Strategic Report
Governance Report
Strategic Report
Annual Report and Accounts 2022
01
Governance Report Financial Statements Additional Information
2.3m
2021: 2.4m
2020: 2.4m
2,028
2021: 2,044
2020: 1,965
351.2m
2021: USD 403.7m
2020: USD 415.3m
5.9%
2021: 5.2%
2020: 13.1%
46.3m
2021: USD 25.7m
2020: USD 2.6m
17.9m
2021: USD 6.4m
2020: USD -1.4m
An overview of 2022
Highlights
•
982.7 million in loans, serving 2.3 million clients.
• Excellent performance in Pakistan, the Philippines,
•
•
•
•
•
• Finalised development of the digital supplier marketplace
•
with universal ESG frameworks.
Read more FY 2022 highlights on page 18
Board of Directors on 21 April 2023.
Dirk Brouwer
21 April 2023
Find the impact highlights on page 09
Ghana
•
•
Strategic Report
Annual Report and Accounts 2022
02
Governance Report Financial Statements Additional Information
Company overview
Our clients are engaged in
services, trading, manufacturing
entrepreneurs who are over
average around USD 3.65 per
services, trading, manufacturing
and small scale agricultural
which are situated in or near the
live and work, and are the centre
Read more on pages 42 and 54
manner and prevent inadvertent
Read more on pages 13, 31
and 43
various collateral-free loans to
an assessment of client needs,
increment and loan limit for each
loans. These follow-on loans are,
on average, 20% to 50% larger
than the previous loan. Where
under the current licence, a
charges average market rates
product and loan term.
In the countries where the
these are deposits from clients
and other digital value-added
services to support the growth
Read more on page 05 and
pages 10 to 12
2,028
2.3m
13
13.6k
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
Company overview
Dhaka, Bangladesh
Branches: 446
Read more on page 24
West Africa
Branches: 441
Read more on page 22
South East Asia
Branches: 471
Read more on page 26
East Africa
Branches: 670
Read more on page 20
South Asia
935,091
433,897
506,494
424,076
118.6m
82.4m
86.9m
63.3m
Strategic Report
Annual Report and Accounts 2022
04
Governance Report Financial Statements Additional Information
Chairman’s statement
future growth
With the worst throes
the Group is recovering well
headwinds.
across Africa and in Pakistan and the Philippines.
We are also engaged in crisis management and
strong and developing focus which informs where
created an unprecedented humanitarian crisis
underpin the need to factor climate change into our
planning on pages 47 to 50
challenges ahead. However, the Board has great
our shareholders and lenders. We remain as
inclusion and socioeconomic progress, ensuring
Guy Dawson
21 April 2023
Strategic Report
Annual Report and Accounts 2022
05
Governance Report Financial Statements Additional Information
Our investment case
services
Outstanding
As a result of staying close to clients Decentralised business model
and experts. The Group was founded to adapt the
•
•
•
•
•
•
markets in Asia and Africa. The impact of principal
increased.
future markets in Asia and Africa.
over-leveraged.
deposit-taking licences.
deposit-taking licences in all countries.
30
5.3%
361m
3.4%
72%
5.9%
6
23%
14
Read more on pages 32 to 39 of Principal risks
Read more on how we engage with clients
on pages 42 and 54 and Our Business model
on page 08
Our Business model on page 08
Strategic Report
Annual Report and Accounts 2022
06
Governance Report Financial Statements Additional Information
improvement in
environment improving
countries, we experienced
million in FY 2021 to USD 46.3 million in FY 2022.
We seek to sustain our performance in the coming
in most of our markets saw demand for our loan
products increase as clients experienced an upturn
of clients from 1.7 million to 1.9 million in 2022.
in 2022 from USD 282 million in 2021. The growth
2022 in all markets excluding India.
countries for now.
in India, including the removal of the margin and
of civil unrest remained high. We do not expect the
environment in 2023 which should allow our
Financial performance
credit losses charged to the Income Statement from
USD 37.5 million in FY 2021 to USD 0.6 million in
the USD 6.4 million achieved in FY 2021. I am
Ghana and Tanzania, was excellent in terms of
Strategic Report
Annual Report and Accounts 2022
07
Governance Report Financial Statements Additional Information
Expected credit losses
Sheet for expected credit losses from USD 27.5
million in FY 2021 to USD 16.9 million in FY 2022,
10.8 million in FY 2022 vs USD 32.9 million in FY
with the remainder spread across the other countries
the segment of our low-income clients, the Group
the second half of 2023.
online orders.
pure digital lenders.
decided not to declare a dividend in 2023
in 2024 on the 2023 results, assuming the
Dirk Brouwer
21 April 2023
2.3m
351.2m
Strategic Report
Annual Report and Accounts 2022
08
Governance Report Financial Statements Additional Information
Business model
demand for savings and loans, and
•
•
•
•
•
•
Branches are deeply
rooted in the community
client of USD 279 for 6-12 months
Strategic Report
Annual Report and Accounts 2022
09
Governance Report Financial Statements Additional Information
Business model
StakeholderImpact in 2022
Read more in our ESG report
on page 41
Clients and prospects
• Financial inclusion.
• Empowering women.
• Socioeconomic progress.
•
Colleagues
•
• Training and development.
•
environment.
•
•
•
Countries
•
to government.
• Higher spending due to
increased income of clients.
Regulators and industry
bodies
•
environment.
•
•
making.
Shareholders
•
USD returns.
•
982.7m
86%
0.4m
28.4m
results, the Board has decided
92%
61,312
112
5.3%
13,602
96.7%
Strategic Report
Annual Report and Accounts 2022
10
Governance Report Financial Statements Additional Information
Increase number
of branches
and clients
to grow the
Maintain branch
model and proven
credit methodology
Increase loan
volumes by product
payments and
deposits
Maintain group
Grow loan revenues
from payments
and deposits
Provide value added
services (Supplier Market
Introduce a digital channel
via a smartphone and
other mobile devices
branches in
new countries
new clients
Enrich the high-
touch service
Increase
inclusion
Add digital
channel to
Broaden
products
and services
Our strategy
Strategic Report
Annual Report and Accounts 2022
11
Governance Report Financial Statements Additional Information
Increase
inclusion
Add digital
channel to
Broaden
products
and services
Our strategy
See the ESG report pages
approach and progress with
regards to environmental
•
markets.
•
•
•
•
•
•
Financial inclusion is reinforced by increasing the loan coverage,
• Returned to growth, excluding in India,
•
•
excluding India, was 10%. The
countries with the highest growth
in clients are Pakistan, Tanzania and
the Philippines, which added a
•
The countries with the highest growth
and the Philippines, which added
•
•
•
• Finalised the development of a digital
market place for clients and their
in 2023 in Ghana.
Adding a digital channel, including the SMP, and acquiring banking
•
licence in Pakistan.
•
Strategic Report
Annual Report and Accounts 2022
12
Governance Report Financial Statements Additional Information
Our strategy
• In-house developed loan system (AMBS)
• Branch
• Loans
• Deposits¹
• Packaged Core Banking System (‘CBS’)²
• Digital Financial Services (‘DFS’) system
• Supplier Market Place (‘SMP’) system
• Branch
• Banking app (‘DFS’)
• SMP app
• Accounts
• Loans
• Deposits
• Savings (public)
• Payments
• Supplier Market Place
Services
Present Future
Internal processes
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
Feature story
Engagement and support of employees are
prerequisites for the success of the Company’s
technologies and tools through training
but also foster a sense of ownership and
two-week training programme on the ground. Eight
training, which covered various topics, including the
found the training enlightening and empowering, as
emphasising that growth in resources goes hand
when familiarising with new developments.
The training programme was a resounding success.
momentum towards the upcoming launch. With
Mavis
Branch Manager
10
170
to feel and be empowered.
and clients.
Imani
Strategic Report
Annual Report and Accounts 2022
14
Governance Report Financial Statements Additional Information
Feature story
Joining forces
for healthcare
in her neck for many years
and no doctor around
Kitale could remove it
fully recovered and
was emboldened to smile
around the other children
in the village again.
Hellen Mukhwana
never seek treatment even when
¹
funding is lacking, and the doctor-
²
and word-of-mouth, clients help
challenges faced in the healthcare
specialising in dental treatment,
Integral to these partnerships is
the health camps, while the
during the health camp and remain
residents was organised at
conducted 16 minor tumour
surgeries, ten circumcisions, 88
I am thankful to the doctors for
removing the tumour and tending
featured on the local news.
acknowledged for their
•
•
during The Top 100 Social
independent panel of judges.
9,734
722
on pages 44 and 45
Strategic Report
Annual Report and Accounts 2022
15
Governance Report Financial Statements Additional Information
Feature story
for Pakistan
disaster on people’s livelihoods are immense – ASA
over one million houses, the loss of more than
as of the end of August, underscoring the scale of the
to clients who needed it. ASA Pakistan also made a
for livestock and farming, recognising that those
collapse of their homes, loss of assets, and even the
Shoukat Ali
85k
2m
The ability to apply for another
business and not being
obligated to repay my loans
hardship was fundamental
for my survival.
2
022
2
021
2
020
$403.7m
$415.3m
$351.2m
2
022
2
021
2
020
28%
19%
26%
28%
3.4%
1.1%
-0.2%
2
022
2
021
2
020
2
022
2
021
2
020
$181m
$187m
$160m
77.4%
97.6%
67.5%
2
022
2
021
2
020
18.5%
6.0%
-1.3%
2
022
2
021
2
020
2
022
2
021
2
020
78%
81%
73%
2
022
2
021
2
020
$25.7m
$2.6m
$46.3m
$0.09¢
-$0.01¢
$0.18¢
2
022
2
021
2
020
5.9%
5.2%
13.1%
2
022
2
021
2
020
-$1.4m
$17.9m
$6.4m
-$1.4m
2
022
2
021
2
020
NIL
NIL
NIL
2
022
2
021
2
020
Strategic Report
Annual Report and Accounts 2022
16
Governance Report Financial Statements Additional Information
Key Performance Indicators
Financial
USD 351.2m
28%
3.4%
USD 160
67. 5%
18.5%
73%
USD 46.3m
USD 0.18¢
5.9%
USD 17.9m
Nil
statements.
2
022
2
021
2
020
79
70
112
2.4m
2.4m
2.3m
2
022
2
021
2
020
33.4%
33.0%
35.0%
2
022
2
021
2
020
2,044
1,965
2,028
2
022
2
021
2
020
2
022
2
021
2
020
1,165
1,212
1,134
5.5%
N/A
5.3%
2
022
2
021
2
020
13,047
12,535
13,602
2
022
2
021
2
020
71.6%
77.6%
74.0%
2
022
2
021
2
020
6,382
5,383
7,392
2
022
2
021
2
020
N/A
86%
85%
2
022
2
021
2
020
93%
93%
2
022
2
021
2
020
N/A
91%
89%
92%
2
022
2
021
2
020
Strategic Report
Annual Report and Accounts 2022
17
Governance Report Financial Statements Additional Information
Key Performance Indicators
112
2.3m
35.0%
5.3%
71.6%
86%
93%
92%
services delivered.
Strategic Report
Annual Report and Accounts 2022
18
Governance Report Financial Statements Additional Information
performance
•
•
•
•
•
•
•
ASA India had collected USD 3.7 million from a total
•
•
(Amounts USD millions) FY 2022 FY 2021 FY 2020
YoY
% change
YoY % change
(constant
currency)
2.3 2.4 2.4 -3%
-1%
46.3 25.7 2.6 +80% +117%
17.9 6.4 +181% +269%
¹ 351.2 403.7 415.3 -13% +5%
367. 5 430.7 445.3 -15% +3%
² 5.9% 5.2% 13.1%
Strategic Report
Annual Report and Accounts 2022
19
Governance Report Financial Statements Additional Information
Dirk Brouwer,
(Amounts USD thousands) FY 2022 FY 2021 FY 2020
YoY
% change
YoY % change
(constant
currency)
+80% +117%
+181% +269%
68% 77% 98%
¹ 3.4% 1.1% -0.2%
¹ 18.5% 6.0% -1.3%
¹ 181% 556% -10 4%
-13 % +5%
-15% +3%
Total assets -13%
Client deposits² -4%
² -18%
Share capital and reserves -13 %
-3%
-1%
160 181 187 -12 % +6%
5.9% 5.2% 13.1%
24% 22% 19%
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
South Asia
(Amounts USD thousands) FY 2022 FY 2021 FY 2020
YoY
% change
YoY % change
(constant
currency)
+251% +273%
+125% +128%
64% 154% 134%
1.9% -5.5% -1.7 %
8.8% -27. 3% -7.8%
125% -18 4% -131%
-35% -19%
-36% -21%
Total assets -33%
Client deposits -45%
-41%
Share capital and reserves -11%
-15%
670 778 758 -14%
137 182 201 -25% -7%
11.1% 9.6 % 21.3%
1% 1% 1%
•
•
•
$118.6m
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
•
•
•
•
•
•
•
•
•
¹.
•
•
•
•
•
•
•
India
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
(Amounts USD thousands) FY 2022 FY 2021 FY 2020
YoY
% change
YoY % change
(constant
currency)
34 +12173% +136 6 0 %
+663% +713%
82% 97% 135%
1.8% -0.3% -2.7%
12.0% -1.8% -16 .1%
663% 90% -16 3%
+2% +13%
+0.3% +12%
Total assets -3%
Client deposits +5%
-3%
Share capital and reserves -11%
+6%
441 420 415 +5%
158 167 189 -5% +5%
6.5% 2.1% 4.1%
35% 34% 32%
•
$63.3m
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
•
•
•
•
•
•
•
•
•
•
20.4%.
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
West Africa
(Amounts USD thousands) FY 2022 FY 2021 FY 2020
YoY
% change
YoY % change
(constant
currency)
-22% -2%
-23% -4%
43% 37% 49%
15.8% 20.6% 13.2%
33.2% 45.4% 31.1%
-23% 86% -16 %
-13% +22%
-1 2% +23%
Total assets -20%
Client deposits -15%
-39%
Share capital and reserves -11%
-5%
446 440 433 +1%
196 210 178 -7% +30%
4.2% 2.6% 2.7%
48% 49% 51%
•
$82.4m
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
•
•
•
•
•
•
•
at 263.
•
•
•
•
•
•
•
•
Ghana
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
(Amounts USD thousands) FY 2022 FY 2021 FY 2020
YoY
% change
YoY % change
(constant
currency)
+70% +75 %
+49% +54%
68% 75% 90%
7.0 % 6.5% 1.8%
29.8% 25.5% 6.7%
49% 333% -83%
+34% +39%
+31% +36%
Total assets +36%
Client deposits +19%
+45%
Share capital and reserves +32%
+21%
471 406 359 +16%
172 160 145 +8% +12%
0.9% 1.3% 13.2%
24% 28% 30%
•
$86.9m
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
to 4.6%.
•
•
•
•
•
Tanzania
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
•
•
India
•
•
Myanmar
•
reserves.
