consolidated hallmark insurance plc - 4 Traders

CONSOLIDATED HALLMARK INSURANCE PLC CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT PERIOD ENDED 30 SEPTEMBER 2017

September 2017 N Assets Cash and cash equivalents 2. Financial assets: -At fair value through profit or loss 3.1 -Loans and receivables 3.2 -Available for sale assets 3.3 -Held to maturity 3.4 Deposit for shares 4. Finance lease receivables 5. Trade receivables 6. Reinsurance assets 7. Deferred acquisition cost 8. Other receivables & prepayments 9. Investment in subsidiaries 10. Inventories 11. Intangible Assets 12.0 Investment properties 12.1 Property and equipment 12.2 Statutory deposits 13.

December 2016 N

September 2017 N

1,836,824,537

1,304,288,656

158,266,312 245,351,141 60,950,000 2,255,251,698 296,927,439 192,951,338 857,170,610 229,579,067 207,793,989 10,635,553 893,882,395 929,384,800 300,000,000

2,862,296,185 141,630,618 236,631,809 60,950,000 1,014,735,272 215,627,088 280,579,297 485,851,346 192,565,490 198,388,279 3,418,701 13,981,971 893,589,275 965,540,115 300,000,000

170,013,089 237,335,789 60,950,000 1,654,142,565 162,290,265 182,091,091 546,323,978 229,579,067 177,968,732 3,920,887 13,119,349 893,882,395 974,022,626 300,000,000

8,147,820,088

7,865,785,447

14. 15. 16. 17. 18.2 18.3

2,955,825,574 116,320,042 133,179,502 5,445,266 271,488,107 174,900,327 3,657,158,818

19.1 20.1. 20.2 21.

Total assets

1,509,675,746

Group September 2016 N

Company September 2016 N

December 2016 N 1,587,501,284

152,630,757 243,047,298 60,950,000 2,255,251,698 192,951,338 857,170,610 229,579,067 225,101,059 480,000,000 9,989,142 809,221,395 917,392,960 300,000,000

2,637,077,063 136,682,023 215,422,459 60,950,000 1,014,735,272 280,579,297 485,851,346 192,565,490 210,330,951 480,000,000 13,189,771 808,928,275 958,669,088 300,000,000

7,442,464,370

8,037,573,980

7,794,981,036

7,392,512,630

2,307,732,618 582,960,851 201,113,714 5,759,030 178,049,506 186,329,728 3,461,945,446

2,410,701,988 87,511,062 179,731,068 151,314 191,465,212 170,103,017 3,039,663,661

2,955,825,574 116,320,042 139,951,894 5,050,858 232,431,135 174,422,385 3,624,001,888

2,307,732,618 582,960,851 218,755,287 5,525,733 148,789,293 185,733,625 3,449,497,406

2,410,701,988 87,511,062 195,101,601 13,502 162,558,597 169,625,075 3,025,511,824

3,000,000,000 1,361,979,153 14,599,948 114,082,169 4,490,661,270

3,000,000,000 1,206,906,555 9,035,935 187,897,509 4,403,840,000

3,000,000,000 1,230,030,314 9,279,386 163,491,009 4,402,800,709

3,000,000,000 1,361,979,153 51,592,939 4,413,572,092

3,000,000,000 1,206,906,555 138,577,073 4,345,483,628

3,000,000,000 1,230,030,314 136,970,491 4,367,000,805

8,147,820,088

7,865,785,445

7,442,464,370

8,037,573,980

7,794,981,034 -

7,392,512,629

163,699,494 211,761,875 60,950,000 1,654,142,565 180,000,000 182,091,091 546,323,978 229,579,067 213,530,118 300,000,000 12,383,037 809,221,395 941,328,726 300,000,000

Liabilities Insurance contract liabilities Trade payables Other payables and provision Retirement benefit obligations Income tax liabilities Deferred tax liabilities Total liabilities Equity and reserves Issued and paid up share capital Contingency reserve Statutory reserve Retained earnings Total equity and reserves

Total liabilities and equity and reserves

The consolidated financial statements were approved by the Board of Directors on 25 October, 2017

Chief Andrew D. S. Odigie Vice Chairman FRC/2013/ICAN/00000004421

Eddie A. Efekoha Managing Director FRC/2013/CIIN/00000002189

Page 1 of 30

Babatunde Daramola Chief Financial Officer FRC/2012/ICAN/00000000564

CONSOLIDATED HALLMARK INSURANCE PLC CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD ENDED 30 SEPTEMBER 2017

Notes Gross premium written

September 2017 N

4,924,157,282

5,826,950,292

4,884,029,421 (2,042,027,164) 2,842,002,257 185,067,338 3,027,069,595 (1,296,324,713) 268,883,655 (1,027,441,058) (1,112,494,873) 887,133,664 315,158,640 129,097,500 -

5,708,277,060 (2,199,995,287)

4,365,120,169 (1,545,139,795)

5,708,277,060 (2,199,995,287)

3,508,281,773 203,707,669

2,819,980,374 308,216,501

3,711,989,442

3,128,196,875

(1,730,652,330) 343,508,618 (1,387,143,712)

(2,066,777,693) 881,741,886 (1,185,035,807)

(1,256,318,222)

(1,106,171,348)

183,860,805 (9,310,327)

25,193,930 (290,329)

4,884,029,421 (2,042,027,164) 2,842,002,257 185,067,338 3,027,069,595 (1,296,324,713) 268,883,655 (1,027,441,058) (1,120,947,764) 878,680,774 315,158,640 75,471,988 -

(6,783,170) (1,340,451,352) 368,133,127 (173,145,284)

(10,673,174) (1,081,090,738) 300,998,097 (134,426,810)

(34,800,641) (906,312,105) 328,198,655 (151,792,973) 176,405,682 176,405,682 176,405,682 (148,124,553)

(6,783,170) (1,281,059,193) 361,974,108 (163,358,219)

(131,948,839)

(34,800,641) (938,510,225) 358,078,938 (162,051,800) 196,027,138 196,027,138 196,027,138 (148,124,553)

75,911,722

47,902,585

20,287,132

34,622,448

28,281,129

27,367,577

3.46

3.27

3.25

2.78

2.94

3.31

25.

2,819,980,374 308,216,501 3,128,196,875

Claims expenses Claims recoveries from reinsurers Claims incurred

25a 25b.

(2,066,777,693) 881,741,886 (1,185,035,807)

Underwriting expenses

26.

(1,106,171,348)

Underwriting profit Investment income

27.

18.1

836,989,720 626,228,181 34,179,043 (4,211,216) (10,673,174) (1,122,294,293) 360,218,261 (152,357,700)

Profit after taxation

207,860,561

Total comprehensive income for the year

207,860,561

Profit attributable to: Equity holders of the parents'

207,860,561

Continency reserve

Basic and diluted earnings per share (Kobo)

32.

31 December 2016 N

4,517,120,169

Net premium income Fee and commission income

30. 31.

Company September 2016

5,826,950,292

4,365,120,169 (1,545,139,795)

28. 29.

September 2017 N

4,924,157,282

23. 24.

Other operating income Impairment (charge)/write back Net fair value gains on financial assets at fair value through profit or loss Management expenses Profit before taxation Income tax expense

31 December 2016 N

4,517,120,169

Gross premium income Reinsurance premium expenses

Net underwriting income

Group September 2016

Page 2 of 30

1,068,527,508 472,982,693

836,989,720 530,868,688

194,987,843

166,571,287

194,987,843

166,571,287

194,987,843 (174,700,711)

166,571,287 (1,319,462,617) (131,948,839)

3,508,281,773 203,707,669 3,711,989,442 (1,730,652,330) 343,508,618 (1,387,143,712) (1,271,473,425) 1,053,372,305 472,982,693 122,768,443 693,030

198,615,888 198,615,888

198,615,888 (171,248,311)

CONSOLIDATED HALLMARK INSURANCE PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AT PERIOD ENDED 30 SEPTEMBER 2017 The Group Issued share capital N At 1 January 2016 Changes in equity for 2016: Profit for the year Other comprehensive income for the year Total comprehensive income for the year Transactions with owners: Transfer to contigency reserves Transfer to statutory reserves Dividends declared during the year Non-controlling interest arising on business combination Contribution by and to owners of the business

3,000,000,000

Contingency reserves N 1,058,782,003

-

-

Statutory reserve N 5,826,986

-

Retained earnings N

Total equity N

203,203,878

4,267,812,867

194,987,843 194,987,843

194,987,843 194,987,843

(60,000,000) (60,000,000)

-

171,248,311 -

3,452,400 -

(174,700,711) (60,000,000)

-

171,248,311

3,452,400

(234,700,711)

At 31 December 2016

3,000,000,000

1,230,030,314

9,279,386

163,491,009

4,402,800,709

At 1 January 2017

3,000,000,000

1,230,030,314

9,279,386

163,491,009

4,402,800,709

207,860,561 207,860,561

207,860,561 207,860,561

(120,000,000) (120,000,000)

Changes in equity for 2017: Profit for the year Other comprehensive income for the year Total comprehensive loss for the year Transactions with owners: Transfer within reserves Dividends relating to prior periods paid during the year Non-controlling interest arising on business combination Contribution by and to owners of the business At September 2017

-

-

-

-

131,948,839 -

5,320,562 -

(137,269,401) (120,000,000)

-

131,948,839

5,320,562

(257,269,401)

1,361,979,153

14,599,948

114,082,169

3,000,000,000

Page 3 of 30

4,490,661,270

CONSOLIDATED HALLMARK INSURANCE PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AT PERIOD ENDED 30 SEPTEMBER 2017 The Company Issued share capital N At 1 January 2016

Contigency reserves N

Retained earnings N

Total equity N

3,000,000,000

1,058,782,003

170,295,943

4,229,077,946

-

-

197,922,859 197,922,859

197,922,859 197,922,859

-

171,248,311

-

171,248,311

(171,248,311) (60,000,000) (231,248,311)

(60,000,000) (60,000,000)

At 31 December 2016

3,000,000,000

1,230,030,314

136,970,491

4,367,000,805

At 1 January 2017

3,000,000,000

1,230,030,314

136,970,491

4,367,000,805

-

-

166,571,287 166,571,287

166,571,287 166,571,287

-

131,948,839

-

131,948,839

(131,948,839) (120,000,000) (251,948,839)

(120,000,000) (120,000,000)

3,000,000,000

1,361,979,153

Changes in equity for 2016: Profit for the year Other comprehensive income for the year Total comprehensive income for the year Transactions with owners: Transfer within reserves Dividends relating to prior periods paid during the year Contribution by and to owners of the business

Changes in equity for 2017: Profit for the year Other comprehensive income for the year Total comprehensive income for the year Transactions with owners: Transfer within reserves Dividends relating to prior periods paid during the year Contribution by and to owners of the business At September 2017

