to publish updated information of the company. The Website is always open for stakeholders, shareholders, investors and valuable clients to provide updated corporate information in its website.

AICL website focuses on: Info about the company, its communication address, Hot line, web mails, business information, capital structure, Assets, corporate governance, prospects, products & services, price sensitive information, Board of Directors profile, Chairman, CEO and Management team’s profile, the Annual Reports etc. AICL has been updated its website with the activities taken place regarding Mujib Borsho.

MANAGEMENT REVIEWAND RESPONSIBILITY

The Corporate Governance Guideline is complied with to establish the Board of Directors, Executive Committee, Claims Committee, Audit Committee, Investment & Business Development Committee, Nomination and Remuneration Committee (NRC) as well as Management Team of the Company.

The Directors of the Board are appointed by the Shareholders at the Annual General Meeting (AGM) and accountable to the Shareholders. The Board is responsible for ensuring that the business activities are soundly administered and effectively controlled. The Directors keep themselves informed about the Company's financial position and ensure that its activities, accounts and asset management are subject to adequate control. The Board also ensures that AICL Policies & Procedures and Codes of Conduct are implemented and maintained and the Company adheres to generally accepted principles for good governance and effective control of Company activities.

Management

The Chief Executive Officer is responsible for overseeing the day to day activities to ensure smooth and effective operation of the company and for implementing strategies and policies adopted by Board. He is accountable to the Board for the financial and operational performance of the Company. The Management Team of the Company is led by the Chief Executive Officer, Mr. Md. Azharul

Islam and overall functions of the Company are being looked after by the following Departments:

1. Board Affairs2. Administration & Establishment3. Finance & Accounts4. Branch Control5. Underwriting6. Claims7. Re-Insurance8. Audit9. Information Communication and Technology (ICT)10. Investors’ Relation Department

Heads of the Departments are well experienced and have dedication for the service to the Business Partners as well as clients. During the crisis moment, they work collectively as a strong team. Besides, several Management Committees are also working to handle the Company’s operation and identifying the Management’s risk. The positive effect of corporate governance on different stakeholders ultimately is a strengthened economy, and hence good governance is a tool for socio-economic development. In conclusion to match the strategic objectives of the company, Agrani Insurance has taken every possible steps to be the top Insurer in respect of complying Corporate Governance Guideline in the Insurance market of the country.

SUMMARY OFQUARTERLY REPORTS

In accordance with para 20 of International Accounting Standard (IAS-34) and as required by Bangladesh Securities & Exchange Commission Corporate Governance Code of 2018 Agrani Insurance Company Limited (AICL) published quarterly financial statements-2020 for the stakeholders in the newspapers in English and Bangla, in one on-line news portal and in the website of the company.

In the year under review, AICL has earned Gross premium income of Tk. 352.49 million, operating income of Tk. 70.35 million and net profit of Tk. 52.12 million after tax in 2020 which was Tk. 423.20 million, Tk. 60.78 million and Tk. 38.22 million respectively in 2019. During the year premium income has been decreased by 16.71% over the year 2020. Details of quarterly profitability and yearly financial results of the Company for the year 2020 and 2019 are given bellow:


In accordance with International Financial Reporting Standards (IFRSs) and in order to enhance Corporate Governance in the interest of investors and the capital market, Bangladesh Securities and Exchange Commission (BSEC) requires preparation of seperate operating result as per Corporate Governance Code of 2018. Agrani Insurance Company has been presented segment wise operating performance accordingly.

The company has earned gross fire premium income of Tk. 122.40 million, marine premium income Tk. 149.15 million motor premium income Tk. 43.53 million and miscellaneous premium income Tk. 37.43 million respectively in 2020. During the year AICL earned total gross premium income of Tk. 352.49 million including PSB premium income and operating income Tk. 70.35 million and net profit after tax Tk. 52.12 million respectively in 2020 which was Tk. 423.20 million, Tk. 60.78 million and Tk. 38.22 million respectively in 2019. Segment Wise Financial Result of the Company for the year 2020 and 2019 are as follows :

SUMMARY OF ACCOUNTS 2020SEGMENT/CLASS-WISE OPERATING PROFIT/PERFORMANCE

Amount in million Taka


REPORT ONGOING CONCERN

It is a requirement that an assessment of an entity’s ability to continue as a going concern as per IAS-1: Presentation of Financial Statements. As the going concern assumption is a fundamental principle in the preparation of financial statements the preparation of the financial statements requires management to assess AICL’s ability to continue as a going concern. AICL makes annual assessment as to whether there exists any material uncertainty that may cause any significant doubt about the ability to continue as a going concern.

The directors are persuaded from the following indications, which gave reasonable assurance as to company’s ability to continue as a going concern focusing on the matters set out below with some financial indications:

Gross premium turnover: AICL has positive gross premium income of Tk. 352.49 million over 2019 with a growth of (-16.71) which signifies company’s ability to underwrite and continue insurance business.

Proper reinsurance coverage: Reinsurance is the insurance of insurance to shift the risk as per legal terms and conditions. AICL has been shifting the excess risk to the state owned reinsurer Sadharan Bima Corporation as per the treaty.

Payment of dividends: AICL has been paying dividend consistently to its shareholders for many years which signifies that after meeting all expenses and taxes the company is able to run in the long run.

Credibility in payment of obligations: AICL in managing large claims obtained long term loans and has been paying EMIs consistently.

AICL is very particular in fulfilling the term of loan agreement.

Speedy settlement of Claims to the Clients: AICL has a good track record and reputation in settlement of its claims. AICL has been giving priority in settlement of claims and always seeks the cooperation from the part of insured to submit proper documents in support of the claims.

Good market reputation and clients’ satisfaction: AICL has been creating its strong position gradually in the insurance industry hiring some qualified professionals to bring transparency and ethics in all its business transactions. Alpha Credit Rating Ltd has graded the Claim Paying ability (CPA) rating of the company to “AA” based on the Audited Financial Statement for the year ended December 31, 2020. This indicates the company’s strong claim paying ability (CPA) position.

Anticipates significant change in IDRA regulations positive for non-life insurers: The non-life insurance sector is going to have strict application of agency commission system with the aspiration that there might have no development officer to claim salary against which agency commission is paid. If this proposition is implemented every non-life insurance company including AICL would be able to generate huge net profit to provide huge revenue in the form of VAT and income taxes and also handsome return to its shareholders.

Adequate disclosures made in the financial statements: Adequate disclosures have been made in the financial statements together with the attached notes of the annual report to understand the appropriateness of going concern basis.


DIRECTORS’RESPONSIBILITY STATEMENTAs per regulations contained in the First Schedule of the Insurance Act, 2010 and as per

section 63 (2) of Insurance Act 2010.

1. The value of investments as shown in the Balance Sheet has been taken at fair value.

2. The values of all assets as shown in the Balance Sheet and as classified on Form “AA” annexed have been duly reviewed as at 31 December

2020 and in our belief, the said assets have been set forth in the Balance Sheet at amounts not exceeding their realizable or market values

under the several headings as enumerated in the annexed form.

3. All expenses of management, wherever incurred and whether incurred directly or indirectly in respect of Fire, Marine, Motor and Miscella-

neous Insurance business have been duly debited to the related Revenue Accounts and Profit & Loss Account.

Chief Executive Officer Director Director Chairman


CERTIFICATIONOF THE CEO & CFO

The Board of Directors

Agrani Insurance Company LimitedCity Centre (Level-17)90/1, Motijheel C/A, Dhaka-1000

Subject: Declaration on Financial Statements for the year ended on 31 December 2020

Dear Sirs,

Pursuant to the condition No.1(5)(xxvi) imposed vide the Commission’s Notification No. SEC/CMRRCD/2006-158/207/Admin/80, Dated 03

June 2018 under section 2CC of the Securities and Exchange Ordinance, 1969, we do hereby declare that:

(1) The Financial Statements of Agrani Insurance Company Limited for the year ended on 31 December 2020 have been prepared in

compliance with International Accounting Standards (IAS) or International Financial Reporting Standards (IFRS), as applicable in the

Bangladesh and any departure there from has been adequately disclosed;

(2) The estimates and judgments related to the financial statements were made on a prudent and reasonable basis, in order for the

financial statements to reveal a true and fair view;

(3) The form and substance of transactions and the Company’s state of affairs have been reasonably and fairly presented in its financial

statements;

(4) To ensure above, the Company has taken proper and adequate care in installing a system of internal control and maintenance of

accounting records;

(5) Our internal auditors have conducted periodic audits to provide reasonable assurance that the established policies and procedures

of the Company were consistently followed; and

(6) The management’s use of the going concern basis of accounting in preparing the financial statements is appropriate and there

exists no material uncertainty related to events or conditions that may cast significant doubt on the Company’s ability to continue as

a going concern.

In this regard, we also certify that: -

(i) We have reviewed the financial statements for the year ended on 31 December 2020 and that to the best of our knowledge and

belief:

(a) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be

misleading;

(b) these statements collectively present true and fair view of the Company’s affairs and are in compliance with existing accounting

standards and applicable laws.

(ii) There are, to the best of knowledge and belief, no transactions entered into by the Company during the year which are fraudulent,

illegal or in violation of the code of conduct for the Company’s Board of Directors or its members.

Md. Azharul Islam Badal Chandra Rajbangshi, FCA, FCS

Chief Executive Officer (CEO) Chief Financial Officer (CFO)

Annexure-A Risk management is the process of identifying, assessing and controlling threats to an organization's capital and earnings. Insurance companies are naturally involved in taking risks of the insured. In the global village insurers underwrite policies dealing with specific risks. As a direct corollary insurance companies should be good at managing their own risks. Sound management of an insurer depends on how well the various risks are managed across the organization.

Risk management processes finds 5 basic steps as follows:

Step 1: Identify the Risk. An insurer [MP1] identifies and defines potential risks that may negatively influence a specific company process or project.

Step 2: Analyze the risk. After identification an insurer determines the odds of it occurring with its consequences.

Step 3: Evaluate or Rank the Risk. On the basis of ranking of the identified risks with evaluation and ranking an insurer can then make decisions about the acceptability of the risk.

Step 4: Risk mitigation. Here the insurer assesses the highest-ranked risks and develops a plan to alleviate them using specific risk controls. These plans include risk mitigation processes, risk prevention tactics and contingency plans in the event the risk comes to fruition.

Step 5: Monitor and Review the risk. Part of the mitigation plan includes following up on both the risks and the overall plan to continuously monitor and track new and existing risks. The overall risk management process should also be reviewed and updated accordingly.

Risk Framework: A good risk framework should have a strong governance structure. That’s why the board and the management of AICL significantly manage their risks. The whole activities are typically facilitated by designated persons in each of the various departments, such as underwriting, reinsurance, legal/compliance, accounts and finance, marketing and sales, branch control, claims, IT, and so on. The management should always aware about risk-taking and risk monitoring roles of each department.

Measuring Risk Framework Effectiveness

Agrani Insurance Company Ltd follows a structured approach in measuring the risk and taking the initiatives to manage risk effectively in the business performance.

AICL and the Risk

Strategic Risk & Management Plan: The company management coordinates to set the activities and methods that are used to an organization and to control many risks that can affect its ability to achieve the objective and risk management plan. Risk associated with the company's future business plans and strategies include failure of future business plans due to aggressive marketing of competitors’ expansion or entry of new competitors:

Operational Risk: Associated with the problems of proper administration, policy issuing, claim settling, customer service and managing the exchange of cash. It also arises in documentation, receive and payment system and compliance with various regulations. It is managed within acceptable levels through an appropriate level of management focus and resources.

Insurance Underwriting Risks: Prudent underwriting is the key to success and growth of the company. The faulty underwriting

decisions and imposing a high level of exposures on the company can destroy the financial strength in a moment.

Reinsurance Risks: Reinsurance is a process of transferring risk to a wider insurance market beyond retention capacity as insurance. AICL is continuously reviewing its financial strength, underwriting statistics and assumption of risk acceptance capacity to arrange reinsurance treaty and facultative placement and increase its underwriting capacity and business efficiency.

Market Risk: Relates to the potential loss arising from an adverse change in the market risk factors, including commodity price, competitors, interest rates, credit spreads and equity prices.

Regulatory/Legal Compliance Risk: AICL carefully complies with the regulatory guidelines of the authorities. The management also issued internal circular to update the branch and departmental staff to be aware of the circulars and regulations of IDRA.

Information Technology (IT) Security Risk: IT security risk is the most sensitive risk factor for the financial organizations. AICL is going through a complete online information technology system and to secure the information and system against the potential threats.

Claims Reserving Risk: Every insurance company have to attain the financial strength to meet the probable claims to the insured. After occurrence of a claim each company has to make a claim reserve to settle and pay the claim at the earliest. The claims department keeps-

• Proper recording of all claims intimated;

• Processing and monitoring of all claims within prescribed time limits;

• Reserves created as soon as preliminary assessment of a loss is carried out;

• Review of outstanding claims on quarterly basis.

Investment Risks: Investment in any business is risky now-a-days. Understanding the potential negative consequences of an event on an investment is very important. Managing those that are relevant is a necessary requirement to achieve organizational goals. Unmanaged risks present barriers to achieving the financial goals and ultimately may result in loss of principal.

Credit Risk: Credit risk is the possibility that a borrower or counterparty will fail to meet its obligations in accordance with agreed terms. IDRA regulations strictly prohibit the credit business in the insurance sector in Bangladesh. AICL strictly follows the IDRA rules regarding every individual insured that also reflects a very good positive benefit to the business portfolio.

Liquidity Risk: Liquidity risk is the risk that a company may be unable to meet short term financial demands. This usually occurs due to the inability to convert a security or hard asset to cash without a loss of capital and/or income in the process. It may arise for insufficient liquid resources to meet claims payments and other obligations. AICL’s responses to manage this risk are:

a) The company follows a policy of maintaining high liquid and near liquid resources.

b) The maturity of its fixed deposits and other investments is matched as far as possible, with its outgoing commitments and obligations.

c) Regular monitoring of its liquid resources is conducted by the Board.

Foreign Exchange Risk: The foreign exchange risk management is the process of prudently managing foreign currency position in order to control, with the set limits/parameters, the impact of change in exchange rates on the financial position of the organizations dealing with it. NBR’s existing circular regarding imposition of 15% VAT and 10% source tax on reinsurance premium is a huge barrier to safeguard proper protection to the insured.

Money Laundering Risk: Money laundering risk is being associated with the non-life insurance agents of Bangladesh. The agents having a white source of income involves black application of the same as the formal agents have to forgo the entire amount of income to the insured as rebate otherwise they cannot get any

insurance business from the potential insured. All concerned including the insured should understand the problems so associated with the so called formal insurance agents.

Reputation Risk: This risk arises from negative opinion from clients, corporate offices, banks, financial institutions etc. The main causes of reputation risk are bad behavior, unethical practices, lack of integrity, devotion, quotation off market rate etc.

Above all, risk management planning is required for every insurer to review the risk and take appropriate management strategies to mitigate risk. AICL management is conscious about the organizational risks. The periodical risk review will be adding value to the company.