•
•
•
Kenya
•
•
•
•
•
In USD millions 31 Dec 22 31 Dec 21 31 Dec 20
84.1 87.8 80.2
216.6 249.8 274.1
21.5 36.5 23.5
19.4 28.1 40.0
89.7 103.4 107.1
Total funding 431.3 505.6 524.9
the short to medium term as of 31 March 2023.
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements Additional Information
million.
assessment period.
US Dollar capital.
Countries FY 2022 FY 2021 FY 2020
– FY 2022
226.4 177.5 160.3
82.7 74.4 73.0
366.3 202.9 185.3
55.7 51.1 48.0
2100.0 1778.5 1330.7
10.2 6.2 5.9
448.1 411.5 384.6
18910.0 11289.0 10107.0
2332.5 2303.7 2317.2
123.5 113.2 109.0
3717.6 3546.2 3647.7
1067.0 1031.8 986.4
18.1 16.7 21.1
Tanwir Rahman,
Strategic Report
Annual Report and Accounts 2022
Governance Report Financial Statements
Strategic Report
Annual Report and Accounts 2022
30
Governance Report Financial Statements Additional Information
Risk management
Outline of the risk management framework in place
1
Senior
is at the heart of the Group’s
business model.
risk management culture to
ensure the risk management is
comprehensive and meets the
takes a prudent and consistent
approach towards risk and the
of risk across its various
then integrated in management
for preparing risk reports on
risk reports and prepares the
Group risk report is discussed
to the Group ARC where the
risks on pages 33 to 39
management across its
in the countries in which the
conduct and maintains a zero
Strategic Report
Annual Report and Accounts 2022
31
Governance Report Financial Statements Additional Information
Risk management
senior management at the Group’s
and district managers at the
management ensure proper
provides guidance and oversight
audits the risk management
risk are performing their roles
the Group’s three lines of
complete and comprehensive
impact on its performance
First line of defence
Second line of defence
and provide an independent oversight
Third line of defence
Strategic Report
Annual Report and Accounts 2022
32
Governance Report Financial Statements Additional Information
Risk management
environment in some of
framework and risk management processes are
in place and can become a key focus for the Board.
The Company updated its risk taxonomy and
incorporated new risks in 2022. The heat map
displays all risks in the risk framework, while
B
i
n
e
R
i
O
p
e
r
a
o
n
a
R
i
I
T
R
i
L
e
g
a
C
o
p
i
a
n
c
e
R
i
F
i
n
a
n
c
i
a
R
i
Risk map
High
Credit risk
Interest rate risk
Credit risk
Interest rate risk
Strategic Report
Annual Report and Accounts 2022
33
Governance Report Financial Statements Additional Information
Risk management
Principal risks
Risk Risk grade and level of change Change in 2022
1. Financial risk
Credit risk
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
34
Governance Report Financial Statements Additional Information
Risk management
Principal risks
Risk Risk grade and level of change Change in 2022
1. Financial risk
Interest rate risk
•
•
•
•
•
monitor interest rates in those countries where there is a limit
Low
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
35
Governance Report Financial Statements Additional Information
Risk management
Principal risks
Risk Risk grade and level of change Change in 2022
•
•
•
•
•
Low
•
•
•
•
Growth risk
All risks and challenges associated with the
•
•
•
•
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
36
Governance Report Financial Statements Additional Information
Risk management
Principal risks
Risk Risk grade and level of change Change in 2022
•
•
•
•
•
Low
•
•
•
•
•
•
Climate risk
emissions; and have procedures in place to respond
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
37
Governance Report Financial Statements Additional Information
Risk management
Principal risks
Risk Risk grade and level of change Change in 2022
•
•
•
•
•
•
•
Low
•
•
•
•
•
•
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
38
Governance Report Financial Statements Additional Information
Risk management
Principal risks
Risk Risk grade and level of change Change in 2022
•
•
•
•
•
•
5. IT risk
•
•
Low
•
•
•
Low
•
•
•
Strategic Report
Annual Report and Accounts 2022
39
Governance Report Financial Statements Additional Information
Risk management
Principal risks
Risk Risk grade and level of change Change in 2022
5. IT risk
resources in place to address and resolve
Low
•
•
•
•
Low
•
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
40
Governance Report Financial Statements Additional Information
ESG report
This ESG report provides an overview
of the environmental, social, and
Environment Social
Governance
Strategic Report
Annual Report and Accounts 2022
41
Governance Report Financial Statements Additional Information
ESG report
m
%
k
m
m
%
%
%
no access to formalised credit
Gender equality
loans, the Group enhances
The Company provides socially
the Company supports
Industry,
infrastructure
The Company supports industry,
Reduced
the Group promotes the use of
household needs, such as
supports economic development
and leads to socioeconomic
fund projects related to health,
Other UN SDGs
supported
community projects
and environmental
commitments, the
Company aims to
on a smaller scale,
Strategic Report
Annual Report and Accounts 2022
42
Governance Report Financial Statements Additional Information
our clients
issues, such as service delivery, loan denials and
for social performance
91%
98%
95%
90%
83%
94%
ESG report
SP14
%
%
%
Strategic Report
Annual Report and Accounts 2022
43
Governance Report Financial Statements Additional Information
ESG report
those who have incorporated the core principles of
There is a preference to promote those that have
turnover is considered low and many employees
professional, facility and department service
The Group monitors and controls health and safety
incidents or illness, and maintains safe equipment
Examples of concerns are improper or unethical
Professionalism
Teamwork
Strategic Report
Annual Report and Accounts 2022
44
Governance Report Financial Statements Additional Information
ESG report
in which they operate, undertake social
except in countries such as India, where
•
•
•
•
•
or scholarship fund
•
Strategic Report
Annual Report and Accounts 2022
45
Governance Report Financial Statements Additional Information
ESG report
•
•
•
2022 performance
$k
k
We have the responsibility
support system, responding
Md Enamul Haque
Strategic Report
Annual Report and Accounts 2022
46
Governance Report Financial Statements Additional Information
the environment and the
the Company is crucial for
the Group to operate in an
ESG report
of emissions
environment, and one way it
Company has conducted an
how to reduce emissions across its
environmental and social
environmental and social impacts
and prevent any harmful impacts
It outlines the necessary factors
to consider and steps to take
towards environmentally
conscious travel decisions while
the Company can monitor its
approach ensures transparent
for further improvements in
To ensure transparency and
disclosure to investors and
to protect resources, clients
The Group assesses the impact
and earthquakes, on its resources
The Philippines is most frequently
the majority of which are
Strategic Report
Annual Report and Accounts 2022
47
Governance Report Financial Statements Additional Information
ESG report
Governance
•
•
•
•
•
•
•
•
Governance
of
Strategic Report
Annual Report and Accounts 2022
48
Governance Report Financial Statements Additional Information
ESG report
•
•
•
•
•
•
•
•
• The Group has implemented standardised
•
•
•
•
Risk label Risk name
A
B
C
D
E
Acute Risk
F
Chronic Risk
risks heat map
FA / B / C
•
•
•
•
•
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
49
Governance Report Financial Statements Additional Information
Climate risk Risk level Financial impact
ST
•
•
Risk associated with
material
ST
•
•
ST
•
concerns in terms of
material
ST
•
•
Physical risk
Acute risk
Risk associated with extreme
weather events such as
material
ST
•
•
Chronic risk
Risk associated with a
material
•
•
ESG report
ST
Strategic Report
Annual Report and Accounts 2022
50
Governance Report Financial Statements Additional Information
Increase the use
Reduce fuel
and protect the
environment
The Group has taken its
enhance its metrics for
performance measurement
•
•
•
•
ESG report
•
•
Strategic Report
Annual Report and Accounts 2022
51
Governance Report Financial Statements Additional Information
ESG report
¹
²
follow the Greenhouse Gas Protocol Corporate
Strategic Report
Annual Report and Accounts 2022
52
Governance Report Financial Statements Additional Information
ESG report
SECR
Greenhouse Gas Protocol
•
owned or controlled assets of
or controlled vehicles and
•
purchased electricity
•
emissions that are a
from sources not owned or
PFCs, SF
factors, expressed as tonnes of
¹
¹
e
Strategic Report
Annual Report and Accounts 2022
53
Governance Report Financial Statements Additional Information
ESG report
ESG
Management System
Emergency Preparedness
ESG
Sexual Harassment
The Company employs
a diverse workforce, with
²
¹
2 5
47 153
8 14
4,713 8,689
Female
Strategic Report
Annual Report and Accounts 2022
54
Governance Report Financial Statements Additional Information
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
55
Financial Statements Additional Information
I am pleased to present our
Board report for 2022
the challenges of Covid being supplanted by
their remits to ensure that Board decisions are
the Board has decided not to pay a dividend for
into a new role as Deputy Chairman of the Board
Guy Dawson
21 April 2023
I believe that careful and
trusted leadership, solid
governance and a sturdy
framework of policies
and procedures have
all contributed to the
the year.
Strategic Report
Annual Report and Accounts 2022
56
Financial Statements Additional Information
Board of Directors
N
ID
Full biographies are available on our website
Guy Dawson
Appointed: 01 January 2021¹
N
ID
Dirk Brouwer
Appointed: 15 May 2018
Karin Kersten
Appointed: 25 April 2022
Aminur Rashid
Appointed: 18 June 2018
2013 and became a Director of the Company on
Member of the Supervisory Board of Mondriaan Fonds and
Gavin Laws
Appointed: 28 June 2018²
ID
Hanny Kemna
Appointed: 28 June 2018¹
ID
Dr Salehuddin Ahmed
¹
N
ID
Chris Low
Appointed: 01 February 2023
N
ID
and was appointed as Senior Independent Director on
Graduate School of Management at BRAC University
and an Independent Director of Grameenphone
Bangladesh and a member of the Board of Trustees
Strategic Report
Annual Report and Accounts 2022
57
Financial Statements Additional Information
Full biographies are available on our website
Dirk Brouwer
Karin Kersten
Joined: 2021
Aminur Rashid
Joined: 2011
Years of MFI experience: 33
Md Enamul Haque
Joined: 2008
Years of MFI experience: 40
Tanwir Rahman
Years of MFI experience: 13
Azim Hossain
Years of MFI experience: 39
Maksudul Amin
Joined: 2022
Years of MFI experience: 1
Joined: 2022
Years of MFI experience: 1
Md Asifur Rahman
Joined: 2018
Years of MFI experience: 24
Strategic Report
Annual Report and Accounts 2022
58
Financial Statements Additional Information
teams are available on the country websites
Regional Director
South Asia South East Asia West Africa East Africa East Africa
India
Years of MFI experience: 15
The Philippines
Years of MFI experience: 31
Nigeria
Kenya
Years of MFI experience: 14
Rwanda
Years of MFI experience: 31
East Africa
Years of MFI experience: 30
Pakistan
Years of MFI experience: 4
Myanmar
Ghana
Tanzania
Years of MFI experience: 11
Zambia
Years of MFI experience: 32
Sri Lanka
Years of MFI experience: 1
Sierra Leone
Years of MFI experience: 31
Uganda
Years of MFI experience: 28
Strategic Report
Annual Report and Accounts 2022
59
Financial Statements Additional Information
2 5
Male
42 1
3 4
52
Board
Audit and Risk
Independent Directors’
Total Total Total Total Total
5 5
Aminur Rashid 5 5 5
5 5
Guy Dawson 5 5 5 5 4 4
5 5 5 5 4 4
5 5 5 5 4 4
5 5 5 5 4 4
Salehuddin Ahmed 5 5 5 5 4 4
•
•
•
•
•
•
•
Company shares to Group employees under the
• Approved the terms of reference for a new Asset
•
23 February 2023 pursuant to which Mr Brouwer
•
•
All other Directors were appointed as Directors
and only dealt with the Company in his role as
Strategic Report
Annual Report and Accounts 2022
60
Financial Statements Additional Information
It is also responsible for approving the Group
The Governance report is structured around the
understanding of how governance supports
recognises the value of gender and ethnic diversity
to consist of members who have the relevant
proper corporate governance and help to generate
Biographical details of the Directors at the date
to be the Senior Independent Director to provide
governance and to serve as an intermediary for the
The Senior Independent Director meets the other
shareholders if they have concerns which contact
Chairman has failed to resolve or for which such
See the Corporate Governance Statement in the
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
expenditure budgets and any material changes
It periodically reviews performance in the light
of the Group’s strategic aims and business plans
dividends and proposing to shareholders of
The Board has overall responsibility for ensuring
regard to the interests of the Company’s various
All Directors have access to the advice and services
ensuring that Board procedures are followed and that
advice at the expense of the Company in the
to request that any concerns they have are recorded
the principal purpose of which is to ensure that the
business independently of the members of the
conducted at arm’s length and on normal commercial
its associates will propose or procure the proposal of
on the Board as the appointee of the Controlling
they would not exercise the right to appoint an
ordinary shares cease to be listed on the premium
Shareholder Group together ceases to retain an
The Board has approved the following succession
and the broader management team in order to
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
The Company has established an assets and liability
Strategic Report
Annual Report and Accounts 2022
63
Financial Statements Additional Information
It meets as required in order to assist the decisions
accordance with the Company’s disclosure procedures
as part of the governance structure of the Group’s
Board receives regular updates from the Senior
related to IT systems of the Company are provided
An annual schedule of rolling agenda items ensures
The Directors receive detailed papers in advance
review the agenda and propose items for discussion
receive papers in the normal manner and have the
that his other commitments do not restrict
Chairman of the Board and is responsible for
by a senior management team which reports
The Directors are responsible for the management
The appointment of Directors is governed by
by the Board of Directors in accordance with
and during normal business hours at the Company’s
Board of Directors
Finance &
Accounts
Investor
India Tanzania
Nigeria
&
Management
Investment,
Treasury &
Funding
Pakistan
The
Philippines
Uganda
Ghana
HR &
Technology
Sri Lanka
Myanmar
Kenya
Sierra
Leone
Rwanda
Risk
Management
Legal &
Compliance
Internal
Audit
Grievance
East AfricaSouth Asia
South East Asia
Zambia
Strategic Report
Annual Report and Accounts 2022
64
Financial Statements Additional Information
light of recent changes in Board membership
The Board discussed the culture statement at length
therefore be recommending that:
•
•
Directors meet the independence criteria set out in
and senior management for the business areas
The Company Secretary is responsible for ensuring
that Board procedures and applicable rules and
Strategic Report
Annual Report and Accounts 2022
65
Financial Statements Additional Information
A procedure has been established whereby actual
prior to the appointment of any new Director
Directors are regularly reminded that they must
of its members who may be connected with the
allows management’s authority to be decentralised
overview of the Group’s management structure
which is based on geographical proximity and
reports directly to the local MFI Board as well as
The table below sets out details of the interests in
as at 31 December 2022 under the provisions of the
the Disclosure Guidance and Transparency Rules is
Name of Director
Number
of shares % holding
¹
Strategic Report
Annual Report and Accounts 2022
66
Financial Statements Additional Information
have appropriate access to management to
The Board believes it is important to maintain open
The Senior Independent Director is available for
shareholders to consult in the event that they have
concerns that contact with the Chairman or the
Directors are available should shareholders
•
•
•
•
•
The Board regards the Company’s AGM as
an important opportunity for shareholders to
discuss the Group and its performance directly
Strategic Report
Annual Report and Accounts 2022
67
Financial Statements Additional Information