Page 4 of 30

51,592,940

4,413,572,093

CONSOLIDATED HALLMARK INSURANCE PLC CONSOLIDATED STATEMENT OF CASH FLOWS AT PERIOD ENDED 30 SEPTEMBER 2017 Group September 31 DECEMBER 2017 2016 N N

Notes Cash flows from operating activities Premium received from policy holders Reinsurance receipts in respect of claims Commission received Other operating receipts Cash paid to and on behalf of employees Reinsurance premium paid Claims paid Underwriting expenses Other operating cash payments Company income tax paid

25b. 25. 33. 25a

18.2

Net cash (used in)/ from operating activities Cash flows from investing activities Purchase of property and equipment Fair value change and additions to investment properties Increase in investment in subsidiaries Proceeds from sale of property and equipment Purchase of financial assets Proceeds from sale of financial assets Dividend received Interest received

4,108,715,306 489,674,257 308,216,501 122,291,168 (429,630,291) (1,518,561,975) (1,673,654,106) (1,106,171,348) (604,812,563) (77,927,821)

5,700,840,079 377,127,939 214,772,393 314,604,224 (513,986,990) (2,112,575,021) (1,657,293,652) (1,305,872,268) (798,539,118) (64,030,627)

Company September 31 DECEMBER 2017 2016 N N 4,108,715,306 489,674,257 308,216,501 25,193,930 (418,481,065) (1,518,561,975) (1,673,654,106) (1,106,171,348) (598,173,681) (70,147,288)

5,700,840,079 377,127,939 214,772,393 122,768,443 (492,007,345) (2,112,575,021) (1,657,293,652) (1,310,527,194) (653,320,688) (64,030,627)

(381,860,872)

155,046,960

(453,389,468)

125,754,328

12.2

(43,901,489)

(149,033,735)

(43,901,489)

(121,549,513)

12. 10. 12.2 3.

4,680,457 (1,530,572,298) 1,118,277,229 7,743,810 618,484,371

(5,862,395) 6,708,974 (1,548,611,151) 355,580,747 4,585,551 255,673,820

(180,000,000) 4,680,457 (682,315,862) 660,105,774 7,743,810 523,864,150

(5,862,395) (230,000,000) 6,708,974 (1,548,611,151) 355,580,747 29,585,551 255,673,820

(1,080,958,189)

290,176,840

(1,258,473,967)

27. 27.

Net cash from investing activities

174,712,080

Cash flows from financing activities Dividend paid

21.

Net cash used in financing activities Increase in cash and cash equivalents Cash and cash equivalents at Beginning Cash and cash equivalent at End

2

(120,000,000)

(60,000,000)

(120,000,000)

(60,000,000)

(120,000,000)

(60,000,000)

(120,000,000)

(60,000,000)

(327,148,791) 1,836,824,537

(985,911,229) 2,822,735,767

(283,212,628) 1,587,501,284

(1,192,719,640) 2,780,220,925

1,509,675,746

1,836,824,537

1,304,288,656

1,587,501,284

The accompanying notes form an integral part of this statement of cash flows.

Page 5 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 1. Corporate information 1.1 The Group The group comprises of Consolidated Hallmark Insurance Plc and its subsidiary - CHI Capital Limited. CHI Capital Limited also has two wholly owned subsidiaries, Grand Treasurers Limited and CHI Support Services. 1.2 The Company Consolidated Hallmark Insurance Plc (formerly Consolidated Risk Insurers Plc) was incorporated on 2 August 1991. The Company changed its name from Consolidated Risk Insurers Plc to Consolidated Hallmark Insurance Plc following its merger with Hallmark Assurance Plc and The Nigerian General Insurance Company Limited in line with the consolidation reform of NAICOM announced in 2006. Consolidated Hallmark Insurance Plc came into effect from 1 March 2007. 1.3 Principal activities During the year under review, the Company engaged in general insurance business and maintained offices in major cities with Corporate headquarters at 266 Moshood Abiola way, Lagos. The principal activities of the subsidiaries are portfolio management, short term lending, equipment leasing and auto tracking services. Group September 2017 N 2.

Cash and cash equivalents Cash in hand Balance with banks Call deposits Fixed deposits (Note 2.1) Impairment charge (Note 2.2)

3,097,904 151,619,308 23,582,555 1,331,376,309 1,509,676,076 (330) 1,509,675,746

December 2016 N

3,045,944 201,753,578 10,945,865 1,621,079,150 1,836,824,537 1,836,824,537

Company September December 2017 2016 N N 3,097,904 24,939,421 23,582,555 1,252,669,106 1,304,288,986 (330) 1,304,288,656

3,045,944 141,892,518 10,945,865 1,431,616,957 1,587,501,284 1,587,501,284

2.1 The Fixed deposits have a short term maturity of 30-90 days and the effect of discounting immaterial.

2.2 Impairment charge At 1 January Written off in the year Provision no longer required (Note 29) At September 2017 3.

Financial assets At fair value through profit or loss (Note 3.1) Loans and receivables measured at amortised cost (Note 3.2) Available for sale (Note 3.3) Held to maturity (Note 3.4)

3.1 At fair value through profit or loss At 1 January Additions Disposals Transfers to cash and WHT receivables

330 330

-

330 330

-

158,266,312

170,013,089

152,630,757

163,699,494

245,351,141 60,950,000 464,567,453 929,134,906

237,335,789 60,950,000 1,654,142,565 2,122,441,443

243,047,298 60,950,000 2,255,251,698 2,711,879,753

211,761,875 60,950,000 1,654,142,565 2,090,553,934

Fair value gains/(loss) (Note 30) At September 2017

170,013,089 337,760 (1,411,363) 168,939,486 (10,673,174) 158,266,312

323,785,254 785,000 (4,282,422) 320,287,832 (150,274,743) 170,013,089

163,699,494 (395,563) 163,303,931 (10,673,174) 152,630,757

318,256,659 (4,282,422) 313,974,237 (150,274,743) 163,699,494

Current Non Current

158,266,312 -

170,013,089 -

152,630,757 -

163,699,494 -

Financial assets at fair value through profit or loss of the group represents investment where there is a ready and liquid quoted market, which are acquired for the purpose of short-term trade, and where mark-to-market valuations are possible on every trading day. Assets under this category have been acquired by management with the intent of short term trading.

Page 6 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group September 2017 N 3.2

Loans and receivables Staff loans Loan issued to corporate individuals (Note 3.2.1)

Current Non Current 3.2.1 Loan issued to corporate / individuals At 1 January Addition Repayment Impairment on loans issued to corporate and individuals (Note 3.2.4) At the end 3.2.2 Analysis by performance: Performing (Note 3.2) Non-performing (Note 3.2.1)

3.2.3 Analysis by maturity: Due within one year Due within one - five years Due after five years

Movement in impairment - loans and 3.2.4 receivables : At 1 January Addition (Note 29) Provision no longer required At the end 3.3

December 2016 N

Company September December 2016 2017 N N

179,181,809 66,169,332 245,351,141

203,485,300 33,850,489 237,335,789

179,181,809 63,865,489 243,047,298

203,485,300 8,276,575 211,761,875

94,164,429 151,186,712

141,492,415 95,843,374

151,955,936 91,091,362

143,652,919 68,108,956

131,126,947 163,148,398 (130,696,243) 163,579,102

126,402,527 210,115,198 (205,390,778) 131,126,947

(97,409,770) 66,169,332

(97,276,457) 33,850,489

(89,505,121) 63,865,489

(93,185,875) 8,276,575

245,351,141 97,409,770 342,760,911

237,335,789 97,276,457 334,612,247

243,047,298 89,505,121 332,552,419

211,761,875 93,185,875 304,947,750

94,164,429 158,596,482 90,000,000 342,760,911

323,517,416 8,596,483 2,498,348 334,612,247

151,955,936 90,596,483 90,000,000 332,552,419

293,852,920 8,596,483 2,498,348 304,947,750

97,276,457 3,814,067 (3,680,754) 97,409,770

101,462,451 134,408,271 61,177,980 130,639,916 (9,269,821) (163,585,736) 153,370,610 101,462,451

95,695,221 2,274,266 (693,030) 97,276,457

93,185,875 (3,680,754) 89,505,121

93,878,905 (693,030) 93,185,875

Available for sale assets At 1 January Addition Exchange gains Impairment on available for sale At the end

60,950,000 158,359,770 219,309,770

60,950,000 60,950,000

60,950,000 60,950,000

60,950,000 60,950,000

Current Non Current

219,309,770

60,950,000

60,950,000

60,950,000

Available for sale assets are the unquoted equity securities of the group and are measured at cost because their fair value could not be reliably measured. At period end there is no indication of impairment. Available for sale equities is analysed as follows:

Planet Capital Limited (Formerly Strategy and Arbitrage Limited) Energy & Allied Insurance Pool Nigeria limited

Page 7 of 30

No. of shares 2,000,000 158,359,770

Cost per unit N1

Total Cost 2,000,000 58,950,000

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group September 2017 N 3.4 Held to maturity assets At 1 January At initial recognition - additions Value at maturity Disposal Amortised interest (Note 27)

a)

b)


December 2016 N

1,706,977,787 705,635,064 2,412,612,851 (502,485,063) 345,123,910

479,575,123 1,227,402,664 1,706,977,787 (170,307,420) 117,472,198

1,706,977,787 705,635,064 2,412,612,851 (502,485,063) 345,123,910

479,575,123 1,227,402,664 1,706,977,787 (170,307,420) 117,472,198

At the end

2,255,251,698

1,654,142,565

2,255,251,698 -

1,654,142,565 -

Held to maturity assets are analysed as follows: Debts securities Listed Unlisted

