excel your expectation Bangladesh Building Systems Ltd. (Pre-Engineered Stee! Building Manufacturer) Annual Report 2016-2017MANAGING TODAY FOR TOMORROWSs SNe AllValued Members, Bangladesh Securities and Exchange Commission (8SEC), Registrar of Joint Stock Companies & Firms of Bangladesh (RISC & FB), DDhaka Stock Exchange Limited (OSE), Chittagong Stock Exchange Limited (CSE). Annual Report for the year ended 30 June, 2017 Dear Sir, We are pleased to enclose @ copy of the annual report together with the Audited Accounts including Statement of Financial Position, Statement of Comprehensive Income, Statement of Changes in Equity and Statement of Cash Flows for the year ended 30 June, 2017 along with notes thereon, Auditors’ and Directors reports for your record/necessary measures. Yours Sincerely, Sdl- ‘Mohammad Mohsin Company Secretary Date : 27 November, 2017 ig s ‘Annual Report 2016-2017 \fo} Deen RC UCL Company Profile ee NM u Co) Be Ueto) Eun Gekier reid Ieuan crac Coe wary Seemeatal reas eaucd | © ) secarracoraxie sir SOR Reru uy ays Peete Due emerge ec Perec} Gieuer Rccuca fcker cagLee ee Tee cee sat Notice is hereby given that the FOURTEENTH ANNUAL GENERAL MEETING of the Members of Bangladesh Building Systems Ltd, wil be held on Tuesday, the 12th December, 2017 at 4:00 p.m. at Factory Premises, Jaina Bazar, Telehate, Sreepur, Gazipur to transact the following businesses. ‘AGENDA 1. To receive, consider and adopt the Directors’ and Auditors’ Reports and the Audited Accounts of the company fer the ‘year ended 30 June, 2017. 2. To deotere Dividend forthe year ended 30 June, 2017. 3. To re-elect the Directors retiring by rotation pursuant to Article 124 of the Articles of Association of the Company. 4. To appoint Aucitors for the year ended 30 June, 2078 and fi their remuneration. 5. To transact any other business of the Company with the permission of the Chair By Order of the Board, Dated: Dhaka 27 November, 2017 Sd Mohammad Mchsin ‘Company St — pany Secretary (1). The Shareholders, whose names appeared in the Share Register ofthe Company or in the Depository Register on the record date ie. 16th November, 2017 will be ented to attend at the Annual General Meeting and to receive the dividend. (2) Amember entitled to attend and vote at the General Meeting may appoint a Proxy to attend and vote in his/her stead. The Proxy Form, duly stamped, must be deposited at the Share Department of the Company not later than 48 hours before the time fixed for the meeting; (8) Entrance to the venue will be strictly on production of the attendance slip sent with the Notice as well as verifcation of signature of Sharehnolder(s) and/or Proxy-holder(s); (4) No giftbenefit in cash or kind shall be paid to the holders of equity securities in terms of Clause (c) of the Notification No. SEC/SRMU2009-193/154 dated 24th October, 2013 for attending the Annual General Meeting of the Company; (8) The Annual Report, proxy forms and attendance slip are also available in the website at wirw.bbspeb.com. | Annual Report 2076-2017en CONNECTORS ARE JUST THE BEGINNING COE Rue eae MR a= ee ee RC) urns Remote eos cu line of product solutions gives engineers, designers fj PCN cea Ru muss on sti SRC tat Committe mens cur mccain Pec PeUChe relent Melia yes Maceeenco ar] erste one eR OMe ae RCs a Been ene ae eeCOMPANY PROFILE Introduction: Bangladesh Building Systems Ltd. (BBSL) isa leacing manufacturer of quality Pre-Engineered Steel Building especialy inthe Industrial & Commercial Sector in Banglades? BBSL sie! constuction products are typically made of steel and are used primaly to strengten, support and connect joints in Industral and commercial construction projets. The Company's steel construction products enhance the safety and clurabilty ofthe structures in which they are installed and can save time and labor costs. Pre-engingered stool construction products contriouta to structural inter and resistance to se’smic, wind and other forces. BBSL is the benchmark for the Pre-Engineered Steel Bulking Manufactures of Bangladesh (On 30 October, 2010 the Company registered itself as Public Limited Company under the Companies Act, 1994. The Company is listed with two bourses like Dhaka Stack Exchange Lid, (OSE) and Chittagong Stack Exchange Lid. (CSE) in Bangladesh, [BBSL designs its products in compliance with the latest and building codes (EC 2006, BNEC 2006, AISC 2005, AWS 2006) equipped with state of the art machinery and technolcgy, including fully automated, sub-merged arc welding lines from USA, Vision-Mission winning industal Leader Creating Superior Values for Business & Community” \Winning the confidence and trust of markets and stakeholders is inherent built in the nature Industrial leadership and Sompetence takes us beyond manufacturing and into other industries, Business and Community are joint benefcaries of our superior value creation towards muta poster. Corporate Role BBSL ripons and ropes the vision and statogic aloynay of its business through common strategic inittives and its functons of Accounts & Finance, Enginoering, Implementation, Administration and Human Resources, Poa CS Information Technology, Corporate Communications, Legal and Corporate ROLE Afi & Share depariment and Factory management as wel. ts aims are closely drawn to achieve he following strategic ends: (@) A pledge to new product development through the use of state-of-the-art technology and the consolidation of IT environments; ()_ Upkeep of the premier quality reassurance standards, replicated in a range of transnational quality certifications; (©) The persistent expansion and development of transnational markets, while sustaining governance in the home market of Bangladesh; (@) Investment in training and career development for employees; (@)_ The sales and Marketing employees are further to an Emerging Markets & South Asia promotion and Marketing Code which has become firmly established as the comerstone of performance with integrity value; (9 Key managers of the company went different professional institutions and rigorous training and workshop of embedding the BSL value named “Quality Firs’. Industry and Market Trends Based on trad periocical, participation in trace and professional associations and communications with governmental and quasi-governmental organizations Private Sectors an with customers and suppliers, BBSL belleves that a variety of events and trends have resulted in signfcant ‘developments in the markets that BBSL serves. The Company's products are designed to respond to increasing demand resulting from these trends. Natural cisasters throughout the world have focused attention on safety concerns relating to the structural intogrty of arge buildings. n tis fac, Government of our County is thinking to build-up the sophisticated Buitings with Pro-Fabrcated Steel. n the lng run, the demand ofthe Stel Buiging wil be visible in every sector. In this regard, BBSL uses sophisticated software to failtate the design and marketing ofits product systems, Besides that the industry is subject to significant volatility due to realestate market cycles, fluctuations in interest rates, the avalabilty o lack of credit to bude, developers and consumers, inflation rates, weather and other factors and trends.Business Strategy Bangladesh Building Systems Ltd. designs, manufactures and sells products that are of high quality and performance, easy to use and cost effective for customers. The Compary provides rapid devery of its products and prompt engineering and sales support. BBSL intends to continue effots to increase market share in PEB product by maintaining frequent contact with customers, as well as private organizations that provide information to building code officials, both to inform thern regarding the quality, proper installation, capabilities and value of products and to update them about product modifications and new produets that may be uscful or necessary. To attract new customers, we also intend to continue to sponsor seminars to inform architects, engineers, contractors and building officials on appropriate use, proper installation and Identification of our products and to continue to invest for advertisements, ulizing social media to connect and engage with customers and to help them do their obs more efficiently. Based on its communications with customers, engineers, architects, contractors and other industy participants, BBSL boloves it has strong brand-name cognition, which wll assist in the aoceptance of new products in curent and new markets, bth domestic and iteration ‘The Company's long-term strategy is to develop, acquire or invest in product lines or businesses that have the potenti’ to increase the Company's eernings per share overtime ard that © Trading of Roof Sheets & Puri © Trading of Puli Products BBBSL manufactures and markets building preducts Pre Engineered Steel Building) and isa recognized brand name in Industrial and commercial applications, This type of product is called a customized product. The availabilty ofthe production or finished goods depends onthe Customer order Exclusive feature of BBSL Products: Economy prise: BBS engineers/designers are ahvays eager to optimize designs by putting in material where forces are greater and cut waste by clminating material where it is nat needed. These waste savings initiative recuces the overall cost ofthe job, so customer could aval our product in the econony price. High quality: With the outstanding combination of design and fabrication, BBSL. can provide the best qualty PEB. BBSL is realy gives its eagle ‘aye regarding the quality of is output Quick delivery: BBSL hes its own wel-trained and specialized engineers who can erect the building within a very short time compared to time ‘akon by the conventional buildings, Atter confirming orders BBSL's technicians chalk out the flow chart framing the required time to daliver the product before the deadline. Design and Architectural flexibility: From the simplest to the ‘most comple buiding dosign BBSL provides the client designing ‘lexbilty and versatility, BBSL buidings blend with any conventional exterior A irivture of panels, block glasses, bricks, stones and concrete could be used to complement the surrounding ‘environment. Low maintenance and long building life: 88S buildings require virtually ro maintenance. it offers a range of interior structural coatings to meet project naeds and on the exterior side, the root and wall panels have superar, ong lasting oven backed coatings that are maintsnance free for years. Expandability: Expandabilty is a build-n-component of B33 Pre Engineered buildings. It is easier, economical and faster. Re-locatable: BBS Pre-Engineered buildings are site bolted. It is Ielatvely easier and economia to cismantle and re-locate the buildings, © serarreporzareaa7Sales and Marketing BBBSL. sales and marketing programs are implemented through its Central Salas and Marketing. Mass advertisement is not required for this product. The brand name "BBS" is much more popular to the Customers inthis sector. The sales torce maintains close working relationships with customers, davelons new business, cals on architects, engineers and building officials in afferent programs. The Team dedicates substantial resources to customer service. And Engineers nat only design and test products, but also provide engineering support fr customers, Based on its communications with customers, BBS believes that its products are important to its customers’ businesses, and itis Company's policy to shin products within a few days of recaiving the order, with many ofthe ordars shipped the same dey. ‘The Major & regular customers are British American Tobacco (Bd) Lid,, Grameen Phone, OTOBI, Basundhara Group, Square Group, Partox Group, Opax Group, ICDDRB, Esquire Group, Rangs Group, Palmal Group, Standard Group, STS Group, Hamim Group, Well Group, Bengal Group, GBB Group, NR Group, Envoy Group, Youn Group, Lite Group, Paragoan Group, Nasir Group, incepta Pharmaceuticals, Seven Cirle (Bd) Ltd, AIT Group, Mainetty Bd. Ltd. (PZ), Epic Garments PZ), Thormax Group, Perfatt Van Molle @d) Ltd, DADA Group, San Group, Prantx Group, unner Group, Pran RAL Group, Lafarge Surma Cament, Meghna Group of Industries, fil Group, ACI Group, Rancon Electronics Lt, Patromax (tinder Ltd, Energypac Power Generation Ltd, Tosrifa Industries Lt, Nortex Textile Mills Lt and others. Manufacturing Process BBS designs and manufactures most ofits standard products It has concentrated con making itsmanufacturing processes as efficient as possible without compromising the quality of flexibilty necessary to serve the needs of its cuslomers. The Company has developed and uses automated manufacturing processes ts nmovative manufacturing systems and techriques have alowed itt Control manufacturing costs, even while developing both new designed and products that meet customized requirements and specifications. Manufacturing process has three separate stages to manufacture three main constituting components including Primary Members: Colum, Beam ‘Secondary Members: Purin, Door Sheets: Roof sheet, wall cladding, flashing & hers Primary Members include the process of Cutting, Hole Punching, Assemiing, Welding and connection detalls welding, Surface cleaning and panting to ‘Secondary Members include the process of Forming, Hole punching and painting Sheets include the prooess ofall kinds of steo! panels are rolled from the high {Wualiy ste, zincalume-coated cold-rolled stel with undercoat panting, Competition BSL faces a varaty of competion inal ofthe markets in which ft participates This competion ranges from large national or international corporations to smal regional manufacturers. While pre isan important facor, BSL also competes on the basis of quality, breadth of product line, propritay tachnolgy, technical support, availabilty of inventory, service (including custom design and manufacturing), field support and product innovation. As aresut of differences in structural design and bullng pratioes and codes, our markets tend to der by region. Within these regions, BESL competes with companies of varying size, several of which aso distribute ther products nationally internationally, ‘Annual Report 2016-2017 @Raw Materials ‘The principal raw material used byHot rolled col, Cold rolled Col, MS Plate, Sheets and accessories etc The Company's practice is to seek cost savings and enhanced qualty by purchasing from a limited number of Local and