This report sets out the
Gavin Laws
As Chair of the Audit and
regulatory changes on the
also closely monitored recoveries
liquidity and funding across the
This report provides an insight
overview of the principal topics
our principal roles and
• Monitor the integrity of the
statements and external
•
• Monitor and review the
both the Internal Audit
• Monitor the adequacy and
• Assess present and emerging
•
•
at the request of the
The full terms of reference of
to focus on the internal controls
systems and processes and
recovery from the challenges
reviewed the provisioning
for expected credit losses in
line with IFRS 9 and whether
adequate provisions has been
made considering economic
established by management to
assess and calculate the expected
audit process as well as the
oversight of Internal Audit and the
focus on further development
including IT audits as well as
security of new and future
Strategic Report
Annual Report and Accounts 2022
68
Financial Statements Additional Information
•
as well as the responses by management to the
•
•
•
•
• Considered the plans and reports from the
internal auditor as well as the quality and
• Reviewed the digital strategy of the Company
•
•
•
•
•
•
• Reviewed whistleblowing reports and
•
liquidity and capital requirements of the Group
• Reviewed the performance of the current auditor
•
•
and greenhouse gas emissions and the TCFD
•
• Reviewing the results announcement for 2023
•
•
•
• Reviewing the value statement of the Company
and focusing on engagement with shareholders
•
auditor of the Company as well as the 2023 report
•
•
•
•
•
•
the other members during 2022 were Salehuddin
28 June 2018 and reappointed at the AGMs held in
the Board members are outlined in the biographies
also considers whether the Company has adopted
•
•
• The basis on which the Group is considered
• Any material misstatements in the accounts that
•
Strategic Report
Annual Report and Accounts 2022
69
Financial Statements Additional Information
about going concern and the existence of material
As part of its role in assessing the integrity of the
the overall system of internal controls within
received in respect of the Group’s covenant breaches
The Group’s liquidity with unrestricted cash and cash
equivalents was approximately USD 55 million at
EY visited several countries in the course of the
audit and had operated a comprehensive program
for the 2022 audit:
•
covenant breaches and ongoing global economic
•
•
the incorrect recording of revenue arising from
•
and material uncertainty in the India component
provide to the Group in 2022 and gave its approval
Strategic Report
Annual Report and Accounts 2022
70
Financial Statements Additional Information
management and discussed various items including
on all employees understanding the process for
Internal Audit and discuss the same with the Board
to ensure that arrangements are in place for the
Emphasis was placed on regular review by the Board
further develop all manuals and carry out training on
Internal Audit team was provided online access to the
audits completed as well as monitoring progress
with inadequate due diligence and incorrect
that the management would respond to issues raised
department and had several discussions on the
and control audit plan for 2023 and the Internal Audit
its report on the IT Audit pursuant to revised
Misstatement pursuant to which EY performed new
overall improvements in IT control design and
needed to meet the challenges we face in our various
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
The management team also provides a full summary
to ensure our three lines of defence model is fully
embedded across our Group and that the governance
medium to high due to the increasing number of
across the Group increased during 2022 with the
which will be rolled out over the coming years in
recognises the need for strong cyber defences
to protect our systems and customer data and to
The IT technology strategy is constantly under
of the internal control systems and believes that they
•
•
receiving dividends from subsidiaries and in the
•
•
•
Group’s IT infrastructure including deployment
maintaining and improving AMBS to meet new
• Improving Internal Audit to allow for more
•
• Monitoring and improving procedures under the
•
•
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
management of the Group around quarterly Board
•
have been made to the numbers that indicate that the
and Directors concluded that the uncertainty around
breaches without waivers on the signing date resulted
months from the date of the approval of the 2022
the unaudited actual numbers up to December 2022
Management has also considered the impact of
crises and has experienced limited losses in the past
seen in the past that the loans provided to clients
during such an economic crisis play a vital role in our
to capital that is instrumental to the resilience of
require larger loans which results in higher interest
The Group also considered the current exchange rate
depreciated against USD in 2022 which impacted
in the going concern period and considered that
The Senior Management and Directors have also
assessed the probable impact of any subsidiary failing
minimum capital requirements at the balance sheet
breaching the capital requirements of the Reserve
Should these requirements be breached then the
exposure of the Group via intercompany loans is very
to ASAI India are also lending at the Group level
and there is an uncertainty on how they will react
Strategic Report
Annual Report and Accounts 2022
73
Financial Statements Additional Information
million in dividends and transfer pricing payments
the stress and reverse stress scenarios include delays
at the subsidiary level in order to raise cash to
that have no regulatory approvals required for
assessed that the probability of the scenarios
breached covenants and which does not have waivers
The outstanding loan amount of covenant breaches
improved performance in 2022 and improvement in
going concern assessment period and it is uncertain
to represent a material uncertainty that may cast
the Senior Management and Directors have a
the Going Concern assessment period being the
13 months from the date of approval of the 2022
The Directors’ assessment has been made with
reference to:
•
• the Group’s business model and strategy – please
•
•
31 December 2022 including access to funding
•
•
concern as discussed above and further detailed
•
Gavin Laws
21 April 2023
Strategic Report
Annual Report and Accounts 2022
74
Financial Statements Additional Information
Guy Dawson
for succession planning for the
robust succession planning for
has recommended the
Board his extensive experience
has specialised in emerging
Chris’s appointment had been
review assisted by Ridgeway
pursuant to which Mr Brouwer
During the year the
•
•
the recruitment of a Chief
• The assessment of senior
experience to ensure that an
appropriate balance of such
•
senior management at the
•
which was formalised on
Strategic Report
Annual Report and Accounts 2022
75
Financial Statements Additional Information
•
•
including succession planning for Directors
•
•
Directors and suitable candidates for the roles
of Senior Independent Director and Chairmen
•
•
•
•
•
• Reviewing the results of the annual Board
•
are set out in the terms of reference and are
Aminur Rashid has over 31 years of experience
Guy Dawson has extensive experience within the
Young as well as broad experience as a supervisory
Mr Ahmed is also on advisory bodies of several
Bangladesh and a member of the board of trustees of
Regional Director for its East Africa businesses and
experience of each of the Directors can be
review the Group’s succession planning at Board and
management across the Group and reviewed the
to the most senior roles in the Company and
Strategic Report
Annual Report and Accounts 2022
76
Financial Statements Additional Information
improve all types of diversity at each level of the
experience of Directors from a range of professional
Company’s eight Directors are women and we
to bring more female Directors onto the Board
recruitment processes and through all stages of
the employee cycle is underpinned by the Group’s
targets have been set by the Company to increase
senior roles in East Africa and South Asia and a
developed in 2023 to ensure gender balance at
the new FCA rules on Diversity and inclusion
Management and employees are expected to ensure
More detail on the Group’s approach to diversity
consequences of the Covid pandemic in 2021 was
managed to increase this in September 2022 to the
to the Board concerning the reappointment of the
Following this year’s review in advance of the 2023
Guy Dawson
21 April 2023
Strategic Report
Annual Report and Accounts 2022
77
Financial Statements Additional Information
Dr Salehuddin Ahmed
to present the report on
presented to shareholders for
approval at the 2022 AGM and
In view of the adjustment that
hereunder and will present the
same to the shareholders for
met on six occasions and:
•
•
• Reviewed the proposed
•
various countries and asked
management to organise a
•
•
review of Independent
pursuant to the report of FIT
• In principle approved the
proposal to approach the
Circular to the Takeover panel
• Approved an amendment
would decide whether a change
•
•
•
the importance of having a
documented and consistent
annual performance appraisal
requirements of a leading
Strategic Report
Annual Report and Accounts 2022
78
Financial Statements Additional Information
•
•
•
•
•
•
•
•
•
Group are compliant with the rules and
requirements of regulators and all relevant
•
performance and quantum and if not what
•
policies are tailored to this model including its
were then presented to the shareholders for
Strategic Report
Annual Report and Accounts 2022
79
Financial Statements Additional Information
Total
(2022)
USD ‘000
Total
(2021)
USD ‘000
in
USD ‘000 %
2022 2021 2020 2019 2018
2023
–2022
2022
–2021
2021
–2020
2020
–2019
¹
²
2022 2021 2020 2019 2018
%
2022
–2021
%
2021
–2020
%
2020
–2019
Aminur Rashid ³
- - - - - - -
Gavin Laws
Salehuddin Ahmed -
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
manner:
•
Helps to recruit and retain
¹
•
• Life assurance cover
•
•
•
Helps to recruit and retain
Strategic Report
Annual Report and Accounts 2022
81
Financial Statements Additional Information
•
•
•
•
•
•
•
•
who have the requisite skills and
experience to determine the
N/A
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
•
•
•
•
•
•
•
•
•
Other
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
•
•
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
84
Financial Statements Additional Information
Name
Annual
Total
(2022)
Total
(2021)
Total
(2020)
Total
(2022)
Total
(2021)
Total
(2020)
¹
Travel expenses
on actuals 0
0 0 0
³
Travel expenses
on actuals 0 0 0 0
² Corporate
EUR
0
EUR
Travel expenses
on actuals 0 0 0 0
Travel expenses
on actuals 0 0 0 0
Travel expenses
on actuals 0 0 0 0
Salehuddin Ahmed
Travel expenses
on actuals 0 0 0 0
Travel expenses
on actuals 0 0 0 0
•
•
Strategic Report
Annual Report and Accounts 2022
85
Financial Statements Additional Information
Name
Aminur Rashid
Md Enamul Haque
Mischa Assink
Basic
salary
(50% increase share price)
100% 74%
26%
Basic
salary
100% 74%
26%
Basic
salary
100% 77%
23%
0
100,000
200,000
300,000
400,000
500,000
600,000
In GBP In GBP In GBP
0
60,000
40,000
20,000
120,000
100,000
80,000
180,000
160,000
140,000
200,000
220,000
260,000
240,000
50,000
140,000
110,000
80,000
230,000
200,000
170,000
320,000
290,000
260,000
350,000
380,000
•
•
•
•
Strategic Report
Annual Report and Accounts 2022
86
Financial Statements Additional Information
1,2
Aminur Rashid
1,3
0
0
Gavin Laws 0
Chris Low 0
0
Salehuddin Ahmed 0
A consequence of the current aggregate shareholding
in a requirement under Rule 9 of the Takeover Code
Strategic Report
Annual Report and Accounts 2022
87
Financial Statements Additional Information
search carried out with the help of the independent
USD
Aminur Rashid ¹
Dr Salehuddin Ahmed
Strategic Report
Annual Report and Accounts 2022
88
Financial Statements Additional Information
the decisions of the Board concerning the
Strategic Report
Annual Report and Accounts 2022
89
Financial Statements Additional Information
The Directors’ interests in the share capital of the
Directors’ report
shareholders to allot such shares to them on the
Strategic Report
Annual Report and Accounts 2022
90
Financial Statements Additional Information
•
•
•
•
•
•
•
Directors’ report
for safeguarding the assets of the group and parent
•
•
•
Guy Dawson
Dirk Brouwer
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
Item
a Director
interested
Directors’ report
Strategic Report
Annual Report and Accounts 2022
Financial Statements Additional Information
•
•
Prism Cosec
Directors’ report
Strategic Report
ASA International Group plc
Annual Report and Accounts 2022
93
Governance Report
Financial Statements
Additional Information
Financial Statements
Financial Statements
93 General information
94 Independent auditor’s report
102 Consolidated income statement
and statement of comprehensive
income
103 Consolidated statement
of financial position
104 Consolidated statement
of changes in equity
105 Consolidated statement
of cash flows
106 Notes to the consolidated
financial statements
157 Statutory Income statement and
statement of comprehensive
income
157 Statutory statement of financial
position
158 Statutory statement of changes
in equity
158 Statutory statement
of cash flows
159 Notes to the statutory financial
statements
Directors Company secretary:
Guy Dawson Prism Cosec Limited
Dirk Brouwer
Aminur Rashid
Karin Kersten
Gavin Laws
Johanna Kemna
Dr Salehuddin Ahmed
Chris Low
Praful Patel (appointed on 28 June 2018) resigned from the Board on 22 June 2022 after expiry of his term.
Registration:
ASA International Group plc is a company registered in England and Wales .
Registered number: 11361159
Office addresses:
ASA Tower, 10th Floor 23/3,
Bir Uttam A.N.M. Nuruzzaman Sarak, Shyamoli,
Dhaka-1207, Bangladesh
Tel: +880 2 8119828, 8110934-35
Rembrandt Tower, 35th Floor, Amstelplein 1
1096 HA Amsterdam, The Netherlands
Tel: +31 20 846 3554
Website:
www.asa-international.com
Investor Relations:
Mischa Assink
ir@asa-international.com
Share Registrars:
Equiniti Ltd
Aspect House, Spencer Road
Lancing, West Sussex BN99 6DA
United Kingdom
Auditor:
Ernst & Young LLP
25 Churchill Place
Canary Wharf, London E14 5EY
United Kingdom
General information
Strategic Report
ASA International Group plc
Annual Report and Accounts 2022
94
Governance Report
Financial Statements
Additional Information
Financial Statements continued
Independent auditor’s report to the
members of ASA International Group plc
Opinion
In our opinion:
• ASA International Group plc’s Group financial statements and Parent Company financial statements (the
‘financial statements’) give a true and fair view of the state of the Group’s and of the Parent Company’s
affairs as at 31 December 2022 and of the Group’s profit for the year then ended;
• the financial statements have been properly prepared in accordance with UK adopted international
accounting standards; and
• the financial statements have been prepared in accordance with the requirements of the Companies Act
2006.
We have audited the financial statements of ASA International Group plc (the ‘Company’ or ‘Parent Company’)
and its subsidiaries (together, the ‘Group’) for the year ended 31 December 2022 which comprise:
Group Parent Company
Consolidated income statement and statement
of comprehensive income for the year then ended
Statutory income statement and statement of other
comprehensive income for the year then ended
Consolidated statement of financial position
as at 31 December 2022
Statutory statement of financial position
as at 31 December 2022
Consolidated statement of changes in equity
for the year then ended
Statutory statement of changes in equity
for the year then ended
Consolidated statement of cash flows
for the year then ended
Statutory statement of cash flows
for the year then ended
Related notes 1 to 39 to the financial statements,
including a summary of significant accounting policies
Related notes 40 to 47 to the financial statements
including a summary of significant accounting policies
Information marked as ‘audited’ within the Directors’
Remuneration Report on page 77.
The financial reporting framework that has been applied in their preparation is applicable law and UK adopted
international accounting standards.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our report. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group and Parent Company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to
listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Group or the Parent
Company and we remain independent of the Group and the Parent Company in conducting the audit.