CLIENTS’ COMPLAINTSAND COMMUNICATION

Insurance industry is a service-oriented industry. Here most important subject is the clients’ satisfaction on the service provided by the insurer through its business channel components. Here the channel means all the service providers from the head office to branches. Everybody associated with the process must have adequate insurance knowledge as well as how to behave with clients with their utmost satisfaction. AICL takes care of them as they are the business providers to whom we are providing our professional services with the insurance products like cover-note, policies etc. We treat all our clients as valued clients small or big with respect. We are always ready with our online service side by side with our human resources to reach at door of the potential insured with our services. AICL attends to the clients’ complaints, if any, with top priority and resolves it without any delay. Agrani Insurance inspires its clients to come forward with any complaint whatever be the reason behind it and the top management is completely available to resolve those. Any type of complaint can be lodged with the management in writing through e-mail, letter or by telephone or through the website.

AICL with its humble eagerness asks the clients whenever meets them anywhere regarding the business issues of the company. The AICL

management enthusiastically solicits the clients’ views and suggestions on the company’s services, any shortcoming in any matter, whether reaching of cover-note or policies to their end or any complaints regarding delay payment of claims. In the MANCOM meetings AICL always discuss with top priority to ensure the service to its clients. This aspect is widely featured conspicuously at every Branch Conference of the company.

The clients of AICL may contact at e-mail and hotline number for complaints to the following address or directly to the Chief Executive Officer (CEO).

Md. Mahbub HasanSEVP & Head of U/W & BCDSaiham Sky View Tower (16th Floor)45, Bijoy Nagar, Dhaka-1000Cell No: 01819464093E-mail : [email protected]

Risk management is the process of identifying, assessing and controlling threats to an organization's capital and earnings. Insurance companies are naturally involved in taking risks of the insured. In the global village insurers underwrite policies dealing with specific risks. As a direct corollary insurance companies should be good at managing their own risks. Sound management of an insurer depends on how well the various risks are managed across the organization.










AICL and the Risk




































AICL and the Risk

























INFORMATION ABOUTSTAKEHOLDRS & INVESTORS


COMMUNICATION WITHSHAREHOLDERS AND STAKEHOLDER

AICL has been maintaining communication with its stakeholders. The acting company secretary Mr. Mofizur Rahman on behalf of the Board Secretariat Department communicates with the shareholders whenever any need arises. Shareholders also communicate with this Department at any time for any sort of information and query. AICL provides updated information in its website for all the shareholders of the company and it also disseminates all price sensitive information (PSI) within 30 minutes of the decision to the BSEC and the Dhaka Stock Exchange Ltd under the signature of the Acting Company Secretary through e-mail and by special messenger and through courier services in special cases and immediately publishes the same in 2 widely circulated newspapers, one in Bangla and the other in English, and also in one online news portal.

The shareholders are provided routine services by the Acting Company Secretary in the matters of transfer of shares, transmission of shares in case of a deceased shareholder, payment of dividend, reissue of dividend warrant when warrant expires in the hand of shareholders, issue of certificates regarding tax deduction from dividend etc. The company also publishes its quarterly reports and annual reports within the time as stipulated in the listing rules and also arranges necessary publications, and dispatches them accordingly. The annual report covers all the notes for current financial year, business performance, future plan, strategy and other key corporate information and disclosures. AICL respects the annual general meeting (AGM) and other general

meetings as important opportunities for direct communication with the honorable shareholders. To make the AGM more participating, the company declares the date of AGM well ahead of time, circulates annual reports and other documents in time, arranges AGM in a well-located place at convenient time, which allows the shareholders to attend and speak at the AGM freely. AICL gives value to their proposals and suggestions which are certainly pertinent and for the development and progress of the company. In the last AGM a large number of shareholders attended the meeting and participated in the discussions and made different queries and suggestions on different subjects. The company is fully committed to protect the interest of its shareholders. The directors and the senior management also attend the AGM where they are available to respond to shareholders’ questions. All shareholders have the right to vote at the general meetings. The number of shareholders is increasing gradually which shows their constant faith on the company.

The website of the company contains corporate information, which is updated on a regular basis. The website serves as a source of business, financial, and other relevant information on the company with easy access. Press releases, quarterly and annual reports and other information of interest to shareholders are regularly uploaded to company’s website. The suppliers, Government, regulatory bodies, society, community, media people and other groups find interest in the company.

SHAREHOLDER’SPOSITION











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34.5

34

33.5

33

32.5

32

31.5

34.18

33.13

32.69

Sponsor Directors Institutions General public

Shareholding position 2019


70

60

50

40

30

20

10

0

30.72

6.79

62.49

Sponsor Directors Institutions General public

Shareholding position 2020


PAID-UPCAPITAL GROWTH

Agrani Insurance Company Limited has started its business journey with initial share paid-up capital of Tk. 60.00 Million in 2000. In 2005 the company has received of Tk. 90.00 Million by Initial Public Offering shares (IPO) and total share paid-up capital stood Tk. 150.00 million. After increasing share paid-up capital at present stood Tk. 302.45 million. At a glance the history of increasing Share Paid-up Capital of the company:

NUMBER OFSHAREHOLDERS

EQUITYSTATISTICS

Agrani Insurance Company increased business growth from five years











AICL and the Risk


























Proposed

547.76

849.99

1076.71

821.42


Reserve and Contingent Liabilities

MARKETSHARE PRICE OF AICL

MARKET CAPITALIZATIONOF SHARES

The Company was listed with Dhaka Stock Exchange Ltd, on March 05, 2005. Agrani Insurance Company Ltd shares traded in the market (DSE) monthly highest and lowest price are as under:











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Share market is a volatile institution. The present day's bourses do not follow any fundamental information to affect the share price rather the effects unpredictable. The up and down are not steady. The indices moves upward very fast and gets down also fastly. As a result, the share markets are too much volatile. The potential shareholders should be very careful to invest in it otherwise it would make their invested fund high risky to become badly affected. At the end of the year 2020, the market capitalization of AICL has been Tk. 1076.71 million while it was Tk. 786.36 million in 2019. Overall, market trend has been upward at the end of the year 2020 in compare to recent past years.

At a Glance 5 Years Market Capitalization status are given below:Particulars 2020 2019 2018 2017 2016

Total number of shares outstanding 30,244,686 30,244,686 28,804,463 27,432,823 26,633,809

Market closing price as on 31 Dec (DSE) 35.60 26.00 17.30 20.60 24.00

Market Shares Capitalization (in BDT) 1076,710,822 786,361,836 498,317,210 565,116,154 639,211,416


212.77

2.2030.35

245.31

-

AICL market share capitalization (in million Taka)












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RISK MANAGEMENT &CONTROL ENVIRONMENT


RISK MANAGEMENTFRAMEWORK











AICL and the Risk





































AICL and the Risk

























RISK MITIGATIONMETHODOLOGY

Mitigation of risks includes reduction of the probability of risk event. Risk management planning is a continuous process and it cannot be stopped. The risk mitigation strategies and specific action plans should be incorporated in the project execution plan.

Risk mitigation plans should include the following:

i. Characterize the root causes of risks that have been identified and quantified in earlier phases of the risk management process.

ii. Evaluate risk interactions and common causes.

iii. Identify alternative mitigation strategies, methods, and tools for each major risk.

iv. Assess and prioritize mitigation alternatives.

v. Select and commit the resources required for specific risk mitigation alternatives.

vi. Communicate planning results to all project participants for implementation.

Insurance is a method of dispersal of the risk of one onto the shoulders of multiple consisting two integral characteristics: (i) shifting of risk from one individual to a group and (ii) express and notify the losses on equitable essence by bodily members of the

group. Insurance is an economic reference whereby the individual substitutes a small premium for a large financial risk which would exist if it were not for the insurance contract.

AICL is of the highest importance on financial security. It imparts technical capacity in a professional manner to the clients and loss adjusters. The handling of salvage at the heels of easing to exist by the loss adjusters further contributes much to the decrease of losses.

An effective framework for managing risk ensures full identification and awareness of significant risks, which are then measured in a consistent manner across asset classes and businesses. A proper exercise can control quantifiable risks. Risk management remains to provide value for its stakeholders. Effectiveness of risk management can increase non-intrinsic motivators such as public recognition and awards. Intrinsic motivators are often more powerful and useful for risk management.

AICL ensures proper risk management of their clients. Time, assets, income, property, and people are all expensive resources that can be saved if fewer claims occur and thus it protects the nation, reputation and image of the clientele, preventing or reducing apprehended liability and damages. This protects the environment, enhancing the power to prepare for different circumstances, reducing liabilities, assisting in visibly defining insurance needs.

DISCLOSURE OFRISK REPORTING

AICL is in the process of maintaining informative, transparent and consistent risk reporting for its valued clients, stake holders and the non-life insurance sector. It has been globally accepted that substantial narrative reporting, including the disclosure of risk, is important to promote investor protection.

The Standard Disclosure of Risk reporting includes the followings:

• Clear, balanced and understandable.• Includes all the insurer’s key activities and risks.• Presents relevant information.• Consistent over time.• Comparable among insurers.

• Provided on a timely basis.

Whenever a new policy comes on hand AICL involves adequate staff to assess the associated risk with the terms and conditions of the policy. For a new and valued client AICL goes on with the service through surveyors’ report to the potential insured. Utmost good faith demands that both the insurer and the potential insured shall disclose the material facts to each other. If there is any excess/deductible for a particular policy, that fact should be disclosed to the insured. In addition the potential insured shall further provide material facts about his property, to the best of his knowledge and belief, to the insurer before underwriting of the risk, including the ownership, position and value of his property, so that

the insurer may inspect the insurable property properly with a view to providing consistent services to the potential insured including competitive figure and necessary advices. There is a growing agreement among users, preparers and advisers that risk reporting needs to improve; better risk registration is an integral part of good governance.

It is to confirm that a generic risk report serves the interests of both shareholders and stakeholders with better information. In spite of the insurance industry’s critical and growing role in the global allocation of risk there is little authentic guidance concerning the form and content of risk reporting in general, due to growing terrorist activities in the world there are enormous probable channels of financing to favor terrorism.

Significant anti-money laundering and combating the financing of terrorism regimes are essential to recover the wholeness of markets and of the global financial framework as they help in mitigating the factors facilitating financial abuse. Bangladesh Bank and IDRA have given priority to Anti Money Laundering (AML) and Combat Terrorist Financing (CFT) issues. With a view to arresting the probable money laundering activities and combating terrorist financing, AICL has been vigilantly underwriting its insurance business through all of its branches and if there found any suspicious transaction but to report to the BFIU of Bangladesh Bank on prescribed format of STR immediately.













AICL and the Risk

























AICL is in the process of maintaining informative, transparent and consistent risk reporting for its valued clients, stake holders and the non-life insurance sector. It has been globally accepted that substantial narrative reporting, including the disclosure of risk, is important to promote investor protection.

The Standard Disclosure of Risk reporting includes the followings:

• Clear, balanced and understandable.• Includes all the insurer’s key activities and risks.• Presents relevant information.• Consistent over time.• Comparable among insurers.

• Provided on a timely basis.

Whenever a new policy comes on hand AICL involves adequate staff to assess the associated risk with the terms and conditions of the policy. For a new and valued client AICL goes on with the service through surveyors’ report to the potential insured. Utmost good faith demands that both the insurer and the potential insured shall disclose the material facts to each other. If there is any excess/deductible for a particular policy, that fact should be disclosed to the insured. In addition the potential insured shall further provide material facts about his property, to the best of his knowledge and belief, to the insurer before underwriting of the risk, including the ownership, position and value of his property, so that

the insurer may inspect the insurable property properly with a view to providing consistent services to the potential insured including competitive figure and necessary advices. There is a growing agreement among users, preparers and advisers that risk reporting needs to improve; better risk registration is an integral part of good governance.

It is to confirm that a generic risk report serves the interests of both shareholders and stakeholders with better information. In spite of the insurance industry’s critical and growing role in the global allocation of risk there is little authentic guidance concerning the form and content of risk reporting in general, due to growing terrorist activities in the world there are enormous probable channels of financing to favor terrorism.

Significant anti-money laundering and combating the financing of terrorism regimes are essential to recover the wholeness of markets and of the global financial framework as they help in mitigating the factors facilitating financial abuse. Bangladesh Bank and IDRA have given priority to Anti Money Laundering (AML) and Combat Terrorist Financing (CFT) issues. With a view to arresting the probable money laundering activities and combating terrorist financing, AICL has been vigilantly underwriting its insurance business through all of its branches and if there found any suspicious transaction but to report to the BFIU of Bangladesh Bank on prescribed format of STR immediately.













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GRAPHICALPRESENTATION












AICL and the Risk

























SEGMENTINFORMATION

440.00

420.00

400.00

380.00

360.00

340.00

320.00

407.06

2016 2017 2018 2019 2020

372.36383.01

423.20

352.49

Gross Premium Income (in million Taka)

Net Assets Value (In million Taka)

Net Premium Income (In million Taka)

193.20

173.80

198.95 192.28

224.20

150.00

160.00

170.00

180.00

190.00

200.00

210.00

2016 2017 2018 2019 2020

487.66 525.89

547.76

100.00

-

200.00

300.00

400.00

500.00

600.00

2016 2017 2018 2019 2020

456.29 459.74

Earnings Per Share (In Taka)1.90 1.79

1.451.26

2016 2017 2018 20202019

Stock & Cash dividend Paid Percentage

Price Earning Ratio (Times) Return on Shareholders fund/Equity(%)

Shareholders Fund and Equity (Taka in million)

12.00

10.00

8.00

6.00

4.00

2.00

-

2016 2017

2016

2017

2018

2019

2020

2018 2019 2020

5.00 Cash &5.00 Stock

7.00 Cash &3.00 Stock 10.00 Cash

5.00 Stock

5.00 Cash &5.00 Stock

456.29459.74

487.66525.89

2016 2017 2018 2019 2020

720.00

700.00

680.00

660.00

640.00

620.00

600.00

547.76

2016

2017

2018

2019

2020

Graphical Presentation/Performance in Graphs

1.72

GRAPHICAL PRESENTATION

20.66

20.57 11.97

11.52

12.64 9.51

7.27

8.54

10.67

11.08












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Class wise Gross Premium Income -2020 (In million Taka)

Opera�ngIncome 70.34

Interest Income17.82

InvestmentIncome 6.43

Dividend Income2.64

Other Income2.62

Fire Marine Motor Misc

63.81

108.25

43.34

8.81

Class Wise Net Premium Income-2020 (In million Taka)

Class wise Operating Income-2020 (In million Taka)

-

Segment wise income- 2020 (In Million Taka )

HORIZONTAL/VERTICAL ANALYSIS

Statement of Operational Performance of the Company

Performance of the Company In million Taka

Agrani Insurance Company Ltd has been maintaining a significant growth in the recent years in its financial position and performance of its business operation in the non-life insurance sector of Bangladesh. The statement below and graphical composition of operational performance and financial position indicates its growth and performance for the year ended December 31, 2020 as against 2019.