Foreign supplers.The ste Industry Is highly cyclical and prices for the Company's raw materials are influenced by numerous factors beyond SST's contro, including general ‘economic conditions, cammpetton, labor costs, foreign exchange rates, import duties, raw material shortages and trade restrictions.The steel market continues to be dynamic, with a high degree of uncertainty about future pricing Seasonality and Cyclicality The Company's sales are seasonal and cyclical Operating results vay from quartar to quarter and with economic cycles. Environmental, Health and Safety Matters The Company is subject to environmental laws and regulatons governing emissions into the ai, discharges into water, and generation, handing, storage, transportation, treatment and cisnosal of waste materials. The Company believes tha it has obtained all material icansas and permits required by environmental, health and safety laws and regulations in connection with the Company's operations and that its policies and prooedures.comply in all material respects with existing environmental, health and safety laws and regulations, Employees and Labor Relatic ‘As on 30th June, 2017, full-time employees and workers ofthe Company were 695 nos. The Company believes tat is overall compensation and benefits for te most part meet industry averages and tha ils relations with its employees are good. The Company benefits is employees by Provident Fund, WPPF and Two Festival Bonuses (Gross salary) etc Available Information The Company's al information are available inthe website" wwtbspeb.com’ and alsa the websites ofthe Stock Exchanges, Printed copies of ‘any materials wil also be provided as per policy on request. © )rcarropsrzais7Board of Directors Engr. Hasan Morshed Chowdhury Engr. Md. Abu Noman Howleder Engr. Mohammad Badrul Hassan Engr. Mohammad Ruhul Majid Md. Ashraf Ali Kan Mr. A.S.M Ali Kabir Mr, Md. Anawar Hossain, FMA, Audit Committee Mr. Md. Anowar Hossain, FCMA Engr. Mohammad Badrul Hassan IM. Ashraf Ali Knan Company Secretary Mohammad Monsin Chief Financial Officer Md. Mamun Howlader Chairman, Managing Director Director Director Director Independent Director Independent Director Chairman, Member Member Statutory Auditors S. k Barua & Co. Chartered Accountants Head of Internal Audit IM. Fayjuizaman Legal Advisor ‘Mr. Jahirl Isa Khan, Advocate Bankers of the Company United Commercial Bank Ltd, Registered Office Factory Premises, Jaina Bazar, Telehate, Sreepur, Gazipur Corporate Office Configure Bepari Tower (Grd Floor), GA-64, Progoti Swarani Middle Badda, Dhaka-121 2. Tel: +88-02-9850771, Fax: +88-02-9850772 E-mail: info@bbspeb.com, Web ; wwn.bbspeb.com Share Office Homestead Guishan Link Tower (2nd Floor), Ta-99, Middle Badda, Dhaka-1212. Tel 02-9854475, Fax: 02-9854476 Chittagong Office Kader Tower (6th Foo) 128, Jubilee road, Chittagong, Factory Jaina Baza, Telehate, Sreepur, Gazipur ‘Annual Report 2016-2017THE POWER TO BUILD. WITH CONFIDENCE © ‘Annual Report 2016-2017Customers We live up the organization by cont the quality of {outstanding prodt Shareholders [We provide a while cafoquarcing th f We respect our | contribution to ti Community orming to the ethios a of the ‘Annual Report 2016-2077 | Nee oe Oe ee FINANCIAL RESULTS : ‘We are in the Pre-Engineered Steel Bullding Market for 14 (fourteen) years & Growing ‘with our concrete strategic decision. The PEB construction market is expected to go through a consolidation phase in this upcoming year & our team will be focusing on specification effort for upcoming projects. The performance of the last five years is highlighted as follows: Five Years Financial Performance Portcutars [z01s-2016 | 201¢-2018 | a01s-2014 | Tunover 2,964,040,040 | 1985.637.628——1,681,696,790 ios rot 605.061.560 | 498582644) 414507.968, 7 Profit before wx B1785 | 951,954005 | O41 797.139, 519,203,776 | 195620012 Prof after tx 250,105,767 | __ 24897920) 226 680.248, 76516 749 Staretoles Fauly 1556821515 | 1.40571 1.006 502.421 Teta Curent Asses | ats.397280) —y6a705R090) 7, 058.403.521 Total Assots 3584197117, 3,100,030,24) @.505.911,270—_1,734,015,71 Total Curent abs [> as,596, 155, 1906.68.06 | 1oa0m.402/ Bava | ABEL TA, Tota Nun of Shares Osan 716582,00 105,988,000) 68:320,000 73,600,000 30,000,000 Curent Rao ines) 130 148] 198 146 Enrigs per sere (aa) 292 236] 27 257 159 190 00 NEN per share Taka 1535 74.08 7478 NOGEPS 064) i Revenue growth in the last five years a4 Total Assets Growth in the Last Five Years oa in S000 Eww | is P= | ao = ||. 1 A moe anal =e ees so00 A Gross Profit Growth in the Last Five Years = ee a Profit after Tax in the Last Five Years ae os ee or tntin Current Ratio of last Five Years ae se or os be —E_ Ny ‘Annual Report 2016-2017eee ee ee eS ‘As can be seen from the review below, the Company managed to exhibit increased revenue performance and net profit Revenue increased by 5.26% to Taka 2,489.43 million in 2016-17 from Taka 2,364.95 million in 2015-16. This increase in Revenue occurred due to the increase of sales price per unit. COGS increased by 6.05% to Taka 1,865.41 milion in 2016-17 from Taka 1,758.07 million in 2015-16. The increase occurred due to the increase of labor cost & Implementation cost. Net Profit went up by 35.96% to Taka 340,03 million in 2016-17 from Taka 250.11 million in 2015-16. This, increase in Net Profit occurred on account of operational efficiency & also additional income from Associates (88S. Cables Ltd). Consequently, the Eamings per share was raised from Taka 2.15 to Taka 2.92. Total Equity incroased by 19.54% to Taka 1,859.79 million in 2016-17 from Teka 1,555.82 milion in 2015- 16 mainly due to increse in Retained Earnings, Total Assets increased by 15.62% to Taka 3,684.14 milion in 2016-17 from Taka 3,100.03 million in 2015- 16 mainly due to Increase in Cash & Cash Equivalents, Trade Recaivables, Inventory, Proparty, Plant & Equipment & also the invesiment value of Associeate. Total Li saw an increased by 11.67% to Taka 1,724.34 million in 2016-17 from Taka 1,544.21 milion in 2015-16 mainly due to incresing in Long Term & Short Term borrowings. Particulars | 2016-17| 2015-16 | Changes (%) Revenue 2,489.43 2,364.95 5.26 oss 1865.41] 1,750.07 | 6.05 Net Profit 340.08] 250.11 | 35.96 Total Equity 1gsa.7o| 7,555.82 | 1954 Total Assets 358414[ 310003 | 1562 Tota Liles 12434] 1,544.21 | _11.87 2000 Tt 1500 : mB mey = 1000 ‘M2516 a soo fevenic COGS Met Prt ‘4000 > 3500 3000 J sa Fee Cer. 5 100 20536 © sp00 seo Touleauty Tox reste Total Lbs ~\ seamen @) y ¢ xsEngr. Hasan Morshed Chowdhury Chairman ‘Annual Report 2016-2017CSS 3 Dear Valued, Shareholders Assalamu-alaikum, On behalf of the Board of Directors of Bangladesh Building Systems Ltd,, | am pleased to present the Annual Report and Aucited Financial Statements of the Company forthe financial year ended, 30th June, 2017. It is my great pleasure to report you all that your company has registered a net proftt of Tk 340.0 milion, Now company's net worth stands at Tk. 1,859.7 milion. EPS stands Tk, 2.92 per share & Net Asset Value Tk. 15.95 per share, The overall operating environment, nevertheless, is more complex and volatile. Our Board and management continue to identity and address all conceivable scenarios for the coming years, focus on opportunities or obstacles that li ahead and incorporating them in our planning. The sound track records of the Company, its experienced and prudent Management, the strong financial position and its low gearings will no doubt allow the Company to reposition itself well and continue to participate competitively as and when business opportunities arise. We will continue to be steadfast to our commitments in pursuing continuous improvements in our products and services, technology advancement, improvement inefficiencies and our long term strategies to strengthen and expand ur presence in the existing and new markets to ensure sustainable growth and development, Finally, | would ike to take this opportunity to thank our shareholders, the authorities and business associates for their confidence in the Company and look forward to their continued support. A special note of appreciation to the Board members, management and staffs of BBSL, Dhaka Stock Exchange Limited, Chittagong Stock Exchange Ltd., Bangladesh Securities and Exchange Commission, Central Depository Bangladesh Ltd., Registrar of Joint stock Companies and Customs, Tax and Vat authority for their unwavering commitment and hard work to weather through the challenges we have encountered this year and to continue to embrace the constantly changing environment. ALLAH HAFIZ sa (Engr. Hasan Morshed Chowdhury) Chairman ‘Annual Report 2016-2017Engr. Md. Abt an Ha Managing Director & CEO © ) ermairesorcoiscoii SSS eT sey Dear Selow Sharchollers ‘Assalamu-alaikum, | would like to express my heartfelt thanks to all of you and various sectors of society for their concem and support to] the Company. | am pleased to announce that your company is able to maintain the business growth consistently. We are realy delighted to report another successful year with earnings per share BOT 2.92, an increase of the turnover growth, We have established to our Brand "BBS" in Pre-Fabricated Steel Building Industry with our strong commitment of Business. Our participation in building high-rise corporate buildings is increasing day by day which is focused a remarkable performance of our business. Taking a leadership role as we navigate through challenges is not something new for BBS. Our history and suocess have been built ‘on how we managed change in times of adversity Considering the Company's earings, the Board of Directors of the Company has recommended 10% Stock Dividend and 5% Cash Dividend for consideration inthis Annual General Meeting by the members. The outstanding performance and sustained and stable development of the Company is attributed to the efforts of all BBSL staff in adhering to the guideline of "focusing on the core businesses in building a better B3S, energetically exercising the Company spirit of being down-to-earth and pragmatic" focusing on the principle of "without wasting one day, without being lazy for one day”, firmly pursuing the path for the development of leading technologies and promoting business transformation in an_ unfavorable environment. The performance and services of the Company was also attributable to the strong support of all shareholders and our investors, Our Govt, has established, the vision 2021. The Country is currently at the period of speedy transformation, structural adjustment and dynamic change.The development trend of the steel industry towards the greening, differentiation, intellectualization and interationalization will bring about numerous merket opportunities involving high technology, high added value and sustained benefit that are relevant to renovation and upgrade works and environmental protection, highend consultation and inteligent operating services. Al these provide BESL with strong motivation, favorable opportunities and timing exactly for its strong development by making better use of its 14 years of sound and extensive experience in technology, as well as a Sound market foundation for continuous and stable development of business of the Company, Our Associate, BBS Cables Ld. is increasing their position as Market leader in the Cables industry in our Country. The campany is listed with DSE & CSE. Company has eamed net profit of Tk. 413.34 million for the year ended June 30, 2017. Earning per share was Tk. 4.12, Net asset value Tk. 19.17 and the company has also declared 15% stock and 5% cash dividend. (On behalf of the Board of Directors of BBSL, | wish to convey my utmost appreciation to our management team for their dligence, admirable performance and leadership qualities, | would also like to take this opportunity to convey our heartfelt thanks the Company's stakeholders, investors, business partners, associates, bankers and regulatory authorities who have played a part in our growth and success. Last but not least, my deepest gratitude to you, our valued shareholders, for your unwavering support and trust in us. We certainly look forward to your continued Support as we work hard to deliver greater value to you. I call upon all our stakeholders to lend us their invaluable support as we ‘work together to deliver on another great year and even greater success, ALLAH HAFIZ Sd- ENGR. MD. ABU NOMAN HOWLADER MANAGING DIRECTOR ‘Annual Report 2016-2017BBSL CSR VISION Bangladesh Building Systems Ltd. (BBSL) supports Corporate Social Responsibility ("CSR*) by taking into consideration the impact of ‘our Company's operations on employees, customers, shareholders, communities, other stakehoider and the environment. In order to comply with the legislations, BBSL commitment towards CSR extends to the way, the Company conducts tis business ‘operations to ensure sustainable social, economic and environmental benefits to the community as a whole, EDUCATION BSL has joined hands with local authority of Schools and Colleges located at Jaina bazar, Sreepur, Gazipur for providing school dresses, education matarals and merit scholarship annually, BBSL is also giving education scholarshia among the children of the workers of the Company. BBSL donates different public libraries for creating awareness among the rural people to read books. The Company takes initiatives with "Alor Bhubon public library" at Patuakhali and others. BBSL donates to the " BINIYOG SHIKSHA TAHOBIL" which was creat fate established by Bangladesh Securities and Exchange Commission. BSEC has taken the initiatives to make individuals understand at their evel of needs the role of money in ther lives, the need and usage of savings , the advantages of using formal financial sectors, various ways 10 Convert their savings into investments, develop self-protection through Gy « ¢ understanding risks and realistic recognition of the attributes of these YN options through BINIVOG SHKSHA program. \o TREE PLANTATION BBSL has established a fund for trae plantation program, Each year a part of the fund is using to plant trees in the south coastal areas and also the factory locality. On a mission to build oxygen hubs. BBSL joined hands with Tree Public to help reduce carbon footprint by planting native trees best known for their properties of purifying the polluted atmosphere and providing a clean and healthy environment. We are establishing a program of One Tree One Child Program in near future,WL Se aia | lo ~®) ‘Annual Report 2016-2017 \Se Engr. Hasan Morshed Chowdhury Chairman Board of Directors Engr Hasan Morshed Chowdhury is the Chairman of Bangladesh Building Systems Ltd. He is a Civil Engineer who completed his graduation from the Bangladesh University of Engineering Technology (BUET). He was bom in 1972 in Galbandha district. He started his professional career in “Mult-Build" under the Management of Jonson Contro-USA. In service under Multi-Build, he worked in Singapore, Si Lanka & India. He gained valuable experiance by getting training on “Building Management System, Air Conditioning System, Fire Protection System & Safty Issue" under direct supervision of an USA expert Professor Mr. John. He isa fellow member of IEB, He is the Member of Al Community Club (ACCl), Capital Recreation Club & Uttara Club. He travelled many renowned countries of the world. He is the honorable Managing Director of BBS Infrastructure Ltd, BBS Readymix Ltd. He is also the Director of BBS Developers Lid., Prithvi Engineers Ltd. Total Knit Composite Ltd., BBS Metallurgic Industries Ltd., Xiamen Reflective Insulations Ltd, BBS Distributions Ltd, BBS Cables Unit-2 Ltd, Helix Wire & Cables Industries Ltd, and BBS Cables Ltd, \hich is a renowned Company of Cables Industry in Bangladesh [=a ss) Engr. Md. Abu Noman Howlader Managing Director & CEO Engr. Md. Abu Noman Howlader is the Managing Director of the Company. He was born in Bhola district in 1973. He completed his B.Sc. in Mechanical Engineering from the Bangladesh Universty of Engineering Technology (BUET). As a key visionary founder of this Company, he has a very strong background in scientific research engineering technology To explore the great potential of such a high tech project requires leadership with cutting edge knowledge in relevant technology, Mr, Noman has that sort of potential leadership to lead this Company into the high tech industrialzation era of Bangladesh. He was awarded "fa were! we #tr-201 1, Business Asia Award as a “Best Entrepreneur of the year 2010-2071". He was awarded a "National Business Award" arranged by The Financial Mirror He is the corporate member of Dhaka Chamber of Commerce & Industry (OCC), Uttara Club, Bangladesh Electrical Association, Electrical Merchandise & Manufacturing Association, All Community Club, Banani Club, Capital Recreation Club Lc. and Gulshan Runners Society. He is also the Member of Bangladesh Malaysia Chamber & Commerce & Industry, Turcey Bangladesh Chamber of Commerce and National Association of Small & Cottage Industries of Bangladesh. He is also the President of Steel Building Manufacturing Assoclation of Bangladesh (SBMA). Mr. Noman is an honorable Managing Director of BBS Cables Unit-2 Ltd, Helbc Wire & Cables Industries Ltd., BBS Metalurgic Industries Lid., Nahee Aluminum Composite Panel Ltd, and BBS Cables Ltd. which is a renowned Company of Cables Industry in Bangladesh, He is also a Director of BBS Developers Li, Prithvi Engineers Lich, Speed Builders and Engineers Lid., BBS Infrastructure Ltd., Total Knit Composite Ltd., BBS Readymix Ltd., BBS Distributions Ltd. and also the honorable Chairman of Nahee SS Pipes Industries LId., Nehee Geo-Textie Industries Ltd, Dynamic Cars Lid. Mr. Noman is the Founder of Abdul Hannan Howlader Secondary School, Donor Member of Karimganj Secondery School and Telehate Higher Seoonder School, He has visited mast ofthe renowned counties of the world.Md. Ashraf Ali Khan Director (Md. Ashraf Ali Khan is a Graduate from the University of Rajshahi. He was bom in 1964 in, Pabna cistrict. He started his professional career in Construction Business Later he involved in Garments and Textile business. He is the "Secretary" of "Ishwardi Janakalyan Samity", Dhaka. He travelled many renowned countries of the world. He is also Member af Al Community Club (ACCL), Asia Club, Uttara Club & Legend Club. He is the Managing Director of Total Knit Composite Ltd. and Apparel Industries Lid. He is also the Director of BBS Developers Lid,, BBS Cables Unit-2 Lic, Prithvi Engineers Ltd., Xiamen Reflective Insulations Ltd., BBS Metallurgic Industries Ltd., Helix Wire & Cables Industries Ltd. and BBS Cables Ltd. Engr. Mohammad Badrul Hassan Director Engr, Mohammad Bacrul Hassan is a Director of the Company. He was bom in 1975 in Noakhali district. Bacrul Hassan is a Graduate in Chil Engineering from 11.7 Kanour, ina in 1997. He completed Masters in Advanced Engr. Management ftom the Bangladesh University of Engineering Technology (BUEN). He took various business related professional courses at home and Abroad. He travelled many countrias of the world. He is the Managing Director of Prithvi Engineers Ltd. and 88S Developers Ltc., BES Distributions Ltd. He is the Director of Xiamen Reflective Insulations Ltd, Total Knit Composita Lid, Speed Builders and Engineors Lid, BBS Cables Unit-2 Ltd, BBS Metalurgc Industries Ltd. Helix Wire & Cables Incustries Ltc BBS Cables Lic., BBS Readymix Ltd. and BBS Infrastructure Ltd. He is also Member of All Community Club (ACCL), Utara Club, ‘Army Golf Club, Baridhara Cosmopolitan Club, Capital Recreation Club, Rotary Club & also the Malaysia Chamber of Commerce & Industry. He travelled many renowned countries of the world —_—_, Engr. Mohammad Ruhul Majid Director Engr. Mohammad Ruhul Majid is a Civil Engineer who completed his graduatin from the Bangladesh University of Engineering Technology (BUET). He was botn in 1972 in Chittagong district. He started his professional career as a site supervisor in *Jamuna Bridge Project" under Hyundai Corporation in 1996. During his service in "Jamun Bridge Project, he was awarded "Best Supervisor” in safaty mattar. Ha is a Fellow Mertbar of IEB. He was awarded "Best Organizer" of CESA, BUET in 1996, Mr, Ruhul is the Direttor of BBS Developers Ltd, Prithvi Engineers Ltd., Total Knit Composite Lid., Xiamen Reflective Insulations Ltd, BBS Metallurcic Industries Ltd, BBS Cables Unit-2 Lid, Helle Wire & Cables Industries Lid., BBS Cables Ltd and BBS infrastructure Ltd,,. BBS Readymix Ltd, BBS Distributions Ltd. & The Chairman of Reyes Lid. He is also the Member of All Community Club (ACCL), Capital Recreation Club & Army Goll Club. He travelled many renowned countries of the works © drmarreoraean7A. S. M Ali Kabir Independent Director ‘A.. S. M Ali Kabir was bor in August 23, 1952. He completed his Masters’ Degree in English Utrature in 1973 trom University of Dhaka. Mr, Kabir worked a5 Lecturer of English, Mirzapur Cadet Colege from Jenvary to October 1976, officer class one, Bangladesh Bank from October 1976 to February 1979, He also worked in Bangladesh Civil Service as Deputy Saoretary, Joint ‘Seotetary Additional Secretary and Seorelary from 1979 to 2011. He joined different Gov. & foreign training, He also visited cifferent counts, He was engaged in diffrent acvtos with Govt. bocios, He is the lite member of Dhaka Univesity Alumni Associaton, member of JICA Alumni Associaton, Officers Club, President, Bangladesh Athletic Federation, Former President, Bangadesh ‘Administrative Service Associaton, 2009-11, *Former Chairman, BIAM Governing Bod,” Former General Secretary, BCS Secretariat “Association ect. Mr. Kabir reid from service on August 22, 2011. Md. Anowar Hossain was bor in 6th January, 1948, He passed OMA from ICMAB in 1982. He also complete his Masters in Accounting frm Rejshahi Univers He isa Fellow member of ICMAB. He worked as lecturer of Accounting at Paksey College, Pakshey, Pabna from 1971 to 1974, North Bengal Paper Mils Ltd. as DY Chief Acoountant from 1974 to 1994, Urea Fertiizer Factory Lid. 23 Dy Chief Accountant from 1994 to 1995, North Bengal Paper Mis Ltd. as General Manager (A & F) from 1996 to 2003, Khulna Newsprint Mis Ltd. as General Manager (A & F) from 2008 to 2005 and worked Jamuna Group as General Manager (Cost & Budget) trom 2005 to 2012. He joined ‘various national and international seminars and workshops, Md. Anowar Hossain, FCMA Independent DirectorDUT Lear Shareholelers, Assalamuy Ain And Good Moming. On behalf othe Board of Directs and Management, welcome you al tothe 1th Annual General Meeting (AGM) ofthe Bengacesh Bulking Systems Lid BSL) tis my prifge to place before you the operating result, Directors report together with the Annual Fhancal Siatemenis of te Company for ‘the year ended 30 June, 2017 along with the report af the autos thereon for your valued consteraton, approval and adoption The report is generated in compliance withthe Companies Act. 1994 and Bangladesh Securties and Exchange. Commission Notifcaton No: SEC/CMARCO/2006/158/143/Admin/44, dated: August 07, 2012 Independent Directors: ‘The Independent Directors have re-appointed in te Board as per the guidelines by BSEC. Two dstnguished Independent Directors heve been performing their Cuties and responsibites ecient fo the greater interest ofthe company. BBSL is realy benefited for ther series Tier details are disclosed Inthe page no 28 of his Annual Report (Chairman and GEO: Chairman and CEO ofthe Company sditferent individuals. Charan is elected fram among the Directors, named Engr. Hasan Morshed Chewhury and CEO ks appointed by the Boer, nemed not Md, Abu Noman Howder The Baad of ects ase clearly defined thei respecte rles and responsible in the Company. ‘The Directors report to Shareholders om: Industry outlook and possible future developments in the industry: Bangladesh is role model of devsloping county with an average GOP growth rate of more than 6% per annum for the lst nie years. Wit this development, Bangladesh wil be a middle Income country within few yeas, For a developing country, economic growth means massive investment in corporate housing and infrastructure constuction projets. n Bangladesh, sine lst fe years inrastructure sector is postoning remarkeby. Our Gov. Is thinking to bud up ports, Canfonments, Fyoers, Bridges and also other sectors wit Pre-Engineered Stel Bling instead of FICC. Right now, Pre-Engineered Steel Bulding is much mote lucrative choice Inthe eyes of Investors. Corporate high rio buildings have aready boon sarod to convo into the FEB with apd motion. In forsooabie future, Pro Engnoored Stoo Building PEB) wil cover tho pate housing sector in the Country. To capture the demand the numberof the local companies are nreasing rapty. Thre are about moce than fity companies ‘conduct the busines with reputation, Inthe long run, PEB Icusty has immense prospects. Companies which invest in the latest plant and process technologies and bing out more innovative PEB ruc wil be market leaders. More deals re explained in the page no. 08 to 08, Segment or product wise performance: Bangladesh Building Systems Li. is a pre-engineered ste! buidng manufacturer Business acts of BESL are nc recognized onthe basis of dterenoas in rots and sevice o ato in geogrpicalaess of operations. BSL hasbeen manufacturing the ste! stucure ini factory ard hen te stucture 5 recogrized tat the poo has Sold ou. Basically, BBSL has to sale a pacage to its potential buyers. Sono ned to show the The Compary has a robust system of managing its business rs which hasbeen describedin page ro. 39-41 ofthis annual eport, Discussion on Cost of Goods Sold, Gross Profit Margin and Net Profit Margin: Cost of Goods Sold: Cost of Goods Sold increased by 6.05% to Taka 1,865.41 millon in 2016-17 from Taka 1,759.07 niin in 2015-16. The increase arcu! duet the nea tf labor cot & implementation cast. Gross Profi Gross profit increased by 2.99% to Taka 624.01 millon in 2016-17 rom Taka 605.8 milion in 2015-16, Gross prfts increased due to incre of sales volume comared to last year Net Profit’ (Loss): Not Profit went up by 35.96% to Taka 340.03 milion in 2016-17 from Taka 250.11 milion in 2015-16. This increase in Net Profit ‘occurred on account of operational efficiency & also addtional income from Assacietes (BBS Cables L1d). Consequently, the Earnings per share was raised from Taka 2.15 (restated) to Taka 2.92. womenYe te Discussion on continuity of any Extra-Ordinary gain or loss: During the year, heres na ary extra edinary gino los inthe business. Basis for related party transactions: Detalles ofthe related party transaction has been given of his annual report in page no.80 Utilization of proceeds from public issues, rights Issues and/or through any others instruments: Ltlizaton of praceeds from public isues is eubect to previous accountng year and it was compliad accordingly. Company had no unutlized PO fund sito 2014. The Company s maintaining a stable nancial performance, Significant Variance between Quarterly and Annual Financial Statements: No sinicant variations have occured between quarterly and fl nancial results ofthe Company during the year under por. Throughout the year Company was able to meintain a judo performance both in operator and financial perspectives. Remuneration to Directors including Independent Directors: Decors were remunerated as per he decison ofthe Boar ard a detailed por ofthe Directors’ Remuneration fs disclose inthe page no. 61 of this annua reope Directors Declaration as to Financial Statements: ‘As part of prporation and presentation of tnancalstatomerts, te sectors eso report that The financial statements prepares by the management of the Company presenta ue and ti view of Company state of ata, resut of its operation, cash ‘lows and changes in equty; b Popar books of accounts as raquied by aw have been maintained ©} Appropriate accounting poles have been foloned in fruiting the financial statements and acceuntng estimates are reasorable and prudent; «#-Te nancial statements were prepared in accordance with Bangladesh Accounting Standards (BASs) and Bangladesh Facial Reporting Standards (BFRSs); 0 Te financial statement prepared by the management ofthe Company present fay ts slat fafa, the resut ofits operations, cash flows end changes in nuity {The Company is aware of is various sks and canoes, mail rom the pocy and regulatory fronts end prepared to meet those by systematic contro {There are no doubts upon the company’s abit to continue as a gong concem andthe annual accounts have been prepared asa gong concer basis; 1 The key operating and financial data fr the last fv yeas is lsclosod in the Page ro. 12 of the Annual Raport; 1) The Company has entre ino transactions with other ents that fl within the definion of reated party as oontaned in BAS-24 ‘System of internal Controt: ‘The company maintains a sound inemal contol system wich gives reasonable assurance against any material