Material uncertainty related to going concern
We draw attention to note 2.1.1 in the financial statements, which indicates that the Directors have assessed
the elevated arrears and credit losses across the loan portfolio that have caused breaches in the Group’s
covenants on its borrowings in 2022 and the ongoing global economic challenges which have increased the
risk of further breaches across the going concern assessment period. The risk is increased, or sustained, by the
specific challenges in India, Sri Lanka and Myanmar, and the potential for restrictions on the movement of
funds between companies across the Group. Unless covenant breach waivers are obtained the debt may be
called due which could materially impact the ability of the Group to meet its debt obligations.
The current challenges relating to inflation across many of the territories in which the Group operates makes it
difficult to assess the potential for future debt covenant breaches and whether the waivers necessary to avoid
the immediate repayment of debt will be forthcoming. As a result, the Directors have concluded that this
represents a material uncertainty which may cast significant doubt on the Group’s ability to continue as a
going concern.
As stated in note 2, these events or conditions indicate that a material uncertainty exists that may cast
significant doubt on the Group and Parent Company’s ability to continue as a going concern. Our opinion is
not modified in respect of this matter.
In auditing the financial statements, we have concluded that the Director’s use of the going concern basis of
accounting in the preparation of the financial statements is appropriate. Our evaluation of the Directors’
assessment of the Group and Parent Company’s ability to continue to adopt the going concern basis of
accounting included:
• In conjunction with our walkthrough of the Group’s financial close process, we confirmed our
understanding of the going concern assessment process and also engaged with management early to
ensure relevant key factors were considered in their assessment.
• We considered the period of the going concern assessment which is from the date of approval of these
financial statements to 31 May 2024 and confirmed this with those charged with governance.
• We agreed the Group’s borrowing analysis to supporting evidence, including satisfying ourselves that there
were no material intra-group liabilities in the form of parental guarantees or letters of support.
• We reviewed debt agreements across the Group in order to establish the existence of covenants and
considered the risk of covenant breaches on the timing of the Group’s debt repayment obligations.
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Additional Information
• We established the accuracy and reasonableness of the budget and cashflow forecasts across the going
concern period under normal conditions and under a series of stress and severe stress scenarios, including
performing independent reverse stress testing. From this testing we considered the cash position in the
Group through to 31 May 2024 and compared that to the external debt in the Group, in order to establish
the level of risk associated with covenant breaches and the potential for debt being called due.
• We reviewed the performance of the Group in 2022 and over recent history, including the historical impact
of the COVID-19 pandemic, natural disasters or other significant events on the business, in order to assess
the historic resilience of the Group to periods of stress.
• We considered whether there were other events subsequent to the balance sheet date which could have a
bearing on the going concern conclusion, including engaging the views of the component audit teams,
reviewing loan arrears analysis and performing media searches relating to the impact of geo-political issues
and other relevant matters.
• We reviewed the Group’s going concern disclosures included in the Annual Report in order to assess
whether the disclosures were appropriate and in conformity with the accounting standards.
From our evaluation of the Directors’ going concern assessment, we had the following observations:
• As detailed in note 25, the Group had $257m of external debt at 31 December 2022 of which $82.5m had
breached loan covenants. The Group have obtained waivers from a number of lenders in order to reduce
the risk associated with debt being called due, but these waivers do not cover the complete period through
to 31 May 2024. We observed that, should a significant proportion of the debt be called due at certain
points in the going concern assessment period, the Group may have insufficient cash, at that time, to fund
the required repayments.
• The Group continues to face challenges in the collection of outstanding loan balances, particularly with
regard to operations in India, Myanmar and Sri Lanka. The recoverability of customer loans may be
impacted by current economic conditions, relating to inflationary pressures, which could impact Group’s
ability to remain in compliance with covenants and settle debt when it becomes due.
• The Group is experiencing restrictions on the movement of funds between certain countries, due to local
laws or regulations, which could restrict the ability of the Group to support the funding and debt
repayment requirements in the countries in which it operates.
Based on the work we have performed, we concur with the Directors that there are material uncertainties
relating to events or conditions that, individually or collectively, may cast significant doubt on the Group and
Parent Company’s ability to continue as a going concern. The assessment period was to 31 May 2024 and
considers at least twelve months from the date of the approval of these financial statements. Going concern
has been determined to be a key audit matter.
In relation to the Group and Parent Company’s reporting on how they have applied the UK Corporate Governance
Code, we have nothing material to add or draw attention to in relation to the Directors’ statement in the financial
statements about whether the Directors considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the
relevant sections of this report. However, because not all future events or conditions can be predicted, this
statement is not a guarantee as to the Group’s ability to continue as a going concern.
Overview of our audit approach
Audit scope
• We performed an audit of the complete financial information of nine components in nine
countries (full-scope) and audit procedures on specific balances on eight components in
eight countries (specific scope and specified procedures).
• The components where we performed full or specific audit procedures accounted for
98.8% of Profit before tax, 98.8% of Revenue and 98.7% of Total assets.
Key audit
matters
• Expected credit loss provisions
• Risk of fraud in revenue recognition through the incorrect recording of revenue arising
from fictitious loans and advances to customers
• Valuation of deferred tax assets
• Going concern
Materiality
• Overall group materiality of $2.2m (2021: $2.4m) which represents 5% of profit before tax.
An overview of the scope of the Parent Company and Group audits
Tailoring the scope
Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality
determine our audit scope for each company within the Group. Taken together, this enables us to form an
opinion on the consolidated financial statements. We take into account size, risk profile, the organisation of
the Group and effectiveness of group-wide controls, changes in the business environment, the potential
impact of climate change and other factors such as recent Internal audit results when assessing the level of
work to be performed at each company.
In assessing the risk of material misstatement to the Group financial statements, and to ensure we had
adequate quantitative coverage of significant accounts in the financial statements, of the 27 reporting
components of the Group, we selected 17 components covering entities within the following countries:
• Full scope (audit of complete financial information): Pakistan, Philippines, India, Ghana, Nigeria, Myanmar,
Kenya, Tanzania and the Parent Company in the United Kingdom.
• Specific scope (audit of specific account balances or disclosures): Sri Lanka, Uganda and Sierra Leone.
• Specified procedures (specific audit procedures as specified by the Primary Team): Rwanda, Zambia and
the holding entities in the Netherlands, Bangladesh and Mauritius.
We performed an audit of the complete financial information of nine components (“full scope components”)
which were selected based on their size or risk characteristics.
The reporting components where we performed audit procedures accounted for 98.8% (2021: 95.1%) of the
Group’s Profit before tax, 99.2% (2021: 98.8%) of the Group’s Profit before tax when using absolute values,
98.8% (2021: 96.2%) of the Group’s Revenue and 98.7% (2021: 96.7%) of the Group’s Total assets. The full
scope components contributed 108.4% (2021: 116.7%) of the Group’s Profit before tax, 85.4% (2021: 80.7%)
of the Group’s Profit before tax when using absolute values, 88.1% (2021: 94.9%) of the Group’s Revenue and
116.7% (2021: 114.5%) of the Group’s Total assets, 68.7% (2021: 70.4%) of the Group’s Total assets when
using absolute values.
Financial Statements continued
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Of the remaining 10 components that together represent 1.2% of the Group’s Profit before tax, none is
individually greater than 5% of the Group’s profit before tax. For these components, we performed other
procedures, including analytical review, testing of consolidation journals and intercompany eliminations and
foreign currency translation recalculations, to respond to any potential risks of material misstatement to the
Group financial statements.
Changes from the prior year
There are two components that were designated as not in scope for the 31 December 2021 audit which were
designated as in scope with specified procedures for the 31 December 2022 audit. One component was
designated as not in scope for the 31 December 2021 audit, was designated as specific scope for the
31 December 2022 audit. Two components which were designated as full scope for the 31 December 2021
audit were designated as specific scope for the 31 December 2022 audit. These changes were as a result of
updated audit scoping from our consideration of component significance and risk.
Involvement with component teams
In establishing our overall approach to the Group audit, we determined the type of work that needed to be
undertaken at each of the components by us, as the primary audit engagement team, or by component
auditors from other EY global network firms operating under our instruction. Of the nine full scope
components, audit procedures were performed on one of these directly by the primary audit team. For the
remaining eight full scope components, where the work was performed by component auditors, we
determined the appropriate level of involvement to enable us to determine that sufficient audit evidence had
been obtained as a basis for our opinion on the Group as a whole.
The Group audit team continued to follow a programme of planned visits and led a number of video
conference calls. The Senior Statutory Auditor and senior members of the Group audit team visited Kenya,
Tanzania, Pakistan, India, Netherlands, Bangladesh, Ghana and the Philippines. During these visits we
attended meetings with management, met borrower groups where possible, and held discussions on the audit
approach and any issues arising from the audit work with component teams.
In addition to the component visits, and for where visits were not undertaken, the Group audit team
implemented a programme of oversight and involvement which included the following activities:
• Issued detailed audit instructions;
• Held a group audit conference, including the primary team and all full-scope component teams, to discuss
the plan for the audit, including but not limited to; significant risk areas and other areas of focus,
independence procedures, materiality levels, updates from component territories, laws and regulations,
and going concern procedures;
• Held planning, execution and conclusions video conference meetings with all components, including
meetings with component management where relevant, in order to direct and supervise the work
performed and conclude;
• Interacted regularly with component teams through each phase of the audit to supervise audit progress,
provide direction and validate the results and conclusions reached; and
• Reviewed component reporting documents and key working papers.
This, together with the additional procedures performed at Group level, gave us appropriate evidence for our
opinion on the Group financial statements.
Climate change
Stakeholders are increasingly interested in how climate change will impact the Group and the micro-finance
industry. The Group has determined that the most significant future impacts from climate change on their
operations will be from the potential impact of natural disasters and weather events impacting the
recoverability of loans and advances to customers. These are explained on pages 47–50 in the required Task
Force for Climate related Financial Disclosures and on pages 32–39 in the Principal risks and uncertainties.
They have also explained their “energy efficiency” actions taken for 2022, and planned action for 2023 on
page 51. All of these disclosures form part of the “Other information,” rather than the audited financial
statements. Our procedures on these unaudited disclosures therefore consisted solely of considering whether
they are materially inconsistent with the financial statements or our knowledge obtained in the course of the
audit or otherwise appear to be materially misstated, in line with our responsibilities on “Other information”.
In planning and performing our audit we assessed the potential impacts of climate change on the Group’s
business and any consequential material impact on its financial statements.
The Group has explained in note 2.1.1 of the financial statements, governmental and societal responses to climate
change risks are still developing, and where the degree of certainty of these changes means that they cannot be
taken into account when determining asset and liability valuations under the requirements of UK adopted
international accounting standards. As noted in note 2.5.1, The Group has identified the Expected credit loss
provision as one of the main areas in which it could be exposed to the financial impacts of climate change risk as a
number of the Group’s operating areas are prone to natural disasters such as typhoons, flash floods or droughts.
Our audit effort in considering the impact of climate change on the financial statements was focused on
evaluating management’s assessment of the impact of climate risk, physical and transitional, the Group’s
climate related disclosures, the potential effects of material climate risks and the significant judgements and
estimates disclosed in note 2.1.1 and whether these have been appropriately reflected in asset values where
these are impacted by future cash flows, and in the timing and nature of liabilities recognised, following the
requirements of UK adopted international accounting standards. As part of this evaluation, we performed our
own risk assessment, supported by our climate change internal specialists, to determine the risks of material
misstatement in the financial statements from climate change which needed to be considered in our audit.
We also challenged the Directors’ considerations of climate change risks in their assessment of going concern
and viability and associated disclosures. Where considerations of climate change were relevant to our
assessment of going concern, these are described above.
Financial Statements continued
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Additional Information
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the
engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters.
Risk Our response to the risk
Key observations communicated to the Audit and
Risk Committee
Expected credit loss provisions (2022: $16.9m, 2021: $27.5m)
Refer to the Audit and Risk Committee report (page 69); Accounting policies (page 116);
and Note 13.2 of the Consolidated Financial Statements (page 129)
Expected credit loss (ECL) provisions under IFRS 9 is an accounting estimate that
carries a high degree of uncertainty driven by judgemental assumptions, including
historical loss rates, their application to the outstanding loan portfolio, forward
looking factors, the application of model overlays (post-model adjustments) to capture
unmodelled risk, and the impact of the economic uncertainty, natural disasters or
governmental interventions on these assumptions.
The vast majority of the Group’s lending is short-term, low in value, unsecured (except
for security deposits paid in certain territories) and to women in developing
economies in order to start and grow their businesses. The impact of the current
economic environment and political conditions has impaired the ability of the Group
to distribute and collect loans made to borrowers, which has resulted in increased risk
in certain countries in which the Group operates.
The inherent ability of management to override internal controls in relation to loan
impairment provisions, combined with the subjectivity of the provisions, represents a
risk of fraud.
We involved credit risk modelling specialists to assist in testing the appropriateness of
the model and model assumptions. This testing included:
• Independent recalculation of the loan impairment provision including the allocation
of loans into stages.
• Sensitivity analysis of the assumptions used by management including back-testing
of the provision to evaluate the accuracy of management’s estimation process and
assess for evidence of management bias.
• Reviewing key model assumptions including the loss rates and the application of
loss rate to loans present at the balance sheet date.
• Assessing whether indications of model weakness exist which could reasonably
give rise to a material misstatement in the ECL estimate.
In order to further challenge the reasonableness of the ECL recorded by management,
we produced an independent challenger model using the complete loan portfolio and
auditor-defined assumptions. This challenger model included the consideration of the
completeness and accuracy of model overlays, including forward-looking factors,
through a review of post balance sheet events and a consideration of historical loss
patterns and forecasting accuracy.
We evaluated the criteria used to allocate a financial asset to stage 1, 2 or 3 in
accordance with IFRS 9.
We performed a test of the dataflows into the ECL model, including the arrears, last
payment date, write-off and recoveries data.
We inquired of management and reviewed the minutes of Board and other key
meetings in order to identify if any specific events or circumstances exist which may
trigger the need for incremental provisions.
We assessed the adequacy and appropriateness of the disclosures with reference to
IFRS 7 and IFRS 9 requirements.
We communicated that we are satisfied
that ECL provisions were reasonable and in
compliance with IFRS 9.
We highlighted to the Committee that
there are heightened levels of uncertainty
in determining forecast losses due to the
ongoing impact of economic uncertainty.
We concluded that disclosures relating to
loan impairments were in compliance with
the requirements of UK adopted
international accounting standards.
Financial Statements continued
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Risk Our response to the risk
Key observations communicated to the Audit and
Risk Committee
Risk of fraud in revenue recognition through the incorrect recording of revenue
arising from fictitious loans and advances to customers (2022: $161.2m, 2021:
$175.7m)
Refer to the Audit and Risk Committee report (page 69); Accounting policies (page 111);
and Note 4.1 of the Consolidated Financial Statements (page 124)
The income recognised may be fraudulently misstated due to the incorrect recording
of interest income arising from loans being disbursed to fictitious borrowers, or
otherwise fraudulently recorded, in order to manipulate income or disguise losses.
The heightened volume of impaired loans also increases the complexity in the
recording of interest income.
For a sample of loans across each of the eight trading full scope components, we
independently recalculated the interest income using contractual terms from
borrower agreements and agreed them through to the amounts recorded in the
financial statements. This testing included a calculation of the impact of payment
deferrals and payment moratoria on the recording of income under IFRS 9.