0

50.00

100.00

150.00

Fire Marine Motor Mise

122.40

149.15

43.53 37.43

Fire(4.62)

Marine 40.56

Motor 30.61

Misc3.80

70.34

17.82

6.43

2.64 2.62












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Operational Performance In Million Taka


2-year Comperative Operational Performance are shown in graphs is under

450.00

400.00

350.00

300.00

250.00

200.00

150.00

100.00

50.00

0.00

-50.00

Gross Pre

mium

Net Prem

ium

Expens

es of M

anagem

ent

Net Claim

s

Rese

rve fo

r un-e

xpire

d risks

Operating (U

nderw

riting) p

rofit/(lo

ss)

Investm

ent & othe

r Incom

e

Profit

or (loss)

before Ta

x

Tax p

rovision

Net Profit/

(loss)

afte

r Tax

Earni

ngs p

er Sha

re (EPS

)

2020

2019

5-year Operational Performance are shown in Graphs as under:

450.00

400.00

350.00

300.00

250.00

200.00

150.00

100.00

50.00

0.00

-50.00

Earni

ng Pe

r Sha

re (EPS

) afte

r Tax (

in Ta

ka)

Reta

ined Ea

rning

(Propose

d divid

ent %

)

Net Profit/

(Loss)

Afte

r Tax

Current

tax p

rovision

Profit

or (Loss)

Befo

re Tax

Rese

rve fo

r Un-

Expire

d bus

iness

Net Claim

s Paid

Managem

ent Ex

penses

Operatin

g (Und

erwriti

ng) P

rofit/(lo

ss)

Investm

ent Inc

ome &

Othe

rs Inc

ome

Net Prem

ium In

come

Gross Pre

mium

Incom

e (Turn

over)

2020

2019

2018

2017

2016












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FINANCIALPOSITION ANALYSIS

Agrani Insurance has maintained a steady growth in the recent years in its financial position. 2-year comparative financial positon of the company are given below:

- 100.00 200.00 300.00

2019

2020

2018

2017

2016

Investment inshares

Fixed depositreceipt (FDR)

Property,plant &equipment

BangladeshGovt TresaryBond (BGTB)

-

50.00

100.00

150.00

200.00

250.00

20192020 2018 2017 2016

Bangladesh Govt Tresary Bond (BGTB) Property, plant & equipment Fixed deposit receipt (FDR) Investment in shares


Statement of Financial Position In Million Taka

Financial Position (Balance sheet Items) In million Taka

5-year Financial Position (Balance Sheet Analysis)

0

100

200

300

400

500

600

20192020 2018 2017 2016

Shareholders' equity PPE Current assets Current liabilites

0%

20%

40%

60%

80%

100%

20192020 2018 2017 2016

Current liabilites Current assetsPPE Shareholders' equity

Investment (Taka in million) In Million Taka












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THE GLOBAL GOALSFor Sustainable Development


STATEMENT OF VALUE ADDEDAND ITS DISTRIBUTION


VALUE ADDEDSTATEMENT

The Value Added Statement (VAS) provides a detailed account of total value creation and distribution of the company during the year under review. Agrani Insurance Company Ltd contributed positively to the socio-economic development through payment of salaries and allowances to employees, paying consistent dividend to the shareholders and also paying Tax, VAT, Stamps duty etc to the Government of Bangladesh. Agrani Insurance Company Ltd pays significant amount of corporate income tax every year. The management of the company is very much keen and transparent in doing the insurance business and tries to expand it steadily.

The Value Added Statement of Prime Insurance Company Ltd for the year 2020 and 2019 mentioned below and show how the value is created and distributed among different stakeholders i.e., Government, investors and employees of the company:

Amount % Amount %

2020 2019Particulars

Figure in Million (BDT)Growth in

Million (BDT)Growth %

Value Added

Gross premium income 352.49 76.37 423.20 81.59 (70.71) (16.71)VAT & stamp duty 46.35 10.04 46.92 9.05 (0.57) (1.21)With holding VAT & Tax 6.24 1.35 7.34 1.41 (1.10) (14.96)Interest income 17.82 3.86 17.27 3.33 0.55 3.18 Share investment income 1.83 0.40 (5.90) -1.14 7.73 (130.94)Dividend income 2.64 0.57 1.58 0.30 1.06 67.34 Rental income 4.60 1.00 4.60 0.89 - - Other income 2.62 0.57 1.74 0.34 0.88 50.58 Re-insurance commission earned 27.00 5.85 21.95 4.23 5.05 23.01

Total Value Added during the year 461.59 100.00 518.69 100.00 (57.10) (11.01)

Reinsurance, claims & other 264.84 63.47 342.81 70.23 (77.96) (315.06)

Re-insurance premium 128.30 30.75 230.92 47.31 (102.63) (44.44)Additional unexpired risks reserveretained 10.26 2.46 (3.92) (0.80) 14.18 (361.50)Management expenses(Excluding employee benefits) 32.84 7.87 27.63 5.66 5.21 18.85 Unallocated expenses 21.37 5.12 20.86 4.27 0.51 2.43 Agent commission 43.61 10.45 51.98 10.65 (8.37) (16.11)Net claims incurred 28.47 6.82 15.33 3.14 13.14 85.71

Employee benefits: 72.48 17.37 73.66 15.09 (1.18) (73.01)

Salary & allowances 57.73 13.84 50.37 10.32 7.36 14.60

Festival bonus & Incentive bonus 7.54 1.81 11.62 2.38 (4.08) (35.10)

Group Insurance Premium 0.40 0.10 0.43 0.09 (0.03) (5.94)

Gratuity fund 5.18 1.24 9.60 1.97 (4.42) (46.02)

Provident fund 1.62 0.39 1.63 0.33 (0.01) (0.55)

Employee benefits: 72.48 17.37 73.66 15.09 (1.18) (73.01)

Government/National Exchequer: 60.69 14.55 66.10 13.54 (5.40) (42.50)

Corporate tax paid 6.00 1.44 10.00 2.05 (4.00) (40.00)

VAT, stamp duty & source taxes paid 54.69 13.11 56.10 11.49 (1.40) (2.50)

Value Added Contribution to/application of the Value Added:


250

200

150

100

50

-

231

128

4 3328

2121

72 74

44 28 52 1561

_

66

519 110

R/ Ic

ost

Unexpire

d risks

rese

rve

Man

agem

ent e

xpen

ses

Unalloc

ated

expen

ses

Agent c

omm

ission

Net cl

ams i

ncurre

d

Reta

ined ea

rnings

Dividen

d to sh

arehold

ers

Govern

ment/c

orpora

te tax

Employ

ees’ s

alary,

bonu e

tc

2020 (Figures in million Taka)2019 (Figures in million Taka)

Distribution of Value added are shown in Graphs for the year 2020 and 2019(Figures in million Taka) as under:

MARKET VALUEADDED STATEMENT

While Economic Value Added (EVA) measures internal performance, Market Value Added (MVA) is a measure of external performance that indicates how the market has evaluated the company's performance in terms of market value of share compared to book value of shares.

Market Value Added (MVA) is the difference between the total market value (based on the quoted price in the main bourse) and total book value of the Company's equity shares. The higher the Market Value Added the better the Company's position. A high Market Value Added indicates the Company has created substantial wealth for the shareholders. A negative MVA mean that the value of management's action and investments are less than that of value of the capital contributed to the Company by the capital market (or that wealth and value have been decreased).

As at 31st December 2020, the market value of total outstanding shares of Agrani Insurance Company Ltd stood at Tk. 1076.71 million whereas the book value of the shares outstanding or shareholder's equity of the same period stood at Tk. 786.36 million.


1200

1000

800

600

400

200

0

1076.71

786.36547.76

525.89

2020 (Figurein millionTaka)

2019 (Figurein millionTaka)528.95

260.47

Market value of shares Book value of shares Market value Added

Market Value Added are shown in Graphs for the year 2020 and 2019 as below:

CONTRIBUTION TO THE NATIONALEXCHEQUER/GOVERNMENT FUND

We recognize that Agrani Insurance Company Ltd has certain corporate responsibilities to the society or community for their development and the development of the nation as a whole. We aspire to be known as an institution that builds enduring relationship with and delivers value for our customers, shareholders, employees, government and community where we do business.

Our priorities:

* Paying fair share of VAT & taxes to the Government

* Creating employment

* Maximizing shareholders value

* Taking environmental initiatives

* Supporting community

* Financial assistance to the insolvent meritorious students

* Increase mass awareness about traffic rules

* Provide handsome returns to shareholders

For this reason, company made significant contribution to the Government each year by payment of Tax, VAT, Stamp duty etc. In the year 2020, company contributed Tk. 60.69 million to the National Exchequer as against Tk. 66.10 million in 2018.

Contribution to National Exchequer/Government Fund:


Contribution to the National Exchequer/Government Fund are shown in Graphs for the year 2020 and 2019 as below:

At a glance 5 Years Highlights of Contribution to the National Exchequer

Contribution to National Exchequer-2019 (in million Taka)

40.00

30.00

20.00

10.00

-

37.76

1010.81

0.54 1.041.30 2.60 2.05

Value Added Ta

x

Stamp duty

Tax deducted at so

urce...

Tax deducted on va

rious sources

Tax deducted on agency c

ommission

Tax deducted on employe

e Salary

Corporate Income Tax P

aid

Tax deducted on va

rious account (F

DR,...

40.00

35.00

30.00

25.00

20.00

15.00

10.00

5.00

-

Valu

e Ad

ded

Tax

Stam

p du

ty

Corp

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Tax

dedu

cted

on

agen

cyco

mm

issi

on

Tax

dedu

cted

on

empl

oyee

sala

ry

2020

2019

2018

2017

2016

At a glance 5 years graphical highlights: Contribution to National Exchequer

Contribution to National Exchequer-2020 (in million Taka)

-

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.0039.73

6.008.12

1.340.76 0.93

2.18 1.64

Tax deducted on employe

e


AICL on Gross Domestic Premium Income AICL on Gross Private Sector Premium Income

At a glance year wise private sector Bangladesh Non-life Insurance Companies' Gross Premium Income and Agrani Insurance Company's premium income position out of 47 Non-life Insurance Companies are given below:

50,000

45,000

40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

-

AICL Gross Premium IncomeGross Domestic Premium Income

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

35,000

30,000

25,000

20,000

15,000

10,000

5,000

-

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

AICL Gross Premium Income

Gross Private Sector Premium Income

MARKET SHARE POSITION OFINSURANCE BUSINESS OF THE COMPANYBangladesh Non-life Insurance Business Market Composition and Status of Agrani Insurance

Market share position of the company's insurance business reflects the ability to exercise underwriting and pricing discipline as well as the risk management effectiveness in managing its business growth. As a second generation insurer, Agrani Insurance Company Ltd is in a better pricing position than insurance companies of other non-life insurance companies.

The non-life Insurance provisional premium income in 2020 was approximately Tk. 43,660 million where AICL's contribution was Tk. 352.49 million. In 2019, the company earned Tk. 423.20 million. Last 10-years non-life insurance premium as a % of GDPI and GPSPI shown in the chart below:


SPECIFIC AREASFOR INSURANCE SECTOR


CLAIMS MANAGEMENT AND DETAILSOF OUTSTANDING CLAIMS (IBNR & IBNER)WITH AGEING THEREOF

Claims settlement in an accounting period, outstanding liabilities against insurance claims may already be in existence or arise in respect of claims which have been reported but not yet settled (IBNER) or against those claims have been incurred but not yet reported (IBNR).

It is obvious that there might be a delay in settlement of the claim, typical reasons are: (i) reporting delay (time gap between claims occurrence and claims reporting at the insurance company); and (ii) settlement delay, because it usually takes time to evaluate the whole size of the claim sometimes not getting proper evidence from the claimant.

The time difference between claims occurrence and claims closing (final settlement) can take days (e.g. in case of property insurance) but it can also take years even more to settle (typically in case of liability insurance).

Provisions of claims are created by setting aside a portion of net premium so that the insurer is able to settle all the outstanding claim liabilities that are proximately caused by perils falling within the scope of insurance contracts.

The following formula is usually applied to calculate the provision for such outstanding claims:

Total IBNR = “Pure IBNR” +” IBNER”

In view of proper accounting practice, reserve for each outstanding claim is maintained in respect of each financial year. Reserve for claims incurred but not reported (IBNR) and Reserve for claims incurred but not enough reported (IBNER) are the two terms that can be regarded as of identical meaning.

Incurred but Not Reported (IBNR) losses reserve

IBNR refers to the losses that are not filed with the insurer or re-insurer until years after the insurance policy is sold. It is a reserve to provide

for claims in respect of claim events that have occurred before the accounting date but have still to be reported to the insurer by that date. In case of a re-insurer, the reserve needs also to provide for claims that, although known to the cadent, have not yet been reported to the re-insurer as being liable to involve the reinsurer.

The characteristics of IBNR looks like a reserve or provision for the particular types of losses not reported, hence gives a better estimation of profits for the insurer’s current business period.

Incurred but Not Enough Reported (IBNER) loss reserve

IBNER refers to a reserve reflecting expected changes (increases and decreases) in estimates for reported claims only. The abbreviation is sometimes stated as applying to “incurred but not enough reserved’ Some liability claims may be filed long after the event that caused the injury to occur. Asbestos-related diseases, for instance, do not show up until decades after the exposure. Reserve for such outstanding claims also has to be created adequately against IBNER losses.

AICL regularly adjusts reserves for such losses as and when new information becomes available. As per IDRA instruction quarterly reporting of all outstanding claims with aging thereof including their specific reasons for delay in settlement of such respective outstanding claims is mandatory.

AICL maintains adequate provision against outstanding claims with respective aging thereof. In Bangladesh, it is not yet requisite to provide reserves for IBNR and/or IBNER claims. However, in accordance with the proposed solvency margin regulations those reserves will be maintained in the accounts.

6 35,010,586 7,472,300 42,482,886 11,592,391 27.29 30,890,4952020


AUDITORS REPORT& FINANCIAL STATEMENTS(For the Year ended December 31, 2020)


Independent Auditor ’s ReportTo the Shareholders of AGRANI INSURANCE COMPANY LIMITEDReport on the Audit of the Financial Statements

Opinion

We have audited the financial statements of Agrani Insurance Company Limited (the Company), which comprise the Statement of Financial Position as at 31 December 2020, the Statement of profit or loss and other Comprehensive Income, Profit or Loss Appropriation, Consolidated & Specific Class of Business Revenue Accounts, Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the company as at 31 December 2020, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs), the Companies Act 1994, the Insurance Act 2010, the Insurance Rules 1958, the Securities and Exchange Rules 1987 and other applicable laws and regulations.

Basis for Qualified Opinion

1. The Company has recorded a receivable of Premium Control worth BDT 112,375,365 as at December 31, 2020 (BDT 112,531,967 as at December 31, 2019) on the Statement of Financial Position under Sundry Debtors. These balances represent receivables which have been due over a significant number of years and there is substantial in regards to the Company's ability to collect these balances and provision has been recognized by the Company against these receivables.

2. The Company did not set aside due part of its profit for the year in relation to workers profit participation and welfare fund as required under the Bangladesh Labour Act 2006.

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (IESBA Code) together with the ethical requirements that are relevant to our audit of the financial statements in Bangladesh, and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

We draw attention to Note 15 of the financial statements, which describes matters related to implementation of investment policy for nonlife insurance companies as issued by the IDRA. Our opinion is not modified in respect of this matter

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated and separate financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Other Information

Management is responsible for the other information. The other information comprises all of the information in the Annual report other than the financial statements and our auditors’ report thereon. The directors are responsible for the other information.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Financial Statements and Internal Controls

Management is responsible for the preparation and fair presentation of the financial statements in accordance with IFRSs, the Companies Act 1994, the Insurance Act 2010, the Insurance Rules 1958, the Securities and Exchange Rules 1987 and other applicable laws and regulations and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company ’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company ’s financial reporting process.