misstatement of loss. Detals ofthe intra ‘conto stated in the page no 43-44 o this anual reer. Going Concern: ‘While approving the financial statements, the Directors have made enpropriate enquires and anayeed signfcant eperating and indicative fancials which enabled them to understand the abity of te Conary to continue is operations fora oreseeeble future. The Ciretors are convince and have a reasonable ‘expectation tht the Company hes adequale resources an legal nsruens o continue ts operations without inlerupins. Therefore, the Company adopted the ‘ping concer basis in preparing these fhancia staterents. ‘Annual Report 201DIRECTORS' REPORT Operating Results: Financial Performance Pastors 2016-2017 2015-2016 Taka Taka Tumover 2489 426423 2,364,949,.40 Cost of Goods Sold (1,865,411,530) (1,759,068,380) Gross Profit/(Loss) 624,014,893 605,861,560 Oper penses (715526 648) (126 55,820) Other Operating Income 1,259,733 24,720 Operating Prot 509,747,877 159,350,460 Other Income 839,000 1,072,360 Financial Expenses (101,531,332), (90,859,670) ‘et Pros) tm Operaton 408,055 645 360 563,150 Contribution tb WRF (19,478,840), (17,598,248) ‘Net Profit/Loss) before Tax 458,481,785 351,964,905 Income Tax Expenses (118,447,321) (101,859,138) ‘Net Profit/(Loss) after Tax 340,034,464 250,105,767 Key Operating and Financial data for the 5 years: ‘The key operating and tinancial data as reqied herein attached in he Page No. 12 ofthis nual Report. Contribution to National exchequor: ‘During the year the Company has contributed BOT 96,619,783 and the last yar it was BOT 87 202,101 to the National Exchequer as Income Tax and also ‘deposited Customs Duty and Valve Add Tax. ‘Appropriations of Net Profits ‘The Directors ave pleased to present the financial resus forthe yeer 2016-2017 and recammend the fllowing zpprooriaons: ‘Outing the year 2016-2017, net profit afer tex ofthe company was amounting to Tk. 3400 cree as compared to Tk 25.01 crore inthe year 2015-2016. ‘Keaping these in vw the Directors would ike to repert the Company facial resus for he yea that ended cn 30 June, 2017 withthe recommendations for Particulars 2016-2017 | 2015-2016 Net Profit forthe year ended 30 une 3400) 25.01 Prot ought foward 3540) 24.58 Prof valle for anprogrition| 6940 | 49.59 ‘Appropriations: Proposed Stack Divided 1165 | 1088 Proposed Cash Dividend 5.2 3.60 "Tarstored to Fotaned Eamings 3198 | 360 OPERATION OF ASSOCIATE COMPANY ‘The only assoclateof the Company s BBS Cables Lis whare your Company has inested 200 milion and holding 16.67% of equ tal, the investment vas 20%, due to increasing of the Capital of BBS Cables Li, trough hia Pubic OFlering( PO), the investment of BBSL has become 16.67% ra 20% for the dled 22nd June, 2017).B8S Cables Lid is a rencwned company in Bangladesh. Both te operating and fnacial performance of the Company were as expected. Hopeful it wl be the Market leader within foreseeable future, “Te Company has erred net profit of Tk. 413.34 milion forthe year ended June 30, 2017 Earrings per share wes Tk. 4.12 and Net Asset Value per share vas 1k 19.17, Net Operating Cash tow per share was Tk. 5:33 The Company has deieed 15% Stock and 5% Cash Dividend Dividend: “The company folows «prudent dividend policy. considers fair retun to the shareholders while ensuring tel the profits esined ae invested in the business for expasion, growth and higher poabiy. Due t the good paromance ofthe company inthe yar 2076-2017, the management fk hata far return shoud bo given othe sharehcdes from the earings. Theefrea Stck Dividend of 10% |. 10 Shares foreach 100 shares and Cash Dividend of 5% are beng recommended for cenideaton ard aproal bythe Shareholders in the AGM, OmerDae Board, Board Meetings and Attendance: “Tare are sevon Diecors ofthe Board p tothe yearend 2016-2017. Inthe year 2016-2017 a toa no, of 13 Beard Meetings wore held a flows: Name of Directors Position Meetings held ‘Atendance Engr Hasan Morshed Chowhary Chairman 13 13 Engr Md, Abu Noman Howiadr Nenaging Director 3 13 MMi. Asaf Al Khan Director 8 2 Engr Mobammed Bacrul Hasan Director B 8 Engr. Mohammad Rutul Majd Director 13 18 Mc ASMAi Keb Independent Director 13 72 MM. Angwar Hossain, FEMA Independent Dict 8 18 ‘Te Member ofthe Board who count attend he meting was grated eave or was cuts he county. Pattern of Shareholdings: ‘Te pattern of Shareholding is disclosedin the Annexure () and Page no. 42 ofthe Anal Repert Directors' Rotirement and Re-appointment: ‘As per the Ailes of Association of the Company Engr. Mohammad Bacrul Hassan and Engr. Mohammad Ruhl Majé shall rete inthe 14th Annual General Meeting by rotaton and beng sige for re-lecton. The Board of Drecors appointed them as Directors af Company on October 27, 2076. Disclosure of information ofthe Directors who seek reappointment in the ensuing AGM is dsccsed inthe page no 22 of ris Annual Report CEO, CS, CFO and HIA: ‘Tne company appointed a Chet Execute Ofc (CEQ), Engr Md. Abu Noman Howtader, Compary Secretary, Mr. Mohammad Mohsin, Chet Fhancial Officor Mr Md. Mamun Howader, Head of intemal Aut HA), Mc Ki, Fayjujaman. The Board of Directors i cleatly defined respective roles, respansibties and duties for each individuals. ‘Attendance of CFO, and CS in the Board Meeting: In each Board meeting CFO, anc CS was inte and then attended on the Board Meeting and contbuiedsigniicriy to the Meetings ‘Audit Committee: ‘The aut commitee asa sub-comvitesof board has been consuted an 30 June, 2017 withthe Indeperdent Director as Chatman and two other Directors as ‘member. The Company Secretary acts as Secretary tothe commit. Role ofthe act commie as per provision he BSEC regulation have been duly adopted byte Board. The report ofthe auc commit is eiscised in tis annual report in page no. 45, Financial Statements certified by CEO and CFO: ‘The CEO and OFO is corfiod of the Financial Staerents after review tothe Board and they balioved that these statormans donot contain any matrtaly untrue ‘Sfatement or omit any material actor cata statements that might he misleading, Ther statement of carfcatin enumerated inthis Anal Report in page 10.46. Other Disclosures and Declarations: “Te fll financial statoments ar preserted in another section of the annual ropa, along wih the fll notes of elscosurs. The CEO & CFO is furor ploasd to ‘resent you the flowing dsclosures and declarations {From inception the financial results of the Company have continued to grow as reflected inthe yearly financial statements of the Company, 1 During the yar the Company has pad no amount as Board meeting attendance fees to the directs except independent Directors. {Al significant devatons from the preious year in cperating results ofthe Company have been higfighted and reasons theeot have been explaned | The Direct's rafbs have been incudd in the Annual report as por BSEC qudlines, ‘Compliance Report on Corporate Governance Guidelines: ‘is part of its corporate poly, BSL has alays strived to maintain high standards of compllance in corpeate goverance. The company’s corperate governance charter, outined in the crpovate goverance charter, governs the way the company will be Operated and managed and the process in place to ensure high ‘slancards of rensparency, accountability and integrity, ‘Annual Report 2016-2017ie Sie Compliance Status: Wie are pleased to confm that the Compery has compiled with all necessary guidlines in accordance with the requirement of BSEC Notification No, ‘SECICIMRACD/2006-158/134/Adminié daied 07 August 2012. The status of Cmplance is atachod Inthe page no. 35-38 ofthis annual report. ‘The company obainad a catiicats fom rat Husain & Associates, Chartered Secretaries in practice regarding compliance of condtons of eoxporate govsrranca Guidelines othe Commission, which &erclsed inthe Annual report as Annexure (inthe page no. 30. Employee Benefits ‘Apart fom the salaries and wages pao the employees, the compar offers cher benef as wel This incudes Bonus, Prevent Fund, Transport Facies and \WPPF fund acoorcingly in the past years. ‘Appointment of Statutory Auditors: 4s per the Companies Act, 1994 and the Atoles of Assocation of BBSL the statutory autor ofthe Compary, WS. S.K. Barua & Co, Chartered Accountants, ‘hal rete at tis AGM based on corplanos guideine by BSEC and suggestons of the Aut Commitee, the Board recommended. K. Bra & Co,, Chartered ‘Accountants, Houso# 432 (2nd Foo, Lane # 30, New DOHS, Motakhal, Dheka-1206 for re-appointment as autrs ofthe Company forthe year 2017-2018, ‘and they have conveyed their willingness to aooep for re-appointment forthe said periods, ‘Acknowledgement: ‘We woud like to exprass our sincere apprectaon and thanks to all the honorable members, employees ofthe Company who exemplified the BBSL spit of puting the patent and customer fst. ‘The Board also recognizes the conrbutions received fram barks & financial intituton, insurance companies, National Board of Ravenve (NER}, Bangladesh ‘Securities and Exchange Commission (SEC), Dhaka Stock Exchange Ltd. (OSE), Chittagong tock Exchange Lid (CSE), Central Depostry Bangladesh Limited (C21), various Government authorities, supple, vendors, customers, end users, diferent medias, and lestly the indduals and agencies who have helped us ‘apcompised what we are ody We ae honor ound to continue to uphold this Wust hal we hold so dao ou hear. ‘wh the supprt of every ane of you nd ther stakeholders, we excitedly expect even better resuts inthe days coming ahead in-Sta-Allah! ‘On eu ofthe Board, sa (Engr. Md. Abu Noman Howlader) ‘Managing Director D) ® ‘Annual Report 2016-2017 SLee se ANNEXURE : 1 (Bunoy) Je12ua9-Areyai9a5, oe “coz 49GUiII9@ , J JUN Juans surpuias ayvo4finsad S1YT, ‘Annual Report 2016-2017 oqasay1 Burmyaddn sabajraud puv szyBu ays yp 01 payniua s1 puv saluedwod pays! Ajaijqng Jo uoyelzossy Yysape|sueg fo sagmayy Cnupicw st CALIWTI SWALISAS DNIGTING HSACVTSNVE aoyy Cfirsa2 07 St StU, 9} PIGT}I9>) pomouay 21g Lamagay got: ans} fo aa0q ey Eke: iwo/210ew ‘On Sou SAINWdINOD G3LSIT A1DITaNd JO NOLLWIDOSSW HSadVIONVAestes ANNEXURE : IT. wes | TRAT HUSAIN ASSOCLATES ——=mat CHARTERED SECRETARIES IN PRACTICE CORPORATE GOVERNANCE COMPLIANCE CERTIFICATE 1. We have examined the compliance of conditions of Corporate Governance by Bangladesh Building Systems Lud. (“the Company”) for the pesiod ended 30 Jere, 2017 as per the Corporate Governance Guidelines issued by the Bangladesh Sccusities and Exchange Commission (BSEC) vide Notification No. SEC/CMRRCD /2006-158/134/Admin 44 dated 7 August 2012. 2. The compliance of conditions of Comporate Governance isthe responsibilty of ‘the Management. Our examination has been limited to a review of the procedures and implementation chereof, adopted bythe Company for ensuring the compliance with the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on financial statements of the Company. 3. In our opinion and to the best of our information and according to the explanation given to ut and the representations made by the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the BSEC notification mentioned above. 4, We further state that such compliance is neither an assurance as to the futuze viability of the Company nor the efficiency or effectiveness with which the ‘Management has conducted the affairs of the Company. L Chatered Secretates in Practice Siged by : Tent Hosin POA, 8S Cher mace Dil, 8 November, 2017 (CELL 171209222, 0188257703, EMALL kage ‘Annual Report 2016-2017STATEMENT OF CORPORATE GOVERNANCE ‘The Statement of Corporate Governance ("Statement") of Bangladesh Building Systems Ltd. ("BBSL") aims to provide an insight of the Corporate Governance practices of the Compary under the leadership of the Board of Directors ("Boavd. ‘The Board remains fully commited to maintaining high standards of corporate governance and ensuring that the Company and affairs strictly adhere to the doctrine and princplas of good corporate governance to safeguard the Compary's assets, enable sustainable perlermance and tutimately enhance shareholders’ value. The Board acknowledges te significance of maintaining good corporate governance practices and plays an active role in advising, reviewing and evaluating the governance framework and continues to reinforce the existing corporate governance practices in order to remain relevant wth developments in market practice and regulations. + The Corporal goveance frameworks bul onthe follwing pertinent requirements and guidlines: = Companies Act, 1994 ("the Act’); + The corporate governance requirements of the Bangladesh Secu and Exchange Commission (BSEC). ‘The principles and ecormendations of the Notification on Corporate Govemance O7th August, 212 (SEC/CMRRCD/200B-158/134/Adin/ 4) issued by the Bangladesh Securities and Exchange Commission (BSEC). Testament othe Company's continuous commitment in acvocatng vansparency, accountabily and disclosure The Boat i pleased to cscise the extent of the compliance withthe principles and recommendations during the nancial year ended 30th June, 2017, as set out hereunder. BOARD OF DIRECTORS ‘The Company continues to be led and controlled by an active, engaged and experienced Board. Throughout the year, the Board continued to dive and effecivy ster the Company wth strategic direction trough acne engagerent withthe Management. Chairman of the Board and Managing Director In Bangladesh Builgng Systems Ltd, Chaitman and Managing Dirctor are two separate individuals selected trom the Board of Directors. Both are Performing defined responsibilties and focusing on the strategic value addition of the company. Managing director is performing the rle of Chiet Executive Officer. Directors’ Report to Shareholders Board of Directors is reporting the performance, annual achievements and status of the company's actives to the shareholders, They are also Conveying the plan and outlook ofthe industry and company in tetr report, Board Charter Since ts adoption, BBSL. Board Charter (Board Charter") serves 2s @ guide for good comorate governance within the Company. The Board Carter provides reterence forthe Directors in elation to the Boar's roe, powers, duties and functions and is set out not only in accordance with applicable rules and regulations but also guided by BSEC and best practices. The Board Charter aims to ensure that Board members are aware of ther roles and responsbiies and also serves as a clear source of reference taal sickeholers. The Board Charter covers inter-ali, ‘the objectives of the Board, duties and