2,255,251,698 -

1,654,142,565 -

2,255,251,698 -

1,654,142,565 -

At the end

2,255,251,698

1,654,142,565

2,255,251,698

1,654,142,565

Current Non-current

345,123,910 1,910,127,788 2,255,251,698

1,027,712,519 626,430,046 1,654,142,565

345,123,910 1,910,127,788 2,255,251,698

1,027,712,519 626,430,046 1,654,142,565

12,413,448 52,979,452 57,467,123

13,990,993 51,109,589 51,016,096

12,413,448 52,979,452 57,467,123

13,990,993 51,109,589 51,016,096

36,556,135

41,781,157

36,556,135

41,781,157

216,657,257

99,300,908 486,703,501

216,657,257

99,300,908 486,703,501

-

158,545,821

-

158,545,821

-

355,160,541

-

355,160,541

-

179,225,644

-

217,308,315

-

217,308,315

162,845,391

-

162,845,391

-

396,425

-

396,425

-

34,438,407

-

34,438,407

-

218,461,144

-

218,461,144

-

237,463,557

-

237,463,557

-

199,088,771

-

199,088,771

-

71,347,576

-

71,347,576

-

38,882,967

-

38,882,967

-

18,475,371

-

18,475,371

-

169,384,110

169,384,110

-

37,611,334

37,611,334

256,861,787

256,861,787

183,421,147

183,421,147

At the reporting date, no held to maturity assets were past due or impaired 15.25% NAHCO Bond series 2 2013/2020 FCMB NGN SERIES 2 BOND 2015/2020 FCMB NGN SERIES 2 BOND 2016/2023 13.5% Lagos State Government Bond series 2 2013/2020 LAGOS STATE PROGRAMME 2 SERIES 2 FIXED RATE BOND ISSUANCE (2013/2020) Wemabank commercial paper Omo 18.45% 24/08/2017 FG TREASURE BILL FCMB Omo 18.45% 10/08/2017 FG TREASURE BILL FCMB Omo 18.25% 27/07/2017 FG TREASURE BILL FCMB Omo 18.25% 27/07/2017 FG TREASURE BILL CAPITAL EXPRESS Omo 18.25% 18/01/2018 FG TREASURE BILL AIICO CAPITAL TREASURY BILLS 18.50% FEB. 1 2018 AIICO CAPITAL LTD TREASURY BILLS 18.50% FEB. 1 2018 AIICO CAPITAL LTD TREASURY BILLS 18.4336% FEB. 1 2018 FSDH MERCHANT BANK LIMITED TREASURY BILLS 18.4336% FEB. 1 2018 FSDH MERCHANT BANK LIMITED TREASURY BILLS 18.4336% FEB. 1 2018 FSDH MERCHANT BANK LIMITED TREASURY BILLS 18.4336% FEB. 1 2018 FSDH MERCHANT BANK LIMITED TREASURY BILLS 13.69% MARCH. 2 2017 AIICO Capital Limited TREASURY BILLS 13.69% MARCH. 2 2017 AIICO Capital Limited TREASURY BILLS 18.25% AUG. 02 2018 FCMB364 days TREASURY BILLS 18.5% JULY. 26 2018 FCMB353 DAYS TREASURY BILLS 18.2% JAN. 4 2018 FCMB- 147 DAYS TREASURY BILLS 18.3% JAN 11 2018 CAPITAL EXPRESS- 139 DAYS TREASURY BILLS 16% JAN 04 2018 CAPITAL EXPRESS- 101 DAYS At the end

4.

December 2016 N

Deposit for shares

250,500,296 2,255,251,698

-

1,654,142,565

-

-

179,225,644

250,500,296 2,255,251,698

-

1,654,142,565

180,000,000

This represents fund deposited by the company for additional shares in Chi Capital Limited. 5.

Finance lease receivables At 1 January Addition Repayment Gross investment Unearned income Net investment (Note 5.1) Impairment on finance lease receivables (Note 5.2) At the end

5.1 Current Non-current Analysis by performance Performing Non-performing Analysis by maturity Due within one year Due between one - five years

5.2 Movement in impairment - finance lease receivables: At 1 January Charge for the year (Note 29) At the end

6.

Trade receivables Due from insurance companies Due from insurance brokers and agents Impairment allowance (Note 6.1)

Current Non-current

178,954,617 376,375,447 (181,247,403) 374,082,661 (67,294,089) 306,788,572 (9,861,133) 296,927,439

181,031,249 177,678,768 (141,477,667) 217,232,350 (38,277,733) 178,954,617 (16,664,352) 162,290,265

-

-

195,128,044 111,660,528

148,336,298 30,618,319

296,927,439 9,861,133 306,788,572

162,290,265 16,664,352 178,954,617

-

-

285,873,047 20,915,525 306,788,572

83,963,156 94,991,461 178,954,617

-

-

16,664,352 (6,803,219)

8,935,263 7,729,089

-

-

9,861,133

16,664,352

-

-

192,951,338 192,951,338 192,951,338

25,015,653 157,075,438 182,091,091 182,091,091

192,951,338 192,951,338 192,951,338

25,015,653 157,075,438 182,091,091 182,091,091

192,951,338 -

182,091,091 -

192,951,338 -

182,091,091 -

-

Page 8 of 30

-


Impairment allowance At 1 January Written off in the year Charge for the year (Note 29) At the end

31 December 2016 N

-

-

-

Company September 31 December 2017 2016 N N

-

-

-

Basis of impairment An impairment rate is derived based on the likelihood that a premium debt will not be paid and will fall into default. The Company first assesses whether objective evidence of impairment exists individually for receivables that are individually significant and are impaired accordingly. If the company determines that no objective evidence of impairment exists for an individually assessed receivable, whether significant or not, it includes the receivable in a group of receivables with similar credit risk characteristics and collectively assesses them for impairment. The impairment rate is derived based on the historical collection rate of outstanding premium over three different periods and the average rate derived is applied to the carrying amounts at the reporting dates to determine impaired receivables.

Group September 2017 N 7.

31 December 2016 N


Reinsurance assets Prepaid reinsurance (Note 7.1) Reinsurers share of outstanding claims (Note 7.2)

242,618,573 614,552,037

298,005,373 248,318,605

242,618,573 614,552,037

298,005,373 248,318,605

At the end

857,170,610

546,323,978

857,170,610

546,323,978

Current Non-current

857,170,610 -

546,323,978 -

857,170,610 -

546,323,978 -

The Company assesses its reinsurance assets for impairment. If there is objective evidence that the reinsurance assets are impaired, the Company reduces the carrying amount of the reinsurance assets to its recoverable amount and recognizes that impairment loss in the income statement. The Company has a reinsurance agreement with African Reinsurance Corporation, and Continental Reinsurance Plc. Based on the financial position and performance during the period under review, they are solvent and had never defaulted on their obligations. Consequently, there are no indications of impairment as at the reporting date. Group September 2017 N 7.1

7.2

7.3

Prepaid reinsurance Fire General accident Motor Marine Bond Engineering Aviation Oil & gas

Reinsurers share of outstanding claims Fire General accident Motor Marine Bond Engineering Aviation Oil & gas

Reinsurance assets: Movement in prepaid reinsurance: At 1 January Additions during the year (Note 24) Amortization during the year (Note 24) At the end

8.

Deferred acquisition cost At 1 January Acquistion cost during the year Less: Amortisation during the year (Note 26) At the end Current Non-current

31 December 2016 N

Company 31 December September 2017 2016 N N

60,624,355 16,064,737 2,268,223 28,596,334 1,143,515 5,874,020 65,548,089 62,499,300 242,618,573

75,104,355 22,917,137 4,816,223 40,096,334 2,343,515 7,376,020 67,050,489 78,301,300 298,005,373

60,624,355 16,064,737 2,268,223 28,596,334 1,143,515 5,874,020 65,548,089 62,499,300 242,618,573

75,104,355 22,917,137 4,816,223 40,096,334 2,343,515 7,376,020 67,050,489 78,301,300 298,005,373

536,462,338 33,811,573 6,247,203 13,317,393 446,544 12,514,776 6,406,334 5,345,875 614,552,037

141,789,565 29,210,186 6,247,203 45,000,355 63,428 14,255,659 6,406,334 5,345,875 248,318,605

536,462,338 33,811,573 6,247,203 13,317,393 446,544 12,514,776 6,406,334 5,345,875 614,552,037

141,789,565 29,210,186 6,247,203 45,000,355 63,428 14,255,659 6,406,334 5,345,875 248,318,605

298,005,373 1,489,752,995 1,787,758,368 (1,545,139,795) 242,618,573

409,975,490 2,088,025,170 2,498,000,660 (2,199,995,287) 298,005,373

298,005,373 1,489,752,995 1,787,758,368 (1,545,139,795) 242,618,573

409,975,490 2,088,025,170 2,498,000,660 (2,199,995,287) 298,005,373

229,579,067 782,238,340 (782,238,340) 229,579,067

190,525,298 843,634,488 (804,580,719) 229,579,067

229,579,067 782,238,340 (782,238,340) 229,579,067

190,525,298 843,634,488 (804,580,719) 229,579,067

229,579,067 -

229,579,067 -

229,579,067 -

229,579,067 -

Deferred acquisition cost represent commissions on unearned premium relating to the unexpired risk. The movement in the deferred acquisition cost during the year is as shown above. Page 9 of 30


9.

Deferred acquisition cost analysis Fire General accident Motor Marine Bond Engineering Aviation Oil & gas

Other receivables and prepayments Staff advances & prepayment Account receivables Intercompany Receivables Witholding tax credit Prepayments (Note 9.1) Impairment allowance (Note 29)

Current Non-current

9.1

Prepayments Prepaid rent Other prepayments

Current Non-current 10.

December 2016 N


December 2016 N

41,961,538 55,711,526 55,521,601 20,902,304 2,190,179 9,634,091 13,763,383 29,894,445 229,579,067

41,961,538 55,711,526 55,521,601 20,902,304 2,190,179 9,634,091 13,763,383 29,894,445 229,579,067

41,961,538 55,711,526 55,521,601 20,902,304 2,190,179 9,634,091 13,763,383 29,894,445 229,579,067

41,961,538 55,711,526 55,521,601 20,902,304 2,190,179 9,634,091 13,763,383 29,894,445 229,579,067

81,794,605 42,986,843 61,352,971 21,659,570 207,793,989 207,793,989

22,374,467 67,171,613 58,105,915 30,316,738 177,968,732 177,968,732

81,794,605 35,054,928 25,238,985 61,352,971 21,659,570 225,101,059 225,101,059

22,374,467 62,681,514 40,051,485 58,105,915 30,316,738 213,530,118 213,530,118

207,793,989 -

177,968,732 -

225,101,059 -

213,530,118 -

16,249,698 5,409,872 21,659,570

28,284,485 2,032,253 30,316,738

16,249,698 5,409,872 21,659,570

28,284,485 2,032,253 30,316,738

21,659,570 -

30,316,738 -

21,659,570 -

30,316,738 -

480,000,000

300,000,000

Investment in subsidiaries CHI Capital (Note 10.1)

-

-

10.1 CHI Capital Limited is a fully owned subsidiary of Consolidated Hallmark Insurance Plc. It carries on the business of consumer leasing. CHI Capital Limited acquired 100% interest in Grand Treasurers Limited, a CBN licensed finance company, in December 2010 with the purpose of carrying on financing activities. CHI Capital Limited also owns 100% interest in CHI Support Services Limited which is into the business of vehicle tracking.