Auditor ’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor ’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

o Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

o Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.

o Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

o Conclude on the appropriateness of management ’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company ’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor ’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor ’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

o Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor ’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on other Legal and Regulatory Requirements

In accordance with the Companies Act 1994, the Insurance Act 2010, the Insurance Rules 1958, the Securities and Exchange Rules 1987 and relevant notifications issues by Bangladesh Securities and Exchange Commission, we also report that:

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit and made due verification thereof;

b) In our opinion, proper books of accounts, records and other statutory books as required by law have been kept by the Company so far as it appeared from our examinations of those books;

c) The Company management has followed relevant provisions of laws and rules in managing the affairs of the Company and proper books of accounts, records and other statutory books have been properly maintained and (where applicable) proper returns adequate for the purposes of our audit have been received from branches not visited by us;

d) As per section 63(2) of the Insurance Act 2010, in our opinion to the best of our knowledge and belief an according to the information and explanation given to us, all expenses of management wherever incurred and whether incurred directly or indirectly, in respect of insurance business of the company transacted in Bangladesh during the year under report have been duly debited to the related Revenue Accounts and the Statement of Comprehensive Income of the Company;

e) We report that to the best of our information and as shown by its books, the company during the year under report has not paid any person any commission in any form, outside Bangladesh in respect of any its business re-insured abroad;

f) The Statement of Financial Position, Statement of Comprehensive Income, Profit and Loss Appropriation Account, related Revenue Accounts, Statement of Changes in Equity and Statement of Cash Flows of the Company together with the annexed notes dealt with by the report are in agreement with the books of account and returns; and

g) The expenditure was incurred for the purpose of the Company ’s business.

A.K. Gulam Kibria, FCAEngagement Partner

G. KIBRIA & CO.Chartered Accountants

DVC: 2103280392AS849165

gmnimemberan association oflegallyindependentaccounting firms

partnering for success

Key Audit Matter How our audit addressed the key audit matters

PREMIUM INCOME

Premium income is the most significant item in the statement of profit and loss & profit and loss appropriation account. The Company has reported gross premium of Taka 352,493,591 for the ended 31 December 2020 (Taka 423,198,765 for the year ended 31 December 2019).

Gross general insurance premium comprises the total premium received during the accounting period for the entire period of coverage for which insurance policy has been issued by contracts with Agrani Insurance Company Limited.

Given the important nature, connections to other items on the financial statements, the sensitivity of the item and the importance to key stakeholder ’s of the Company, we believe this area possess high level of risk.

The procedures that were performed in order to mitigate this risk are listed below:

o Carried out analytical procedures and recalculated premium for the period.

o Carried out cut-off testing to ensure unearned premium income has not been included in the premium income reported in the year.

o On a sample basis, reviewed policy to ensure appropriate policy stamp was affixed to the contract and the same has been reflected in the premium register.



Opinion







Emphasis of Matter


Key Audit Matters


Auditors Report To The Shareholders

Other Information






























DVC: 2103280392AS849165


PREMIUM INCOME

Details of Premium Income have been included in Note 25 to the financial statements.

o Tested on a sample basis that the premium has been deposited in the designated bank account. For each sample, we also tested whether appropriate VAT was collected and deposited to bank.

o For a sample of insurance contracts, tested to see if appropriate levels of re-insurance, was done and whether the re-insurance was deducted from the gross premium.

o Applying judgment, assessed whether there is any impairment of the re-insurer.

o Assessed the appropriateness, presentation and disclosure against relevant accounting standards, Insurance Act 1938 (as amended in 2010), Insurance Rules 1958 and other applicable rules and regulations and regulatory guidelines.


ESTIMATED LIABILITY IN RESPECT OF OUTSTANDING CLIAMS WHETHER DUE OR INTIMATED ANS CLAIM PAYMENT

Details of Estimated Liability have been included in Note 8.00 to the financial statements.

The procedures that were performed in order to mitigate this risk are listed below:

o Obtained an understanding of the internal controls around this financial statement line item. This allowed us to gain a better understanding of the process as well as design better substantive procedures.

o Obtained samples of claimed policies and cross checked with claim.

o For samples selected, obtained copies of survey reports and cross checked with respective ledgers.

o Reviewed the claim committee meeting minutes about decision about impending claims

o Tested sample of claim payments with intimation letter, survey report, bank statement, claim payment register and general ledger.

o Assessed the appropriateness, presentation and disclosure against relevant accounting standards, Insurance Act 1938 (as amended in 2010), Insurance Rules 1958 and other applicable rules and regulations and regulatory guidelines.

This amount represents the claim due or intimated from the insured and involves significant judgment and risk of understatement. As at December 31, 2020, the reported balance under the head of estimated liability in respect of outstanding claims whether due or intimated was Taka 30,890,495 and Claims paid in the year ended December 31, 2020 was Taka 32,593,249 (outstanding claims as at December 31, 2019 was Taka 35,010,586 and claims paid for the year ended December 31, 2019 was Taka 29,931,842).

This provision has a direct impact on the profitability and liquidity of the Company which makes it an important item for key stakeholders. Considering its impact on multiple line items on the financial statements, its sensitivity and importance to key stakeholders, we believe this area possesses high level of risk.


IMPLEMENTATION OF IFRS 16 LEASES

We obtained an understanding of the management's process for implementing IFRS 16 Leases, including financial controls designed by the management to mitigate the risks assessed by us independently. We tested those relevant controls and adopted a control rely strategy. Furthermore, to mitigate the inherent risk in this audit area, our audit approach included testing of the controls and substantive audit procedures, including:

o Obtained and read the accounting policy for compliance with IFRS 16 Leases;

With reference to Note 13 and 14 to the financial statements, IFRS 16 Leases becomes effective for annual reporting beginning on or after 01 January 2019 which replaces the existing International Accounting Standard 17 Leases. Agrani Insurance Limited has implemented the modified retrospective approach for the transition accounting. The Company reported a Right of Use Asset and Lease Liability worth BDT 4,045,180 on the Statement of Financial Position.



Opinion







Emphasis of Matter


Key Audit Matters



Other Information






























DVC: 2103280392AS849165


IMPLEMENTATION OF IFRS 16 LEASES

Details of IFRS 16 Leases have been included in Note 13 and 14 to the financial statements.

o Obtained listing of all contracts from the management and tested the contracts on a sample basis for impact under IFRS 16 Leases. In respect of the contracts selected for testing;

o Obtained and assess the borrowing rates;

o Tested the assumptions used in the calculation model for the sample contracts selected for testing;

o categories of lease for valuation of the right of use of asset and lease liability;

o Assessed the disclosures within the financial statements.



Opinion







Emphasis of Matter


Key Audit Matters



Other Information






























DVC: 2103280392AS849165

Date: Dhaka, 14th March, 2021


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AV) p

er sh

are

3

1.00

1

8.11

1

7.39

31-D

ec-2

0Ta

ka31

-Dec

-19

Taka

Note

s

PRO

PERT

Y AN

D AS

SETS

Non-

curre

nt A

sset

s

2

33,4

81,4

64

240

,391

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perty

, pla

nt &

equ

ipm

ent le

ss a

ccum

ulate

d de

pr.

1

4.00

1

51,9

21,8

88

163,

384,

462

Statu

tory

dep

osits

at B

GTB

15.

00

25,

000,

000

2

5,00

0,00

0 Fa

ir val

ue o

f finn

cial

ass

ets

1

6.00

5

6,55

9,57

7

52,

007,

414

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rent

Ass

ets

321

,054

,578

3

03,5

18,1

83

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ck o

f sta

tione

ry

548

,497

68

1,61

0 In

sura

nce

stam

p in

hand

3

,223

,759

1

,057

,781

In

tere

st ac

crue

d bu

t not

due

17.

00

9,4

95,0

00

6,83

1,44

4 Am

ount

due

from

oth

er p

erso

ns o

r-

bo

dies

car

rying

on

insur

ance

bus

iness

18.

00

121

,627

,520

10

9,84

1,86

4 Su

ndry

deb

tors

(incl

uding

adv

ance

s, de

posit

s

19.

00

186

,159

,802

1

85,1

05,4

84

and

pre-

paym

ents)

C

ash

and

Cas

h Eq

uiva

lent

s

20.

00

295,

450,

372

27

8,05

8,69

5 C

ash

in ha

nd

288

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5

33,8

69

Cas

h at

ban

k

5

1,41

2,32

5

35,

274,

826

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dep

osit r

ecei

pts (

FDR)

2

43,7

50,0

00

242

,250

,000

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tal

8

49,9

86,4

15

821

,968

,754

31-D

ec-2

0Ta

ka31

-Dec

-19

Taka

Note

s

Dat

e: 1

4-03

-202

1S

igne

d as

per

our

sep

arat

e re

port

of s

ame

date

.

A.K

. G

ula

m K

ibri

a,

FCA

G.

KIBR

IA &

CO

.C

harte

red

Ac

co

unta

nts

DVC

: 21

0328

0392

AS8

4916

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mud

ul H

oque

Dire

ctor

Qua

zi S

akha

wat

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sain

(Lin

too)

Cha

irman

Md

. Azh

aru

l Isl

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hief

Exe

cutiv

e O

ffice

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ker A

hmed

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ctor


Pro

fit o

r Lo

ss A

cc

ou

nt

(Sta

tem

en

t o

f O

the

r C

om

pre

he

nsi

ve In

co

me

) A

s a

t 31 D

ec

em

be

r 2020

Pro

fit o

r Lo

ss A

pp

rop

riatio

n A

cc

ou

nt

As

at

31 D

ec

em

be

r 2020

The

anne

xed

note

s fro

m 1

to 3

4 fo

rm a

n in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

Exp

ense

s of

ma

nag

emen

t (no

t ap

plic

ab

le to

28,1

76,5

73

32,

097,

685

any

pa

rticu

lar f

und

or a

ccou

nt)

Ad

verti

sem

ent a

nd p

ublic

ity

7

14,5

75

530

,537

Aud

it fe

es

21.

00

225

,000

2

00,0

00

S

ubsc

riptio

n

765

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2

25,0

00

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rofe

ssio

nal f

ees

2

62,9

65

346

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reci

atio

n

12,

992,

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1

3,78

4,27

9

Reg

istra

tion

fees

486

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4

40,4

60

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irect

ors

fee

22.0

0

1,3

20,8

00

1,1

36,0

00

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.F. c

ontri

but

ion

1

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1

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eres

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ft

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5

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nter

est o

n lo

an

4

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3

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tuity

5,1

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84

9,6

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ir va

lue

of fi

nanc

ial a

sset

s' (in

com

e)/lo

ss re

cogn

ized

(1

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867,

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et p

rofit

for t

he y

ear c

arri

ed to

71,

680,

440

4

7,96

9,66

5 Pr

ofit

and

loss

ap

pro

pria

tion

acc

ount

T

ota

l

98,

523,

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8

7,93

4,49

4

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2020

Taka

Note

sIn

tere

st, d

ivid

end

and

rent

s (n

ot a

pp

lica

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to a

ny

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rticu

lar f

und

or a

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nt)

In

tere

st a

nd d

ivid

end

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me

23.

00

25,

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617

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7,60

7

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tere

st in

com

e

17,

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1

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2

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s

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ed fr

om

7

0,34

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4

60,

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330

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insu

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(4

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nce

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nue

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ount

40,

557,

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6,35

4 M

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nce

reve

nue

acc

ount

30,

608,

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2

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0 M

iscel

lane

ous

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ranc

e re

venu

e a

ccou

nt

3

,797

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5

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al

9

8,52

3,65

8

87,

934,

494

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Taka

2020

Taka

Note

s

Rese

rve

for e

xcep

tiona

l loss

es

2

2,41

9,56

7

19,

227,

642

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dend

201

9

30,

244,

686

1

4,40

2,23

0 Pr

ovisi

on fo

r inc

ome

tax

1

7,08

1,89

4

9,5

69,5

51

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nce

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g pr

ofit

trans

ferre

d to

bal

ance

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et

29.

00

30,

345,

363

3

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9

To

tal

1

00,0

91,5

10

74,

092,

442

Earn

ing

per s

hare

(EPS

) 3

0.00

1

.72

1

.26

2019

Taka

2020

Taka

Note

s

Bala

nce

bein

g pr

ofit

brou

ght f

orw

ard

from

last

year

30,

893,

019

2

6,30

2,65

9 Ne

t pro

fit fo

r the

year

bro

ught

dow

n fro

m p

rofit

or lo

ss Ac

coun

t

71,

680,

440

4

7,96

9,66

5 Of

fsettin

g flu

ctua

tion

fund

for f

air p

rese

ntat

ion o

f fina

ncia

l asse

ts

-

-

Def

erre

d ta

x in

com

e/(e

xpen

ses)

14.

01

(2,4

81,9

49)

(179

,882

)

Tota

l 1

00,0

91,5

10

74,

092,

442

2019

Taka

2020

Taka

Note

s

Dat

e: 1

4-03

-202

1S

igne

d as

per

our

sep

arat

e re

port

of s

ame

date

.

A.K

. G

ula

m K

ibri

a,

FCA

G.

KIBR

IA &

CO

.C

harte

red

Ac

co

unta

nts

DVC

: 21

0328

0392

AS8

4916

5

Mah

mud

ul H

oque

Dire

ctor

Qua

zi S

akha

wat

Hos

sain

(Lin

too)

Cha

irman

Md

. Azh

aru

l Isl

amC

hief

Exe

cutiv

e O

ffice

rZa

ker A

hmed

, FCA

Dire

ctor


Co

nso

lida

ted

Re

ven

ue

Ac

co

un

t (A

s a

t 31 D

ec

em

be

r 2020)

The

anne

xed

note

s fro

m 1

to 3

4 fo

rm a

n in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

All e

xpen

ses

of m

anag

emen

t whe

reve

r inc

urre

d w

heth

er d

irect

ly o

r ind

irect

ly in

resp

ect o

f fire

, mar

ine,

mot

or a

nd m

iscel

lane

ous

insu

ranc

e bu

sines

s tra

nsac

ted

in B

angl

ades

hha

ve b

een

fully

deb

ited

in th

e re

spec

tive

reve

nue

acco

unts

as

expe

nses

in th

e ra

tio o

f gro

ss p

rem

ium

inco

me.

Cla

ims

und

er p

olic

ies

less

re-in

sura

nces

:

28,

473,

158

1

5,33

2,02

5

Paid

dur

ing

the

yea

r

32,

593,

249

2

9,93

1,84

2

Ad

d :

tota

l est

ima

ted

lia

bilit

y in

resp

ect o

f

30,

890,

495

3

5,01

0,58

6

ou

tsta

ndin

g c

laim

s a

t the

end

of t

he y

ear

whe

ther

due

or i

ntim

ate

d

63

,483

,744

6

4,94

2,42

8 Le

ss: C

laim

s ou

tsta

ndin

g a

t the

end

o

f the

pre

viou

s ye

ar

3

5,01

0,58

6

49,

610,

403

C

omm

issio

n ex

pen

ses

43,

605,

621

5

1,97

9,75

6

Exp

ense

s of

ma

nag

emen

t 2

6.00

9

8,51

6,99

0

90,

056,

324

Pr

ofit

trans

ferr

ed to

pro

fit o

r lo

ss a

ccou

nt

7

0,34

5,71

4

60,

781,

330

Bala

nce

of a

ccou

nt a

t the

end

of t

he y

ear

a

s sh

own

in th

e b

ala

nce

shee

t:

Rese

rve

for u

nexp

ired

risk

s b

eing

100

% fo

r

Ma

rine

Hull

and

40%

for o

ther

pre

miu

m in

com

e

of

the

yea

r.