responsibities, powers, roles of the Chairman, Managing Diector end Chief Executive Ofcer, and Independent Non-Executive Directors ('INEDs") It will be reviewed from time to time to ensure tht it remains relevant and consistent to current rules and regulations Roles and Responsibilities of the Board The Board has the colectve responsibility for the overall conduct and performance of the Company's business and affairs by maintaining effective conirol over management oversight, sting the stategic direction and promoting ethical conduct in is business dealings. In discharging its roles and responsiviites, the Board is mindful ofthe nead to safeguard the interests ofall stakeholders. ‘The Board assumes the following core responsibilities which serve as guiding principles: Review and Adopt a Strategic Direction of the Company The Board reviews and approves the proposed strategies and the anual budget forthe ensuing year and sets the targets and action plans for the Company which willbe tabled and deliberated to the Bcard on quarterly basis. A periodic monitoring and reporting system isin place which highlights signifeant variances of Key performance indicators against actual and budget to montor the Company's performance, Oversee and Evaluate the Conduct of the Company's businesses The Board has empowered the Board Nomination and Remunertion Committee (‘BNRC") to deiberate onthe resuts of FY 2076-17. Directors and Board Committzes Performance Evaluation ("DBCPE") batore thsi tabled forts approval during the fourth quarter financial results | ‘Annual Report 2011SUAS aie AS Monitor Succession Planning ‘The BNAC is entrusted by the Board to ensure effective human capital development, talent retention and succession planning for both the Directors and kay management positions inthe Company to ensure business continuity ‘The BNRC also monitors the performance ofthe Board, reviews and evaluates the suitability oftheir experiances to fil any gaps therein. ‘The succession planning Is to ensure all candidates appointed to senior management postions possess the appropriate skis, capabilites and are of high quality, The Board had adopted a Succession Devetooment Pian to ensure that there are platforms in place to provide forthe orderly succession of senior management. Based on the results of FY 2016-2017, the Board agreed that suocession planning of the Board and Pivotal postion is crucial moving forward. ‘The Board concurred to gjve mare focus on the matter, and the BNAC is ta deliberate on it accordingly Monitor the Existence of Good Shareholder and Investor Relation ("IR") Strategy The Board recognizes that a sound IR and shareholder strategy are vial in managing investors interest and perception ofthe Company. As part of effective shareholder communications strategy, the Company maintains and keeps current is Corporate website and to be made avaliable via its IR webpage. Review the Adequacy and Integrity of the Company's Internal Control Systems ‘The Boards ultimately responsible forthe adequacy ofthe Company's internal contro system. Internal contro systems throughout the Company ‘are managed by the Intemal Audit and Ris Menagement Department ("IARM’). ARM has jurisdiction to audit any division and to report ts findings directly to Managing Director & also members of the Board Audit Committee ("BAC"). Sgniicant findings from the audit reports were highlighted and deliberated on at the BAC mesting. Detais of the Company's internal control system and the review ofits effectiveness are respectively set out in the Statement on Risk Management and internal Control and Fisk Management Report of this Annual Report Beyond the main responsibilty of maximizing shareholders’ value, the Board has also taken into consideration the interests and values ofits business partners and otter stakeholders. The Board is ensuring sustainability ofthe business has baen supportive towards initiatives ofthe Government and business partners in promoting ethica! business conducts and creating a business environment that is free from elements of ‘corruption. The Board urgas thatthe integrity is maintained in all business conducts and interactions wit is business partner, including the Government. ‘The Board emphasizes on the importance of health, safely, sacurty and employees’ sustainably by ensuring that priority and sulicient Tesources are given to axoress thelr interests inaction to the focus on the bottom line figures. Further, the Board with ful commitment towards promoting the Health, Safety, Security and Environment (HSSE’) in the operations and business activites ensures that compliance to laws and regulations in relaton to environmental protection is one ofthe items of review at the BRMC. A more detailed report is set out on page 40 to 41 ofthis Annual Report. Board Composition ‘As per BSEC. natficationit SEC/CMRRCD/2006-158/134/Admin/44) dated O7th August, 2012, the number of the board members of the Company shall not be less than 5ive) and not more than 20(twenty) including Independent Directors. Curent, the Consists of Seven Directors including Two Independent Directors. The Two Independent Directors are Mr. AS M Ali Kabir (Ex. Secretary of GOB) and Mr. Md. Anowar Hossain, FOMA, They are independent from Management and are able to exercise independent judgement and participate positively in all the Board's \dliberatins. They also play a pivotal rte in corporate accountabilities as they provide unbaased and independent views, advice, opinions and judgement at Board and Board Committees deiteratiors as well as safeguard the interests of other parties such as minority shareholders and ‘other stakeholders, These values are most clearly ilusrated in the Board Committees chaired by the INEDs, namely the BAC and BNRC. ‘The INEDs are not involved in the day-to-day management ofthe Company and are not party to any business dealings or any other relationship, vith the Company that could reasonably be perceived to materially interfere wit their exercise of unfettered and independent judgement, ‘The Board is of the view that the current composition is a mix of Knowledge, skils and expertise relevant to the Company's operations which Provides strong and effective leadership, strategic direction and necessary govemance to the Company. The profiles of the respective Directors ‘are set out on pages 21 to 23 ofthis Annual Report Tenure of Independent Directors ‘As pet BSEC notfcation# SEC/CMRRCD/2006-156/134/Admin/44) dated O7th August, 2012, the current Independent Directors were reappointed forthe 2nd term for next thee years, ‘Annual Report 2076-2017Sa eS aa eS BOARD COMMITTEES ‘The Companies Act, 1994 and also the BSEC notification # SEC/CMRRCD/2006-158/134/dmin/44) dated 07th August, 2012 provides the Board the discretion to delegate its power to its Committees. These committees have clear defined to operate and conduct broad and in depth deiberation on issues before puting up recommendation tothe Board, ‘The Company has established two (2) main Board Committees which are entusted to cary out the Board delegated tasks, ramely BAC and NRC. The proceedings and deliveraions of the Board Committees are reported to the Board at every Board Meeting. On matters reserved for the Board and where the Board Commitizes have no authorily to make decisions, recommendations are highlighted in their respective reports together withthe Committae members comments and views for the Boerds' deliberation and appraval () Board Audit Committee The objective ofthe BAC is to assist the Brard to review the adequacy and inegiy of the Company's and intemal contol systems and ‘management informatio systems. The composition, summary of activities and terms of reference of the BAC can be found in the Raport from, the BAC on pages 43 ofthis Annual Report The Board has identifed an Intemal Audit function that reports directly to the BAC. The functions of Internal Audt amongst others include conducting regular reviews and appraisals of the effectiveness of the risk management and Intemal controls and governance system in the Company. Further details ofthe Intemal Audit function and activites are set out in the Internal Contol Statement inthis Annual Report (ii) Board Nomination and Remuneration Committee ‘The Company has @ combined Nomination and Remuneration Committee for the purpose of expediency asthe same members are entrusted with the functions for both the Nomination and Remuneration Committees. The Committee consis of Two Independent Directors and Director name Nc AS.M All Kabir Mr. No, Anowar Hossain, FCMA and Engr, Mohammad Badrul Hassan respectively. ‘The BNRG ensures that prospective candidate has the required set of personal qualities and competencies to cary out duties and responsibitties, 5 a Director. The incumbent's professionals, integrity, skils and expertise must be seen to contbute and complement the Board existing ‘Strengths. For a good corporate governance practice, the BNAC agreed for each committe to be chaired by diferent Independent Directo. ‘Summaries of Activities During tha financial year ended 20 June, 2017, the BNRC mat two (2) times, and deliverated on the folawing key active: ‘¢ assessment on the effectivenoss of the Board as a whola, Board Committees and contribution of individual Directors and recommend Improvement plans, where applicable; «revised Terms of Service ‘*re-electon/re-appointment and retirement of Directors at AGM CFO, CS & HIA The Company has appointed CFO, CS & Head of internal Audit. There are clearly defined roles, responsibilties & duties which have been approved by board as per requirement of BSEC notification, BOARD ACCESS TO INFORMATION AND ADVICE ‘Access to Management ‘The Board recognizes thatthe decision making process is high contingent on the quality of information fumished. As such, the members of the Board in the course of performing their duties, have united access to all information about the business affairs as well as to the advice and services ofthe Senior Management. The Board firmly believes that eftective deliberation and its decision making process is highly dependent on ‘the quaityof information furisned by the Management From time to time, whenever the Board requires relevant information updates and clarifications, the relevant member of the Management is, invited to attend meetings of the Board and its Committees to present or seek recommendations for the Board's consiceration on matters relating to their area of responsibilty. The respective Senior Management and permanent invitees such as the Head of Intemal Ault and Chief Financial Officer (CFO) have been inited to Board Meetings during the presentation of quartely performance reports for effective delivration on the financial and safety performance, ‘The Board and the Board Committees receive timely and up-to-date information and the Company Secretary, under the direction of the Chairman, ensures a seamless flow of information is disseminated for decisions to be made on an informed basis for effective cischarge of the Board's responsibilities. Prior to the Board and Board Comittee moetings, a formal and structured agenda, together with a sat of Board and Board Committee papers, are forwarded to all Directors within three (3) days prior to the Board and Board Committee meetings, for the Directors to be prepared to deal with matters arising from such meetings and to enable the Board and Board Committees to make dacisions. yy ‘Annual Report 2016-2017 5) Cee STATEMENT OF CORPORATE GOVERNANCE Minutes of proceedings and resolutions passed at each Board and Board Committee meetings are Kept in the statutory books at the registered office and Share Otic of the Company and are accessible to all Directors, ‘Access to Company Secretary ‘The Board is supported by the Company Secretary in discharging its duties and functions, The Directors have unrestricted access to the advice ‘and services of the Company Secretary to enable the Directors to discharge thelr duties effectively. The Company Secretary is responsible to provide support and appropriate guidance to the Board on the policies and procedures, rulas and regulations and relevant laws as well as best fractioes on governance. The Company Secretary alterds and ensures that all Board and Committee meetings are properly convened and all Coliverations and decisions made atthe meetings are properly minuted and kept. ‘Access to External Experts Exteral advisers may also be inited to attend Board and Board Committee meetings, 2s the case may be, to provide adetonal insights end professional views, advice end clarifications on specie ems on the meeting agenda. The Board nas the same right of access to al information within the Company and the duty to make further enquiries which they may requir in discharging thelr duties including seeking independent professional advice, necessary, t the Comiary’s expense. During the year, no extemal expert was separately sources by the Board for advice. BOARD CONDUCT Conflict of Interest and Related Party Transactions All diectors are required to make daclarations ofthat respective interest in transactions at every Board meeting to ensure accountabilty and ascertain potential or actual contict of interest in relation to every issue deliberated. The Directors cancemed willbe advised to abstain trom deliberating and voting in relation to relevant resolutions or transactions in which they have conflict of interest at the Board or any general meeting convened. ‘The Recurrent Related Party Transactions entered into by the Compary with its related parties in FY 2016-2017 are set out on pages 80 of this ‘Anrwal Report ‘Trading on Insider Information BSI. Directors and employees. who have access f0 price sensitive information are prohibited from trading in securties hased on price sensitive information and knowledge which has not been publicly announces. During the year, there were no cases reported on any breach ofthe prohibition, Code of Ethics ‘The Directors and emplayees of Bangladesh Building Systems Ltd are expected to behave ethically and professionally at al times end to protect the reputation of the Company. The Company communicates its code of conduct to al Directors and employees upon their appointment of ‘employment through Board Charter and Employees HR Policy respectively, The conduct of employees is governed by Code of Ethics of employees which provide clear direction on conduct of business, dealing with stakeholders and general workplace behaviors. It