For a sample of borrowers across the eight trading full scope components we
attended the borrower group meetings, where the borrowers meet periodically as a
group to make scheduled payments, and physically verified the identity of the
borrowers and traced the loan outstanding balance per the borrower’s passbook to
the accounting records. Where it was not possible to perform physical verification of
borrowers in person, due to the impact of local social restrictions, borrower existence
was tested through alternative means, including video conference and phone calls.
We performed an independent calculation of income recorded on IFRS 9 stage 3 loans
and compared it to that recorded by Management.
We reported to the Audit and Risk
Committee our conclusion that the
recording of interest income was found
to be materially accurate.
From our test of income recorded on
impaired loans we reported to the Audit
and Risk Committee that the balance was
materially accurate.
Our audit procedures did not identify
evidence of fraud in the recognition of
revenue.
Valuation of deferred tax assets (2022: $4.6m, 2021: $13.4m)
Refer to the Audit and Risk Committee report (page 69); Accounting policies (page 121);
and Note 11.2 of the Consolidated Financial Statements (page 127)
Management exercises judgement in the determination of the value of deferred tax
assets that can be recognised, based upon the likely timing and extent of future
taxable profits. Given the recent history of losses in certain components of the Group,
and the prevailing economic conditions, there is uncertainty around timing and extent
of forecast profitability.
The risk is focused towards those components where there are material deferred tax
assets and a recent history of losses.
The inherent ability of management to override internal controls in relation to
forecasts, combined with the subjectivity of the assumptions used for the forecasts,
represents a risk of fraud.
With the support of our tax audit team we reviewed management’s tax calculations,
including considering the accuracy of brought-forward unutilised tax losses and
taxable temporary differences.
We obtained, reviewed and tested management’s deferred tax asset calculation,
which included:
• Testing the completeness and accuracy of the relevant calculations.
• Establishing the accuracy of the dataflows into management’s forecasts.
We considered the reasonableness of management’s profit forecasts through
reviewing the historical accuracy of forecasting, the history of profitability at a
country-level and relevant future assumptions – including profitability growth rates
and the time-horizons where taxable profits are considered probable.
We communicated that, following the
recording of adjustments arising from our
audit testing, the deferred tax asset balance
was reasonable and in compliance with UK
adopted international accounting
standards.
Financial Statements continued
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Additional Information
Our application of materiality
We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified
misstatements on the audit and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to
influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining
the nature and extent of our audit procedures.
We determined materiality for the Group to be $2.2m (2021: $2.4m), which is 5% (2021: 5%) of profit before
tax. We believe that profit before tax provides us with the most appropriate basis for materiality given the
Group is a profit orientated entity.
For the prior year audit, materiality figures for the Group were based on adjusted profit before tax. We
adjusted the Group’s pre-tax profit for the increased expected credit losses incurred as a consequence of
COVID-19. We determine the items adjusted for to be non-recurring in nature and therefore the adjustments
have not been applied for the 31 December 2022 audit.
We determined materiality for the Parent Company to be $711k (2021: $711k) which is 0.5% of total assets
(2021: 0.5%). We consider that, in respect of the Parent Company, total assets is most relevant to the
stakeholders and representative of the economic size of the entity and, as such, provides us with an
appropriate basis for determining the nature, timing and extent of risk assessment procedures, identifying and
assessing the risk of material misstatement and determining the nature, timing and extent of further audit
procedures.
Performance materiality
The application of materiality at the individual account or balance level. It is set at an amount to reduce to an
appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds
materiality.
On the basis of our risk assessments, together with our assessment of the Group’s overall control
environment, our judgement was that performance materiality was 50% (2021: 50%) of our planning
materiality, namely $1.1m (2021: $1.2m). We have set performance materiality at this percentage (which is at
the lowest end of the range of our audit methodology) based on various considerations including the past
history of misstatements and the effectiveness of the control environment.
Audit work at component locations for the purpose of obtaining audit coverage over significant financial
statement accounts is undertaken based on a percentage of total performance materiality. The performance
materiality set for each component is based on the relative scale and risk of the component to the Group as a
whole and our assessment of the risk of misstatement at that component. In the current year, the range of
performance materiality allocated to components was $0.22m to $0.49m (2021: $0.24m to $0.48m).
Reporting threshold
An amount below which identified misstatements are considered as being clearly trivial.
We agreed with the Audit and Risk Committee that we would report to them all uncorrected audit differences
in excess of $0.11m (2021: $0.12m), which is set at 5% of planning materiality, as well as differences below
that threshold that, in our view, warranted reporting on qualitative grounds. The reporting threshold for the
Parent Company was $0.04m (2021: $0.04m).
We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed
above and in light of other relevant qualitative considerations in forming our opinion.
Other information
The other information comprises the information included in the annual report other than the financial
statements and our auditor’s report thereon, including the Strategic Report on pages 1 to 54, the Governance
Report on pages 55 to 92 and Additional Information on pages 161 to 164. The directors are responsible for
the other information contained within the annual report.
Our opinion on the financial statements does not cover the other information and, except to the extent
otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or
otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude that there is a material
misstatement of the other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, the part of the directors’ remuneration report to be audited has been properly prepared in
accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the strategic report and the directors’ report for the financial year for which the
financial statements are prepared is consistent with the financial statements; and
• the strategic report and the directors’ report have been prepared in accordance with applicable legal
requirements.
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Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the Parent Company and its environment
obtained in the course of the audit, we have not identified material misstatements in the strategic report or
the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
• adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit
have not been received from branches not visited by us; or
• the Parent Company financial statements and the part of the directors’ remuneration report to be audited
are not in agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Corporate Governance Statement
We have reviewed the directors’ statement in relation to going concern, longer-term viability and that part of
the Corporate Governance Statement relating to the Group and Parent Company’s compliance with the
provisions of the UK Corporate Governance Code specified for our review by the Listing Rules.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of
the Corporate Governance Statement is materially consistent with the financial statements or our knowledge
obtained during the audit:
• Directors’ statement with regards to the appropriateness of adopting the going concern basis of accounting
and any material uncertainties identified set out on page 90;
• Directors’ explanation as to its assessment of the company’s prospects, the period this assessment covers
and why the period is appropriate set out on page 73;
• Director’s statement on whether it has a reasonable expectation that the group will be able to continue in
operation and meets its liabilities set out on page 73;
• Directors’ statement on fair, balanced and understandable set out on page 90;
• Board’s confirmation that it has carried out a robust assessment of the emerging and principal risks set out
on page 73;
• The section of the annual report that describes the review of effectiveness of risk management and
internal control systems set out on page 71; and;
• The section describing the work of the Audit and Risk Committee set out on page 67–73.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 90, the directors are
responsible for the preparation of the financial statements and for being satisfied that they give a true and fair
view, and for such internal control as the directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Group and Parent
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless the directors either intend to liquidate the Group or
the Parent Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of
not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from
error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations,
or through collusion. The extent to which our procedures are capable of detecting irregularities, including
fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests
with both those charged with governance of the company and management.
• We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group and
determined that the most significant are:
– Financial Conduct Authority (‘UK Listing Authority’ or UKLA’) Listing Rules;
– Companies Act 2006; and
– Legal and regulatory frameworks in operation in the countries in which the Group operates.
• We obtained an understanding of how ASA International Group plc complies with these legal and
regulatory frameworks by making enquiries of Management, internal audit, and those responsible for legal
and compliance matters. We also reviewed correspondence between the Group and its regulators;
reviewed minutes of the key committee meetings and gained an understanding of the Group’s approach to
governance, demonstrated by the Board’s approval of the Group’s governance framework, and the Board’s
review of the Group’s risk management framework (‘RMF’) and internal control processes.
• As the primary team we held discussions with each of the component teams during our Group Audit
Conference, and reviewed their component reporting to us, in order to understand the applicable legal and
regulatory frameworks at a component level and how the Group complies with these.
• We assessed the susceptibility of the Group’s financial statements to material misstatement, including how
fraud might occur by holding discussions with senior management, internal audit and the Audit and Risk
Committee and through an analysis of financial reporting information and areas of estimation which could
be subject to manipulation. We considered the risk of fraud through management override of internal
controls and in revenue recognition and designed specific audit procedures to address these risks,
including those detailed in the Key Audit Matters section above.
Financial Statements continued
Independent auditor’s report to the members
of ASA International Group plc continued
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• Based on the results of our risk assessment we designed our audit procedures to identify non-compliance
with such laws and regulations. Our procedures involved enquiries of the Legal team, the Audit and Risk
Committee, senior management, internal audit and the review of reports prepared by internal audit, legal
and compliance and the Group’s Fraud and Misappropriation Unit. We also reviewed the whistleblowing
reports presented to the Group’s Audit and Risk Committee throughout the year. In order to further
consider legal and regulatory compliance at a component level, we instructed each component audit
team to report to us any instances of non-compliance with laws and regulations to which they had
become aware.
• The Group operates in the financial services industry, which is a highly regulated environment. As such, the
Senior Statutory Auditor considered the experience and expertise of the engagement team, including
auditor’s specialists, to ensure that the team had the appropriate competence and capabilities, which
included the use of specialists where appropriate.
A further description of our responsibilities for the audit of the financial statements is located on the Financial
Reporting Council’s website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of
our auditor’s report.
Other matters we are required to address
• Following the recommendation from the Audit and Risk Committee, we were appointed by the Company
on 12 July 2018 to audit the financial statements for the year ending 31 December 2018 and subsequent
financial periods. The period of total uninterrupted engagement including previous renewals and
reappointments is five years, covering the years ending 31 December 2018 to 31 December 2022.
• The audit opinion is consistent with the additional report to the Audit and Risk Committee.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of
the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s
members those matters we are required to state to them in an auditor’s report and for no other purpose. To
the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the
Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we
have formed.
Stephen Littler (Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory Auditor
London
21 April 2023
Financial Statements continued
Independent auditor’s report to the members
of ASA International Group plc continued
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| Consolidated income statement and statement of comprehensive income | |||
| for the year ended 31 December 2022 | |||
| 2021 | |||
| 2022 | USD’000 | ||
| Notes | USD’000 | (Restated)¹ | |
Interest income calculated using Effective Interest Rate (‘EIR’) | 4.1. | ||
Other interest and similar income | 4.2. | ||
Interest and similar income | |||
Interest and similar expense | 5. | ( | ( |
Net interest income | |||
Other operating income | 6. | ||
Total operating income | |||
Credit loss expense | 7. | ( | ( |
Net operating income | |||
Personnel expenses | 8. | ( | ( |
Depreciation on property and equipment | 16. | ( | ( |
Depreciation on right-of-use assets | 17. | ( | ( |
Other operating expenses | 9. | ( | ( |
Exchange rate differences | 10. | ( | ( |
Total operating expenses | ( | ( | |
Profit before tax | |||
Income tax expense | 11. | ( | ( |
Withholding tax expense | 11.7. | ( | ( |
Profit for the period | |||
| Profit for the period attributable to: | |||
Equity holders of the parent | |||
Non-controlling interest | ( | ( | |
17,887 | 6,358 |
| 2021 | |||
| 2022 | USD’000 | ||
| Notes | USD’000 | (Restated)¹ | |
| Other comprehensive income: | |||
Foreign currency exchange differences on translation of foreign operations | ( | ( | |
Movement in hedge accounting reserve | 23. | ||
Others | ( | ( | |
| Total other comprehensive (loss) to be reclassified to profit | |||
or loss in subsequent periods, net of tax | ( | ( | |
Gain/(loss) on revaluation of MFX investment | 15. | ( | |
Actuarial gains on defined benefit liabilities | 8.1. | ||
Total other comprehensive income not to be reclassified to profit or loss in subsequent periods, net of tax | |||
Total comprehensive (loss) for the period, net of tax | ( | ( | |
| Total comprehensive (loss) attributable to: | |||
Equity holders of the parent | ( | ( | |
Non-controlling interest | ( | ( | |
(13,779) | (3,512) | ||
Earnings per share | 39. | USD | USD |
| Equity shareholders of the parent for the period: | |||
Basic earnings per share | |||
Diluted earnings per share |
The notes 1 to 39 form an integral part of these financial statements.
1 See note 2.1.2 for details.
Financial Statements continued
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| Consolidated statement of financial position | |||||||
| as at 31 December 2022 | |||||||
| 2022 | 2021 | 2022 | 2021 | ||||
| Notes | USD’000 | USD’000 | Notes | USD’000 | USD’000 | ||
| Assets | Liabilities | ||||||
Cash at bank and in hand | 12. | Debt issued and other borrowed funds | 25. | ||||
Loans and advances to customers | 13. | Due to customers | 26. | ||||
Due from banks | 14. | Retirement benefit liability | 8.1. | ||||
| Equity investments at Fair Value through Other | Current tax liability | 11.1. | |||||
Comprehensive Income (‘FVOCI’) | 15. | Deferred tax liability | 11.3. | ||||
Property and equipment | 16. | Lease liabilities | 17. | ||||
Right-of-use assets | 17. | Derivative liabilities | 19. | ||||
Deferred tax assets | 11.2. | Other liabilities | 27. | ||||
Other assets | 18. | Provisions | 28. | ||||
Derivative assets | 19. | Total liabilities | |||||
Goodwill and intangible assets | 20. | ||||||
Total equity and liabilities | |||||||
Total assets | |||||||
| Approved by the Board of Directors on 21 April 2023 | |||||||
| Equity and liabilities | |||||||
| Equity | |||||||
Issued capital | 21. | ||||||
Retained earnings | 22. | ||||||
Other reserves | 23. | ||||||
Foreign currency translation reserve | 24. | ( | ( | ||||
Total equity attributable to equity holders of the parent | |||||||
Total equity attributable to non-controlling interest | 31.6 | ( | ( | ||||
Total equity |
Signed on behalf of the Board
Dirk Brouwer Tanwir Rahman
CEO CFO
The notes 1 to 39 form an integral part of these financial statements.
Company number: 11361159
Financial Statements continued
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Consolidated statement of changes in equity
for the year ended 31 December 2022
| Foreign | ||||||
| currency | Non- | |||||
| Issued | Retained | Other | translation | controlling | ||
| capital | earnings | reserves | reserve | interest | Total | |
| USD’000 | USD’000 | USD’000 | USD’000 | USD’000 | USD’000 | |
At 1 January 2021 | ( | ( | ||||
Profit for the year | ( | |||||
| Other comprehensive income: | ||||||
Actuarial gains and losses on defined benefit liabilities | ||||||
Foreign currency translation of assets and liabilities of subsidiaries | ( | ( | ||||
Movement in hedge accounting reserve | ||||||
Other comprehensive income (net of tax) | ( | ( | ||||
Total comprehensive (loss)/income for the period | ( | ( | ( | |||
Disposal of ASA Consultancy Limited and ASA Cambodia Holdings | ( | ( | ||||
Dividend | ||||||
At 31 December 2021 | ( | ( | ||||
At 1 January 2022 | ( | ( | ||||
Profit for the year | ( | |||||
| Other comprehensive income: | ||||||
Actuarial gains and losses on defined benefit liabilities | ||||||
Foreign currency translation of assets and liabilities of subsidiaries | ( | ( | ( | |||
Movement in hedge accounting reserve | ||||||
Other comprehensive income (net of tax) | ( | ( | ( | |||
Total comprehensive (loss)/income for the period | ( | (12) | (13,782) | |||
Dividend | ||||||
At 31 December 2022 | ( | ( |
The notes 1 to 39 form an integral part of these financial statements.