CHI PLC N

CHI Capital Limited N

CHI Microinsurance N

Elimination N

Total N

Condensed result of consolidated entities - 2017 10.2 Condensed financial position Assets Cash and cash equivalents Financial assets Deposit for shares Finance lease receivables Trade receivables Reinsurance assets Deferred acquisition cost Other receivables and prepayment Investment in subsidiaries Investment properties Inventories Intangible Assets Property and equipment Statutory deposits Total assets

1,304,288,656 2,711,879,753 192,951,338 857,170,610 229,579,067 225,101,059 480,000,000 809,221,395 9,989,142 917,392,960 300,000,000 8,037,573,980

146,754,803 68,554,233 296,927,439 7,931,915 84,661,000 646,411 11,991,840 617,467,641

Liabilities Insurance contract liabilities Trade payables Provision and other payables Staff retirement benefit Tax liabilities Deffered tax Share capital Statutory reserve Retained earnings Total liabilities and equity

2,955,825,574 116,320,042 139,951,894 5,050,858 232,431,135 174,422,385 3,000,000,000 1,361,979,153 51,592,939 8,037,573,981

79,081,428 394,409 39,056,972 477,942 430,000,000 14,599,948 53,856,942 617,467,641

Page 10 of 30

58,632,287 (60,614,835) (25,238,985) (480,000,000) -

58,632,287

(565,853,820)

(85,853,820) 50,000,000 8,632,287 58,632,287

(480,000,000) (565,853,820)

1,509,675,746 2,719,819,151 296,927,439 192,951,338 857,170,610 229,579,067 207,793,989 893,882,395 10,635,553 929,384,800 300,000,000 8,147,820,088

2,955,825,574 116,320,042 133,179,502 5,445,267 271,488,107 174,900,327 3,000,000,000 1,376,579,101 114,082,169 8,147,820,089

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 CHI CHI PLC N 10.2

836,989,720 530,868,688

97,097,238

25,193,930 1,393,052,338 (290,329)

97,097,238 (3,920,887)

(10,673,174) (1,081,090,738) 300,998,097 (134,426,810) 166,571,287

(41,203,556) 51,972,795 (17,930,890) 34,041,905

Condensed financial position Cash and cash equivalents Financial assets Deposit for shares Finance lease receivables Trade receivables Reinsurance assets

1,587,501,284 2,090,553,934 180,000,000 182,091,091 546,323,978

197,938,334 31,887,509 162,290,265 -

Deferred acquisition costs Other receivables and prepayment Investment in subsidiaries Investment properties Property and equipment Inventories Statutory deposits Total assets

229,579,067 213,530,118 300,000,000 809,221,395 12,383,037 941,328,726 300,000,000 7,392,512,630

31,952,439 84,661,000 3,920,887 736,312 32,693,901 546,080,647

Liabilities Insurance contract liabilities Trade payables Other payables and provision Retirement benefit obligation Income tax liabilities Deferred tax liabilities Share capital Statutory reserve Retained earnings Total liabilities and equity

2,426,766,048 87,511,062 179,037,541 13,502 162,558,597 169,625,075 3,000,000,000 1,230,030,314 136,970,491 7,392,512,630

232,143,292 137,812 28,906,615 477,942 250,000,000 9,279,386 25,135,600 546,080,647

806,841,995 192,156,293 65,404,832 1,064,403,120 -

45,172,664 45,172,664 -

Other operating income Total operating income Impairment charge Net fair value gains/(losses) on financial assets at fair value through profit or loss Management expenses Profit before taxation Taxation Profit after taxation

10.2

Elimination N

Total N

Condensed result of consolidated entities - 2017 Condensed profit and loss Underwriting profit Investment income

10.2

CHI

Capital Microinsurance N N

7,247,368 7,247,368

7,247,368 7,247,368

-

836,989,720 635,213,294

-

25,193,930 1,497,396,944 (4,211,216)

-

(10,673,174) (1,122,294,293) 360,218,261 (152,357,700) 207,860,561

-

Condensed result of consolidated entities - 2016

51,384,918 (180,000,000) (67,513,825) (300,000,000) -

51,384,918

(547,513,825)

(247,513,825) 50,000,000 1,384,918 51,384,918

1,836,824,536 2,122,441,443 162,290,265 182,091,091 546,323,978 229,579,067 177,968,732 893,882,395 3,920,887 13,119,349 974,022,627 300,000,000 7,442,464,370

(547,513,825)

2,426,766,048 87,511,062 163,667,008 151,314 191,465,212 170,103,017 3,000,000,000 1,239,309,700 163,491,009 7,442,464,370

7,198,565 (7,198,565) -

814,040,560 192,156,293 103,378,931 1,109,575,784 -

(300,000,000) -

Condensed result of consolidated entities - 2016 Condensed profit and loss Underwriting profit Investment income Other operating income Total operating income Impairment charge Net fair value gains on financial assets at fair value through profit or loss Management expenses Profit before taxation Taxation Profit after taxation

(16,160,071) (645,664,724) 402,578,325 (156,566,299) 246,012,026

Page 11 of 30

(25,408,969) 19,763,696 (6,636,987) 13,126,709

-

(16,160,071) (671,073,693) 422,342,020 (163,203,286) 259,138,734

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group September 2017 N 11.

Inventories At 1 January Auto track devices Used


(3,920,887) -

6,520,134 (1,225,967) 5,294,167 (1,373,280) 3,920,887

23,074,700 23,074,700

22,265,000 809,700 23,074,700

21,337,500 21,337,500

21,337,500 21,337,500

Accumulated amortization At 1 January Addition September

9,955,351 2,483,796 12,439,147

5,797,129 4,158,222 9,955,351

8,954,463 2,393,895 11,348,358

5,745,067 3,209,396 8,954,463

Carrying amount At End

10,635,553

13,119,349

9,989,142

12,383,037

12.1 Investment properties At 1 January Addition Fair value change September

893,882,395 893,882,395

888,020,000 5,862,395 893,882,395

809,221,395 809,221,395

803,359,000 5,862,395 809,221,395

Impairment allowance (Note 29)

12.0 Intangible assets Cost At 1 January Addition September

3,920,887 -

31 December 2016 N

3,920,887

-

-

-

-

Investment properties Investment properties are made up of buildings and properties held by the company to earn rentals or for capital appreciation or both and are accounted for in line with International Accounting Standard (IAS) 40. Some of these properties retained the title of one of the legacy companies making up Consolidated Hallmark Insurance Plc. There is no dispute as to the title of Consolidated Hallmark Insurance Plc to these properties. However, in line with NAICOM requirement, provided below is the list of these properties and status of efforts to change their name to Consolidated Hallmark Insurance Plc.

S/N 1

TYPE OF ADDRESS ASSET Company Plot A/5 Pocket Layout (Clerk Building Quarters) Owerri, Imo State.

AMOUNT N

CURRENT TITLE HOLDER

STATUS ON CHANGE OF TITLE

207,680,000 Consolidated Hallmark Insurance Plc.

Title over this property has been transferred to Consolidated Hallmark Insurance Plc. Title now changed from Hallmark Assurance Plc to the name of Consolidated Hallmark Insurance Plc. Title over this property has been transferred to Consolidated Hallmark Insurance Plc. Title over this property has been transferred to Consolidated Hallmark Insurance Plc. Title over this property has been transferred to Consolidated Hallmark Insurance Plc.

2

Building

219, 220 and 221, Akukwe Street, Works Layout, Owerri, Imo State


3

Building

No. 30, East Street, Rivers Layout Aba, Abia State.


4

Building

Plot 33, Chief Ogbonda Layout, Rumuogba, Port Harcourt.


5

Land

Plot 3, Sea Gate Estate, Phase 1, Lekki Peninsula, Eti-Osa.


6

Building

Rivers State Housing Estate, Abuloma PH


Title over this property has been transferred to Consolidated Hallmark Insurance Plc.

7

Land

Plot 14, 1(W) Road, First Avenue, Lugbe Estate, Abuja.

23,275,000 Hallmark Assurance Plc (Legacy Company)

8

Shops

Trade Fair Shopping Complex

The Company made payments to the Federal Housing Authority during the year and is awaiting final approval from them. Already exist in the name of Consolidated Hallmark Insurance Plc.

3,070,000 Consolidated Hallmark Insurance Plc. 809,221,395

CHI Capital Limited 84,661,000 Total

893,882,395

Page 12 of 30

CHI Capital Limited

Already exist in the name of CHI Capital Limited

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 12.2 12.2a

Property and equipment 2017 The group Land N Costs At 1 January Additions in the year Disposals in the year September

Building N

Office Equipment N

Furniture & Fittings N

Motor Vehicles N

Computer Equipment N

Total N

286,099,948 286,099,948

536,339,722 536,339,722

101,370,202 1,520,520 102,890,722

118,714,084 7,179,719 125,893,803

419,230,497 26,077,250 (10,630,000) 434,677,747

213,960,444 9,124,000 223,084,444

1,675,714,897 43,901,489 (10,630,000) 1,708,986,386

Accumulated depreciation At 1 January 2017 Depreciation charge for the period Disposals in the period September

-

107,326,721 8,023,054 115,349,775

72,538,148 7,786,868 80,325,016

97,720,403 5,980,509 103,700,912

231,268,023 58,006,647 (7,228,740) 282,045,930

192,838,976 5,570,565 (229,588) 198,179,953

Accummulated impairment losses

-

-

-

-

-

-

-

Carrying value September

286,099,948

420,989,947

22,565,706

22,192,891

152,631,817

24,904,491

929,384,800

At 1 January 2017

286,099,948

429,013,001

28,832,054

20,993,681

187,962,474

21,121,468

974,022,626

701,692,271 85,367,643 (7,458,328) 779,601,586

Some fixed assets were professionally re-valued as at 31 December 2006, by Messrs Adegboyega Sanusi & Co. on the basis of open market values. These values were incorporated in the books at that date. The surplus arising on the revaluation over the written down values was treated in the NGAAP financial statements as fixed assets revaluation reserve. However, in compliance with IFRS (i.e. IAS 16) the revalued amount was taken as deemed cost at transition date and the revaluation reserve was transferred to revenue reserve. During the year ended 31 December 2011, the landed property of CHI Capital Limited were professionally re-valued at N84 million by Messrs Adegboyega Sanusi & Co. Estate Surveyors & Valuers on the basis of open market value between a willing seller and buyer. The sum of N65,495,775 was then recognised as revaluation reserve in the financial statements.