includes guidance on disclosure of confict of interests, practices regarding its and enleriainment, amongst otters, wtSTATUS OF COMPLIANCE Status of compliance withthe Corporate Governance Guidelines (030) ‘forthe year from 01 July, 2016 to 30 June, 2017, ‘Sts of cunplane wttheconitins nosey the Naticatn No, SECACVRRCL206-158/13Adrn44 date 7 Agu, 2012 of Banga Sanus and henge Carmisson BSE Ise nd oo 20 oft Sur ou tae renee, 1808, {Report under Conon No. 7.00) (Condition No. Tile op | tn Remarks 1 | oud Sox: ie uni ote Do nes ote Corp Slade san ema] The BSL Bor corpat 7 Orcas. me 20 Bu. eden rca Ae oe rior owe te Oro “Tie ae bo bpd Ore ESL 120, | Beartersnsninocay ea nmoedoresneeneate) Bit a oH Fh a “2m | eion Der ds ra wy era ws Han (| nonmetal Th bie DR GE A tear pct carl 1.2) | dnt ier ris iy nabs rot ima wh te Comps any rom] ry «Orc Shae wo ss era tars 12009 | Ox at tae ay ater sen, whee peony a oer, whe Carey ae ry sioidayastd corns. “2108 | indecent ec isat Nerbo, eco Oca ary stack eae. v bo ‘2 |e erste Sender ect Ofer an meer cca to an iermatiry te ost att 1.209 | pendent etfs otapane or an eos owas oa patron cet | Py {hep 3 toe) years of ay say et rm wa F210 __|trdpecenl Orc shel rotten eben Dac cor reed cps | o + 2m | sede Decors eterno otf compe soins adr n| ye of ea ako a ar-arracilistuon NEF, a “2 | rater Oreo ree bom cit fe nel fins neki Morph v oD 124i | The eee Dec sl be ape by ie Oar of recuse appre byte] Vy ‘Seon th AG 0 1200 | MePesotinpntr Orc zn tara cat ear 2 rie) 38 Novag ecu 4.20) |The oi ead a ce cca al fond meters andar mle Te ete Pacts ses “2m | Teter of in of an pede ier tbe ar pedo 3 re ers. wh ry be “Te ped rer (D9 ar ne n6 ere re ey ‘eal ‘aq | PERG Orc fal ea wpe wit ay wo Bbw re ergace Te quia ad tacked of Ws 8 0 | nnanet ela antcopont sarc mle mesg cxteot hes. tha ites as 4.30 | eye Dr cind ea BsresLeiCopoi efeBreaur ies Tar wih xing npr Dieses ae Bsess roms Bstes Sus or Law texgandProssons be Ore! Azan, Ost & | Leader Lear with no thn (12) erupt AcoutisCatee Sees Te pnt rar mst awe ls 12 ‘wede ea ofenetece E00 crpieraraprentssomlepeince 130i) __| Neel caes tate gains abe ae top poate Gris Tp ‘Daa OD a Wey Son Wes Came lc an a aS Tia aT BGT BW CED we OTE | M4) Theda bie sel cent eeepc aps d eChear ante ED. | ‘vu, The robs and esprit of he Choiman of te Baud and te CED mete at Dincos. | 1.6 __| The Diecorseport to Sharer 1.50) | dusty vt and paste ate deoonens ne ray. v The Drees pr corps wih gues 750) Sener nto er pom eer v 0 “5 | Rid doce, v 0 “Sti _ | Adkcusien Coto Gots Sa Goss Prof Marg ae et Pa gh, v 10 1500 ‘Discussion on conti af ary Etr-Ornany ca oss. v oo ‘uy | SES 8 apy tance: + sero a ree ety Wrens So be] oy cad he rept TS) | Win of proces ra ue ies iss rr og ay oes ses 0 1 5yiy | A lan rancid xa etse ar econ pes fr aka Pic Oe neti (0, eget ube feng PC), iis fe, Diet Lig ee ‘Annual Report 2016-2077STATUS OF COMPLIANCE O maraaaan [concon No Tie Campi ap Romar 5h) | ita varios eros tees Oost Franc formance and Aral Fs] — 7 "he ies apt cannes We gis Suse to rrapoe lai ab evar orl a 759 Feruaton ses ear eee res v 0 75] Nefanca Saerenswepsedy we nspret of fe sow coroay pen By aS] yp fata tho rests paras, cas fos and cages neauy ba Ba Pop nck of onan oe sr corpay he ber mars Ea 7 | voor axntiggcoes tw teen crn ald i repaon of te trance] yy re ‘Sonor aha ergata aan eel a pi isa TEIaH | ieevatnsKxoniny Seis HSangesh Axo Sard Aira 0 Franz eptrg Sarde (FAVBgud Fencing Sus BFS, os apa Indios tae ten cw pean oe fate Stet any parr ro into) dist Sieh] Te Sono are ur sare af o echo npn a woe w 75 | Thee mo msc tts ntelonercorsn's bly crue as eapa cre. te a isu carga nates toa gary rca. Bex ag wo se od S| 7 vec “ib | Saran dvs Fa We jews nCoealg Pou of be er cncay al be] 7 0 hijugibdan een aed ob pe. 1.5 it | Kyran rd ee da prog 5 fa al M4 0 15 a) NoDeiran orn Tae 0 Sok Ged & 5 Cab win Se _| gb Bat Ha ity To ay wt rT HT] aa EON “inn et of rng al apn cae re ape abs asa] — 0 ahr ns ose bal By un | PUES Ao Cncses hee aes anew AL v 0 ‘ester ows trode fare sede ‘54 | ret hel aie fo, Gna Sen. Oi Farce fi, esd rl At cy 15(ei0 | Beaes v 0 15(ala_| etait ( OR) or Mae Wig eel ey famed. |v 00 50a) | cas of aparinetieapnet oa ied te Gry Sade loin 00 Homi be ares) tre ene Des ae ohh emetic | ‘pace ini aes 9 ames ony hhc te petanak Pals e Dros ad te nemastin cf anmtas ce ah Z| Teco sal pat Ot ezahe Oat Parc Oi, Tea iad Ez ori, a ag re Come Conroy a Conan See) (9). TheGa of rr std | iin lene enh ny ‘hat eto roperta ibs tebe ard a CF, ho eat ra tar CS. epi md dial ee 72 | Atoms of CF ere Comp Sot ine ora Ney. Inpatce a) | Moma alta an ust Cmte aan cinmte oe Bi et edas v Aes nga “Mi [Te tat Conner se ais e Ber Dros het Tate tar! sara Taper ‘lect te a vo fe staf tas fe came adn rug «ud mont |? somone HiT [ Te fact Contes sal be apse We Gor Deco. Te as oF at | Tapa. Correale Get xno SH [ Te Connie abe cong oat fed wes v Tie oe are ro ani i [Te Bra of Drecos shal anit mb of be At Conn Merbss wo wal be | Tins mi pany ta Drosera oe noe atl ae) ear Dc ‘ope ies nee Gi) [AM nerbs a eat ote shai psy ea rd at st ear il hia We seiic quai esl teaming re franca msepenet epee The bm Fecal rene he exert kr eee an carte shy ede unos te cal stamens Le noe Set rome Steet a | 7 al teeing antes ot htt rate Cash fos Start an 2 pour wil be cs av asin oe Fratea “aaa ey har" ra mange ere fe psases possi saan w ecurtogtiace gaa eee ogee ape BEC rat ea 2 el ye of pee agen des egies oe “eB api FC wan Gwin i) _| Casini Crete salb fied by B v eee SiR Ten ST OT COT ipa sy) | Te aun oe Aad Onno Ajmer Sel nt coi wba a Ek Te] Tape { IndeedSTATUS OF COMPLIANCE inti Tie Satu Rents 3y he oes ltr ut Contemp | ML | as sn A sn pi |Audt Comte, who stall be an inepencert rece, angi] indeendet Der whos ao he Chan of BAC, | 32H) |ctamranot east anne stl rean eset fe kre Gr Met AI, v nvete 32) Tero it Contes Ove rnc prass v hire 3.4]__|Nonit chive of contig polis and pris, v net 23) [Nonita intel Coto Fst manegeent proces. v ‘npractoe 33M dessin enero cael autos, v inp 32h) [Peerage tend inn cares be iso btetadirgpnd | yi inate 3 een sg wit te mara he ay a a jy alters tate] hate sbnissontote rade apa ‘33h [Ree te tay citer itil hipaa 33M) | Review tament ot icant rated party ransctns suited the marageet v ‘npractoe 5.330 [Reenieyeer ete Ltr hind Cortl wanes suey sty aut, v hipaa 3.36) Aen money ras thet ital Pubic Ding (PCM Ret Pui ering POMP se he conan sal dc te Aut Corie tt ewes ous by ma caboy Capt Exerc, Sales ard Mataing eens, waking capil et) os a Quart tai, 2 2) V7 pt of et uae cat of raat Fre en nm tas, te ana stl pesare a tet of ues wad fr he puses oer tan tse sted te oer coxmaripepets, 141) [te A Connie tal pot oni acts to he Board of ects, v 34.1) | Reparting of Conti of riers ote Board frets, v ‘Thee wasn pole cas of conic titre, 4th] ety pd pes arly rae ent al Gt] The so such cen ised. Sisto to be Ba, 41g tay see init fs, dr eats ras, ues an] 10 regalo te oe. 4A1q)_| Weg ay der matric tate dad tote ert iets, ¥ 0 42 [Repro Aes: te dt Canute es era oe Eero Ordos aut 0 anything which has mala impact on te franc contin and resus of opeaion and tas | cased vith ua of Dect ath eres et ey econ ean te at Coe in ath etic sb vse ed eA] Cente sel et suc ining we Cormisor, yn poring such nates tobe Bord of Drecos forthe times o clin ofthe pod of 6 (sh) arts from te date rst eng te Sado Dec, wicker sexe, As ——________#f marge scanSTATUS OF COMPLIANCE ond io Tite i Remarks 35 Reporte Statler and Grea Insts put on aces cared ut by he Au Canmites, clu any rept mate to he Board of Draco under coc 34.1) ate The Aut Conmtee repo dacsed te axing eye, sel espe ye Chaman cle fa Oita ac ese ne) Ben a sedi ecm | anna epart ofthe issuer company, “ah__ [Nor epganer of tanaltyandrin appaal oan secs erfaras pris | V7 Tnpatke /Non-engagement of extenalstatutxry auditors in Financial Information System design and) Vv Inpractice 40) | opine ‘e-em of einai Bek Ry ar ie lw ey inpactce | aoounting reccecs or firencialstaterrerts Complied. ‘i)__[ Na engnenent of etemal stants nBke-Deaerserces Cal Vv Inpracie 4) | Non- engagement of ertemeal/ Statutory auctors in Actuarial services Compied. Vv Inpractice ‘4y)__| ow engagement of edema actin renal ut snes Cone, Vv Inpracie “| cpa cals sn ay esos tat he Aa ante deorines | Inpacte ai) pier eres of ete it rs el pes aye oe eroay Be] pie ett hr ewe east sige a aay. 2) | Psrs era tote consti cite oar Oc of he hang cpa Sl be rate Telia | anpicable to the compost ofthe Bowed of Directors o the subsichary company. i [At Teas oe) dependent decor an he Bordo Decors o he toking corgany tal be a 50 | oar te art cst sti tomy sae ‘|The mints of eGo maning oto suber covpary sal be plc or von ate Ta galee felling Board meeting of the hadng company ‘M) |The ina of he respective Baad mesing oe king conpary stl Ste tat te tae evn has ct te subscary omgany a0. NitPopiaie 5i)_| Tie Rat amie te eng rp Se a ee al seen peat Teele nests rate ye tsi ope Bga,_| Te et wi ct eB he he ree rel Sears a CH ard OF cx to he Bead cig aid se seen otc ay may i eet on ay atid) Atk rence satd toro sees tate misedg ‘ets dria Fer ares ines Fp. 6k) |The 0 at CO wi ety we ot at ey hae ied he Fra soars and = ei et ee ses aber peset ane and uo he campy eas ade] ncn wh xshy xing ars ples oq) | se ae ote tet one a tl ons teeta ty cgay dea] hate exw er ool ooops eo et The ony alan a Ostia fon a Psi Cured Srey ort 1 ifec vertical has been abtaned from lt | cate Acari Oat Nergen AasaiOatee Seay epg crewed] 7 (eas ome cae he cna of opr Gere Gtk be Omen a sl sre sae te Fic, btn de 27, eos erie Arnal Roto bass : 7 | eset crn tlt aoc urea dec tu Ola ed the Dia et whe cong as copia wh se nis v pat asia —Se ads te CS The factors descnbed below may concelvably matertalyatfect Investors’ decisions as investment inequity shares involves a high deoree of risk, Bangladesh Buiing Systems Ltd. (BSL) is operating in a locally compete industry invohing both external and intemal factors having direct 25 well as indirect effects on the imvestrents. Investors should carefully consider all of the information in this report, including the risk factors, both external and internal, and management perceptions enumerated hereunder before making investment decison. any ofthe following risks actually accu, ther business, result of operations and financial conton could suffer, the trading price of their oquity share could detine, and investors may lose all or par of ther investment. INTEREST RATE RISKS Interest rate risk refers to the Ikely changes inthe cash flows or future value ofa thm because of changes In the interest rates inthe ‘market. Increase in interest rte increases the cost of borrowed funds for @ company in case of floating rete lors. Inoreas in the interest rate burdens the company with additional nancial charges and squeezes the profit ofthe company, Management Perception Interest rate risk is the risk where changes in interest rates of borrowed fund might adversely affect the financial condition of the Company. iterestfinancial charges are to be paid agenst gry kind of borrowed fund, Therefor, the fluctuation in the interestproft rte viously has an effect onthe profitability ofthe Company. The Management of te Company is well aware ofthe volatility inthe money ‘market of our country. The Company has a very strong equity base with comparatively minimum dependence on bank loan, pertculrty on short torm fund from the Banl/Financial Institution. We monitor interest rates roguary and borrow money from the Bant/NBF forthe long term when interest rates ar lo. We keep the borrowings short-term during periods of high intrest rates, and then lock in fong- ‘erm loans wen rates go back down. On the other hand, the Management of the Company is emphasizing on reducing our dependence con bank borrawing, So therefore, BBSL wanted 1 go for issuing Rights Share to raise capital for reducing dependency on debt caotal and expansion of ts business. Since BBSL boraws for long term from Banks wi fed interest rate and has a strong equity base, the management percelves that fluctuation of interest rate on porroning would have Ile Impact upon the performance ofthe company. EXCHANGE RATE RISKS Exchange rate risk mainly affects the operating results of those companies mainly dependent on import of raw matarils whereas major Porton of sales are local. Unfavorable voatity or curency fctuation may afect the profitably ofthe Company. Incase of export, sales Increase of exchange rata will enhance the proftabilty of the Compeny, Management Perception Measuring and managing exchenge rate rsk exposure is important for reducing a firm's vulnerabilities trom major exchange rate movements, which could adversely affect proft margins and the value of assets. An exchange rate change in the currency of denomination of ary such contract wil resutin a direct ransecton exchange rate risk to the frm. tis the isk thatthe Company may sulfer losses because of adverse exctiange rate movements during a period In which It hes an pen postion in an Individual foreign Caurrency. The enti amount of foreign U/C for payments of raw materials is made in foreign currency. I the USD appreciates: or Bangladeshi Taka deprecates then the company has to pay adcitional charge for L/G amount. BBSL. has minimum dependency on the foreign market for procurement of raw materials. BBSL is to import some of its raw materials from foreign market, but those raw materials are also availabe in local market. Depending on the price of raw materials in foreign and local market, foreign curreny rate, lead time, foreign currency rate movement etc. wee make our decision for procurement of raw materials. Hotever, 2s a highly profitable compary the foreign exchango fluctuation risk isnot vital n case of LC ratrement. INDUSTRY AND MARKET RISKS Industry risks refer tothe impact thatthe county's indus policy can have onthe performance ofa pectic industry. Market risks are Un-civesifiable risks that refer to the risks to an institution resuitng from movements in maket prices, in particular, changes in interest rates, foreign exchange rates, and equity and commodity prices, Management Perception ‘Any industry is dependent on the policy of government and the international business scenario, BBSL's business operation isnot exposed to cross border risks very much, Here are some inherent risk inthe poultry and related business in terms of sudden disease outbreaks, ‘ragmented nature of industry with low entry paris and intense