Financial Statements continued
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| Consolidated statement of cash flows | |||
| for the year ended 31 December 2022 | |||
| 2021 | |||
| 2022 | USD’000 | ||
| Notes | USD’000 | (Restated)¹ | |
| Operating activities | |||
Profit before tax | |||
| Adjustment for movement in: | |||
Operating assets | 29.1. | ( | ( |
Operating liabilities | 29.2. | ||
Non-cash items | 29.3. | ||
Income tax paid | ( | ( | |
Net cash flows used in operating activities | |||
| Investing activities | |||
Purchase of property and equipment | 16. | ( | ( |
Proceeds from sale of property and equipment | |||
Purchase of intangible assets | ( | ( | |
Net cash outflow from disposal of subsidiaries | ( | ||
Net cash flow used in investing activities | ( | ( | |
| Financing activities | |||
Proceeds from debt issued and other borrowed funds | |||
Payments of debt issued and other borrowed funds | ( | ( | |
Payment of principal portion of lease liabilities | ( | ( | |
Net cash flow from financing activities | ( | ( | |
Cash and cash equivalents at 1 January | |||
Net increase in cash and cash equivalents | |||
Foreign exchange difference on cash and cash equivalents | ( | ( | |
Cash and cash equivalents as at 31 December | |||
| Operational cash flows from interest | |||
Interest received | |||
Interest paid |
The notes 1 to 39 form an integral part of these financial statements.
1 See note 2.1.2 for details.
Financial Statements continued
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Notes to the consolidated financial statements
for the year ended 31 December 2022
1. Corporate information
ASA International Group plc (‘ASA International’, the ‘Group’) is a public company limited by shares bearing
registration number 11361159 in England and Wales. The entity was incorporated by Catalyst Microfinance
Investors (‘CMI’) on 14 May 2018 for the purpose of the initial public offer of ASA International Holding. ASA
International Group plc acquired 100% of the shares in ASA International Holding and all its subsidiaries on
13 July 2018 in exchange for the issue of 100 million shares in ASA International Group plc with a nominal
value of GBP 1.00 each.
Investment strategy
ASA International is an international microfinance holding company with operations in various countries
throughout Asia and Africa.
Abbreviation list
Definitions Abbreviation
A1 Nigeria Consultancy Limited A1 Nigeria
ASA Consultancy Limited ASA Consultancy
ASA Cambodia Holdings Limited ASA Cambodia Holdings
ASA Dwaso Limited ASA Dwaso
ASA International Group plc ASAIG
ASA International Holding ASAIH
ASA International India Microfinance Limited ASA India
ASA International(Kenya) Limited (formerly 'ASA International Microfinance
(Kenya) Limited') ASA Kenya
ASA International N.V. ASAI NV
ASA Lanka Private Limited ASA Lanka
ASA Leasing Ltd ASA Leasing
ASA Microfinance (Myanmar) Ltd ASA Myanmar
ASA Microfinance (Rwanda) Limited ASA Rwanda
ASA Microfinance (Sierra Leone) ASA Sierra Leone
ASA Microfinance (Zanzibar) Ltd ASA Zanzibar
ASA Microfinance (Tanzania) Ltd ASA Tanzania
ASA Microfinance (Uganda) Limited ASA Uganda
ASA Microfinance Zambia Limited ASA Zambia
ASA NGO-MFI registered in Bangladesh ASA NGO Bangladesh
ASA Pakistan Limited ASA Pakistan
ASA Savings & Loans Limited ASA S&L
ASHA Microfinance Bank Limited ASA Nigeria (formerly
‘ASA MFB’)
ASAI Investments & Management B.V ASAI I&M
ASAI Management Services Limited AMSL
Definitions Abbreviation
Association for Social Improvement and Economic Advancement ASIEA
C.M.I. Lanka Holding (Private) Limited CMI Lanka
Catalyst Continuity Limited Catalyst Continuity
Catalyst Microfinance Investment Company CMIC
Catalyst Microfinance Investors CMI
Corporate Social Responsibility CSR
CMI International Holding CMII
Lak Jaya Micro Finance Limited Lak Jaya
Pagasa ng Masang Pinoy Microfinance, Inc Pagasa
PagASA ng Pinoy Mutual Benefit Association, Inc. MBA Philippines
Pagasa Consultancy Limited Pagasa Consultancy
Pagasa Philippines Finance Corporation PPFC
Pagasa Philippines Finance Corporation and Pagasa ng Masang Pinoy
Microfinance, Inc
Pagasa Philippines
Pinoy Consultancy Limited Pinoy
PT PAGASA Consultancy PT PAGASA Consultancy
Microfinance Institution MFI
Reserve Bank of India RBI
State Bank of India SBI
Standard & Poor's S&P
Sequoia B.V. Sequoia
Financial Statements continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies
2.1 General
After the issue of the financial statements the Company’s owners or others do not have the power to amend
the financial statements.
2.1.1 Basis of preparation
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.1 General continued
2.1.1 Basis of preparation continued
Senior management and the Directors have also assessed the probable impact of any subsidiary failing to
maintain its required regulatory ratios. Given the level of arrears and challenge in India there is a probable risk
of breaching capital requirements of the Reserve Bank of India (‘RBI’) if the realisation significantly declines.
Should these requirements be breached then the possible implications could be that the RBI provides
management with a remediation plan and/or further capital could be required. As stated earlier, the Group did
not provide parent guarantees to funders of the operating subsidiaries and hence in case of dissolution, the
Group’s risk is limited to its capital investment and any shareholder loans.
Nevertheless, having assessed the Projections, downtrend analysis and mitigations described above, senior
management and the Directors have a reasonable expectation that the Group has adequate resources to
continue in operation existence for at least twelve months from the date of the authorisation of these financial
statements, and the going concern assessment period through to 31 May 2024. For these reasons, they
continue to adopt a going concern basis for the preparation of the consolidated financial statements.
Accordingly, these financial statements do not include any adjustments to the carrying amount or
classification of assets and liabilities that would result if the Group was unable to continue as a going concern.
2.1.2 Statement of compliance
The preparation of the consolidated financial statements in conformity with IFRS requires management to
make judgements, estimates and assumptions that affect the application of accounting policies and the
reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis.
2.1.3 Consideration of climate change
In preparing these financial statements, the Group has given consideration to the recommendations laid out
by the Task Force on Climate-related Financial Disclosures (‘TCFD’). The relevant assessment of the climate-
related risks outlined in the Group’s Annual Report on page 49 has been incorporated into judgements
associated with recognition, measurement, presentation, and disclosure, where so permitted by the UK
adopted International Accounting Standards. The accounting judgements relating to climate change are
presented in note 2.5.1.
While there is currently no significant impact expected from climate change, the Directors are aware of the
constant evolving risks attached to climate change and will regularly assess these risks against judgements and
estimates made in preparation of the financial statements.
2.1.4 Basis of consolidation
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.2.1 Foreign currency translation
consolidation.
2.2.2 Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or
equity instrument of another entity.
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.2 Summary of significant accounting policies continued
2.2.2 Financial instruments continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.2 Summary of significant accounting policies continued
2.2.3 Financial liabilities – Initial recognition and subsequent measurement continued
2.2.5 Recognition of income and expenses
The following specific recognition criteria must also be met before revenue is recognised:
(2) Dividend income
Revenue is recognised when the Group’s right to receive the payment is established.
(3) Other income
Other income includes group member’s admission fees, document fees, sale of passbook, income on death
and multipurpose risk funds and service fees from off-book loans under the BC model. Group members’
admission fees, document fees and sale of passbook fees are recognised on receipt as the then admission and
sale constitutes as satisfactory performance obligation.
2.2.6 Cash and cash equivalents and Cash at bank and in hand
Cash in hand and in bank as referred to the statement of financial position comprises of cash and cash
equivalents and restricted cash relating to Loan Collateral Build Up (‘LCBU’) in the Philippines and against
security deposits from clients in Tanzania and Kenya.
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.2.8 Taxes
(2) Deferred tax
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.2 Summary of significant accounting policies continued
2.2.12 Goodwill
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.2 Summary of significant accounting policies continued
2.2.15 Liability for death and multipurpose risk funds
The Group collects 1-2% of disbursed loan amounts for death risk funds or multipurpose risk funds in certain
markets (the Philippines, Uganda, Kenya and Sri Lanka). These funds cover settlement of the outstanding loan
amount and other financial assistance when the borrower dies or is affected by natural calamities. The
collected amounts are recognised upfront as income and a liability is recognised in the statement of financial
position for the claims resulting from these funds. Reference is made to note 2.5.3 on the key judgement used.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.2 Summary of significant accounting policies continued
2.2.20 Impairment of non-financial assets
Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount,
which is the higher of its fair value less costs of disposal and its value in use. For Property and equipment, the
fair value less costs of disposal calculation is based on available data from similar assets or observable market
prices less incremental costs of disposing of the asset. For “ROU” the fair value is determined based on
estimated rental payments using incremental borrowing rates used for each country where such ROU exists. If
there is a significant change in discount rates, the fair value is reviewed to see if there is impairment.
The Group has identified the impairment of non-financial assets as one of the areas in which it could be
exposed to the financial impacts of climate change risk, as a number of the Group’s operating areas are prone
to natural disasters. However, as the Group manages a frugal cost operating model with minimum investment
in fixed assets and leases, the impact of climate-related financial loss is expected to be insignificant.
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.3. New standards, interpretations and amendments adopted by the Group continued
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.4. Standards issued but not yet effective continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
2. Accounting policies continued
2.5 Significant accounting judgements and estimates continued
2.5.8 Taxes
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
Explanation: Segment profit is net profit after tax.
1 Inter-segment operating income includes intercompany dividends, management fees and share in results of the subsidiaries.
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
Explanation: Segment profit is net profit after tax.
1 Inter-segment operating income includes intercompany dividends, management fees and share in results of the subsidiaries.
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
1 Refer to note 2.1.2.
Interest income decreased from last year in USD terms mostly due to devaluation of local currency against
USD in most of the operating subsidiaries. Loan processing fees increased mainly in Tanzania where an
additional transaction fee equivalent to 1% of disbursement is introduced in 2022.
4.2. Other interest and similar income
2022
USD’000
2021
USD’000
(Restated)
Interest income on short-term deposits 3,916 4,579
Other interest income 207 558
4,123 5,137
Other includes a number of small items that are smaller than USD 150K on an individual basis.
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
1 CSR expenses have been separately disclosed.
basis.
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
9. Other operating expenses continued
9.2. Professional fees
2022
USD’000
2021
USD’000
Legal services fees (295) (378)
Other professional fees (2,284) (2,329)
(2,579) (2,707)
Other professional fees includes fees for various consultants on tax, IT, accounting and actuary valuation
services.
10. Exchange rate differences
The Group incurred certain foreign exchange losses on monetary assets denominated in currencies other than
the Group’s functional currency
2022
USD’000
2021
USD’000
Foreign currency losses (4,876) (7,530)
Foreign currency gains 3,317 5,998
(1,559) (1,532)
11. Income tax and withholding tax expense
2022
USD’000
2021
USD’000
Income tax expense
Current income tax (20,883) (18,844)
Income tax for previous period (7) 477
Changes in deferred income tax (6,284) 2,773
(27,174) (15,594)
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
11. Income tax and withholding tax expense continued
11.5. Reconciliation of the total tax charge
2022
USD’000
2021
USD’000
Accounting result before tax 46,281 25,705
Income tax expense at nominal rate of consolidated entities (15,373) (9,565)
Over/(under) provision for income tax previous year (7) 477
Net allowable/(non-allowable) expenses (1,114) (271)
Movement in unrecognised deferred taxes (11,285) (6,191)
Exempt income 74 185
Tax impact on elimination 531 (11)
Other permanent differences – (218)
Total income tax expense for the period (27,174) (15,594)
Weighted average nominal rate of consolidated entities 33% 37%
Consolidated effective tax rate 59% 61%
11.6. Income tax per region
2022
USD’000
2021
USD’000
Corporate income tax – West Africa (9,417) (10,564)
Corporate income tax – South Asia (9,292) (4,164)
Corporate income tax – East Africa (3,994) (1,974)
Corporate income tax – South East Asia (1,653) (344)
Corporate income tax – Holding and other non-operating entities (2,818) 1,452
Total income tax per region (27,174) (15,594)
11.7. Withholding tax expense
2022
USD’000
2021
USD’000
Withholding tax on interest income, dividend, royalties and service fees (1,332) (1,457)
Deferred tax on undistributed dividend 112 (2,296)
Total withholding tax expense (1,220) (3,753)
Interest income, dividends, royalties and service fees are subject to withholding tax in certain jurisdictions.
The applicable withholding tax rates vary per country and per type of income.
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Financial Statements
Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
13. Loans and advances to customers continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
14.1. Escrow bank account at Citibank
In certain countries in which the Group operates, Non–Resident Capital Gains Tax (‘NRCGT’) regimes have
been enacted in recent years which may give rise to an NRCGT liability if there is a change of control (‘COC’)
of more than 50% of the underlying ownership of a subsidiary of the Company resident in that country as
measured over a rolling three-year period. In each case, the liability is payable by the local subsidiary. A COC
of certain of the Group’s subsidiaries resulting from the offering to certain institutional and professional
investors in view of the admission of the Group to the London Stock Exchange in 2018 (the ‘Global Offer’), or
thereafter, may trigger NRCGT liabilities in certain jurisdictions for the affected subsidiaries. In connection
with the potential NRCGT liability, CMI, being the selling shareholder at the time of the listing of the Group on
13 July 2018, agreed upon admission to place USD 20 million (the ‘Escrow Amount’) of its net proceeds from
the sale of shares in the Global Offer in an escrow account for the sole benefit of the Company (the ‘Escrow
Account’). The Escrow Amount may be applied to fund NRCTG liabilities in accordance with the escrow deed
dated 29 June 2018 between, inter alia, CMI and the Company. The Escrow Account is established in the
name of the Company and is therefore presented as part of ‘Due from banks’. The beneficial ownership of
these funds, including any interest accrued thereon and less any expenses, rests with CMI because the
Company will need to return all remaining funds to CMI in accordance with the terms of the escrow deed.
Therefore, the same amount is presented as a liability to CMI under ‘Other liabilities’.
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
16. Property and equipment
Property and equipment consists of land and buildings, office furniture and equipment. Depreciation policies are described in detail in the accounting policies. The movements are as follows.