Page 13 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017

12.2a

Property and equipment The group 2016 Land

Building N

Costs At 1 January Additions in the year Disposals in the year At 31 December 2016

Office Furniture & Motor Computer Equipment Fittings Vehicles Equipment Total N N N N N

N

286,099,948 286,099,948

536,339,722 536,339,722

83,679,352 17,853,350 (162,500) 101,370,202

107,872,857 11,982,227 (1,141,000) 118,714,084

338,825,681 111,310,500 (30,905,684) 419,230,497

208,436,224 7,397,336 (1,873,116) 213,960,444

1,561,253,784 148,543,413 (34,082,300) 1,675,714,897

Accumulated depreciation At 1 January Depreciation charge for the year Disposals in the year At 31 December 2016

-

96,570,538 10,756,183 107,326,721

66,185,219 6,505,796 (152,866) 72,538,148

93,249,714 5,611,689 (1,141,000) 97,720,403

199,919,550 59,216,084 (27,867,611) 231,268,023

188,279,419 6,415,528 (1,855,972) 192,838,976

644,204,440 88,505,280 (31,017,449) 701,692,271

Accummulated impairment losses

-

-

-

-

-

-

-

286,099,948 286,099,948

429,013,001 439,769,184

28,832,054 17,494,133

20,993,681 14,623,143

187,962,474 138,906,131

21,121,468 20,156,805

974,022,626 917,049,344

Carrying value At 31 December 2016 At 31 December 2015

Page 14 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 12.2b

Property and equipment 2017 The company Land N Costs At 1 January Additions Disposals September

Building N

Office Equipment N


Motor Vehicles N


382,284,183 26,077,250 (10,630,000) 397,731,433

213,129,621 9,124,000

193,428,299 5,370,565 198,798,864

696,439,215 64,435,993 (7,228,740) 753,646,468

Total N

286,099,948

536,339,722

101,200,381 1,520,520

118,714,084 7,179,719

286,099,948

536,339,722

102,720,901

125,893,803

-

107,326,721 8,023,054

72,484,689 5,536,184

97,720,404 4,855,104

115,349,775

78,020,873

102,575,508

225,479,102 40,651,086 (7,228,740) 258,901,448

Carrying value September

286,099,948

420,989,947

24,700,028

23,318,295

138,829,985

23,454,757

917,392,960

At 31 December 2016

286,099,948

429,013,001

28,715,693

20,993,680

156,805,081

19,701,322

941,328,726

Accumulated depreciation At 1 January Depreciation charge for the period Disposals September

222,253,621

1,637,767,939 43,901,489 (10,630,000) 1,671,039,428

Some items of property and equipment were professionally re-valued as at 31 December 2006, by Messrs Adegboyega Sanusi & Co. on the basis of open market values. These values were incorporated in the books at that date. The surplus arising on the revaluation over the written down values was treated in the NGAAP financial statements as revaluation surplus. However, in compliance with IFRS (i.e IAS 16) the revalued amount was taken as deemed cost at transition date and the surplus on revaluation was transferred to retained earnings.

Page 15 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Property and equipment (Cont'd) 2016 The company Land N Costs At 1 January Additions Disposals At 31 December 2016 Accumulated depreciation At 1 January Depreciation charge for the year Disposals At 31 December 2016 Carrying value At 31 December 2016 At 31 December 2015

Building N

Office Equipment N


Motor Vehicles N


Total N

107,872,857 11,982,227 (1,141,000) 118,714,084

327,710,680 84,945,000 (30,371,491) 382,284,189

207,661,473 6,823,936 (1,355,789) 213,129,620

1,549,249,208 121,549,513 (33,030,780) 1,637,767,941

286,099,948

536,339,722

286,099,948

536,339,722

83,564,528 17,798,350 (162,500) 101,200,378

-

96,570,538 10,756,183 107,326,721

66,155,857 6,481,698 (152,866) 72,484,689

93,249,715 5,611,689 (1,141,000) 97,720,404

196,402,613 56,944,100 (27,867,611) 225,479,102

187,946,133 6,837,787 (1,355,621) 193,428,299

640,324,856 86,631,457 (30,517,098) 696,439,215

286,099,948 286,099,948

429,013,001 439,769,184

28,715,689 17,408,672

20,993,680 14,623,142

156,805,087 131,308,067

19,701,321 19,715,340

941,328,726 908,924,352

Page 16 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group 2017 N 13.

Statutory deposits

2016 N

Company 2017 N

2016 N

300,000,000

300,000,000

300,000,000

300,000,000

1,362,033,067 1,593,792,507

968,909,480 1,441,792,508

1,362,033,067 1,593,792,507

968,909,480 1,441,792,508

2,955,825,574

2,410,701,988

2,955,825,574

2,410,701,988

This represents the amount deposited with the Central Bank of 14.

Insurance contract liabilities Reserve for outstanding claims (Note 14.1) Unearned premium reserve (Note 14.2)

14.1 Reserve for outstanding claims - 2017 Group Provision for IBNR N 147,207,500 80,327,608 185,546,097 52,434,352 2,480,898 9,586,420 33,044,377 47,938,652 558,565,904

Reserve for outstanding claims - 2016 Outstanding Provision for Claim IBNR N N Fire 84,369,661 147,207,500 General accident 189,071,074 80,327,608 Motor 80,902,057 185,546,098 Marine 8,379,859 52,434,352 Bond 30,000 2,480,898 Engineering 25,120,925 9,586,420 Aviation 8,400,000 33,044,377 Oil & gas 14,070,000 47,938,652 410,343,576 558,565,904

Fire General accident Motor Marine Bond Engineering Aviation Oil & gas

Outstanding Claim N 399,877,278 79,299,014 48,701,346 4,228,576 1,343,464 12,605,788 99,317,960 158,093,737 803,467,163

Gross Reserve N 547,084,778 159,626,622 234,247,443 56,662,928 3,824,362 22,192,208 132,362,337 206,032,389 1,362,033,067

Outstanding Claim N 399,877,278 79,299,014 48,701,346 4,228,576 1,343,464 12,605,788 99,317,960 158,093,737 803,467,163

Company Provision for IBNR N 147,207,500 80,327,608 185,546,097 52,434,352 2,480,898 9,586,420 33,044,377 47,938,652 558,565,904

Gross Reserve N 547,084,778 159,626,622 234,247,443 56,662,928 3,824,362 22,192,208 132,362,337 206,032,389 1,362,033,067

Gross Reserve N 231,577,161 269,398,682 266,448,154 60,814,211 2,510,898 34,707,345 41,444,377 62,008,652 968,909,480

Outstanding Claim N 84,369,661 189,071,074 80,902,056 8,379,859 30,000 25,120,925 8,400,000 14,070,000 410,343,575

Provision for IBNR N 147,207,500 80,327,608 185,546,098 52,434,352 2,480,898 9,586,420 33,044,377 47,938,652 558,565,905

Gross Reserve N 231,577,161 269,398,682 266,448,154 60,814,211 2,510,898 34,707,345 41,444,377 62,008,652 968,909,480

Group 2017 N 14.2 Unearned premium reserve Fire General accident Motor Marine Oil & Gas Engineering Aviation Bond

245,793,995 315,034,977 552,903,401 117,346,854 207,978,480 63,386,936 78,552,876 12,794,988 1,593,792,507

2016 N

222,411,236 286,553,511 506,744,947 106,613,671 179,991,537 58,263,594 69,557,327 11,656,685 1,441,792,508

Group 2017 N 14.2a Unearned Commission Reserve Fire General accident Motor Marine Oil & Gas Engineering Aviation Bond

941,301 661,870 652,801 1,617,958 7,428,580 4,761,551 16,064,061

2016 N 941,301 661,870 652,800 1,617,958 7,428,580 4,761,551 16,064,060

Page 17 of 30

Company 2017 N 245,793,995 315,034,977 552,903,401 117,346,854 207,978,480 63,386,936 78,552,876 12,794,988 1,593,792,507

222,411,236 286,553,511 506,744,947 106,613,671 179,991,537 58,263,594 69,557,327 11,656,685 1,441,792,508

Company 2017 N 941,301 661,870 652,801 1,617,958 7,428,580 4,761,551 16,064,061

2016 N

2016 N 941,301 661,870 652,800 1,617,958 7,428,580 4,761,551 16,064,060

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group 2017 N 14.3

15.

Funds representing insurance contract liabilities Balance with banks Fixed placement Treasury bill & Bonds Available for sale assets At fair value through profit or loss

Trade payables Due to insurance companies Due to reinsurance companies - local Other trade payables

Current Non-current 16.

Other payables and provision Audit fees VAT payable Witholding tax payable Unclaimed dividend payable (Note 16.1) Due to CHI Capital Accrued expenses Unearned Commission received Sundry creditors (Note 16.2)

Current Non-current

2016 N

Company 2017 N

2016 N

1,252,669,106 1,489,575,711 60,950,000 152,630,757

10,945,865 1,341,626,500 1,179,635,507 -

1,252,669,106 1,489,575,711 60,950,000 152,630,757

10,945,865 1,341,626,500 1,179,635,507 -

2,955,825,574

2,532,207,872

2,955,825,574

2,532,207,872

116,320,042 116,320,042

66,438,027 21,073,035 87,511,062

116,320,042 116,320,042

66,438,027 21,073,035 87,511,062

116,320,042 -

87,511,062 -

116,320,042 -

87,511,062 -

3,500,000 6,166,311 884,998 81,511,521 16,064,061 25,052,611 133,179,502

7,500,000 11,666,311 635,340 72,747,541 23,933,656 16,064,060 47,184,159 179,731,068

3,500,000 6,166,311 884,998 81,511,521 16,064,061 31,825,003 139,951,894

5,500,000 11,666,311 635,340 72,747,541 27,462,340 23,933,656 16,064,060 37,092,353 195,101,601

133,179,502 -

179,731,068 -

139,951,894 -

195,101,601 -

16.1

Unclaimed dividend payable represents amount of dividend which shareholders are yet to collect from the company's registrars and which, in line with the relevant rules of the Securities and Exchange Commission, have been returned to the Company to be held in a separate investment trust account. The balance in the fund is N81,904,931 (made up of principal of N81,511,521. and accrued interest of N393,410).

16.2

Sundry creditors includes =N=23,659,359 payables to Chi Cooperative and multipurposes society.

Group 2017 N 17.