88,

742,

483

7

8,48

6,42

1

To

tal

3

29,6

83,9

66

296

,635

,856

2019

Taka

2020

Taka

Note

s

Bala

nce

of a

ccou

nt a

t the

beg

inni

ng o

f the

yea

r

78,

486,

421

82,

408,

681

Prem

ium

less

re-in

sura

nce

ced

ed

25.

00

224

,195

,667

1

92,2

76,4

26

Com

miss

ion

on re

-insu

ranc

e ce

ded

27,

001,

878

21,

950,

749

To

tal

3

29,6

83,9

66

296

,635

,856

2019

Taka

2020

Taka

Note

s

Dat

e: 1

4-03

-202

1S

igne

d as

per

our

sep

arat

e re

port

of s

ame

date

.

A.K

. G

ula

m K

ibri

a,

FCA

G.

KIBR

IA &

CO

.C

harte

red

Ac

co

unta

nts

DVC

: 21

0328

0392

AS8

4916

5

Mah

mud

ul H

oque

Dire

ctor

Qua

zi S

akha

wat

Hos

sain

(Lin

too)

Cha

irman

Md

. Azh

aru

l Isl

amC

hief

Exe

cutiv

e O

ffice

rZa

ker A

hmed

, FCA

Dire

ctor


1.00 General Information:

1.01 Legal form and status of the Company:

The Company was incorporated as a public limited company in Bangladesh on 14 March 2000 under the Companies Act, 1994 and obtained certificate for commencement of business from the Registrar of Joint Stock Companies and Firms on 14 March, 2000 and also obtained registration from the Chief Controller of Insurance, Government of the People's Republic of Bangladesh on 3 April 2000 under the Insurance Act, 1938. The company has also been obtaining registration certificate from the Insurance Development and Regularity Authority (IDRA) after its establishment. The company went into Initial Public Offering (IPO) on February 10, 2005 and listed with Dhaka Stock Exchange Ltd (DSE). Registered office of the company situated at Shaiham Sky View Tower (14th Floor), 45, Bijoy Nagar, Dhaka-1000 has been shifted to City Centre (Level # 17), 90/1, Motijheel C/A, Dhaka-1000 on 1 November 2020. The company is engaged in non-life insurance business under the Insurance Act, 2010.

1.02 Principal activities and nature of operations:

The principal activity of the company is to carry on non-life insurance business of fire, marine, motor and miscellaneous insurance business. There was no significant change in the nature of the principal activities of the company during the year 2020 under review.

1.03 Date of financial statements authorized for issue:

Financial Statements of the company for the year ended 31 December 2020 were authorized for issue on 14 March 2021 in accordance with a resolution of the Board of Directors.

2.00 Significant accounting policies and relevant information:

2.01 Basis of accounting:

These accounts have been prepared under International Financial Reporting Standards (IFRSs) on historical cost convention.

2.02 Basis of preparation:

The Financial Reporting Act 2015 (FRA) was enacted in 2015. Under the FRA, the Financial Reporting Council (FRC) is formed and it is yet to issue fiĐnancial reporting standards for public interest entities such as non-bankig financial institutes. The FRC has been formed but yet to issue any fiĐ nancial reporting standards as per the provisions of the FRA and hence International Financial Reporting Standards (IFRSs) as approved by the Institute of Chartered Accountants of Bangladesh (ICAB) are still applicable.

Accordingly, the accompanied nancial statements have been prepared and presented in accordance with International Financial Reporting Standards (IFRSs), the Insurance Act 2010, Insurance Rules 1958, the Companies Act 1994, and other applicable laws and regulations as much as practicable. In certain cases where rules and regulations are yet to be framed by the Insurance Development and Regulatory Authority (IDRA), the relevant provisions of the Insurance Act 1938 have been resorted to. Accordingly, the balance sheet has been prepared in accordance with the regulations contained in part I of the First Schedule and as per Form "A" as set forth in Part II of that schedule and the Revenue Account of each class of non-life insurance business has been prepared in accordance with the regulations as contained in Part I of the Third Schedule and as per Form "F" as set forth in Part II of that Schedule of the Insurance Act 1938 as amended.

2.03 Branch accounting:

The Company has 21 branches under its umbrella without having any overseas branch for the year ended 31 December 2020. The accounts of the branches are maintained and consolidated at the head office level. Only petty cash book and premium collection books are being maintained at the respective branches to meet up the day to day expenses and collection respectively.

2.04 Going concern:

The accompanying financial statements has been prepared on going concern basis which indicates that the realization of assetes and discharge of liabilities will be done in the normal course of business and the management belives the entity is able to continue its operation for foreseeble future.

2.05 Premium income recognition:

Premium income is recognized when insurance policies are issued and premium is collected. Gross underwriting business as well as re-insurance thereof and claim settlement etc, have been prepared separately for each class of business and net underwriting results thereof have been reflected in the revenue accounts after due consideration of re-insurance ceded.

2.06 Public Sector Business (PSB):

As per government decision effective from April 2000, all the public sector insurance business (PSB) is being underwritten by Sadharan Bima Corporation (SBC) and out of which 50% is being equally distributed among the 46 private insurance companies.

Company’s share of public sector business is accounted for in the year in which the statement of accounts has been received from Sadharan Bima Corporation up to June 30, 2020. The statements of accounts for the period from July 1, 2019 to June 30, 2020 have been received from Sadharan Bima Corporation and accordingly, the company’s share of public sector business for that period has been accounted for in the accompanying accounts. This practice is being followed consistently.

2.07 Investment income recognition:

Interest on fixed deposit receipts (FDR) and 10-year Bangladesh Government Treasury Bond (BGTB) are recognized on accrual basis after making provision for income tax deductible at source. Interest on STD account and other income are recongnized on cash basis. Interest on FDR and STD income and other income have been credited to the statement of profit or loss and other comprehensive income.

2.08 Investment in shares and securities:

The aggregate market value of the investment at the year end is Tk. 56,559,577 against the cost amount of Tk. 69,211,251. The company finds it prudent to recognize the unrealised loss/(gain) following the applicable IFRS and consider fair presentation of investment in shares.

2.09 Dividend income:

Cash dividend income on investment in shares are recognized on cash basis and show in the statement of profit or loss and other comprehensive income. For stock dividend, number of shares increases and average cost of investment decreases.

2.10 Functional and presentation currency:

The financial statements are presented in Bangladeshi Taka which is the company's functional currency except indicated otherwise.

2.11 Materiality and aggregation:

Each material class of similar items is presented separately in the financial Statements. Item of dissimilar nature as function are presented separately unless they are immaterial.

2.12. Balance of Fund and Accounts (un-expired risk reserve):

These have been arrived at by making provision for unexpried risks @ 40% of net premium of all business except marine hull insurance where provision has been made @ 100% on net premium income.

2.13 Reserve for exceptional losses:

As per para 6 of the 4th schedul of income tax ordiance, 1984 to meet the exceptional losses the company sets aside maximum 10% of the premium income of the year in which it is set aside shall be deducted from the balance of the profits.

2.14 Compliance with local laws:

The financial statements have been prepared in compliance with the requirements of the Companies Act, 1994, Securities and Exchange Rules 1987, Insurance Act, 2010 and Insurance Rules 1958 and other relevant local laws.

2.15 Reporting currency:

The financial statements are presented in Bangladesh currency (Taka) which have been rounded off to the nearest taka unless indicated otherwise.

2.16 General reserve fund:

The company creates a general reserve fund from the current year profit to cover future contingencies.

2.17 Reporting period:

The financial statements cover the financial year from 1 January 2020 to 31 December 2020 with comparative figures for the financial year from 1 January 2019 to 31 December 2019.

2.18 Property, plant and equipment:

Property, plant and equipment of the company shown in financial statements that are within the scope of IAS-16, "Property, plant and equipment" in physical existence and valued at cost less accumulated depreciation. Following International financial reporting standards adopted by (ICAB).

i) Recognition and measurement:

Property, plant and equipment are recognized if it is probable that future economic benefit associated with the asset will flow to the company and cost of the asset can be measured reliably. Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulatated impairment losses.

Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost self constructed assets includes the cost of material and direct labour, any other costs directly attributable to bringing the asset to a working condition for its intended use and the cost of dismantling and removing the items and restoring the site on which they are located.

Gains and losses on disposal of items of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment. When revalued assets are sold, the relevant amount included in the retained earnings.

ii) Subsequent cost:

The cost of replacing a component of an items of property, plant and equipment is recognized in the carrying amount of the item if it is probable that the future economic benefits associated with the part will flow to the company and its cost can be measured reliable. The carrying amount of the replaced component is de-recognised.

iii) Depreciation:

Depreciation of fixed assets has been charged on reducing balance method at rates varying from 10% to 50% on estimated useful life of the assets except building property which are being depreciated @2%. Depreciation on newly acquired assets charged for the period from the date of acquisition that is when it was available for use and depreciation is also charged up to the date of disposal during the year in which assets are disposed off. Assets category wise depreciation rates are as follows:

Particulars Rate of Dep.

Building property 2% Decoration 10% Furniture & Fixture 10% Fans 20% Typewriters 20% Office Equipment 20% Motor Vehicles 20% Air Conditioner 20% Motor Cycle 20% Fax Machine 20% Photocopy Machine 20% Computer & Printer 30% Software 50%

iv) De-recognition:

An item of property, plant and equipment is de-recognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on de-recognition of the asset is included in the statement of Comprehensive income in the year the asset is de-recognised.

v) Impairment of assets:

The carrying amounts of the company's non financial assets, other than deferred tax assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the assets recoverable amount is estimated. An impairment loss is recognized if the carrying amount of an asset or its cash generating unit exceeds its estimated recoverable amount. Impairment losses are recognized in the statement of comprehensive imcome. Considering the present conditions of the assets, management concludes that there is no such indications exist.

2.19 Recognition of Right-of-Use Asset and Lease Liability: Agrani Insurance Company Ltd, as a lessee, recognizes a right-of-use (ROU) asset representing its right to use of the underlying

leased assets and corresponding lease liability representing its obligation to make lease payments for office rent agreements with effect from 1 January 2019 and has been following in the current period. The R-O-U asset and lease liability are recognized in the

financial statements considering the incremental borrowing rate @9%.

The R-O-U asset is depreciated using the straight-line method from the beginning to the end of useful life of the ROU asset or end of the lease term.

The lease liability is initially measured at the present value of the lease payments that are adjusted for monthly payments. Lease payments are recorded to profit or loss account as depreciation and lease interest as finance charges note reference 15 and Annexure-A1.

2.20 Employee benefit plan: (a) Contributory provident fund:

The company operates a recognized contributory provident fund for its permanent employees. The fund is approved by the National Board of Revenue (NBR), administered separately by a Board of Trustee. The employees of the company contributes 10% of their basic salary and the employer contributes equal amount to the fund. No fund is included in the assets of the company.

(b) Gratuity scheme:

The company operates a gratuity scheme under which regular confirmed employees entitled to benefit at a graduated scale based on the length of service. The length of service for the purpose of gratuity shall be reckoned from the date of joining in the regular service of the company. A permanent employee who completes minimum 10-year continuous service with the company shall be entitled to the benefit of gratuity. Calculation of gratuity is made on the basis of last drawn basic salary. An employee will receive one month’s basic salary for each completed year of service.

(c) Group insurance policy:

The company has been operating a group insurance policy for employees of the company in order to provide support to the family of the employee after his death as per terms and condition of the group insurance policy of the company.

2.21 Segment reporting: A business segment is a distinguishable component of the company that is engaged in providing services that are subject to risks

and returns that are different from those of other business segments. The company accounts for segment reporting of operating results using the classes of business. The performance of segments is evaluated on the basis of underwriting results of each segment. The company has four primary business segments for reporting purpose namely fire, marine, motor and miscellaneous insurance business.

2.22 Stock of stationery and forms: Stock of stationery and forms have been valued at cost.

2.23 Provision for income tax: The company has made income tax provision as per the IAS-12 "Income Tax", following the Income Tax Ordiance, 1984 as

amended from time to time and Finance Act, 2020.

2.24 Provision for deferred tax: Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and

the corresponding tax bases used in the computation of taxable profit and are accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which such differences can be utilised. Appropriate accounting treatment has been made in the financial statements as per IAS-12 which had not been done earlier.

2.25 Cash flow statement: Cash flow statement has been prepared in accordance with IAS-7 under direct method as per requirement of Securities and Exchange

Rules 1987 and also a reconciliation of the cash flow from operating activities has been done followed by indirect method.

2.26 Earnings per share (EPS): The company calculates Earnings per Share (EPS) in accordance with IAS-33, "Earnings per Share" which has been shown on the

statement of profit or loss and other comprehensive income.This has been calculated by dividing the basic earnings by the weighted average of ordinary shares outstanding during the year.

2.27 Diluted earnings per share: Diluted earnings per share reflects the potential dilution that could occur if additional ordinary shares are assumed to be issued under

securities or contracts that entitle their holders to obtain ordinary shares in fiture, to the extent such entitlement is not subject to unresolved contingencies. At 31 December 2020, there was no scope for dilution and hence no diluted EPS is required to be calculated.

2.28 Interest on investment: Interest on FDR and STD income from shares and other income have been duly credited to the profit and loss account.

2.29 Related party disclosure: The Company, in normal course of business, carried out a number of transactions with other entities that fall within the definition of

related party contained in IAS-24: Related Party Disclosures. All transactions involving relating parties arising in normal course of

business are conducted on an arm's length basis at commercial rates on the same terms and conditions as applicable to the third parties. Details of the related party disclosures have been given in note 30.

2.30 Event after balance sheet date: Subject to approval in the 21st Annual General Meeting to be held on 29 April 2021 the Board of Directors has recommended 5%

cash dividend and 5% stock dividend on paid-up capital for the year endded 31 December 2020 against 10% cash dividend for the year 2019.

2.31 Borrowing costs: Interest on borrowings of fund from bank against secured overdrafts is recognized as financial expenses according to IAS-23:

“Borrowing Costs.” Interest represents amount paid and accrued up to the end of the reporting year.

2.32 Components of the financial statements: According to the International Accounting Standard (IAS)-1 "Presentation of Financial Statements" the complete set of Financial

Statements includes the following components:

(i) Balance Sheet (Statement of Financial position) as at December 31, 2020

(ii) Profit or Loss Account & Profit or Loss Appropriation Account (Statement of Other Comprehensive Income) for the year ended December 31, 2020

(iii) Related Revenue Accounts for the year ended December 31, 2020

(iv) Statement of Cash Flows for the year ended December 31, 2020

(v) Statement of Changes in Shareholders Equity for the year ended December 31, 2020

(vi) Significant Accounting Policies and Explanatory Notes.

2.33 Comparative information: Comparative information have been disclosed in respect of the year 2019 for all numerical information in the Financial Statements

and also the narrative and descriptive information when it is relevant for understanding of the current year financial statements.