2022 2021
Furniture and
fixtures
USD’000
Vehicles
USD’000
Office
equipment
including IT
USD’000
Buildings
USD’000
Total
USD’000
Furniture and
fixtures
USD’000
Vehicles
USD’000
Office
equipment
including IT
USD’000
Buildings
USD’000
Total
USD’000
Cost at the beginning of the period 1,683 320 9,483 1,229 12,715 1,999 400 8,621 1,306 12,326
Accumulated depreciation at the beginning of the period (1,166) (252) (7,055) (157) (8,630) (1,366) (298) (5,908) (137) (7,709)
Carrying value at the beginning of the period 517 68 2,428 1,072 4,085 633 102 2,713 1,169 4,617
Additions during the period at cost 219 210 1,146 – 1,575 168 6 1,539 – 1,713
Foreign currency adjustment (277) (100) (1,375) (102) (1,854) (107) (21) (467) (77) (672)
Disposal during the period (60) (25) (248) – (333) (377) (65) (210) – (652)
Depreciation during the period (242) (66) (1,485) (23) (1,816) (254) (39) (1,667) (25) (1,985)
Adjustment of depreciation for disposals 77 40 371 – 488 370 61 186 (4) 613
Foreign currency differences 211 60 1,084 13 1,368 84 24 334 9 451
Carrying value at the end of the period 445 187 1,921 960 3,513 517 68 2,428 1,072 4,085
Cost at the end of the period 1,565 405 9,006 1,127 12,103 1,683 320 9,483 1,229 12,715
Accumulated depreciation at the end of the period (1,120) (218) (7,085) (167) (8,590) (1,166) (252) (7,055) (157) (8,630)
Carrying value at the end of the period 445 187 1,921 960 3,513 517 68 2,428 1,072 4,085
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
18.1. Receivables from related parties
2022
USD’000
2021
USD’000
Sequoia BV 145 53
MBA Philippines 86 5
Catalyst Investment Management services
18
12
249 70
The receivables from related parties are short term in nature and do not accrue interest.
18.2. Receivables under off-book BC model (ASA India)
Under off-book BC model is presented net of impairment. Gross amount receivable under off book BC model
is USD 2.2 million (2021: 2.1 million).
18.3. Other receivables
Includes various advances in relation to employee’s insurance, receivable from VAT and service tax authorities
etc.
Individually none of the advances are over USD 150K.
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
20. Intangible assets and goodwill continued
Total spent during the year against DFS and CBS are as follows:
Particulars
2022 2021
Capitalised
USD’000
Charged
to P&L
USD’000
Total
USD’000
Capitalised
USD’000
Charged
to P&L
USD’000
Total
USD’000
Development fees 1,032 – 1,032 83 – 83
Licence fees 1,906 588 2,494 – – –
Implementation cost 948 – 948 – – –
Consultancy 180 – 180 213 – 213
Salary and travelling 526 218 744 156 – 156
4,592 806 5,398 452 – 452
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
25. Debt issued and other borrowed funds continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
27. Other liabilities continued
27.1. Amounts due to related parties
2022
USD’000
2021
USD’000
Sequoia BV 10 24
MBA Philippines 31 78
41 102
27.2. Other sundry liabilities
Other sundry liabilities include various smaller accruals and provisions for various entities in the Company.
Individually none of the payables are over USD 150K.
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management
30.1 General
Risk is inherent in the Group’s activities but it is managed through a process of ongoing identification,
measurement and monitoring, subject to certain risk limits and other controls as described in the paragraphs
below. This process of risk management is critical to the Group’s continuing profitability and each individual
within the Group is accountable for the risk exposures relating to his or her responsibilities. The Group is,
amongst others, exposed to business risk, operational risk, IT risk, finance risk, and legal & compliance risk.
The independent risk control process does not include business risks such as changes in demand, technology
and industry. These changes are monitored through the Group’s strategic planning process.
30.2 Risk management structure
The Company’s risk management principles allow it to balance its risk and reward effectively by aligning its
risk appetite with its business strategy. The Company’s risk management framework is based on its three lines
of defence model, which has been adopted at both the Company level and at each of the Company’s
microfinance institutions. The Company’s objectives in using the three lines of defence model include:
identifying risk areas and minimising loss; protecting its clients by minimising financial risk; protecting the
interests of its shareholders and investors; preserving its branches, data, records and physical assets;
maintaining its business and operational structure; enforcing a standard operational procedure for managing
risk; and providing guidelines in line with internationally accepted risk management principles. The first line of
defence is the team, person or department that is responsible for executing particular tasks/activities, as well
as for mitigating any related risks. The second line of defence is comprised of management of the respective
departments and personnel that oversee the first line of defence and provide expertise in risk management to
help develop strategies, policies and procedures to mitigate risks and implement risk control measures. The
third line of defence is the Internal Audit department, which evaluates and improves the effectiveness of the
risk management, control and governance processes through independent verification of risk control
measures. The Internal Audit department is based in the country head office of each of the Company’s
microfinance institutions and audits each branch based on their risk ratings but at least once a year.
30.3 Key Risk management areas and mitigation
The Group’s key risk management areas are business risk, operational risk, IT risk, finance risk, and legal and
compliance risk.
Risk category Definition Risks Description
Business
risk
Business risk is
an organisation’s
exposure to factors
that will lower
its profit or lead
it to fail. Anything
that threatens a
company’s ability to
achieve its financial
and operational goals
is considered a
business risk.
Growth risk Risks and challenges associated with the Group’s
operational expansion.
Competition
risk
Risk that the Group might face for not responding
to the competitive environment or failing to meet
customer needs.
Reputation risk Risk to earnings or capital arising from negative
public opinion.
Climate-
related risk
Risk related to potential negative impact of climate
change on the organisation.
Health &
Environmental
risk
Risk arising from the threat of natural disasters and
viral diseases.
Operational
risk
Operational risk refers
to uncertainties a
company faces when
it attempts to do its
day-to-day business
activities. It can result
from breakdowns in
internal procedures,
people and systems.
Transaction
risk
Human or system errors within the Group’s daily
product delivery and services.
Human
Resource risk
Likelihood of negative results due to a failure within
its human resource department.
Fraud and
Integrity risk
Risk of incidents of fraud and misappropriation by
staff or client.
IT risk
Information
technology risk is any
threat to business
data, critical systems
and business
processes due to IT
failure. It is the risk
associated with the
use, ownership,
operation,
involvement, influence
and adoption of IT
within an
organisation.
Business
continuity
This risk refers to loss of data in case of a
catastrophic event.
System
vulnerability
This risk refers to the vulnerability of our IT system
to different types of cyber-attacks.
Network
availability
Risk of inadequate internet connectivity for
running real-time branch operations.
IT support Risk of delay in resolving IT related issues which may
negatively impact the operations.
System access
control
Risk of misuse of system access.
IT fraud risk Risk of fraud due to control gap in IT system and
processes.
Data migration
risk
Risk of loss of data during the time of data
migration.
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for the year ended 31 December 2022
Risk category Definition Risks Description
Finance risk
The Group
experiences financial
risks such as credit
risk, liquidity risk,
exchange rate/
currency risk and
interest rate risk
which can adversely
impact the earnings.
Credit risk Risk that the Group will incur a loss because its
clients or counterparties fail to discharge their
contractual obligations.
Liquidity risk Risk that the Group will be unable to meet its
payment obligations when they fall due under
normal and stress circumstances.
Exchange rate
risk
Possibility of financial loss to the Group arising
from adverse movements in foreign exchange rates.
Interest rate
risk
Risk arising from the possibility of change in the
value of assets and liabilities because of changes in
market interest rates.
Legal &
Compliance
risk
Financial and other
losses the Group may
suffer as a result of
regulatory changes or
failure to comply with
applicable laws and
regulation.
Local
regulation
Risk of non-compliance to local regulation.
Change of
policy
Risk of negative impact arising from change in
policies by regulatory authorities.
Product
transparency
Risk of negative public opinion for not ensuring
product transparency.
Business risk
The Group manages its business risks by adopting various mitigation strategies at Group level as well as at
subsidiary level. While setting growth targets the Group remains prudent, as uncontrolled growth may lead to
increased overdue loans. Sites for new branches are selected after thorough assessment as per the
operational manual.
When it comes to competition, the Group continuously monitors client satisfaction and focuses on tailoring its
products according to client needs. In order to safeguard its reputational risk, the Group ensures that staff
meet the highest standards in terms of client protection principles and business transparency.
Climate change risk is thoroughly assessed by the Group. The Group has started the process of collecting its
carbon emission data to determine the major emission sectors so a carbon management plan can be put in
place to reduce emissions. During the year, the Group’s operations were adversely impacted by the Covid
pandemic; however, this was mitigated by proactively amending operational procedures in order to adapt to
changing conditions.
Operational risk
Transaction risk is mitigated by strictly following operational procedures and ensuring thorough monitoring by
supervisors. Human resource risk is mitigated by attracting, retaining and developing staff by providing
competitive remuneration structures and long-term career opportunities, and by investing in training and
development of all staff. The Company evaluates its human resource risk by observing the availability of
skilled staff within its compensation bands as well as compliance and regulatory issues that impact staff,
including visas or employment permits needed for its expatriate staff.
IT risk
The rise of the knowledge economy and the digital revolution has led to organisations becoming increasingly
dependent on information, information processing and especially IT. The Group’s IT business continuity is
safeguarded by maintaining secure data centres with disaster recovery sites, either on premises or in the
cloud. System vulnerability is regularly assessed and virus guards, firewalls and other security measures are
kept up to date. Adequate internet connectivity is provided at all branches to ensure smooth running of
operations; proper internet connectivity is provided at head office level. IT issues are addressed through the
JIRA issue management software based on priority. A strong password policy is in place to prevent
unauthorised system access and staff are made aware that password sharing is prohibited.
30. Risk management continued
30.3 Key Risk management areas and mitigation continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management continued
30.3 Key Risk management areas and mitigation continued
Legal and Compliance risk
New changes are proactively discussed with regulators; new requirements (such as minimum capital
requirements) are timely implemented; and the Company’s ASA Model and digital strategy are proactively
discussed with different authorities in order to be well understood when new regulations are being proposed
and drafted. The Group closely monitors the political developments in countries like India and Myanmar.
Risks are mitigated through standardised practices that are part of the ASA Model of microfinance. These
include:
• Standardised loan products.
• Basic voluntary deposit services.
• Effective and rigid procedures for cost-effective delivery of microcredit and limited deposit services.
• Zero tolerance on the late deposit of loan instalments by loan officers.
• Group selection without joint liability.
• Loans granted exclusively for income-generating activities.
• Full repayment via instalments before eligibility for new loan.
• No incentive or bonus payments for operating staff.
• Frequent client interactions through weekly collections.
• Ongoing assessment of client needs, benefits and satisfaction.
30.4 Financial risks
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management continued
30.4 Financial risks continued
1 Due from banks are neither past due nor credit impaired.
2 Includes interest receivable
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management continued
30.4 Financial risks continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management continued
30.4 Financial risks continued
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management continued
30.4 Financial risks continued
30.4.3 Foreign exchange rate risk
Currency risk is the possibility of financial loss to the Group arising from adverse movements in foreign
exchange rates. Currency risk is a substantial risk for the Group, as most loans to MFIs and borrowers are in
local currency in countries where currency depreciation against the USD is often considered less predictable.
At present the Group manages currency risk mainly through natural hedging, i.e. by matching the MFI’s local
currency assets consisting of the MFI’s loan portfolio with local currency liabilities. The Group’s risk policy
allows the Group treasurer the possibility of hedging with instruments such as swaps and forward contracts if
and when appropriate. In order to mitigate the foreign exchange risk on foreign currency loans, ASA India,
ASA Pakistan, ASA Myanmar, ASA Sierra Leone and ASA Tanzania have entered into hedging agreements. The
Group applies hedge accounting to the foreign currency loans and related hedge contracts. Reference is made
to note 37.
While the Group faces significant translation exposure on its equity investments in local MFIs (as the
functional currency of the Group is USD), the policy is not to hedge equity investments since the currency
translation gain and loss on the latter do not affect the net profit of the Group.
In summary, the Group takes a number of measures to manage its foreign currency exposure:
• Investments are only made in countries that show a reasonable level of macroeconomic stability. A detailed
macroeconomic and socio-political assessment is carried out before the Group decides to invest in a
certain country.
• The Group endeavours to procure its MFIs to secure local currency loans (instead of foreign currency
loans) to the extent possible or deemed commercially advantageous.
Simulation: Foreign currency translation reserve
FX
translation
reserve
actual
2022
USD’000
FX
translation
reserve after
-10% rate
2022
USD’000
Movement
2022
USD’000
FX
translation
reserve
actual
2021
USD’000
FX
translation
reserve after
-10% rate
2021
USD’000
Movement
2021
USD’000
West Africa (46,638) (52,595) (5,957) (26,017) (31,553) (5,536)
East Africa (2,551) (5,038) (2,487) (1,485) (3,317) (1,832)
South Asia (33,324) (37,028) (3,703) (22,814) (26,288) (3,477)
South East Asia (5,197) (6,683) (1,486) (3,453) (4,977) (1,524)
Non-operating entities (413) (432) (19) (365) (391) (25)
Total (88,123) (101,776) (13,652) (54,134) (66,526) (12,394)
Analysis of the actual exchange rate fluctuations against the USD for the period 2022 shows different trends
for all the operating currencies. The annual exchange rate fluctuations are between 81% and 1%, but most
moved within 3% to 15%. For the simulation of foreign currency effects the Company has therefore assumed
an additional 10% movement year on year in these currencies as compared to USD.
The following overview shows the actual foreign currency exchange results by country for 2022 as well as the
simulation of the impact of a 10% downward movement of the FX rates on the foreign exchange results.
As at 31 December 2022 a 10% downward movement of FX rates against the USD has a positive impact on
the foreign currency exchange result of USD 3K (2021: USD -633K). The lower impact on the result of the
Company results from the decrease in short-term intercompany USD loans, which cannot be hedged.
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management continued
30.4 Financial risks continued
30.4.3 Foreign exchange rate risk continued
Simulation: Foreign exchange profit and loss
Foreign
exchange
profit and
loss actual
2022
USD’000
Foreign
exchange
profit and
loss after
-10% rate
2022
USD’000
Movement
2022
USD’000
Foreign
exchange
profit and
loss actual
2021
USD’000
Foreign
exchange
profit and
loss after
-10% rate
2021
USD’000
Movement
2021
USD’000
West Africa 350 182 (168) (142) 8 150
East Africa (37) 216 254 151 225 73
South Asia (259) (266) (6) (331) (342) (11)
South East Asia (614) (475) 139 (562) (436) 126
Non-operating entities (998) (1,212) (216) (648) (1,618) (969)
Total (1,558) (1,555) 3 (1,532) (2,163) (631)
30.4.4 Interest rate risk
Interest rate risk is the risk that profitability is affected by fluctuations in interest rates. The greatest interest
rate risk the Group experiences occurs when the cost of funds increases faster than the Group can or is willing
to adjust its lending rates. The Group’s strategy in evaluating and managing its interest rate risk is to consider
any risk at the pre-investment stage, to conduct a cost of funds analysis and to consider interest rates in
particular, where there is a limit on the amount of interest it may charge, such as in Myanmar and Tanzania.