competion trom unorganized payers. We need to import some ra materials from abroad and we sell our products in the local make. Apart fom goverment policy, some problems such as wars, embargoes, trade ban have significant effet on a company’s operations. Due to raoid development inthe poultry & ish farming and ‘maintaining of strict product quality, efficient management of ingredient of production utilzaton of developed technology, timely decision for expansion of production capacity, development of strong marketing network with skilled human resources etc, the future of BBSL is ‘expecta to be bight Since the food market is gradually expanding withthe demand for protein forthe increasing population, there are ols chances of further occupying the market share ‘Annual Report 2016-2017SO TU aes e aC TECHNOLOGY RELATED RISKS ‘These are the risks associated with the use of modem technology in procassing food in an efficient manner. Sophisticated technologies define modern food producton, including agricultural machinery, botechnolagy, computer technology et. ‘Management Perception At present, the word is oping through technological revolution, Technology always plays a vital ole for any business perticulrly forthe enterprise engaged in production activites to ensuring better product quality, providing better services tothe customers and mirimizing costs of production of the Company. Pre-Engineered Steel BuldingManufactuing fs a technology-based industy and continuous technological improvement is an integral part of ths tusiness. Obsolete technology or machineries will make it dificult for any feed company to sustain in such a competitive industy. The factory of BBSL established with modern machineries imported from Germany. BBS. is well avare ofthe nee for regular up-gradation an maintenance of machinery ad equipment. Moreover, a portion ofthe fund raised through issuance of shares will used to procure new machineres that wil increase the productvty and ficiency of BBSL However the Company has been using the latest tecinology and has the provision to cope withthe modern technological requirement in future, (CHANGES IN POTENTIAL OR EXISTING GOVERNMENT REGULATIONS Government regulations are broadly defined as imposition of rules by government, backed by the use of penalties that are intended to rmoxify the economic behavior affirms in the private sector. There are various regulatory instruments in Bangladesh lke taxation, quality assurance, price celngs, rates of retum, disclosure of information, standarus and ovmership celings et. ‘Management Perception ‘The Company operates under Companies Act, government's fiscal policy, Bangladesh Securities and Exchange Commision rules and rules adopted by other regulatory bodies. Any abrupt changes ofthe policies formed by those bodies may impact the business ofthe ‘company adversely. However, te Government has been emphasizing on the growth ofthis industry by providing tax faclity and future infrastructure development by Stee! Structure. POTENTIAL CHANGES IN THE GLOBAL OR NATIONAL POLICIES Giobal and national policies have huge Impact on the performance of business in any sactor.Pre-EngineeredStee! Building sector is heavily dependent on the other sectors’ grown and political station, bath nationally and gloelly. Any change in these policies may have ‘adverse effects onthe profitability ofthe business. ‘Management Perception Performance of BBSL may be affected by the politcal and economic instabilly both in Bangladesh and worldwide. Ary instance of poltical turmoil and disturbance in the country may adversely affect the economy in general. he company can prosper a situation of foitical stability and a congenial business environment, Poitical turmoll and disturbance has a negative impact on the ecanomy as well as the proftabilty of our company. HISTORY OF NON OPERATION 's there any history for the Company to become non-operatve from its commercial operation? ‘Management Perception BESL does not have any history of non-operaton. It has very experienced Directors and Management team (mostly Engineer and Professional) to make the Company more efficient and stronger. So, the chanoe of becoming non-operative for the Company is @ ‘minimum. OPERATIONAL RISKS Operational risk arses from improper execution of company’s business. Tis risk can also be summarizad as human risk, which ocours due to human error, ‘Management Perception Operational risk is defined as the risk of loss resulting from inadequate or failed internal processes, people and systems or from external ‘events. This includes legal risk but excludes strategic and reputation risk. It is inherent in every business organization and covers a wide spectrum of saves. The Company manages this isk through a conrol-based environment, This is supported by an independent program of periodic reviews undertaken by intemal audit, and by monitoring external operational risk events, which ensure that the Company stays in line which industry best practice and takes account or lessons leamed from publicized operational failures within the STEEL BUILDING rmanutactring industry. ‘Annual Report 2016-2017Ga Uae teaC ‘The major operational risks ae as folows: Internal fraud; External fraud; Employment practioes and workplace safety; Gent, products and business practices; Damage to physical assets; Business disruption and system flue; Execution, celery and process management ooccoece The Management witha long experience inthis trace identified and measured in the following manner: <2. Fisks are identified with reference tothe relevant policy manuals, processes, procedures and practices; ‘2. Accounts are evaluated as per Departmental Consol function Check List; “2 Incident reporting and analysis of causes and actions taken on lsses from fraud and control lapses; <2 Review o safety and contol measures of premises. Thus, the entrepreneurs and managers, through their insight and knowledge ofthe market help the company to avoid any such risks. RISK ASSOCIATED WITH HIGH ACCOUNTS RECEIVABLE Accounts Receivable ofthe Company has increesed significant from Tk. 67.62 to Tk. 80.11 crores considering sales trom Tk. 236.49 to Tk, 248.94 orores during FY June 30, 2016 to 2077. As such, racevable turnover has been inreased over the year, which indicating incompetent of receivable management ofthe Company. MANAGEMENT PERCEPTION ‘Due to increase in market compettion, the Company had to sale a significant amount of product in credit. Moreover, ue to penetrate in ‘ew market areas, the Company had to gve credit to the new customers. Thus, sales have increased significant in the subsequent periods as well asthe accounts recelable. However, BBSL. has developed aggressive recovery plan for etilent recelvable management. ‘Annual Report 2016-2017SSeS UU rg ANNEXURE : Il a |__ Mame of Shareholder | Description 8 0 tests ana tht spouses on ior hierar deta 1 | Eng. Hasan ose Chondhury Gaiman i 390760 39407600 3.3802 (2 Ege Md Anu Noman Hote Marui Dror 0354919 103549, eRe 8 Ma. Aste Al Kan + Director a972132, 98,721,80 7.6102 i OF Ey. Notarmat a Hn Decor “| azeogi0 —62200,00 0516 5 | Eng Noten al aj (ome | 3605440 | 35954400 | 3.080) (0s Sehr ted Cony Wee ges ry 7 : : 7s Mona None Weta mente azjo00 42800003886 eo “Ms. Shae gan lett Asrt Rta a oo “is. aa Tetra ya (Meclinemnasieatese | ‘aso000 10900000 | os 10 Atul Hanan Howecer ng ura 1981388 Taga TH Sub‘ | a ee) Ni Ni Nil Ni ie ‘Md. Mamun Howlader Fapipanan_ le cuties Top 05 Salad employes) nt Nil Ni (6 Speers tn erany ATE Md. Batu Hasan Ni NN 18 | Engr Kani Ashfaquzzaman Nit Ni Ni 19. Engr Fercous Khan Ni Ni (20 Ege karte NNN _D fees pore a oe oe etn op NL Ni Ni iq x © sera ro 20:6207 NG alaeSATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL The Board of Directors of Bangladesh Building Systems Ltd. ("Board") is committed to maintaining a sound risk management and interna control system, Each business unt or function has implemented its own control processes under the leadership of the Managing Director ("MD") / Chet Executive Officer ("CEO"), who is responsible for good business and regulatory governance. The Board Is pleased to provide the folowing staemetoutns th nature and spe of Bangadesh Bulking Systems Lis. and isk managerent and ral contol rte Manca yet ence lune, RESPONSIBILITY The Board of Directors of Bangladesh Building Systems Ltd('Board’) asserts its overall responsibilty forthe system of risk management and internal control and for reviewing the adequacy and integrity ofthe systom. The systom oF intemal control covers nt only financial controls but also controls relating to operational, governance, risk management, strategy, organizational and compliance with applicable las, regulations, ‘ules, and guidelines. The Board, through the Board Audit Committee ("BAC") recognizes that this system is designed to manage, rather than eliminate, the risks of not adhering to the policies and to identify, assess and respond to risks to achieve the organization's goals and objectwves within the risk tolerance to as-low-as reasonably-practicabe (‘ALARP") established by the Board and Management. Therefore, the system provides realste approach and solution, but not absolute against nature or Act of God, assurance against the occurrence of any material testimonial, foreture or deception. ‘The Board confirms that there is a continuous process of reviewing and reporting the adequacy and integrity of the Company's system of risk ‘management and internal control to provide reasonable assurance in safeguarding shareholders’ investments, Company's assets and other stakeholders’ interests, The process is regulary reviewed by the Board through the BAC and accords with the guidelines for directors on inter Cortrl, the Statement on Risk Management and intemal Conirol, Minutes of the BAC: meetings which recorded these deliberations were presented to the Board, KEY INTERNAL CONTROL PROCESS In order to ensure Regulatory Compliance, Transparencies, pravent Conflct-at-Interest, Health, Safety, Security and Environment Protection, the Company's risk management framework and internal control system comprises the folowing key processes: 1. Control Environment 1.1 Board Committees ‘The Board acknowledges that ensuring sound governance requires etfactve and direct interaction among the Board, Management, Intemal and External Auctors. The Board, in ensuring effect discharge of its responstbiltes is assisted by the Board Committees namely the BAC, Board Nomination and Remuneration Committe ("BNR"). 1.2 Independence ofthe Board Audit Committee ‘The BAC comprises non-executive members and Directors of the Board. The Committee has full aocess to both intemal and Extemal Auditors ‘anc it meets vith the Exteral Auditors 1.3 Operating structure with clearly defined lines of responsibilty and delegated authority ‘The operating structure includes defined delegation of responsiblies tothe committees ofthe Board and the management team, 2. Risk Management 2.1 Rsk management regarded bythe Bardo bean ntepralpar of he buses and operations. Management responsible fo cetng & Tek ewarness culture dca the nsoessary koowiedge of sk management and eve reply of Rsk ols and procecres The aso have the responsibility'for managing risks and infernal conirol associated with the operations and ensuring compliance with applicable Laws, Regulations and Requirements. 3. Risk Management Framework ("RMF") 3.1 The Group has put in place a Risk Management Framework with the aim of providing a consistent approach to risk and facitating @ ‘easonably accurate perception of acceptanla risk by all employees. The framework essentialy outines the isk management governance and StLCTUre, processes, acoountabiities as well as responsibifties throughout the organization. The process is as follows: FIRST LINE OF DEFENSE HEAD OF DEPARTMENT ‘SECOND LINE OF DEFENSE MANAGING DIRECTOR ‘THIRD LINE OF DEFENSE BOARD AUDIT COMMITTEE ‘Annual Report 2016-2017SSS el Set er) te) CONTROL ACTIVITIES. 1. Policies, Procedures and Limits of Authority 1.1 Well defined Financial Limits Of Authority ("FLOA") on all financial commitments for each level of management within the Company and clearly documented internal policies, standards and procedures are in place to ensure compliance with intemal controls and relevant laws, Regulations and Requirements and regulary updated to reflect changing risks or resolve operational deficiencies. Regular reviews are performed to ensure that documentation remains current and relevant 2, Strategic Business Planning, Budgeting and Reporting 2.1 Regular and comprehensive information provided by management for monitoring of perfamance against strategic plan, covering all key Financial, investment and operational indicators. On a quarterty bass, the Managing Director reviews withthe Board on al issues covering, but rot resticted to strategy, performance, resources and standards of business conduct; detaled budgeting process established requiring all business units to prepare budgets anualy which are discussed and aporoved by the Board; and effective reporting systems which expose significant variances aoainst budgets and plan are in place to monitor performance. 3. Insurance and Physical Safeguard 3.1 Adequate insurance and physical safeguard on major assets in place to ensure that the assets of the Company are sufficiently covered against any lablties that wil result in material damage, claim or losses, 3.2 A yearly policy renewal exercise Is undertaken by Management to review the coverage based on the current fied asset register and the Drevaling market price for the same or sinfar item, where applicable. The underwriter also assists by conducting a rsk assessment, which helps INFORMATION AND COMMUNICATION 1. Timely communication of relevant information such as the company’s achievement and changes with regard to corporate and organizational structure and policies and procedures, enabling employees to focus on and perform their responses effectively. 2. The Heads of operating departments within the company also participate in business dialogue programs vith Senior Management to discuss ‘on strategies and challenges faced towards achioving the business goals and objectives, MONITORING 1. Management Visit Directors and Senior Management conduct reguar visits to project sites, customers and business partners’ offices to review the Company's operations and gain better understanding to faclitate cognizant in decision making capability. 