Retirement benefit obligation Defined contribution pension plan At 1 January Provision during the period (Note 33) Payment during the period September

151,314 26,202,429 (20,908,477) 5,445,266

Page 18 of 30

2016 N

184,444 35,657,920 (35,691,050) 151,314

Company 2017 N

13,502 25,745,229 (20,707,873) 5,050,858

2016 N

4,430 35,048,320 (35,039,248) 13,502


Taxation

18.1

Income tax expense Income tax Education tax Under/(over)provision in previous year

147,560,390 4,797,310 152,357,700 4,797,310 157,155,010

Deferred tax (Note 18.3)

2016 N

103,944,290 7,035,961 32,351,284 143,331,535 29,813,749 173,145,284

Company 2017 N

129,629,500 4,797,310 134,426,810 4,797,310 139,224,120

2016 N

94,757,836 6,317,189 32,351,284 133,426,309 29,931,910 163,358,219

18.1.1 The Nigerian Information Technology Development Agency (NITDA) Act was signed into law on 24 April 2007. Section 12(2a) of the Act demands that, 1% of profit before tax should be paid to the Nigerian Information Technology Development Agency. In line with the Act, the Company has provided for NITDA levy at the specified rate. Group 2017 N 18.2

18.3

Current income tax liabilities At 1 January Transfer from VAT and WHT payable Payments during the period

2016 N

Company 2017 N

2016 N

Charge for the period September

191,465,212 5,593,016 (77,927,821) 119,130,407 152,357,700 271,488,107

120,730,104 (72,478,265) 48,251,839 143,213,373 191,465,212

162,558,597 5,593,016 (70,147,288) 98,004,325 134,426,810 232,431,135

93,162,912 (64,030,625) 29,132,287 133,426,309 162,558,597

Deferred tax liabilities At 1 January Charge for the period (Note 18.1) September

170,103,017 4,797,310 174,900,327

140,289,268 29,813,749 170,103,017

169,625,075 4,797,310 174,422,385

139,693,165 29,931,910 169,625,075

Reconciliation of effective tax rate Profit after tax

207,860,561

194,987,843

166,571,287

197,922,859

Total income tax expense Income Education (Over)/under-provision Deferred tax (Note 18.3)

147,560,389 4,797,310 4,797,310

103,944,290 7,035,961 32,351,284 29,813,749

129,629,500 4,797,310 4,797,310

94,757,836 6,317,189 32,351,284 29,931,910

157,155,009

173,145,284

139,224,120

163,358,219

365,015,570

368,133,127

305,795,407

361,281,078

The Company has adopted the International Accounting Standards (IAS 12) on accounting for taxation, which is now computed using liability method. 18.4

Profit for the period before excluding income tax Effective tax rate

43%

Page 19 of 30

47%

46%

45%


Share capital Authorised: 10 billion ordinary shares of 50k each

19.1 Issued and fully paid: 6 billion ordinary shares of 50k each September

2016 N

Company 2017 N

2016 N

5,000,000,000

5,000,000,000

5,000,000,000

5,000,000,000

3,000,000,000

3,000,000,000

3,000,000,000

3,000,000,000

1,230,030,314 131,948,839 1,361,979,153

1,058,782,003 171,248,311 1,230,030,314

1,230,030,314 131,948,839 1,361,979,153

1,058,782,003 171,248,311 1,230,030,314

9,279,386 5,320,562

5,826,986 3,452,400

The holder of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to vote at meetings of the Group.

20.

Other reserves

20.1. Contingency reserve At 1 January Transfer from income statement (Note 21) September In line with sections 21(1) and (2) and 22(16) of the Insurance Act 2003, Insurance companies in Nigeria are required to transfer to the statutory contingency reserve, the higher of 20% of net profits and 3% of total premium. 20.2 Statutory reserve At 1 January Transfer from income statement (Note 21)

-

-

September 14,599,948 9,279,386 In line with Central Bank of Nigeria guideline, Finance companies in Nigeria are required to transfer a minimum of 15% of its profit before tax to statutory reserve until the reserve fund equals the Paid-up Capital and a minimum of 10% thereafter. This applies to Grand Treasurers Limited a sub-subsidiary within the group. 21.

Retained earnings At 1 January Dividend declared and paid in the year based on the previous year published accounts Transfer to contigency reserve (Note 20.1) Transfer from income statement Transfer to statutory reserve (Note 20.2) September

163,491,009 (120,000,000) (131,948,839) 207,860,561 (5,320,562) 114,082,169

203,203,878 (60,000,000) (171,248,311) 194,987,843 (3,452,400) 163,491,009

136,970,491 (120,000,000) (131,948,839) 166,571,287 51,592,939

170,295,943 (60,000,000) (171,248,311) 197,922,859 136,970,491

66,547,760 3,499,300

92,663,502 7,500,000

64,435,993 3,499,300

89,840,853 5,500,000

5,637,500 (15,040,252)

5,250,000 (4,195,293) (110,125,307)

5,637,500 (15,040,252)

5,250,000 (4,195,293) (110,125,307)

Retained earnings are the carried forward recogni sed income net of expenses plus current period p rofit attributable to shareholders. 22.

Profit before taxation Profit before taxation is stated after Depreciation of property and equipment Auditors' remuneration Directors' remuneration: - Fees Profit on disposal of property and equipment Foreign exchange (gains)/loss

Page 20 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 23. Gross premium earned analysed as follows:

Fire General accident Motor Aviation Oil & Gas Marine Engineering Bond

Direct premium N 691,877,159 653,444,455 1,102,512,549 431,096,713 1,017,968,347 389,760,733 125,798,259 49,753,442 4,462,211,657

Increase/ Inward decrease in reinsurance unearned Gross premium premium premium earned N N N 18,939,227 (23,382,759) 687,433,627 9,812,801 (28,481,467) 634,775,789 9,175,672 (46,158,454) 1,065,529,767 214,476 (8,995,549) 422,315,640 12,058,794 (27,986,943) 1,002,040,198 940,027 (10,733,183) 379,967,577 3,767,515 (5,123,342) 124,442,432 (1,138,303) 48,615,139 54,908,512 (152,000,000) 4,365,120,169

Gross premium earned analysed as follows:

Direct premium N Fire General accident Motor Aviation Oil & Gas Marine Engineering Bond

Increase/ Inward decrease in reinsurance unearned Gross premium premium premium earned N N N

628,698,908 725,013,087 1,047,830,529 1,299,110,838 712,096,197 321,408,438 113,168,484 23,687,767 4,871,014,248

14,850,392 3,884,759 10,421,453 6,535,284 13,945,824 1,801,850 1,703,472 53,143,034

Group 2017 N 24. Reinsurance expense The reinsurance expense is analysed as follows: Reinsurance premium cost (Increase)/decrease in prepaid reinsurance Reinsurance expense (Note 7.3) 25. Fee and commission Fire General accident Motor Aviation Oil & Gas Marine Engineering Bond

2016 N

(35,433,196) 5,006,025 (33,880,517) 8,106,547 232,303,909 (189,523,330) (21,104,395) (5,602,904) (40,127,861)

608,116,104 733,903,871 1,024,371,465 1,313,752,669 958,345,930 133,686,958 93,767,561 18,084,863 4,884,029,421

Company 2017 N

2016 N

1,489,752,995

1,835,965,094

1,489,752,995

1,835,965,094

55,386,800 1,545,139,795

206,062,070 2,042,027,164

55,386,800 1,545,139,795

206,062,070 2,042,027,164

79,656,373 44,164,953 3,916,114 98,957,956 46,347,253 13,687,664 21,486,188 308,216,501

62,878,427 3,627,272 1,390,254 26,655,787 57,293,007 16,302,709 16,919,882 185,067,338

79,656,373 44,164,953 3,916,114 98,957,956 46,347,253 13,687,664 21,486,188 308,216,501

62,878,427 3,627,272 1,390,254 26,655,787 57,293,007 16,302,709 16,919,882 185,067,338

Page 21 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group Claims expenses September 2017 N 25a

Claims expenses Claims paid during the year Opening IBNR and outstanding claims Closing IBNR and outstanding claims (Note 14.1) Gross claims expenses

25b. Claims recoverable Opening claims recoverable Claims recovered Closing claims recoverable Net recoverable Net claims expenses

26.

Claims expenses September 2016 N

Company Claims Claims expenses expenses September September 2017 2016 N N

1,673,654,106 (968,909,480) 1,362,033,067 2,066,777,693

1,247,390,034 (895,550,802) 944,485,481 1,296,324,713

1,673,654,106 (968,909,480) 1,362,033,067 2,066,777,693

1,247,390,034 (895,550,802) 944,485,481 1,296,324,713

(248,318,604) 489,674,257 640,386,233

281,937,926 268,883,655 (281,937,926)

(248,318,604) 489,674,257 640,386,233

281,937,926 268,883,655 (281,937,926)

881,741,886

268,883,655

881,741,886

268,883,655

1,185,035,807

1,027,441,058

1,185,035,807

1,027,441,058

Acquisition expenses N 140,630,366 133,326,433 129,600,405 79,060,181 186,288,514 78,827,732 26,163,776 8,340,933 782,238,340

Maintenance expenses N 36,733,587 55,747,630 125,780,178 17,975,062 50,780,945 21,008,836 12,576,960 3,329,810 323,933,008







Underwriting expenses Underwriting expenses- 2017


Underwriting expenses- 2016


Page 22 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group September 2017 N 27.

Investment income Interest received Amortised gain(loss) on held to maturity (Note 3.4) Dividend received

27.1 Investment income Investment income attributable to policyholders' fund Investment income attributable to shareholders' fund

28.

29.

Other operating income Profit on disposal of property and equipment Interest on staff receivables Rent income on investment properties Recoveries in the year Exchange gain (loss) Other income

Impairment on charge Cash and cash equivalent (Note 2.2) Loans and receivables (Note 3.2) Finance Lease receivable (Note 5.1) Trade receivables (Note 6.1) Other receivables (Note 9) Inventories (Note 11)

September 2016 N


September 2016 N

273,360,461 345,123,910 7,743,810 626,228,181

263,319,121 47,881,678 3,957,841 315,158,640

178,000,968 345,123,910 7,743,810 530,868,688

263,319,121 47,881,678 3,957,841 315,158,640

345,123,910 281,104,271 626,228,181

224,674,679 90,483,960 315,158,640

345,123,910 185,744,778 530,868,688

224,674,679 90,483,961 315,158,640

1,279,197 2,235,752 2,978,591 30,000 15,040,252 12,615,251 34,179,043

3,796,981 5,624,050 1,389,401 48,000 64,640,519 53,598,549 129,097,500

1,279,197 2,235,752 2,978,591 30,000 15,040,252 3,630,138 25,193,930

330 289,999 3,920,887 4,211,216

-

330 289,999 290,329

Page 23 of 30

3,796,981 5,624,050 1,389,401 48,000 64,640,519 (26,963) 75,471,988

-

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group September 2017 N 30. Net fair value gains on financial assets at fair value through profit or loss Fair value through profit or loss (Note 3.1) Investment property (Note 12.1) Others Fair value gains/loss

September 2016 N


September 2016 N

10,673,174 10,673,174

16,160,071 16,615,168

10,673,174 10,673,174

34,800,641 34,800,641

Staff cost (Note 33) 429,630,291 Rent, insurance and maintenance 84,768,411 Depreciation of property and equipment 65,871,465 Auditors' remuneration 3,500,000 Directors' remuneration: - Fees (Note 45) 5,637,500 - Allowance & Expenses 43,128,182 Professional charges 49,319,883 Printing and telecommunication 29,512,947 Electricity Diesel,Travelling& Motor runing expenses21,595,314 Advertising, & Entertainment 122,035,971 Travelling and motor vehicle expenses 71,651,337 Rates, Insurance levy and utilities 56,606,727 Office running,bank charges,AGM expenses 37,596,303 Subcription&Office security exp. 26,103,018 Others 75,336,943

335,256,365 79,970,865 58,146,636 4,002,500 56,286,908 19,202,650 36,945,601 57,164,667 60,330,889 32,223,495 27,913,199 21,315,556 59,613,130

418,481,065 83,268,411 64,435,993 3,500,000

367,140,051 79,620,910 64,762,362 4,002,500

5,637,500 43,128,182 49,319,883 28,512,947 20,095,314 121,781,921 57,317,342 56,606,727 37,596,303 26,103,018 65,306,131