The credit methodology of the MFIs determines that loans to microfinance clients have short-term maturities
of less than one year and at fixed interest rates. Third-party loans to MFIs, sourced from both local and
international financial institutions, mostly have relative short terms between one and three years. 37% (2021:
30%) of the consolidated debt has variable interest rates. Depending on the extent of the exposure and
hedging possibilities with regard to availability of hedging instruments and related pricing, the Group might
actively hedge its positions to safeguard the Group’s profits and to reduce the volatility of interest rates by
using forwards, futures and interest rate swaps. The very short tenor of the loans provided to microfinance
dampens the effect of interest rate fluctuations. The following table demonstrates the sensitivity to a
reasonably possible change in interest rates on the loans and borrowings affected.
With all other variables held constant, the Group’s profit before tax is affected through the impact on floating
rate borrowings, as follows:
Increase in
basis points
Decrease in
basis points
2022 2021
Effect on profit before tax Effect on profit before tax
USD’000 USD’000 USD’000 USD’000
USD +100 –100 806 (806) 622 (798)
PKR +100 –100 77 (77) 72 (72)
INR +100 –100 10 (10) 62 (62)
30.5 Managing interest rate benchmark reform and associated risks
Following the decision by global regulators to phase out IBORs and replace them with alternative reference
rates, the Group has established a project to manage the transition for any of its contracts that could be
affected. The project is led by the Group Treasury. The project provides periodic updates to senior
management and the Board. The Group has already completed the transition of a portion of its IBOR exposure
to Risk free rates (‘RFRs’) and is confident it will complete the remaining transitions to RFRs for those interest
rate benchmarks, including exposures to USD LIBOR of 3 and 12 months, that will cease to be available after
30 June 2023. As of 31 December 2022, the Group has loans amounting to USD 50.0 million which are based
on USD six-month LIBOR and will mature after 2023. For other benchmark interest rates such as EURIBOR
that have been reformed, financial instruments referencing those rates will not need to transition provided the
reformed rates continue to meet regulators’ stringent requirements to qualify as RFRs.
Derivatives
The Group holds forward and cross currency interest rate swaps for risk management purposes which are
designated in cash flow hedging relationships. The interest rate swaps have floating legs that are indexed to
either Euribor or LIBOR. The Group’s derivative instruments are governed by contracts based on International
Swaps and Derivatives Association (‘ISDA’) master agreements. On 23 October 2020, the ISDA published its
IBOR fall back protocol and supplements, which are designed to address transition for those derivative
contracts still outstanding on the permanent cessation of an IBOR. The ISDA fall back spread adjustments
became fixed on 5 March 2021. The Group currently plans to adhere to the protocol and to monitor whether
its counterparties will also adhere. The Group’s current hedge contracts will mature before the publication
cessation date.
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
30. Risk management continued
30.5 Managing interest rate benchmark reform and associated risks continued
Hedge accounting
The Group has evaluated the extent to which its cash flow hedging relationships are subject to uncertainty
driven by IBOR reform as at 31 December 2022. The Group’s hedged items and hedging instruments continue
to be indexed to Euribor or LIBOR. These benchmark rates are quoted each day and the IBOR cash flows are
exchanged with counterparties as usual. The calculation methodology of Euribor changed during 2019. In July
2019, the Belgian Financial Services and Markets Authority granted authorisation with respect to Euribor
under the European Union Benchmarks Regulation. This allows market participants to continue to use Euribor
for both existing and new contracts and the Group expects that Euribor will continue to exist as a benchmark
rate for the foreseeable future.
In terms of the Group’s LIBOR cash flow hedging relationships, all the contracts will mature before the
anticipated cessation date of June 2023. In terms of non-hedged loans, the Group has loans linked to USD
LIBOR which will mature after the cessation date. The Group is in the process of amending contracts of those
affected loans.
30.6 Climate-related risks
The Group and its customers may face climate-related risks in the future. These risks include the threat of
financial loss and adverse non-financial impacts that encompass the political, economic and environmental
responses to climate change. The key sources of climate risks have been identified as physical and transition
risks. Physical risks arise as the result of acute weather events such as hurricanes, floods and droughts, and
longer-term shifts in climate patterns, such as sustained higher temperatures and rising sea levels.
Transition risks may arise from the adjustments to a net-zero economy, e.g., changes to laws and regulations,
litigation due to failure to mitigate or adapt, and products and services due to changes in consumer behaviour
and investor demand. These risks are receiving increasing regulatory, political and societal scrutiny, both
within the operating country and internationally. While certain physical risks may be predictable, there are
significant uncertainties as to the extent and timing of their manifestation. For transition risks, uncertainties
remain as to the impacts of the impending regulatory and policy shifts, changes in consumer demands and
supply chains.
The Group is making progress on embedding climate risk into its Risk framework, including the development
of appropriate risk appetite metrics and the creation of a Sustainability Committee, which is responsible for
developing Group-wide policies, processes and controls to incorporate climate risks into the management of
principal risk categories, appointing a Climate Officer for each operating subsidiary and setting up SMART
targets to reduce GHG emissions.
The impact of climate-related risks has been assessed on a number of reported amounts and the
accompanying disclosures. Refer to page 49 for details in relation to climate-related risks.
30.7 Legal and compliance risk
Legal and compliance risks in the countries that the subsidiaries or MFIs are active in will be mitigated through
continuous monitoring of the regulatory and legal environment, through inter alia tier-one law firms and the
local corporate secretaries and compliance officers in certain countries. In most countries the relevant
microfinance subsidiary also maintains direct relationships with the regulator, including central banks. In
addition, the Group believes it is, through its local and international network, well positioned to identify any
relevant changes in the law that will have a material impact on any of the businesses it invests in. A number of
investments in the MFIs are m ade by ASAI NV in the Netherlands. The Netherlands has entered into an
extensive network of Bilateral Investment Treaties that offer compensation in case any of such investments
are nationalised or expropriated by a country in which an investment is made. Currently, the investments in
the Philippines, Sri Lanka, Uganda, Kenya and Ghana are owned by ASAI NV, an indirectly owned but wholly
controlled subsidiary of the Group.
Product transparency is also key to the Group’s strategy in mitigating its legal and compliance risk. Because
the education and knowledge levels of the Group’s target clients are low, the Group aims to be transparent in
its products and prices. The Group established a Legal and Compliance department headed by the General
Counsel. The General Counsel assigns and supervises all legal matters involving the Group. The General
Counsel, Deputy General Counsel and Group Compliance Manager establish and maintain an operationally
independent Compliance function at the corporate level led by the Group. Whilst the General Counsel bears
overall responsibility for the Compliance function, the General Counsel has delegated day-to-day
responsibility for managing the Compliance function to the Group Compliance Manager, who performs the
compliance duties independently. The Group Compliance Manager is responsible for overseeing and
implementing the Group compliance framework, including the Group compliance policy (the ‘Compliance
Policy’). The Compliance Policy sets out the principles and standards for compliance and management of
compliance risks in the Group. The Group seeks to reduce compliance risks taking into account the nature,
scale and complexity of the business and ensures the policies are in alignment with the Group strategy and its
core values.
30.8 Strategic risk
Strategic risk is the current or prospective risk to earnings and capital arising from changes in the business
environment and from adverse business decisions, improper implementation of decisions or lack of
responsiveness to changes in the environment. The Group evaluates its strategic risk by analysing its cost
reduction and growth, its liquidity management and its competition and reputational risk.
Competition and reputational risk are frequent in the microfinance industry. The Group defines reputational
risk as the risk to earnings or capital arising from negative public opinion. The Group believes that reputational
risk may impact its ability to sell products and services or may limit its access to capital or cash funds. To
mitigate any competition or reputational risk, the Group evaluates the introduction of highly subsidised
competitors, movements in average borrowing rates, and information sharing with different agencies.
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
32. Related party disclosures
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
38. Maturity analysis of assets and liabilities
The table below shows an analysis of assets and liabilities according to when they are expected to be
recovered or settled. Loans and advances to customers are based on the same expected repayment behaviour
as used for estimating the EIR. Debt issued and other borrowed funds reflect the contractual repayments
except for debts, where no waivers have been received against breached covenants at the balance sheet date.
Those borrowings are presented on demand. The 2021 maturity table has been restated to reflect the above.
As at 31 December 2022
Within
12 months
USD’000
After
12 months
USD’000
Total
USD’000
Assets
Cash at bank and in hand 83,117 – 83,117
Loans and advances to customers 331,301 597 331,898
Due from banks 16,613 22,287 38,900
Equity investment at FVOCI – 244 244
Property and equipment – 3,513 3,513
Right-of-use assets 832 3,757 4,589
Deferred tax assets – 4,625 4,625
Derivative assets 7,131 724 7,855
Other assets 9,621 349 9,970
Goodwill and Intangible assets – 5,041 5,041
Total assets 448,615 41,137 489,752
Liabilities
Debt issued and other borrowed funds 171,172 90,129 261,301
Due to customers 84,146 9 84,155
Retirement benefit liability – 4,593 4,593
Current tax liability 8,873 – 8,873
Deferred tax liability 7 2,177 2,184
Lease liability 982 2,109 3,091
Derivative liabilities 456 – 456
Other liabilities 10,323 24,077 34,400
Provisions 967 71 1,038
Total liabilities 276,926 123,165 400,091
Net 171,689 (82,028) 89,661
As at 31 December 2021
Within
12 months
USD’000
After
12 months
USD’000
Total
USD’000
Assets
Cash at bank and in hand 87,951 – 87,951
Loans and advances to customers 354,671 18,571 373,242
Due from banks 34,294 30,965 65,259
Equity investment at FVOCI – 237 237
Property and equipment – 4,085 4,085
Right-of-use assets 1,013 4,018 5,031
Deferred tax assets – 13,362 13,362
Derivative assets 3,313 653 3,966
Other assets 6,456 2,483 8,939
Goodwill and Intangible assets – 482 482
Total assets 487,698 74,856 562,554
Liabilities
Debt issued and other borrowed funds 224,041 94,633 318,674
Due to customers 87,241 571 87,812
Retirement benefit liability 7 5,384 5,391
Current tax liability 6,265 – 6,265
Deferred tax liability – 2,296 2,296
Lease liability 450 3,009 3,459
Derivative liabilities 219 383 602
Other liabilities 8,873 24,064 32,937
Provisions 1,136 539 1,675
Total liabilities 328,232 130,879 459,111
Net 159,466 (56,023) 103,443
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Additional Information
Financial Statements continued
Notes to the consolidated financial statements continued
for the year ended 31 December 2022
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Statutory statement of financial position
Company number: 11361159
Financial Statements continued
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Additional Information
Notes to the statutory financial statements
for the year ended 31 December 2022
Separate financial statements
The accounting policies applied in the statutory financial statements are similar to those used in the
consolidated financial statements except for investments in subsidiaries. Investments in subsidiaries are
accounted in the separate financial statements, using the cost method.
At each reporting date it is determined whether there is objective evidence that the investment in the
subsidiaries is impaired. If there is such evidence, a calculation will be made for the impairment amount as the
difference between the recoverable amount of the subsidiaries and its carrying value.
40. Total other operating expenses
2022
USD’000
2021
USD’000
Total operating expenses include the following items:
Personnel expenses (1,192) (1,045)
Professional fees (1,936) (1,661)
Administrative expenses (976) (533)
(4,104) (3,239)
41. Investments in subsidiaries
2022
USD’000
2021
USD’000
Investments in subsidiaries
ASA International Holding 75,195 75,195
ASA International NV 45,489 45,489
120,684 120,684
Name of company Country Nature of business 2022 ownership 2021 ownership
ASA International Holding Mauritius MFI Holding Company 100% 100%
ASA International NV Netherlands MFI Holding Company 100% 100%
42. Other assets
2022
USD’000
2021
USD’000
The other assets comprised the following:
Other receivables 145 482
Advances and prepayments 80 283
225 765
43. Issued capital
100 million ordinary shares of GBP 0.01 each. No movement occurred during 2022 and 2021.
Financial Statements continued
44. Retained earnings
Total retained earnings are calculated as follows:
2022
USD’000
2021
USD’000
Balance at the beginning of the period 92,779 92,508
Dividend – –
Result for the period 26,859 271
Balance at the end of the period 119,638 92,779
Profit for the period
Attributable to equity holders of the parent 26,859 271
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Additional Information
Financial Statements continued
Notes to the statutory financial statements continued
for the year ended 31 December 2022
47. Maturity analysis of assets and liabilities
The table below shows an analysis of assets and liabilities according to when they are expected to be
recovered or settled.
As at 31 December 2022
Within
12 months
USD’000
After
12 months
USD’000
Total
USD’000
Assets
Cash at bank and in hand 778 – 778
Due from banks – 20,692 20,692
Investment in subsidiaries – 120,684 120,684
Other assets 225 – 225
1,003 141,376 142,379
Liabilities
Other liabilities 739 20,692 21,431
Net 264 120,684 120,948
As at 31 December 2021
Within
12 months
USD’000
After
12 months
USD’000
Total
USD’000
Assets
Cash at bank and in hand 383 – 383
Due from banks – 20,465 20,465
Investment in subsidiaries – 120,684 120,684
Other assets 765 – 765
1,148 141,149 142,297
Liabilities
Other liabilities 4,537 43,671 48,208
Net (3,389) 97,478 94,089
45. Other liabilities
Notes
2022
USD’000
2021
USD’000
Short-term liabilities
Accrued audit fees 563 557
Accrued cost 176 288
Other intercompany payables – 3,692
739 4,537
Long-term liabilities
Intercompany loan – –
Escrow liability to CMI 14.1. 20,692 20,465
Purchase price for ASAI NV to ASAIH – 23,206
20,692 43,671
21,431 48,208
46. Additional cash flow information
2022
USD’000
2021
USD’000
Changes in operating assets
Due from banks (227) –
Other assets 540 (491)
313 (491)
Changes in operating liabilities
Other liabilities (3,571) 744
(3,571) 744
Changes in non-cash items
Foreign exchange result – –
– –
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KPI 2022 2021
(‘O LP’)
$351.2m
$403.7m
$181
OLP
73%
78%
$46.3m
statement.
$17.9m
$6.4m
28%
28%
3.4%
1.1%
18.5%
6.0%
0.18
0.09
was 100 million.
NIL
67. 5%
77.4%
5.3%
KPI 2022 2021
72%
74%
112
79
93%
93%
CO
tonnes
92%
91%
2.3m
2.4m
2,028
5.9%
13,602
1,134
30%
30%
period.
86%
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2FA
A1 Nigeria
Admission
ASA Rwanda
ASA Tanzania
ASA Nigeria
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Governance Report Financial Statements
FX
Greenhouse Gas
Group
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RFRs
SAAS
Sequoia
to ISO 14001 environmental management system.
forests and other controlled sources.
100% of the inks used are HP Indigo ElectroInk which
requirements of the Nordic Ecolabel (Nordic Swan) for
the remaining 1% used to generate energy.
The paper is Carbon Balanced with World Land Trust,
standing forests, under threat of clearance, carbon
is locked-in, that would otherwise be released.
