Etihad Atheeb Telecom Company increased its losses to reach 71.6 million riyals in the fiscal year ending in March 2020, compared to losses of 53.29 million riyals in the same period of the year The past.

According to Arabia Net, the company attributed the reason for the increase in losses during the current period compared to the same period in the previous year due to: a decrease in revenues and other revenues, and an increase in consumption expenses And financial fees.

This came despite the low cost of services, general and administrative expenses, and selling and marketing expenses.

The company’s financial statements, as in the year ended March 31, 2020, were prepared on the basis of the going concern principle as a basis for accounting. However, we were not able to obtain sufficient and appropriate audit evidence to enable us to conclude whether the use of the going concern principle as a basis in accounting is appropriate for preparing these financial statements, due to the following factors:

(a) As shown in Note No. 2 attached to the financial statements, the company's current liabilities exceeded its current assets by 620.62 million Saudi riyals as at March 31 2020, and the company incurred a net loss of SAR 71.50 million for the fiscal year ending on that date.

(b) The company's financial position statement includes non-financial assets in the amount of SAR 1,183.17 as of March 31, 2020. The management has conducted an evaluation to verify the impairment in value according to IAS 36 Impairment of Assets, and determined that the recoverable values ​​of the above assets exceeded their book value as of March 31, 2020, and therefore no loss resulting from the impairment has been recognized.

The assessment of management to verify impairment relies heavily on a number of judgments and assumptions that relate to future business performance. Some of the assumptions that management used to check impairment are key judgments, which include deferral payments to major suppliers, cash flows, long-term growth rates, and a discount rate.

The impairment test includes the assumption that the company will receive ongoing financial and technical support from its main suppliers to implement the business plan. However, as at the date of the approval of the financial statements, we have not been able to obtain sufficient and appropriate audit evidence, including binding agreements signed with major suppliers to confirm their provision of ongoing financial and technical support, including their acceptance of deferred payments.

Moreover, the business plan is greatly influenced by changes in ...