2. Internal Audit Function In order to ensure tat the internal controls system 1s viable and robust, periodic examination of business process and the internal controls procedures and processes by the Internal Audit function to monitor and review the effecivenass and effcioncy of the system of internal control. Reports onthe reviews carred out by the Internal Auditor are submitted on a regular basis to the management and the BAC. 3. Performance Management Ih order to nurture the quality and competencies of employees, continuing education, trang, seminar and development programs ara ‘emphasized 1 enable employees to discharge thelr duties effectively Progressively, employees’ performance are measured according to the sets of key performance indicators aligned to their functions as assigned to them in which they are expected to accomplish. REVIEW OF STATEMENT BY EXTERNAL AUDITORS Based on ther review, the extemal auditor have reported to the Board that nathing has come to thelr attention that cause them to believe that this Statement is inconsistent with their understanding of the process the Board has adopted in the review of the adequacy and integrity of Internal control ofthe Company. ‘The extemal auditors are also not requted to consider whether the processes described to deal with material intemal control aspects of any Significant problems disclosed in the annual report mil n fact, remedy the problems. CONCLUSION For the financial year under review, based on inquiry information and assurance provided by the Managing Director and the Chief Fanci Offices, the Board is ofthe opinion and to the best of is knowledge thatthe system of inleral controls and risk management processes are adequate and sound to provide reasonable assurance in safeguarding the sharebolers’ investments, the assets and other stakeholders! interests as well asin addressing key sks impacting the business operations of the Company. There was no major ineal contol weakness | identified which may resulted in any material loss or uncertainty that would require cisclosure inthis annual report. ) Anrwual Report 2016-2017SU eee) 3 FOR THE YEAR ENDED 30 JUNE, 2017 ES. has an Aut Commitee a a sub-conmitie of the Boat of Deco, as recommended by Barlaesh Sours and Exchange Commission(@SEC). The Board Audit Commitee (BAC) assists the Board of Directors in ensuring that the financial statements effect the fathful ‘and fer view ofthe state of affairs ofthe company and inproviding a sound monitoring system whhin the business. The committe fs reporting to the Board of Directors on performing the clearly set fort responsibilities by the Board of Director, Committee Members ‘The Aucit Committe ofthe Company comprises of tree members and also member secretary - SL Name Designation ot i. Anowar Fossain FCA Chainman 2 Engr. Mohamad Bacul Hassan Member (i Md. Asha li Khan Member 04 Mohammad Nohsin Member Seoretary ‘Terms of Reference ‘The terms of reference of the Auct committee have been determined by the Board and by the BSEC notification. The Committe is resoonsitle to the Board of Directors and reports on its activities regularly. The Committee assists the Board of Directors in its general oversight of financial fring, Fra cca neon ae re a awe a een coretncew Core Gooner usees promulgat ‘Meetings and attendance uring the year under reven, the Committee held five meetings. Permanent invites to the mesting were the Company Secretary, Chief Financial Officer and Head of internd Audit. Relevant heads of division and other members of the Management also attend the meeting as required The attendance ofthe members these meeting is as under: Name ofthe members fo, of meetings Mestings Atended (Md. Anowar Hossain FCMA. 4 4 Engr. Mohammad BadruHtassan 4 4 Md Asrat All Khan L 4 4 Mandate and Role The pupae, etry, canposton, dues and respenbities ofthe Aut Commitee ae detned ints Chart, The Commitee fas 2een mat Review the annual, hal-yeely and quarter financial statements and other financial results, and upon ts satisfaction ofthe review, recommended the same to the Board. Tre Audit Committee also ensures the appropriateness of accounting policies and their adherence to statutory and regulatory compliance and appicable accounting standards. ‘Monitor the financial reportng systems in place to ensure the integrity and the soundness ofthe information provided to the Board of Regulatory Authorities, Management and other Stakeholders, Identity, analyze and monitor the risks faced by the Company and examine the adequacy, efficiency and effectiveness of intemal controls and procedures in place to avoid, mitigate or transfer such risks. faxiw tober Francia Statements andthe Company's Aral Finance Sstrets prepare or scare, beloe submission tote Eoard rectors Reporting of the Committee On discharging its responsibilities, the audit committee has ensured the followings: Financial statements have been prepared and presented incompliance with all laws, regulation & standards as applicable. ‘Adequate controls and procedures are in place to provide responsible assurance that the Company's assets are safeguarded and tha: the financial positon ofthe company is adequately managed, ‘Aust Committee also reviewed the internal Auditor's Reports and observations. They have assessed and examined the effectiveness of the Independent performance cf the Extemal Auditors’ S.K. Barua & Co. Chartered Accountants and also recommended tothe Board of Directors that S.K. Barua & Co. Chartered Accountants is re-appointed as Auditors for the year 2017-2018, This willbe subject to the approval of the merrbers atthe Annual Ganeral Mestng. On behalf of te uct Committee Sd: (Md. Anowar Hossain, FCMA } Independent Director and Chairman of Audit Committee tors, ‘Annual Report 2016-2017Pe ee eet ‘The Board of Directors, Bangladesh Buiding Systems Ltc., Configure Bepari Tower (Grd Floor), GA-64 Progoti Swarani, Middle Badia Dhaka-1212. Subject: CEO & CFO's Declaration to the Board of Directors. Dear Sirs), Compliance with the condition no. 06 () (a), () & (6) (i) imposed by Bangladesh Securities & Exchange Commission's notification No, SEC/CMRRCD/2006-158/134/Admin/44 dated 07 August, 2072 issued under saction 2CC of the Securities and Exchange Ordinance, 1969. We do hereby certify to the Board that : i) We have reviewed financial statements for the year ended 30 June, 2017 and that to the best of our knowledge and belief; a) the financial records of the company for the financial year have been properly maintained in accordance with section 181 of the Companies Act,, 1994; b) ‘the Financial Statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misieading; c) the Financial Statements and the accompanying notes to the financial statements together present a true and {alr view of the Company's affaits and are in compliance with existing accounting standards and applicable laws; d) the expenditure incurred was for the purposes of the Company's business. i) There are, tothe best of knowledge and belie, no transactions entered into by the Company during the year which are fraudulent, illegal or violation of the company’s code of conduct. We also give our assurance that, in accordence with BSEC Corporate Governance Prionole, the declaration above is founded on a sound system of risk management {nd intemal control which implements polcics adopted by the Board and the Company's risk management and Internal compliance control system is opreating efficiently and effectively in all material respect in relation to business and financial reporting risks. Sincerely yours, sw- sd (Engr. Md. Abu Noman Howlader) (Md. Mamun Howlader) Managing Director & CEO Chief Financial officeroS Se fs} a msthionof @empacta S.K.BARUA 8. CO. ooo CHARTERED ACCOUNTANTS Independent eae Report To ‘The Shareholders of Bangladesh Building Systems Limited We have aucited the accompanying financial statements of Bangladesh Building Systems Limited which comprise the statement of financial postion as at 30 June 2077, Statement of profit or ls and other comarehensive income, sttamant of changes in equity, Statement of cash flaws for the year ended and a summary of signifcant accountng policies and other relevant explanatory notes thereon Management's Responsibility for the Financial Statements Management of Bangladesh Building Systems Limited is responsible for the reparation and far presentation of these financial Statements in accordance with Bangladesh Financial Reporting Siandards (BFRS) the Companias Act 1994, The Secures and Exchange Fules 1987 and other applicable lavs and regulations. Te responsiblity Includes: designing, implemeriing and maintaining internal contol relevant tothe preparation and far presentation of finance statements that are fee from material misstatement, whether due 10 fas oer; seeing and apping appopte accounting pols: and makin accouing estimates tht are reasonable in he ‘roumstances, ‘Auditor's (Our responsiblity isto exoress an opinion an these financial statements based on our aut. We conducted our aut in accordance with Bangladesh Standards on Auditing (BSA). Those standards require that we comply with ethical requirements and pian and pertorm the audit to obtain reasonable assurance about whether the fnancie statements are foe from materia misstatement. ‘An aust incoves performing procedures to obtain audlt evidence about the amounts and disclsures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement ofthe facial Siatements, whether due to fraud or error. in making those risk assessments, te austor considers intemal contol relevant to the entity's Preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the ‘cumstances, lu not or the purpose of expressing an opinion onthe effectwanass ofthe ety’ interval contro, An aut aso includes evaluating the appropriateness of accounting poicis used and the reasonableness of accounting estimates made by management, 25 well as evaluating the overall preseniation of the financial statements. \We botiove that the audit evidence we have obtained issufcient and appropriate to provide a basis for our aud opinion Opinion Ic cin he rac leurs fhe moan repre nacaance vith Baga Fan Rept Snes BFS) ave a tue and far vew of the franca psiton of Bangladesh Building Systems Limited as at 30 June 2077, of ts financial Brfomanoe and its cash lows for he year then ended an comply wi he Companies Act 1994, The Secures and Exchange Rules 1987 and other appicale avs and rogultons. We also report that: 3) we have caine al the inormaton and explanations which to thebestof our knowledge and belie were necessary forthe pusposes of cur aut and made cue vericaton threo, nau apna, rope tks of acount as requir by aw have ben Kept ye company star as ana om ox xarinaion 32 BOOKS 0) the statement of franc! poston and the statement of prof or loss and other comprehensive income deat wih by the report are in ‘agreement ith he books of account; and 6) the expenditure incued and payments made were forthe purposes ofthe company’s business - paula Dated: Dhaka S.K BARUA.& CO. 28 October, 2017 Chartered Accountants House # 432 (2nd Fl), Lane # 90, New DOHS, Mohakhal, Dhaka-1206 Thielallee 113, D 14195 Berlin Tel: +880-2-9884390, Mobile 01824-56 79 96, 01819-13 70 95, Germany E-mail: skbarua_129@yahoo.com, Web : www.skbarua.org, Phone : +355 67 2066 161 } (, Annual Report 2016-2017FINANCIAL STATEMENTS See Menton STATEMENT OF FINANCIAL POSITION ‘ASAT JUNE 30, 2017 2016-2017 2015-2016, Notes Taka Taka ASSETS: ‘Non-current assets 1,402,044,064_ 1,154,699,004 Property, plant and equipment 4 980,565,331 ‘797,784,004 Leased assets 5 152,113,289 156,405,463 Intangible asset 6 "460,484 509,537 Investment in Associate Company 7 268,904,980. 200,000,000 Current assets 2,182,093,054_ 1,945,331,230 Inventories: 8 816,802,912 754,687,980 ‘Advances, deposits and prepayments 9 450,700,915 434,306,852 ‘Trade & other receivables 10 801,165,944 676,186,091 ‘Cash and cash equivalents " 113,423,283, 80,150,206 ‘TOTAL ASSETS: 3,584,137, 117. EQUITY AND LIABILITIES ‘Shareholders' equity 1,859,793,598 1,555,821,515, ‘Share capital 12 1,165,824,000 1,059,840,000 Retained earings 13 693,969,598 495,981,515 Total equity 1,859,793,598 1,555,821,515 ‘Non-current liabilities 272,747,365. 237,842,161 Long term loan 14 46,710,054 22,125,000 Lease obligation 15 94,776,123. 105,509,083 Deferred tax liability 16 131,261,188. 110,208,068 Current liabilities 1,451,596,155_ 1,306,366,648 Accounts and other payables 7 42,955,372, 52,882,707 Accruals and provisions 18 261,640,710 381,911,404 ‘Short term loan 19 1,078,757,008 819,702,747 Current portion of ong term loan “4 21,000,000, 7,875,000 Current portion of lease obligation 15 49,243,064 43,994,700 ‘TOTAL EQUITY AND LIABILITIES 3,584,137,117 00,030,324 "Number of share used to calculate NAV 116,582,400, _116,582,400 \Net asset value per share (Restated) —_ Ek —_2 ‘he accpaying rates am an egal pa sre ate are eo obo fe cone roth ‘Su/- ‘Sal- Sdi- ‘Chairman ‘Managing Director ‘Company Secretary Siren ees far er rept of ve eorex sale Dated: Dhaka ‘SK BARUA & CO. 28 October, 2017 Chartered AccountantsGUA e Se SS ‘S. K BARUA & CO. (harteres Accountants BANGLADESH BUILDING SYSTEMS LTD. STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED JUNE 30, 2017 2016-2017 2015-2016 Notes Taka Taka Revenue 20 2,489,426 423 2,364,949,940 Cost of goods sold a (1,866,¢11,590) _(1,759,068,080) Gross profit 624,014,893 605,684,560 Operating expenses (115,526,648) (146,555,820) Administrative expenses: 22 (04,088,376) (104,253,812) ‘Selling and distribution expense 23 (21,438,273) (42,302,008) ‘Other operating income 25 1,259,733 24,720 Profit from operation 509,747,977 459,350,460 Finance income 26 839,000 1,072,360 Finance cost a (101,531,932) ___ (90,850,670) Net profit rom operation 409,055,645 369,569,150 Provision for workers’ profit participation fund (19,478,840) (17,598,245) ‘Share of Profit from Associate 68,904,980 Net profit before tax 458,481 351,964,905 Income tax expenses 28 (118,447,321) (107,859,138) Net profit after tax 250,105,767 ‘Total comprehensive income 340,034,464 250,105,767 Number of share used to calculate EPS 116,582,400 116,582,400, Earning per share for the year (Restated) 2.92 215 The accmparyng rates fam an heal part of is rector and are be read councton ei Sd/- Sd/- Sdi- Chairman Managing Director Company Secretary Sire nes sen ep of ence reed sal Dated: Dhaka SK. BARUA & 00. | 28 October, 2017 Chartered Accountants: ‘Annual Report 2016-2017