57,443,674 26,538,903 37,467,564 60,316,924 63,565,407 32,455,551 29,284,956 22,789,849 60,923,455

1,122,294,293

848,372,462

1,081,090,738

906,312,105

207,860,561

196,027,138

166,571,287

176,405,682

6,000,000,000

6,000,000,000

6,000,000,000

6,000,000,000

3.46

3.27

2.78

2.94

3.46

3.27

2.78

2.94

This represents increase in the value of financial assets at fair value through profit or loss during the year. 31. Management expenses

32. Basic/diluted earnings per share Profit/(loss) after taxation Number of shares Earnings/(loss) per share (kobo) Basic Diluted Earnings/(loss) per share have been computed on profit/(loss) after taxation attributable to ordinary shareholders and

Group September 2017 N

September 2016 N


September 2016 N

33. Staff costs Wages and salaries Medical Staff training Defined contribution pension plan (Note 17.1)

34. Chairman's and Directors' emoluments, pensions and compensation for loss of office Emoluments: Chairman Other Directors Other emolument of executives Emolument of highest paid Director

339,944,814 17,117,153 46,365,896 26,202,429

300,772,654 19,075,952 37,468,272 26,318,344

329,252,925 17,117,153 46,365,758 25,745,229

284,734,821 19,075,952 37,468,134 25,861,144

429,630,291

383,635,222

418,481,065

367,140,051

750,000 750,000 4,500,000 4,500,000 8,160,000 8,160,000 12,000,000 12,000,000 Page 24 of 30

750,000 4,500,000 8,160,000 12,000,000

750,000 4,500,000 8,160,000 12,000,000

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Group 2017 2016 Number Number 35.

36.

Staff Average number of persons employed in the financial year and staff costs were as follows: Managerial Senior staff Junior staff

26 109 100 235

31 110 103 244

24 103 96 223

30 104 98 232

Nil Nil Nil 10

Nil Nil Nil 9

Nil Nil Nil 10

Nil Nil Nil 9

Nil

Nil

Nil

Nil

7 30 29 14 2 11 14 5 123 235

7 30 26 14 1 11 15 3 137 244

6 30 29 14 2 11 13 5 113 223

6 30 26 14 1 10 14 3 128 232

The number of Directors excluding the Chairman whose emoluments were within the following ranges were: N Nil 100,001 200,001 Above

-

N 100,000 200,000 300,000 300,000

Emolument Number of Directors who have waived their rights to receive emoluments 37.

Company 2017 2016 Number Number

Employees remunerated at higher rates The number of employees in respect of emoluments within the following ranges were: N N 200,001 300,000 300,001 400,000 400,001 500,000 500,001 600,000 600,001 700,000 700,001 800,000 800,001 900,000 900,001 1,000,000 1,000,001 and above

38.

Capital commitments There were no capital commitments at 30 September 2017.

39.

Contingent liabilities There were no material contingent liabilities at 30 September 2017.

40.

Comparative figures Where necessary, comparative figures have been adjusted to conform with changes in presentation of the current year in accordance with the International Accounting Standards (IAS 1).

Page 25 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 41.

Segment Information An operating segment is a component of the Group engaged in business activities from which it can earn revenues whose operating results are reviewed regularly by the Group’s Executive Management in order to make decisions about resources to be allocated to segments and assessing segments performance. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, which is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Group’s Executive Management. The Group is organized into two operating segments, these segments and their respective operations are as follows:

General Insurance Business: This segment provides cover for indemnifying customers’ properties,and compensation for other parties that have suffered damage as a result of customers’ accidents. Major sources of revenue in this segment are mainly from insurance premium, investment income, commission received,net fair value gains on financial assets at fair value through profit or loss. CHI Capital Ltd: This is a subsidiary of Consolidated Hallmark Insurance Plc. The company is registered by CAC to offer consumer leasing and support services to Consolidated Hallmark Insurance Plc (the parent company). In addition, it owns Grand Treasurers Ltd who is registered by CBN to offer wide range financial services and products domestically to suit customer’s long- and short-term financial needs. These products include L.P.O financing, Consumer Lease, Working Capital financing, Auto lease, Project financing and intermediation and Financial Management Consultancy Services. Revenue from this segment is derived primarily from interest income, fee income, investment income and net fair value gains on financial assets at fair value through profit and loss. Segment information by company and subsidiaries: General Insurance N At September 2017 Operating income Operating expenses Operating profit Taxation Profit for the period

Finance and support services N

Elimination N

1,389,336,204 (1,081,090,738) 308,245,465 (134,426,810) 173,818,656

97,097,238 (45,124,443) 51,972,795 (17,930,890) 34,041,905

Total assets

8,037,573,980

676,099,928

(565,853,820)

8,147,820,088

Total liabilities

3,624,001,888

119,010,752

(85,853,820)

3,657,158,819

Share capital and reserves

4,413,572,092

557,089,176

(480,000,000)

4,490,661,269

Depreciation ROCE

-

Total N

64,435,993 4%

3,704,329 6%

118,063,222 (1,281,059,193) 362,665,996 (163,358,219) 199,307,777

99,169,617 (68,702,486) 30,467,132 (9,787,065) 20,680,066

(25,000,000) (25,000,000) (25,000,000)

192,232,839 (1,349,761,679) 368,133,128 (173,145,284) 194,987,843

Total assets

7,392,512,630

597,465,565

(547,513,825)

7,442,464,370

Total liabilities

3,025,511,825

261,665,660

(247,513,825)

3,039,663,659

Share capital and reserves

4,367,000,805

335,799,905

(300,000,000)

4,402,800,710

As at 31 December 2016 Operating income Operating expenses Operating profit Taxation Profit for the year

Depreciation ROCE

89,840,853 5%

Page 26 of 30

2,822,649 6%

-

1,486,433,441 (1,126,215,181) 360,218,260 (152,357,700) 207,860,560

-

68,140,322 5%

92,663,502 4%

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 42. Contraventions The company did not contravened any provisions or guidelines of any regulator during the period under review. However, penalty of =N=7,680,300 for late submission of various financials between 2011 - 2013 to SEC were settled during the period.

43. Reinsurance treaty The Company has a reinsurance agreement with African Reinsurance Corporation, and Continental Reinsurance Plc to reinsure the risks associated with fire and consequential loss, General accident, Marine cargo, motor, aviation and special risks etc. according to agreed quota share, surplus treaty or excess of loss treaty. This agreement was last modified 31 December 2016. 44. Related party transactions There are no significant business dealings with its related parties during the year under review.

Parent: The Group is controlled by Consolidated Hallmark Insurance Plc. which is the parent company, whose shares are widely held. Consolidated Hallmark Insurance Plc, is a General Business Insurance Company licensed by the National Insurance Commission. Subsidiaries: Consolidated Hallmark Insurance Plc holds 100% interest in CHI Capital Limited. Transactions between Consolidated Hallmark Plc and this subsidiary is eliminated on consolidation and already disclosed in Note 10.2 Key management personnel: Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group or Company, directly or indirectly, including any director (whether executive or otherwise). It includes close members of their families who may be expected to influence or be influenced by that individual in their dealings with the Group. The significant related party transaction in the course of the reporting period are as stated below with the subsidiary company, CHI Capital Limited. 2017 2016 September September Entity 6,274,336 Income from Auto-insurance support services CHI Capital Limited 6,274,336 Auto-insurance support services expenses CHI PLC Grand Treasurers Ltd

Group September 31 December 2017 2016 N N 45. Compensation of key management personnel: Directors fees

5,637,500

5,250,000

Company September 31 December 2017 2016 N N 5,637,500

5,250,000

46. Events after the reporting period: No event or transaction has occurred since the reporting date, which would have had a material effect on the financial statements as at that date or which needs to be mentioned in the financial statement in the interests of fair presentation of the Group's financial position as at the reporting date or its result for the year then ended. 47. Capital management The Group’s objectives with respect to capital management are to maintain a capital base that adequately meets regulatory requirements and to utilize capital allocations efficiently and effectively. Capital levels are determined either based on internal assessment or regulatory requirements. The Nigerian Insurance Act 2003 stipulates the minimum capital requirement for a non life insurance company as an amount not less than 15% of the gross premium income less reinsurance premiums paid out during the year under review or the minimum paid up capital whichever is greater. The act defines what constitutes admissible assets liabilities. The regulators generally expect companies to comply with capital adequacy requirements and the Company has consistently exceeded this minimum over the years. The regulator has the authority to request more extensive reporting and can place restrictions on the Company’s operations if the Company falls below this requirement as deemed neccesary. All of the Groups capital is Tier 1 (core capital) which consists of share capital and reserves created by appropriation of retained earnings. The following sources of funds are available to the group to meet its capital growth requirements: 1. Profits from operations: The group had regularly appropriated from its profit to grow its capital. 2. Issue of shares: The Group can successfully access the capital market to raise the desired funds for its operations and needs. 3. Loans (long term/short term): this remains a source of capital even though the group had never had cause to access this source for funding its operations. Compliance with statutory solvency margin requirement: The company at the end of the 2016 financial year maintained admisible assets of N7,178,081,979 which exceeded the total admissible liabilities of N2,855,886,749 The solvency margin was computed in line with the requirements of Section 24 of the insurance Act 2003, latest NAICOM guidelines. This showed a solvency margin of N1,322,195,230 in excess of the minimum requirement of N3billion for General Insurance Business by 44%. Thus, the solvency margin above satisfies the requirement of the regulatory requirement. Page 27 of 30

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017

48.