2.34 Re-arrangement of head of accounts: To comply with the Insurance Act 2010, International Financial Reporting Standards as adopted by the Institute of Chartered

Accountants of Bangladesh (ICAB) during the year 2020, we have re-arranged some of Head of Accounts.

2.35 Status of Compliance of International Accounting Standard and International Financial Reporting Standards: In preparing financial Statements, we applied following IAS and IFRS:

Name of the IAS / IFRS IAS / IFRS No. Status

Presentation of Financial Statements 1 Applied

Inventories 2 Applied

Cash Flow Statements 7 Applied

Accounting Policies, Changes in Accounting Estimates & Errors 8 Applied

Events after Reporting Period 10 Applied

Income tax 12 Applied

Property, Plant and Equipments 16 Applied

Employee Benefits 19 Applied

The effects of Changes in Foreign Exchange Rate 21 Applied

Borrowing Costs 23 Applied

Related Party Disclosures 24 Applied

Financial Instruments: Presentation 32 Applied

Earnings per Share 33 Applied

Impairment of Assets 36 Applied

Provisions, Contingent Liabilities and Contingent Assets 37 Applied

Investment Property 40 Applied

Insurance Contracts 4 Applied

Financial Instruments: Disclosures 7 Applied

Operating Segments 8 Applied

Financial Instruments 9 Applied

Fair Value Measurement 13 Applied

Revenue from contract with customers 15 Applied Leases 16 Applied

Fire

Insu

ran

ce

Re

ven

ue

Ac

co

un

t (A

s a

t 31 D

ec

em

be

r 2020)

The

anne

xed

note

s fro

m 1

to 3

4 fo

rm a

n in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

Cla

ims

und

er p

olic

ies

less

re-in

sura

nces

23,

275,

784

11,

002,

808

Pa

id d

urin

g th

e ye

ar

2

2,81

4,18

7 7

,830

,055

Ad

d :

tota

l est

ima

ted

lia

bilit

y in

resp

ect o

f

16,

110,

000

15,

648,

403

outs

tand

ing

cla

ims

at t

he e

nd o

f the

yea

r

whe

ther

due

or i

ntim

ate

d

38,

924,

187

23,

478,

458

Less

: Cla

ims

outs

tand

ing

at t

he e

nd

o

f the

pre

viou

s ye

ar

1

5,64

8,40

3 1

2,47

5,65

0

Com

miss

ion

exp

ense

s

1

6,41

3,27

3 2

3,29

3,61

8Ex

pen

ses

of m

ana

gem

ent

3

7,07

5,35

4 4

0,27

3,82

7Pr

ofit

trans

ferre

d to

pro

fit o

r los

s a

ccou

nt

(4

,618

,031

) (1

5,98

5,68

3)

Rese

rve

for u

nexp

ired

risk

s b

eing

40%

of p

rem

ium

inco

me

of th

e ye

ar.

2

5,52

2,56

2 1

9,26

2,52

3

Tota

l 9

7,66

8,94

2 7

7,84

7,09

3

2019

Taka

2020

Taka

Bala

nce

of a

ccou

nt a

t the

beg

inni

ng o

f the

yea

r

19,

262,

523

22,

325,

357

Pr

emiu

m le

ss re

-insu

ranc

e ce

ded

63,

806,

405

48,

156,

307

C

omm

issio

n on

re-in

sura

nce

ced

ed

1

4,60

0,01

4 7

,365

,429

T

ota

l 9

7,66

8,94

2 7

7,84

7,09

3

2019

Taka

2020

Taka

Dat

e: 1

4-03

-202

1S

igne

d as

per

our

sep

arat

e re

port

of s

ame

date

.

A.K

. G

ula

m K

ibri

a,

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G.

KIBR

IA &

CO

.C

harte

red

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co

unta

nts

DVC

: 21

0328

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AS8

4916

5

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mud

ul H

oque

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ctor

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zi S

akha

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(Lin

too)

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irman

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Exe

cutiv

e O

ffice

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ker A

hmed

, FCA

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ctor

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































Ma

rine

Insu

ran

ce

Re

ven

ue

Ac

co

un

t (A

s a

t 31 D

ec

em

be

r 2020)

The

anne

xed

note

s fro

m 1

to 3

4 fo

rm a

n in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

Cla

ims

und

er p

olic

ies

less

re-in

sura

nces

:

544

,521

(1

,762

,242

)

Paid

dur

ing

the

yea

r

4,4

66,8

11

15,

633,

108

Add

: Tot

al e

stim

ate

d li

ab

ility

in re

spec

t of

6

,874

,335

1

0,79

6,62

5

outs

tand

ing

cla

ims

at t

he e

nd o

f the

yea

r

w

heth

er d

ue o

r int

ima

ted

11

,341

,146

2

6,42

9,73

3Le

ss: C

laim

s ou

tsta

ndin

g a

t the

end

of

the

pre

viou

s ye

ar

1

0,79

6,62

5 2

8,19

1,97

5

Com

miss

ion

exp

ense

s

18,

960,

031

15,

763,

676

Exp

ense

s of

ma

nag

emen

t

42,

542,

229

26,

999,

969

Prof

it tra

nsfe

rred

to p

rofit

or l

oss

acc

ount

40,

557,

894

41,

826,

354

Bala

nce

of a

ccou

nt a

t the

end

of t

he y

ear

a

s sh

own

in th

e b

ala

nce

shee

t:

Rese

rve

for u

nexp

ired

risk

s b

eing

40%

of p

rem

ium

inco

me

on m

arin

e ca

rgo

and

100

% o

f pre

miu

m in

com

e on

ma

rine

hull

of th

e ye

ar.

42,

363,

288

27,

280,

743

Ca

rgo

43,

922,

927

24,

654,

327

Hul

l

(1

,559

,639

) 2

,626

,416

Tota

l 1

44,9

67,9

63

110,

108,

500

2019

Taka

2020

Taka

Bala

nce

of a

ccou

nt a

t the

beg

inni

ng o

f the

yea

r

27,

280,

743

36,

821,

248

Pr

emiu

m le

ss re

- ins

ura

nce

ced

ed

1

08,2

47,6

79

64,

262,

233

C

omm

issio

n on

re-in

sura

nce

ced

ed

9

,439

,541

9

,025

,019

To

tal

144

,967

,963

11

0,10

8,50

0

2019

Taka

2020

Taka

Dat

e: 1

4-03

-202

1S

igne

d as

per

our

sep

arat

e re

port

of s

ame

date

.

A.K

. G

ula

m K

ibri

a,

FCA

G.

KIBR

IA &

CO

.C

harte

red

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co

unta

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DVC

: 21

0328

0392

AS8

4916

5

Mah

mud

ul H

oque

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ctor

Qua

zi S

akha

wat

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(Lin

too)

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irman

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. Azh

aru

l Isl

amC

hief

Exe

cutiv

e O

ffice

rZa

ker A

hmed

, FCA

Dire

ctor

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































Mo

tor

Insu

ran

ce

Re

ven

ue

Ac

co

un

t (A

s a

t 31 D

ec

em

be

r 2020)

The

anne

xed

note

s fro

m 1

to 3

4 fo

rm a

n in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

Cla

ims

und

er p

olic

ies

less

re-in

sura

nces

:

4,2

12,0

02

8,0

35,2

91

Pa

id d

urin

g th

e ye

ar

4

,821

,400

6

,412

,511

Add

: tot

al e

stim

ate

d li

ab

ility

in re

spec

t of

7

,906

,160

8

,515

,558

outs

tand

ing

cla

ims

at t

he e

nd o

f the

yea

r

w

heth

er d

ue o

r int

ima

ted

12

,727

,560

1

4,92

8,06

9 Le

ss: C

laim

s ou

tsta

ndin

g a

t the

end

of

the

pre

viou

s ye

ar

8

,515

,558

6

,892

,778

Com

miss

ion

exp

ense

s

6

,100

,880

1

0,53

0,93

6 Ex

pen

ses

of m

ana

gem

ent

1

4,09

6,52

1 1

8,66

0,32

1

Prof

it/(lo

ss) t

rans

ferre

d to

pro

fit o

r los

s a

ccou

nt

3

0,60

8,67

8 2

9,00

2,16

0

Bala

nce

of a

ccou

nt a

t the

end

of t

he y

ear

a

s sh

own

in th

e b

ala

nce

shee

t:

Rese

rve

for u

nexp

ired

risk

s b

eing

40%

of p

rem

ium

inco

me

of th

e ye

ar

1

7,33

4,05

8 2

8,96

9,49

8

To

tal

72,

352,

139

95,

198,

206

2019

Taka

2020

Taka

Bala

nce

of a

ccou

nt a

t the

beg

inni

ng o

f the

yea

r

28,

969,

498

22,

725,

123

Prem

ium

less

re-in

sura

nce

ced

ed

4

3,33

5,14

4 7

2,42

3,74

4

Com

miss

ion

on re

-insu

ranc

e ce

ded

47,

497

49,

339

Tota

l 7

2,35

2,13

9 9

5,19

8,20

6

2019

Taka

2020

Taka

Dat

e: 1

4-03

-202

1S

igne

d as

per

our

sep

arat

e re

port

of s

ame

date

.

A.K

. G

ula

m K

ibri

a,

FCA

G.

KIBR

IA &

CO

.C

harte

red

Ac

co

unta

nts

DVC

: 21

0328

0392

AS8

4916

5

Mah

mud

ul H

oque

Dire

ctor

Qua

zi S

akha

wat

Hos

sain

(Lin

too)

Cha

irman

Md

. Azh

aru

l Isl

amC

hief

Exe

cutiv

e O

ffice

rZa

ker A

hmed

, FCA

Dire

ctor

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































Mis

ce

llan

eo

us

Insu

ran

ce

Re

ven

ue

Ac

co

un

t (A

s a

t 31 D

ec

em

be

r 2020)

The

anne

xed

note

s fro

m 1

to 3

4 fo

rm a

n in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

Cla

ims

und

er p

olic

ies

less

re-in

sura

nces

440

,851

(1

,943

,832

)

Paid

dur

ing

the

yea

r

490

,851

5

6,16

8

Add

: Tot

al e

stim

ate

d li

ab

ility

in re

spec

t of

-

5

0,00

0

outs

tand

ing

cla

ims

at t

he e

nd o

f the

yea

r

w

heth

er d

ue o

r int

ima

ted

49

0,85

1 1

06,1

68Le

ss: C

laim

s ou

tsta

ndin

g a

t the

end

of

the

pre

viou

s ye

ar

5

0,00

0 2

,050

,000

Com

miss

ion

exp

ense

s

2

,131

,437

2

,391

,526

Ex

pen

ses

of m

ana

gem

ent

4

,802

,886

4

,122

,207

Prof

it/(lo

ss) t

rans

ferre

d to

pro

fit o

r los

s a

ccou

nt

3

,797

,173

5

,938

,499

Bala

nce

of a

ccou

nt a

t the

end

of t

he y

ear

a

s sh

own

in th

e b

ala

nce

shee

t:

Rese

rve

for u

nexp

ired

risk

s b

eing

40%

of p

rem

ium

inco

me

of th

e ye

ar

3,

522,

575

2,97

3,65

7

Tota

l 1

4,69

4,92

2 1

3,48

2,05

7

2019

Taka

2020

Taka

Bala

nce

of a

ccou

nt a

t the

beg

inni

ng o

f the

yea

r

2,9

73,6

57

536

,953

Prem

ium

less

re-in

sura

nce

ced

ed

8

,806

,439

7

,434

,142

Com

miss

ion

on re

-insu

ranc

e ce

ded

2,9

14,8

26

5,5

10,9

62

To

tal

1

4,69

4,92

2 1

3,48

2,05

7

2019

Taka

2020

Taka

Dat

e: 1

4-03

-202

1S

igne

d as

per

our

sep

arat

e re

port

of s

ame

date

.

A.K

. G

ula

m K

ibri

a,

FCA

G.

KIBR

IA &

CO

.C

harte

red

Ac

co

unta

nts

DVC

: 21

0328

0392

AS8

4916

5

Mah

mud

ul H

oque

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ctor

Qua

zi S

akha

wat

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(Lin

too)

Cha

irman

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. Azh

aru

l Isl

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hief

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cutiv

e O

ffice

rZa

ker A

hmed

, FCA

Dire

ctor

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































The

anne

xed

note

s fro

m 1

to 3

4 fo

rm a

n in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

Sta

tem

en

t o

f C

ha

ng

es

in S

ha

reh

old

er's

Eq

uity

(A

s a

t 31 D

ec

em

be

r 2020)

Sta

tem

en

t o

f C

ha

ng

es

in S

ha

reh

old

er's

Eq

uity

(A

s a

t 31 D

ec

em

be

r 2020)

Parti

cula

rsSh

are

capi

tal

Gen

eral

rese

rve

Reta

ined

ear

ning

s To

tal T

aka

Rese

rve

for

exce

ptio

nal lo

sses

Rese

rve

for i

nves

tmen

t

fluct

uatio

n fu

nd

Bala

nce

as a

t 01.

01.2

020

302,

446,

860

190,

348,

956

2,20

0,00

0 -

30,8

93,0

19

525,

888,

835

Cas

h di

viden

d 20

19

-

-

-

-

(30,

244,

686)

(3

0,24

4,68

6)

Net

pro

fit a

fter t

ax

-

-

-

-

54,

598,

546

5

4,59

8,54

6

Rese

rve

for e

xcep

tiona

l loss

es

-

22,

419,

567

-

-

(2

2,41

9,56

7)

-

Gen

eral

rese

rve

-

-

-

-

-

-

Def

erre

d ta

x in

com

e/(e

xpen

se)

(2,4

81,9

49)

(2,4

81,9

49)

Bala

nce

as o

n 31

.12.

202

0 3

02,4

46,8

60

212

,768

,523

2

,200

,000

-

3

0,34

5,36

3

547

,760

,746

Parti

cula

rsSh

are

capi

tal

Gene

ral r

eser

ve

Reta

ined

ear

ning

s To

tal T

aka

Rese

rve

for

exce

ptio

nal lo

sses

Rese

rve

for i

nves

tmen

t

fluct

uatio

n fu

nd

Bala

nce

as a

t 01.

01.2

019

288

,044

,630

1

71,1

21,3

14

2,2

00,0

00

-

26,

302,

659

4

87,6

68,6

03

Cas

h di

viden

d 20

18

-

-

-

-

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Statement of Cash Flows (As at 31 December 2020)

The annexed notes from 1 to 34 form an integral part of these financial statements.

A. Cash flows from operating activites

Premium collection and other receipts 395,721,221 522,278,632

Payment of expenses of management, (309,574,607) (522,340,371)

Income tax paid and deducted at source (15,805,806) (21,554,508)

Net Cash (used)/from operating activities 70,340,808 (21,616,247)

B. Cash flows from investing activities

Purchase of shares and securities (4,217,669) (6,256,057)

Sale of share 1,495,841 4,370,214

Acquisition of fixed assets (921,520) (4,208,252)

Disposal of fixed assets 4,423,500 5,041,398

Dividend received 2,644,980 1,580,696

Net cash (used) /from investing activities 3,425,132 527,999

C. Cash flows from financing activities

Interest paid on overdraft - (543,621)

Increase/(decrease) in Loan Balance, net of repayment and interest (29,360,983) 27,316,290

Dividend paid (26,466,966) -

Net cash from/(used) in financing activities (55,827,949) 26,772,669

Net cash increased/(decreased) (A+B+C ) 17,937,991 5,684,421

Cash and cash equivalent at the begining of the year 277,512,381 271,827,960

Cash and cash equivalent at the end of the year 295,450,372 277,512,381

Net operating cash flows per share 30.00 2.33 (0.71)

2019Taka

2020TakaParticulars
















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:










































































Date: 14-03-2021 Signed as per our separate report of same date.


