Muharram 26, 1445H August 13, 2023 Ref: 243/2023
Tihama for Advertising, Public Relations and Marketing Company (A Saudi Joint Stock Company)
Subject: Agreed Upon Procedures Report Scope of Procedures :
We have performed the agreed upon procedures for Tihama for Advertising, Public Relations and Marketing Company (the “Company”), which is mentioned below, our procedures have been performed in accordance with the International Standard on Related Services No. (4400) “Engagements to perform agreed-upon procedures regarding financial information” as endorsed in the Kingdom of Saudi Arabia applies to the performance of agreed Upon Procedures engagements. These procedures were performed to assist the management of the company in completing the relevant legal procedures and instructions for listed companies in which the accumulated losses exceeded more than 20% of the share capital issued by the board of Capital Market Authority in accordance with resolution no. 4-48-2013 dated 15/1/1435H corresponding 18/11/2013 based on Capital Market Authority regulations issued in accordance with Royal Decree no. M/30 dated 2/6/1424H amended by Capital Market Authority resolution no. 8-5-2023 dated 25/6/1444H corresponding to 18/1/2023.
The Company is responsible for the adequacy of these procedures and the correctness of the legal procedures;
accordingly, no assurance will be expressed regarding the adequacy of these procedures for the purpose of that engagement or for any other purpose.
Agreed Upon Procedures:
1) Obtain the supporting journal entries related to the capital increase and verifying their accounting accuracy.
2) Obtain and reviewing the decision of the Extraordinary General Assembly meeting, which held on April 2, 2023, which is related to increasing the company’s share capital by issuing priority rights shares at a value of 350 million SAR, to increase the the share capital to 400 million SAR.
3) Agree the amount of share capital capital, the number of shares, and the par value of each share before and after the company’s share capital increase with the approval of capital increase prepared by the company’s management.
4) Ensure that the company completed the legal procedures by amending the articles of association and the commercial register to reflect the new capital after the increase, which amounts to 400,000,000 SAR divided into 40,000,000 shares.
5) Calculate the percentage of the company's accumulated losses related to company's amended capital as at June 30, 2023.
Conclusion:
The following are the results of the performed agreed upon procedures :
1. Regarding to Procedure No. (1), we have obtained the supporting journal entries for capital increase, and we have ensured the accounting correctness, and there are no exceptions noted (Annexure 1).
2. Regarding to Procedure No. (2), we have obtained and reviewed the minutes of the Extraordinary General Assembly meeting held on April 2, 2023, and there are no exceptions noted.
3. Regarding to procedure No. (3), we have obtained and reviewed the share capital increase statement prepared and approved by the company's management, and there are no exceptions.
4. 4. Regarding procedure No. (4), we have obtained and reviewed the new commercial register and the new articles of association of the company after the share capital increase, and there are no exceptions noted.
5. Regarding to procedure No. (5), we have calculated the percentage of accumulated losses to the company's amended share capital, as at June 30, 2023 as follows:
The following are the relevant items in the statement of financial position related to the capital increase :
Since the above procedures do not constitute an audit or a Review in accordance with International Standards on Auditing or Standards for Review Engagements as endorsed in the Kingdom of Saudi Arabia, we do not express an opinion with respect to the audit or review process.
If we were to perform additional procedures or an audit or limited review, other matters may have come to our attention that would have been reported to you.
The purpose of this report is what was clarified in the scope of work section of this report, and it may not be used for any other purpose. In addition, we do not bear any responsibility for the consequences of sharing this report with a party other than the party to whom the report is directed to. Therefore, we will not be liable for any damages or compensation for any fees or other expenses that the Company may incur as a result of using our Report.
Al-Kharashi & Co.
Abdullah S. Al Msned License No. (456)
Percentage of Accumulated losses related amended Share Capital Share Capital as at June
30, 2023 (SAR) Accumulated losses as at
June 30, 2023 (SAR)
30%
400,000,000 (119,824,215)
Balance as at June 30, 2023, after the share
capital increase (SAR) Amount of Increase
(SAR) Balance as at March
31, 2023, before the share capital
increase (SAR) Description
400,000,000 350,000,000
50,000,000 Share Capital