Asset & liability Management Asset & liability Management (ALM) is the practice of managing an insurer’s financial position so that actions taken with respect to assets and liabilities are designed to address the broad set of financial risks inherent in their joint behavior. Asset & Liability management (ALM) attempts to address financial risks the group is exposed to which includes interest rate risks, foreign currency risks, equity price risks and credit risks. The major financial risk is that in the long run its investment proceeds are not sufficient to fund the obligations arising from its insurance contracts. ALM ensures that specific assets of the group is allocated to cover reinsurance and other liabilities of the group. The following tables reconcile the consolidated balance sheet to the classes and portfolios used in the Group’s ALM framework. Group 2017 Insurance fund N ASSETS Cash and cash equivalents Financial assets - At fair value through profit or loss - Loans and receivables - Available for sale -Held -to-maturity Deposit for shares Finance lease receivables Trade receivables Reinsurance assets Deferred acquisition cost Other receivables and prepayments Investment in subsidiaries Intangible Asset Inventories Investment properties Property and equipment Statutory deposit TOTAL ASSETS LIABILITIES Insurance contract liabilities Trade payable Other payables and Provision Retirement benefit obligations Income tax liabilities Deferred income tax TOTAL LIABILITIES

1,252,669,106 152,630,757 60,950,000 1,489,575,711

2,955,825,574 2,955,825,574

2,955,825,574 -

SURPLUS

Shareholders funds N

September 2017 N

257,006,640

1,509,675,746

5,635,555 245,351,141 765,675,987 296,927,439 192,951,338 857,170,610 229,579,067 207,793,989 10,635,553 893,882,395 929,384,800 300,000,000 5,191,994,514

158,266,312 245,351,141 60,950,000 2,255,251,698 296,927,439 192,951,338 857,170,610 229,579,067 207,793,989 10,635,553 893,882,395 929,384,800 300,000,000 8,147,820,088

116,320,042 133,179,502 5,445,266 271,488,107 174,900,327 701,333,244

2,955,825,574 116,320,042 133,179,502 5,445,266 271,488,107 174,900,327 3,657,158,818

4,490,661,270

4,490,661,270

Group 2016 Insurance fund N ASSETS Cash and cash equivalents Financial assets - At fair value through profit or loss - Loans and receivables - Available for sale -Held -to-maturity Deposit for shares Finance lease receivables Trade receivables Reinsurance assets Deferred acquisition cost Other receivables and prepayments Investment in subsidiaries Intangible Asset Inventories Investment properties Property and equipment Statutory deposit TOTAL ASSETS LIABILITIES Insurance contract liabilities Trade payable Other payables and Provision Retirement benefit obligations Income tax liabilities Deferred income tax TOTAL LIABILITIES SURPLUS

1,784,325,749

626,376,239

2,410,701,988 2,410,701,988

2,410,701,988 -

Shareholders funds N

Dec 2016 N

52,498,788 170,013,089 237,335,789 60,950,000 1,027,766,326 162,290,265 182,091,091 546,323,978 229,579,067 177,968,732 13,119,349 3,920,887 893,882,395 974,022,626 300,000,000 5,031,762,382

1,836,824,537

87,511,062 179,731,068 151,314 191,465,212 170,103,017 628,961,673

2,410,701,988 87,511,062 179,731,068 151,314 191,465,212 170,103,017 3,039,663,661

4,402,800,710

4,402,800,709

Page 28 of 30

170,013,089 237,335,789 60,950,000 1,654,142,565 162,290,265 182,091,091 546,323,978 229,579,067 177,968,732 13,119,349 3,920,887 893,882,395 974,022,626 300,000,000 7,442,464,370

CONSOLIDATED HALLMARK INSURANCE PLC NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Company 2017 Insurance fund ASSETS Cash and cash equivalents Financial assets – At fair value through profit or loss - Loans and receivables – Available for sale -Held-to-maturity Deposit for shares Trade receivables Reinsurance assets Deferred acquisition cost Other receivables and prepayments Intangible Asset Investment in subsidiaries Investment properties Property, plant and equipment Statutory deposit TOTAL ASSETS LIABILITIES Insurance contract liabilities Trade payable Provision and Other payables Retirement benefit obligations Income tax liabilities Deferred income tax TOTAL LIABILITIES SURPLUS

Shareholders funds

June 2017

1,252,669,106

51,619,550

1,304,288,656

152,630,757 60,950,000 2,255,251,698

243,047,298 192,951,338 857,170,610 229,579,067 225,101,059 9,989,142 480,000,000 809,221,395 917,392,960 300,000,000 4,316,072,419

152,630,757 243,047,298 60,950,000 2,255,251,698 192,951,338 857,170,610 229,579,067 225,101,059 9,989,142 480,000,000 809,221,395 917,392,960 300,000,000 8,037,573,980

2,955,825,574

116,320,042 139,951,894 5,050,858 232,431,135 174,422,385 668,176,313

2,955,825,574 116,320,042 139,951,894 5,050,858 232,431,135 174,422,385 3,624,001,887

765,675,987

3,647,896,106

4,413,572,093

3,721,501,561 2,955,825,574

Company 2016 Insurance fund ASSETS Cash and cash equivalents Financial assets – At fair value through profit or loss - Loans and receivables – Available for sale -Held-to-maturity Deposit for shares Trade receivables Reinsurance assets Deferred acquisition cost Other receivables and prepayments Intangible Asset Investment in subsidiaries Investment properties Property, plant and equipment Statutory deposit TOTAL ASSETS LIABILITIES Insurance contract liabilities Trade payable Provision and Other payables Retirement benefit obligations Income tax liabilities Deferred income tax TOTAL LIABILITIES

49.

SURPLUS Fair value hierarchy

Shareholders funds

Dec 2016

1,974,439,083

294,133,108

1,974,439,083

331,557,775 19,379,021 2,000,000 133,173,401 50,250,000 69,245,808 651,767,868 194,835,265 141,704,560 15,592,433 250,000,000 793,460,682 905,899,680 300,000,000 4,137,407,168

1,587,501,284 163,699,494 211,761,875 60,950,000 1,654,142,565 180,000,000 182,091,091 546,323,978 229,579,067 213,530,118 12,383,037 300,000,000 809,221,395 941,328,726 300,000,000 7,392,512,630

192,031,909 87,511,062 195,101,601 13,502 162,558,597 169,625,075 806,841,745

2,410,701,988 87,511,062 195,101,601 13,502 162,558,597 169,625,075 3,025,511,825

3,330,565,423

4,367,000,805

2,218,670,079

2,218,670,079 -

The determination of fair value for each class of financial instruments was based on the particular characteristics of the instruments. Group’s accounting policy on fair value measurements is discussed under the statement of significant accounting policies. Level 1: Fair value measurements classified as Level 1 include exchange-traded prices of fixed maturities and equity securities unadjusted in active market for identical assets and liabilities. Level 2: valuation techniques based on observable inputs. This category includes instruments valued using: quoted market prices in active markets for similar instruments; quoted prices for similar instruments in markets that are considered less than active; or other valuation techniques where all significant inputs are directly or indirectly observable from market data. Observable inputs generally used to measure the fair value of securities classified as Level 2 include benchmark yields, reported secondary trades, brokerdealer quotes, issuer spreads, benchmark securities, bids, offers and reference data.

Level 3: This includes financial instruments, the valuation of which incorporate significant inputs for the asset or liability that is not based on observable market data (unobservable inputs). Unobservable inputs are those not readily available in an active market due to market illiquidity or complexity of the product. These inputs are generally determined based on inputs of a similar nature, historic observations on the level of the input or analytical techniques.

Page 29 of 30

CONSOLIDATED HALLMARK INSURANCE PLC APPENDIX 1 REVENUE ACCOUNT FOR THE PERIOD ENDED 30 SEPTEMBER 2017 Motor N Income Direct premium Inward reinsurance premium Gross written premium (Increase)/decrease in unexpired premium reserve Gross premium earned Deduct: Outward reinsurance premiums (Increase)/decrease in prepaid reinsurance Reinsurance cost Net premium earned Commission received (Increase)/decrease in unearned commission Total Income Gross Claims Paid (Increase)/decrease in outstanding claims provision Gross claims incurred Reinsurance claims recovery (Increase)/decrease in reinsurance recoveries

Fire N

Bond N

Gen. Accident N

Aviation N

Oil & Gas N

Engineering N

2017 Total N

2016 Total N

1,102,512,549 9,175,672

691,877,159 18,939,227

49,753,442 -

653,444,455 9,812,801

389,760,733 940,027

431,096,713 214,476

1,017,968,347 12,058,794

125,798,259 3,767,515

4,462,211,657 54,908,512

1,111,688,221

710,816,386

49,753,442

663,257,256

390,700,760

431,311,189

1,030,027,141

129,565,774

4,517,120,169

(46,158,454) 1,065,529,767

(23,382,759) 687,433,627

(1,138,303) 48,615,139

(28,481,467) 634,775,789

(10,733,183) 379,967,577

(8,995,549) 422,315,640

(27,986,943) 1,002,040,198

(5,123,342) 124,442,432

(152,000,000) 4,365,120,169

(22,386,596)

(319,822,525)

(13,114,939)

(187,266,649)

(186,611,660)

(268,007,908)

(492,542,718)

(2,548,000) (24,934,596)

(14,480,000) (334,302,525)

(1,200,000) (14,314,939)

(6,852,400) (194,119,049)

(11,500,000) (198,111,660)

(1,502,400) (269,510,308)

(15,802,000) (508,344,718)

1,040,595,171 3,916,114

353,131,102 79,656,373

34,300,200 -

440,656,740 44,164,953

181,855,917 13,687,664

152,805,332 98,957,956

493,695,480 46,347,253

122,940,432 21,486,188

2,819,980,374 308,216,501

1,044,511,285

432,787,475

34,300,200

484,821,693

195,543,581

251,763,288

540,042,733

144,426,620

3,128,196,875

(484,835,565)

(628,286,418)

(5,098,800)

(287,918,867)

(30,526,697)

(71,785,591)

(124,649,312)

(40,552,856)

(1,673,654,106)

3,027,069,595 (1,247,390,034)

31,719,510 (453,116,055) 61,810,295

(315,026,417) (943,312,835) 296,480,056

(1,313,464) (6,412,264) 33,858

109,772,061 (178,146,806) 42,115,825

4,151,283 (26,375,414) 32,354,845

(90,917,960) (162,703,551) 41,530,478

(144,023,736) (268,673,048) 14,000

12,515,136 (28,037,720) 15,334,900

(393,123,587) (2,066,777,693) 489,674,257

(48,934,679) (1,296,324,713) 268,883,655

-

394,672,773

383,116

4,601,387

Net claims incurred

(391,305,760)

(252,160,006)

(5,995,290)

(131,429,594)

Acquisition expenses (Increase)/decrease in commission expenses Maintenance/operating expenses

(129,600,405)

(140,630,366)

(8,340,933)

(133,326,433)

(125,780,178)

(36,733,587)

(3,329,810)

Total expenses

(646,686,343)

(429,523,959)

Underwriting profit/(loss)

Marine N

397,824,942

3,263,516

(5,848,765) 130,666

-

-

(1,502,000) (1,502,000)

(1,740,882)

(1,489,752,995) (55,386,800) (1,545,139,795)

392,067,629

(121,173,073)

(268,659,048)

(14,443,702)

(1,185,035,807)

(78,827,732)

(79,060,181)

(186,288,514)

(26,163,776)

(782,238,340)

(55,747,630)

(21,008,836)

(17,975,062)

(50,780,945)

(12,576,960)

(323,933,008)

(17,666,033)

(320,503,657)

(99,705,902)

(218,208,316)

(505,728,507)

(53,184,438)

(2,291,207,155)

16,634,167

164,318,036

95,837,679

33,554,972

34,314,226

91,242,182

Page 30 of 30

836,989,720

4,871,014,249 53,143,034 4,924,157,282 (40,127,861) 4,884,029,421 (1,835,965,094) (206,062,070) (2,042,027,164) 2,842,002,257 185,067,338

(1,027,441,058) (691,609,180) 2,040,192 (431,378,777) (2,148,388,822) 878,680,773