Zaker AhmedDirector

A.K. Gulam Kibria, FCA


DVC: 2103280392AS849165

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































NOTES TO THEFINANCIAL STATEMENTS(As at and for the year ended 31 December 2020)

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































NOTES TO THE FINANCIAL STATEMENTS


















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:

























































































2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































3.00 Share capital:

4.00 Reserve for exceptional losses: Tk. 212,768,523

Classification of Shareholders by holding:

This balance represents:

Amount in BDT

2020 2019Authorized:

Divided into 50,000,000 ordinary shares of Tk. 10 each. 500,000,000 500,000,000

Issued, subscribed and paid-up:

15,000,000 ordinary shares of Tk. 10 each issued for cash 150,000,000 150,000,000

15,244,686 ordinary shares of Tk. 10 each issued as bonus shares 152,446,860 152,446,860

30,244,686 shares of Tk. 10 each 302,446,860 302,446,860

Sponsor 12 9,252,198 30.59% 92,521,980 103,388,550

General Public 3,521 18,940,000 62.62% 189,400,000 98,879,970

Institutional Investors (Including ICB) 73 2,052,488 6.79% 20,524,880 100,178,340

Total 3,606 30,244,686 100.00% 302,446,860 302,446,860

Below 500 2,011 1,810 803,121 735,949 2.66% 2.43%500 to 5000 1,307 1,211 5,311,521 4,217,205 17.56% 13.94%5001 to 10000 136 118 1,107,121 995,119 3.66% 3.29%10001 to 20000 55 65 1,011,222 1,122,335 3.34% 3.71%20001 to 30000 17 22 463,247 532,558 1.53% 1.76%30001 to 40000 25 35 882,651 980,335 2.92% 3.24%40001 to 50000 15 14 639,318 435,119 2.11% 1.44%50001 to 100000 12 11 892,551 881,550 2.95% 2.91%100001 to 500000 9 12 3,881,383 4,082,559 12.83% 13.50%500001 to 1000000 13 14 8,750,633 9,558,903 28.93% 31.61%1000001 to 5000000 6 7 6,501,918 6,703,054 21.50% 22.16%

3,606 3,319 30,244,686 30,244,686 100.00% 100.00%

Category

Holding of SharesNo. of Holders

2020 2020 20202019 2019 2019

No. of Shares % of Total Holdings

No. ofShareholders

No. ofshares

% ofshares

Paid-upShare Capital

Paid-upShare Capital

As per paragraph 2 of the 4th schedule of Income Tax Ordinance 1984, not exceeding 10% of the net premium income has been transferred to reserve for exceptional losses. Details are as under:

ParticularsAmount (In Taka)

2020 2019


2020 2019

Balance as on 1 January 190,348,956 171,121,314 Add: New reserve made during the year 22,419,567 19,227,642

Balance as on 31 December 212,768,523 190,348,956

5.00 General reserve: Tk. 2,200,000 The above fund has been arrived as under:

Balance as on 1 January - 12,200,000 Less: Prior year VAT deposit - (5,500,000)Less: Prior year general reserve adjustment - (4,500,000)

Updated Opening Balance (Refer to Note 1.04 and Annexure A4) 2,200,000 2,200,000 Add: New reserve made/transferred to P/L appropriation account during the year - -




2020 2019

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































The above balance represents premium received against covernotes for which policies have not been issued within 31 December 2020. While the risks against non marine and marine hull can be assumed from the issuance of covernote but risks against marine cargo can not be assumed until shipment advices are provided and accordingly policies are issued.

6.00 Premium deposits: Tk. 7,700,832

7.00 Loans and advances: Tk. 47,168,989 The above fund has been arrived as under:

IDLC Finance Ltd 5,236,934 6,462,525 Eastern Bank 41,932,055 64,990,619

Total 47,168,989 71,453,144


2020 2019

8.00 Estimated liability in respect of outstanding claims whether due or intimated: Tk. 30,890,495 Classwise break up of the class wise insurance business as under:

Fire 16,110,000 15,648,403 Marine 6,874,335 10,796,625 Motor 7,906,160 8,515,558 Miscellaneous - 50,000

Total 30,890,495 35,010,586

7.01 Term Loan with IDLC Finance Ltd: The Term Loan of Tk. 10 million availed from IDLC Finance Ltd Motijheel Branch on 22 June 2016 with the following details:

Purpose : For purchase of floor space of 1,044 sft

Interest : 7% per annum

Repayment : 96 EMI of Tk. 145,210

Security : Lien over FDR of Tk. 10,000,000 maintained with IDLC Finance Ltd.

7.02 Term Loan with Eastern Bank Ltd: The Term Loan of Tk. 70 million availed from Eastern Bank Ltd, Shantinagar Branch on 24 October 2019 with following details:

Purpose : For payment of fire claim of M/s. Afil Papers

Interest : 9.0% per annum.

Repayment : 36 EMI of Tk. 2,247,438.47

Security : Lien over total FDR of Tk. 76,700,000 maintained with different banks.

7.03 Secured Overdraft (SOD) with Jamuna Bank Ltd: The Overdraft facility of Tk. 5 million with Jamuna Bank Ltd, Motijheel Branch, Dhaka has been maintained from 4 September 2020

to 3 September 2021. The terms and conditions of the overdraft are as follows:

Purpose : To meet up time to time financial requirements.

Interest : 8.10% p.a. or 2.10% above of the FDR rate with quarterly rates subject to the change by the bank from time to time.

Repayment : The facility shall be adjusted in lump sum from time to time but full/final adjustment within the stipulated time.

Security : Lien on FDR of Tk. 6.5 million maintained with Jamuna Bank, Motijheel Branch.

During the year the facility has not been availed.


















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































Income tax assessment has been completed up to the Assessment Year 2018-2019 and adjustment has been made up duly. The assessment for the assessment years 2019-2020 and 2020-2021 are under process.

9.00 Amount due to other persons or bodies carrying on insurance business: Tk. 17,054,438 The break up of the above amount is as under:

10.00 Sundry creditors and accruals: Tk. 35,569,396 The break up of the above amount is as under:

11.01 Income tax:


2020 2019


2020 2019

Sadharan Bima Corporation 14,746,851 8,003,527 Federal Insurance Company Ltd 17,225 17,226 Bangladesh General Insurance Co Ltd 300,651 300,651 Nitol Insurance Company Ltd 432,752 432,753 Central Insurance Company Ltd 118,125 118,125 Asia Insurance Company Ltd 275,356 275,356 Standard Insurance Company Ltd 165,374 165,375 Republic Insurance Company Ltd 417,159 417,159 Prime Insurance Company Ltd 537,630 537,630 Asia Pacific Insurance Company Ltd 43,315 43,315

Total 17,054,438 10,311,115

Audit fees payable 1,363,600 1,263,600 Insurance stamps on deposit premium 39,841 1,007,793 Office rent tax payable 23,045 25,183 Client income tax payable 24,383 58,914 Client VAT payable 42,438 124,258 Employees' income tax payable 162,318 192,580 Salary payable 3,736,507 3,031,168 VAT payable 2,945,691 3,270,880 Tax payable on agency commission 1,016,097 137,132 PF Contribution 276,124 467,615 Un-claimed dividend 8,230,845 6,449,150 Rent advanced 4,686,780 4,686,780 PF loan payable 38,801 4,375 Gratuity 12,982,926 12,100,000

Total 35,569,396 32,819,428

11.00 Provision for income tax: Tk. 45,731,371


2020 2019Balance as on 1 January 28,649,477 52,430,185 Current tax provision 17,081,894 9,569,551

45,731,371 61,999,736

Less: Adjustment made during the year - 33,350,259




2020 2019

















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































11.02 Current tax provision:

Taka Taka TakaTax Rate

12.00 Deferred tax liability: Tk. 25,322,485 This has been made up as under:

12.01 Deferred tax liabilities/(assests): Amount (In Taka)

2020 2020

Carrying amount of property, plant & equipment 151,921,888 163,384,462 Tax base 75,839,698 89,147,026 Taxable/(deductible) temporary difference 76,082,190 74,237,436

Provision for gratuity (5,181,784) (9,600,000)Fair value reserve (12,651,675) (13,985,029)Deductible temporary difference (17,833,459) (23,585,029)Net taxable/(deductible) temporary difference-Assets/(liabilities) 59,005,740 97,822,466

Tax rate 37.50% 37.50% 10.00% 10.00%

Deferred tax assets as at December 31 25,322,485 22,840,536 Deferred tax assets/(liability) in previous year 22,840,536 22,660,653 Deferred tax expense/(income) for the year 2,481,949 179,883


2020 2019


2020 2019

Profit before tax 71,680,440 Less: Items for separate calculations Gain from sale of shares 496,981 Dividend income 2,644,980 Gain from sale of fixed assets 1,295,037 4,436,998 67,243,442 Less: Unrealized gain on fair value (1,333,355) Less: Reserve for exceptional losses (22,419,567) Income from business 43,490,521 37.50% 16,308,945 Gain from sale of shares 496,981 10.00% 49,698 Dividend income 2,644,980 20.00% 528,996 Gain from sale of fixed assets 1,295,037 15.00% 194,256

Total 17,081,895 9,569,551

Balance as on 01.01.2020 22,840,536 22,660,653 Add: Prior year deferred tax expenses - -

22,840,536 22,660,653 Less: Current year deferred tax income (2,481,949) (179,883)


13.00 Lease Liability: Tk. 4,045,180

Recognized against R-O-U Assets 5,631,697 10,704,063

Add: During the year 3,737,174 -

Add: Lease Interest 454,604 -

Less: Rental payment 5,778,295 5,072,366

Lease Liability on 31 December 4,045,180 5,631,697


















2.04 Going concern:





































iii) Depreciation:




iv) De-recognition:








































































15.00 Statutory deposits at Bangladesh Government Treasury Bond (BGTB): Tk. 25,000,000

16.00 Fair value of finncial assets Tk. 52,007,414

14.00 Property, plant & equipment: Tk. 151,921,888 151,921,888 163,384,262

The property, plant & equipment has been stated at cost less accumulated depreciation. Details are shown in the Annexure-A1.

14.01 Building property (floor purchase): The company purchased 3 Nos Floor space, details are as follows:

Particulars SFT Location Acuisiion Date 2020 2019

City Centre 13,928 Motijheel 30-Jun-11 84,467,164 84,467,164 Saiham Sky View Tower (14th floor) 6,340 Bijoynagar 11-Oct-10 20,902,825 20,902,825 Saiham Sky View Tower (16th floor) 1,352 Bijoynagar 14-Mar-13 20,096,055 20,096,055 Palton Tower (2nd floor) 1,044 Purana Palton 23-Jun-16 11,220,240 11,220,240

Total Cost 136,686,284 136,686,284

Less: Accumulated depreciation as on 31 December 10,611,208 8,038,247

Net book value 126,075,076 128,648,037

This has been maintained in compliance with the Schedule 1 of the Insurance Act, 2010 that every non-life insurance company shall maintain at least Tk. 25,000,000.


2020 2019


2020 2019

10-year BGTB with Jamuna Bank Ltd issued in 2016 16,000,000 16,000,000 11-year BGTB with Jamuna Bank Ltd issued in 2013 9,000,000 9,000,000

Total 25,000,000 25,000,000

lnvestment in shares at cost 69,211,251 65,992,443

Fair market value of the investment as at 31 December 56,559,577 52,007,414

Unrealized gain/(loss) as at 31 december (12,651,675) (13,985,029)

Less: Unrealized gain/(loss) of previous year 13,985,029 6,117,885

Change in fair value of financial assets charged to Profit or Loss Account 1,333,355 (7,867,144)



1 AB Bank Ltd 41,494 23.31 967,164 12.10 502,077 375,431

2 Aman Cotton Fibrous 11,692 40.00 467,680 36.50 426,758 444,296

3 ADN Telecom - - - - - 574,098

4 Advent Pharma Ltd 110 10.00 1,100 22.80 2,508 3,850

5 Al-Arafa Islami Bank 131,700 26.52 3,492,684 22.20 2,923,740 2,897,400

6 Bank Asia Ltd 68,228 18.85 1,286,097 18.20 1,241,750 1,391,851

7 BD Finance 3,800 64.71 245,898 29.10 110,580 42,940

8 Bashundhara Paper 14,017 80.00 1,121,360 44.40 622,355 756,490

9 Copertech 4,979 10.32 51,383 21.10 105,057 174,265

10 Crystal Insurance 9,878 10.00 98,780 39.40 389,193 -

11 EBL 1st Mutual Fund 434,260 6.92 3,005,079 6.70 2,909,542 3,126,672

12 Esquire Knit Composit 26,780 45.12 1,208,314 26.30 704,314 1,258,660

13 Exim Bank Ltd 313,735 17.05 5,349,182 11.80 3,702,073 3,451,085

14 First Security Bank 37,497 14.64 548,832 9.00 337,473 405,659

15 Genex Infoys Ltd - - - - - 156,520

16 ICB Islami Bank 400 2.18 873 4.30 1,720 1,480

17 IFIC Bank Ltd 25,854 16.27 420,721 15.20 392,981 230,339

18 Indo-Bangla Pharma 320 10.26 3,283 19.10 6,112 12,160

19 Jamuna Bank Ltd 172,379 18.82 3,244,173 18.80 3,240,725 3,560,201

20 Kattali Textile Ltd 12,843 15.42 198,039 10.90 139,989 496,692

21 Mercantile Bank Ltd 125,529 13.80 1,732,432 12.70 1,594,218 1,478,952

22 ML Dying 1 10.00 10 50.00 50 33

23 Mutual Trust Bank 102,517 28.87 2,959,252 24.10 2,470,660 3,124,352

24 National Bank Ltd 198,369 11.69 2,319,291 7.00 1,388,583 1,492,492

25 NCC Bank Ltd 510,660 19.05 9,728,887 13.20 6,740,712 6,908,942

26 Newline 8,038 13.00 104,494 17.00 136,646 200,950

27 One Bank Ltd 161,872 15.32 2,480,094 10.60 1,715,843 1,165,722

28 Popular Life 1st M.F. 691,199 6.69 4,622,048 5.40 3,732,475 3,977,865

29 Premier Leasing 25,269 28.62 723,199 7.40 186,991 161,722

30 Prime Finance & Inv. 17,444 47.62 830,683 12.60 219,794 143,041

31 Pubali Bank Ltd 28,784 28.60 823,223 24.10 693,694 748,384

32 Robi 271,253 10.00 2,712,530 29.80 8,083,339 -

33 Runner Automobile 7,566 75.25 569,342 50.90 385,109 466,822

34 Rupali Insurance - - - - - 59,620

35 Summit Alliance Port 7,855 70.00 549,850 31.00 243,505 274,925

36 Sea Peal Beach Resort 1,865 9.52 17,764 79.10 147,522 99,075

37 Silco Pharma 8,023 10.21 81,915 24.00 192,552 251,922

38 Southeast Bank Ltd 301,234 20.79 6,263,049 12.50 3,765,425 4,114,418

39 SS Steel Ltd 3,878 10.22 39,633 18.40 71,355 130,591

40 Standard Bank Ltd 743,505 13.36 9,932,156 8.30 6,171,092 7,010,190

41 Sumit Power 2,495 58.55 146,082 38.90 97,056 112,275

42 Trust Bank Ltd 18,514 23.76 439,943 33.40 618,368 564,256

43 Union Capital Ltd 3,171 36.00 114,156 8.40 26,636 29,173

44 Uttara Bank Ltd 4,188 65.54 274,477 24.00 100,512 109,301

45 Uttara Finance & Inv. 396 91.16 36,099 46.70 18,493 22,302

Total 69,211,251 56,559,577 52,007,414

16.01 Investment in shares of listed securities:

Sl.No

No ofShares

Total CostValue: Tk

Total MarketValue 2019: Tk

Total MarketValue 2018: Tk

AverageCost pershare: Tk

AverageMarketPrice: Tk

Name of Company



17.00 Accrued interest, dividend and rents: Tk. 9,495,000

18.00 Amount due from other persons or bodies carrying on insurance business: Tk.121,627,520 The break up of the above amount is as under:

19.00 Sundry debtors (including advances, deposit and pre-payment): Tk 186,159,802Headwise break up is as under:

Break up of which are as under:


2020 2019


2020 2019


2020 2019

Interest on fixed deposit (FDR) 8,193,450 5,529,894 Interest on BGTB 1,301,550 1,301,550

Total 9,495,000 6,831,444

Sadharan Bima Corporation 118,440,049 106,654,393 Reliance Insurance Company Ltd 301,847 301,847 City General Insurance Company Ltd 5,443 5,443 Karnafuli Insurance Company Ltd 99,508 99,508 Green Delta Insurance Company Ltd 144,205 144,205 Mercantile Insurance Company Ltd 9,609 9,609 Progati Insurance Company Ltd 886,735 886,735 Sonar Bangla Insurance Company Ltd 16,320 16,320 Bangldesh General Insurance Company Ltd 394,406 394,406 Takaful Insurance Company Ltd 22,837 22,837 Standard Insurance Company Ltd 1,101,235 1,101,235 Provati Insurance Company Ltd 80,921 80,921 Islami Commercial Insurance Company Ltd 84,930 84,930 Pioneer Insurance Company Ltd 8,960 8,960 Continental Insurance Company Ltd 30,515 30,515

Total 121,627,520 109,841,864

Premium collection control account 112,375,365 112,531,967Advance office rent 1,890,977 2,381,576 Tax deducted at source [Note: 19.01] 3,910,957 2,572,190 Advance against salary 53,000 225,000 Advance income Tax [Note: 19.02] 28,710,437 20,452,960 Advance tax on dividend 1,122,459 593,511 Advance payment of advertisement 2,848,370 3,164,855 Advance tax on car 920,000 585,000 Advance tax deducted from office rent 894,874 665,062 Security deposit IDLC 290,420 290,420 Advance tax on premium (Treasury Bond) 540,000 540,000 Deposit to VAT Authority [Note: 19.03] 35,000,000 41,000,000 Advance interest on treasury bond 102,943 102,943

Total 186,159,802 185,105,484

19.01 Tax deducted at source from the interest earned on FDR and STD account: Tk. 3,910,957 Year wise break up of tax deducted at source from the interest on FDR, STD and account

On STD interestOn FDR interestYearAmount (In Taka)

2020 2019

2018 1,226,390 47,733 1,274,123 1,591,456 2019 1,222,414 75,653 1,298,067 1,298,587 2020 1,281,657 57,110 1,338,767 1,274,123

Total 3,730,461 180,496 3,910,957 4,164,166



19.02 Advance against income tax: Tk. 28,710,437 This made up as under:

19.03 Deposit to VAT Authority Deposit to VAT Authority has been adjusted for Tk. 6000,000 during the year and the rest amount will be adjusted in 2020.

20.00 Cash and cash equivalents: Tk. 295,450,372 The break-up of the above amount is as under:

21.00 Audit fees: Tk. 225,000

23.00 Interest and dividend income: Tk. 25,063,617 The break-up of the above amount is as under:

22.00 Directors fee: Tk. 1,320,800 During the year under review an amount of Tk. 1,320,800 has been paid to the directors of the company as Board/Committee meeting fee. The Board of Directors received no remuneration from the company other than fees for attending Board/Committee meeting.

Assessment YearAmount (In Taka)

2020 2019


2020 2019


2020 2019


2020 2019


2020 2019

2018-2019 - 5,452,960 2019-2020 15,452,960 10,000,000 2020-2021 10,000,000 5,000,000 2021-2022 3,257,477 -

Total 28,710,437 20,452,960

Cash in hand 288,047 533,869 Short term deposits 18,404,672 21,304,289 Current deposits 33,007,653 13,970,537 Fixed deposits 243,750,000 242,250,000

Total 295,450,372 278,058,695

Statutory audit fee 100,000 100,000 Special audit fee 125,000 100,000 Other audit fee - -

Total 225,000 200,000

Interest on Bangladesh GovernmentTreasury Bond (BGTB) 2,603,100 2,603,100 Interest on fixed deposit 15,219,297 14,400,000 Interest on short term deposit - 267,571 Dividend income 2,644,980 1,580,696 Rental income 4,596,240 4,596,240

Total 25,063,617 23,447,607

24.00 Other income: Tk. 3,114,327 The break up of the above amount is as under :

Gain on Sale of Fixed Assets 1,295,037 1,738,842 Gain on Sale of Share 496,981 1,966,715 Provident Fund-forfeited amount 1,322,309 -

Total 3,114,327 3,705,557



26.00 Expenses of management: Tk. 98,516,990 The break up of the above amount is as under:

An amount of Tk. 6,859,227 was paid to the Directors and Chief Executive Officer as fees and remuneration.

Class of Business % Amount (In Taka)

2020 2019

Fire 37.63 37,075,354 40,273,827

Marine 43.18 42,542,229 26,999,969

Motor 14.31 14,096,521 18,660,321

Miscellaneous 4.88 4,802,886 4,122,207

Total 100.00 98,516,990 90,056,324

25.00 Premium less re-insurance: Tk. 224,195,667 The break up of the above amount is as under:

Class of Business DirectPremium

PSBPremium

GrossPremium

R/IAccepted

R/ICeded

Amount (In Taka)

2020 2019

Fire 109,421,823 12,973,324 122,395,147 - 58,588,742 63,806,405 48,156,307 Marine 126,400,206 22,745,656 149,145,862 - 40,898,183 108,247,679 64,262,233 Motor 40,672,532 2,852,599 43,525,131 - 189,987 43,335,144 72,423,744 Miscellaneous 14,209,580 23,217,871 37,427,451 - 28,621,012 8,806,439 7,434,142

Total 290,704,141 61,789,450 352,493,591 - 128,297,924 224,195,667 192,276,426

28.00 Net assets value (NAV):


2020 2019

Shareholders' equity 547,760,746 525,888,835Ordinary Shares on 1 January 30,244,686 28,804,463Weighted Average number of ordinary Shares outstanding on 31 December 30,244,686 30,244,686Net Asset Value per share (Tk.) 18.11 17.39

Net Asset Value (NAV) per share has been calculated by dividing net asset value reported in the statement of financial position by the weighted average number of ordinary shares in issue.

29.00 Net operating cash flows:


2020 2019

Net operating cash flow 70,340,808 -21,616,247Ordinary Shares on 1 January 30,244,686 28,804,463Weighted Average number of ordinary Shares outstanding on 31 December 30,244,686 30,244,686Net Operating Cash Flow per share (Tk.) 2.33 (0.71)

27.00 Earniang per share (EPS):


2020 2019

Net profit after taxes 52,116,597 38,220,232Ordinary Shares on 1 January 30,244,686 28,804,463Weighted Average number of ordinary Shares outstanding on 31 December 30,244,686 30,244,686Basic earnings per share (Tk.) 1.72 1.26

The Company calculates Earnings Per Share (EPS) in accordance with IAS 33: Earnings Per Share, which has been shown on the face of the income statement and this has been calculated by dividing the basic earnings by the weighted average number of ordinary shares outstanding for the year. Details calculations are as follows:



31.00 Compensation:

No compensation was allowed to the Chief Executive Officer (CEO) or any member of the Board for any special service rendered except as noted in the note no. 26.

32.00 Commission, brokerage or discount against sales:

Commission was incurred or paid to agents as per insurance Act, 2010 but no brokerage or discount was incurred or paid against sales.

33.00 Disclosure as per requirement of schedule XI, part II of the company Act, 1994:

a Disclosure as per requirement of Schedule XI, Part II, Note 5 of Para 3:

a (i) Employees engaged:

The total number of employees as on 31.12.2020 was 304 and drawing monthly salary of Tk. 4,000 and above.

29.01 Causes of deviation of Net Operating Cash Flow per share:

29.01 Causes of deviation of Net Operating Cash Flow per share:

30.00 Transaction with related parties: Detail transactions with related parties and balances with them for the year 2019 were as follows:

Particulars RelationNature of

TransactionPremiumearned

ClaimPaid

Beijing Dyeing and Weaving Industries Ltd Director Insurance 4,141,004 - BHT Industries Ltd "Royal Shipping Lines Millenniun Shippers and traders Director Insurance 5,012,995 - M.M.M Navigation Co." "MHC Apparels (pvt) Ltd Director Insurance 190,923 - MHC Wears (pvt) Ltd"

Sarban Import Ltd. Director Insurance 708,041 - Mosharrof Group Director Insurance 20,930,770 -


2020 2019

Net profit before tax 71,680,440 47,969,665 Depreciation 12,992,804 13,784,279 Interest income (17,822,397) (17,270,671)Dividend income (2,644,980) (1,580,696)Gain on sale of fixed assets (1,295,037) (1,738,842)Gain on sale of shares (496,981) (1,966,715)Forfeited provident fund (1,322,309) - Rental income (Floor) (4,596,240) (4,596,240)Increase/(decrease) the balance of fund 10,256,062 (3,922,261)Increase/(decrease) of premium deposit (3,176,683) (3,760,707)Increase/(decrease) of amount due to other persons or body 6,743,323 (1,428,767)Increase/(decrease) of outstanding claims (4,120,091) (14,599,817)Increase/(decrease) of sundry creditors except payable for fixed asset and tax payable 2,749,968 2,184,970 Increase/(decrease) of stock of stamps and others 2,032,865 (131,882)Increase/(decrease) of advanced, deposit and prepayment except AIT 3,380,214 (3,823,493)Increase/(decrease) of amount due from other persons or body 11,785,656 (14,180,562)Income tax paid (15,805,806) (16,554,508)

Net cash generated from operating activities 70,340,808 (21,616,247)

NOCFPS for the year ended on 31 December 2020 is Tk. 2.33 against Tk. (0.71) in 2019 registerred a growth of 425% due to lower expenses of management and inome tax shown in cash flow statement.



b Disclosure as per requirement of schedule XI, part II, para 4:

i) Period of payment of remuneration to the Directors is from 1 January 2020 to 31 December 2020.

(ii) The Directors of the company did not take any benefit from the company other than the remuneration for attending Board Meeting.

a. Expense reimbursed to the managing agent -Nil

b. Commission or other remuneration payable separately to a managing agent or his associate -Nil.

c. Commission received or receivable by the managing agent or his associate as selling or buying agent of other concerns in respect of contracts entered into such concerned with the company-Nil

d. The money value of the contracts for the sale or purchase of goods and materials or supply of services, entered into by the company with the managing agent or his associate during the financial year.

e. Any other perquisites or benefit in cash or in kind stating - Nil.

f. Other allowances and commission including guarantee commission - Nil.

34.00 General:

i) Previous period's figure have been regrouped/reclassified wherever considered necessary to conform to current period's presentation.

ii) The financial statements are presented in BDT which have been rounded off to the nearest taka unless indicated otherwise.

iii) All shares have not been fully called and paid-up.

iv) Auditor's are paid only statutory audit fees.

v) No foreign exchange remitted to the relevant shareholders during the year under audit.

vi) No amount of money was expended by the company for compensating any members of the Board for special service rendered.

vii) There was no bank guarantee issued by the company on behalf of Directors.

Date: 14-03-2021





Zaker AhmedDirector


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Statutory deposit at BGTB 25,000,000 25,000,000 Realizable Value

Fair value of financial assets (investment in shares) 56,559,577 56,559,577 Fair Value

Fixed deposit 243,750,000 243,750,000 Realizable Value

Cash at bank 51,412,325 51,412,325 Realizable Value

Cash in hand 288,047 288,047 Realizable Value

Interest, dividend and rent accrued 9,495,000 9,495,000 Realizable Value

Sundry debtors 186,159,802 186,159,802 Realizable Value

Amount due from other persons or bodies 121,627,520 121,627,520 Realizable Value

carrying on insurance business

Property, plant & equipment 151,921,888 151,921,888 Written down Value

Stock of stationery and stamp 3,772,256 3,772,256 At cost price

Total 849,986,415 849,986,415

Classified Summary of Assets in Bangladesh of the CompanyAs at 31 December 2020

Date: 14-03-2021 Signed as per our separate report of same date.

FORM"AA"





Zaker AhmedDirector


OTHER EVENTS


EVENT HIGHLIGHTS

20TH AGM OF AGRANI INSURANCE COMPANY LTD., LOCATION: DIGITAL PLATFROM

OTHER ACTIVITIES


EVENT HIGHLIGHTS

Celebration of Banghabandhu’s 100th Birth Anniversary-2020


EVENT HIGHLIGHTS

Celebration of Prime Minister Sheikh Hasina’s Birthday

Celebration of Banghabandhu’s 101st Birth Anniversary


EVENT HIGHLIGHTS

Bima Dibosh 2020


EVENT HIGHLIGHTS

National Mourning Day 2020


I/We

of

being a Member of Agrani Insurance Company Limited do hereby appoint

Mr./Ms.

of

of (failing him/her) Mr./Ms.

of

as my/our proxy, to vote for me/us and on my/our behalf at the 21st Annual General Meeting of the Company to be held virtually by using digital platform on Wednesday, 28 April 2021 at 11:00 AM and at any adjournment thereof.

Signed this day of 2021.

Signature of Shareholder

BO No.

No. of Shares:Signature of Proxy

N.B: IMPORTANT

1. This Form of Proxy, duly completed, must be scanned and sent through email at least 72 hours before the meeting at [email protected]. Proxy is invalid if not singed and stamped as explained above.

2. Signature of the shareholder should agree with the specimen signature registered with the Company and depository register.

I hereby record my attendance at the 21st Annual General Meeting of the Company to be held on Wednesday, April, 2021.

Name of the Member/Proxy-------------------------------------------------------------------------------------------------------------------------

B.O No.--------------------------------------------------------------------------holding of---------------------------------------ordinary shares.

Signature of Shareholder(s) / Proxy

Registered Office: City Centre (Level-17), 90/1, Motijheel C/A, Dhaka-1000, Bangladesh

Registered Office: City Centre (Level-17), 90/1, Motijheel C/A, Dhaka-1000, Bangladesh

st - AGRANI INSURANCE

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