VERITAS KAPITAL ASSURANCE : QUARTER 3 - FINANCIAL STATEMENT FOR 2023

VERITAS KAPITAL ASSURANCE PLC

UNAUDITED FINANCIAL STATEMENT FOR THE PERIOD ENDED

30 SEPTEMBER 2023

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Report and Unaudited Financial Statements for the Period ended September 30, 2023
Table of contents	Page
Corporate information	1
Vision, Mission and Values	2
Our Commitments	3
Statement of significant accounting policies	5
Statement of financial position	27
Statement of profit or loss and other Comprehensive income	29
Statement of changes in equity	30
Statement of cash flows	32
Notes to the financial statements	33
Value added statement	83
Five year financial summary	84

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

CORPORATE INFORMATION

Membership of the Board of Directors during the period ended 30 September, 2023.

1	Mr. Nahim Abe Ibraheem	Non-Executive Director	Chairman
2	Dr. Oluwafunsho A. Obasanjo	Non-Executive Director
3	Mr. Aminu Babangida	Non-Executive Director
4	Hajia Yabawa Lawan Wabi (mni)	Non-Executive Director
5	Mrs Priya Heal	Non-Executive Director
6	Emmanuel Etuh	Non-Executive Director
7	Sen. Maj. Gen. M. Magoro (OFR)	Non-Executive Director
8	Mr. Paul Oki	Independent Non-Executive Director
9	Mr. Sunkanmi Adekeye	Executive Director, Operations
10	Mr. Kenneth Egbaran	Managing Director/CEO
COMPANY SECRETARY	RE-INSURERS
Ms. Saratu Umar Garba	African Reinsurance Corporation
FRC/2019/NBA/00000019159	Continental Reinsurance Corporation
		WAICA Reinsurance Corporation
REGISTERED OFFICE	Nigerian Reinsurance Corporation
Plot 497, Abogo Largema Street,	Alwen Hough Johnson (AHJ) Limited
Off Constitution Avenue,	CK Reinsurance Limited
Central Business District	Meridian Risk Solutions Ltd, London
Abuja.	Score Re.
		CICA Re.
		ACTUARIES
		O & A Hedge Actuarial Consulting
		(Consulting Actuaries & Chartered Insurers)
		Suite 28, Motorways Centre
		(Opposite 7UP Bottling Plant)
www.veritaskapital.com	1 Motorways Avenue
RC NO: 11785	Alausa Ikeja - Lagos, Nigeria
FRC REGISTRATION NO:	REGISTRARS
FRC/2013/0000000000717	Unity Registrars Limited
		25 Ogunlana Drive
		Surulere Lagos.
BANKERS
Unity Bank Plc	AUDITORS
Guaranty Trust Bank Ltd.	Ernest & Young
First Bank Limited	(Chartered Accountants)
Fidelity Bank Plc	13th Floor, UBA House
Keystone Bank Limited	Marina Lagos.
Sterling Bank Plc

Access Bank Plc

Tax Consultants

Pedabo Professional Services

Lagos

REGULATORY AUTHORITY

National Insurance Commission

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

MISSION

To help our Stakeholders have peace of mind

VISION

To be one of the top Insurance Companies of choice in Africa

PRINCIPLES

Integrity

We will act with openness, fairness, integrity and diligence. We will always adhere to the applicable laws, regulations and standards of doing business.

Performance

We will promote a positive and challenging high performance culture. We will do this by encouraging personal accountability, development and measuring, reward and recognizing success.

Responsibilty

We will act responsibly as individuals and as a Company. This applies to the management of our business, our approach to corporate interaction with key external stakeholders.

Values

- Working in teams

-Servicing our Customers -Respecting each other -Being proactive -Growing our people

-Delivering to our Shareholders -Guarding against arrogance -Upholding the highest levels of integrity

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

OUR COMMITMENTS

Customers

A satisfied and loyal customer base is core to our business.

We are committed to:

• Delivering the consistent and reliable levels of customer service.
• Acting with integrity, due care and diligence.
• Communicating openly, honestly and with sensitivity and understanding.
• Listening to our customers.
• Handling complaints fairly and promptly.
• Respecting our customers' rights to privacy and confidentiality.
• Protecting our customers and our business from fraud.

Business Partners

We demand high standards from the companies we work with and believe that they should expect the same from us.

We are committed to:

• Carrying out our business with fairness and integrity.
• Being reliable and quick to respond.
• Awarding contracts and selecting business partners solely on the basis of fair and objective business criteria and having regards to high ethical standards.
• Respecting all obligations and confidentiality.
• Protecting our customers and our business from fraud.

Employees

Motivated and skilled employees are critical to our success.

We are committed to:

• Fostering a positive and challenging high performance culture.
• Rewarding superior performance.
• Encouraging personal development.
• Encouraging a culture of frank and honest communication.
• Encouraging teamwork and strong leadership.
• Providing a safe and secure working environment.
• Encouraging diversity and equal opportunities.
• Ensuring that grievances and unethical behaviour can be raised without fear of discrimination.

In return we expect our employees to:

• Act with integrity.
• Take responsibility and accountability for their own actions.
• Show support and commitment for change.
• Focus their energy in getting the best from themselves and others.
• Have the confidence and courage to act with conviction.
• Show understanding for and meet external and internal customers needs.
• Show a relentless desire for success.
• Create positive and effective working relationships.

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

Regulators

We have an open, cooperative and transparent relationship with our regulators.

We are committed to:

• Dealing with our regulators in an open, cooperative and transparent manner.
• Managing our business with appropriate standards of risk management and controls.
• Preventing and reporting any instances of significant financial crime.
• Preventing breaches of relevant regulatory requirements.
• Complying with all set standards.

Community & Environment

We believe in continuous improvement of our environmental performance and in taking action around emerging environmental issues. Whenever we operate, we will seek positive engagement with local communities.

We are committed to:

• As a business, we have a responsibilty to manage our impacts on the environment through appropriate use of resources such as energy, paper and water and the investment of our assets.
• We also have a responsibility to take proactive action on environmental issues that are likely to affect our business and community at large.
• In each of these areas, we will look to make continuous improvement and actively monitor our performance.

Shareholders

We are committed to fufilling the aspirations of our shareholders through a commitment to business performance, and high standards of transparency, communication and corporate governance.

We are committed to:

• A culture of business performance, focused on delivering returns to shareholders.
• Comprehensive and transparent disclosure.
• Aiding Shareholder's understanding through the disclosure of relevant financial and non-financial information.
• Listening to the views of our shareholders.
• Managing our business with appropriate standards of risk and control.
• Ensuring due care in the selection of our third party advisers, including our auditors.
• Preventing and reporting any market abuse.
• Acting with due sense of responsibilty on confidence entrusted to us.

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

1. Reporting Entity
   Veritas Kapital Assurance Plc ("the group") was initially incorporated under the name of Kapital Insurance group Limited as a private limited liability group on the 8 August, 1973. on 14 March 2007, it acquired and merged withs two other insurance companies became a public limited liability group. its shares are quoted on the Nigerian Stock Exchange.
   Its Head Office is located at 497 Abogo Largema Street, Off constitution Avenue, Central Business District, Abuja Nigeria.
   The group has 93.5% equity interest in Veritas Health Care Limited and 70% interest in Veritas Glanvills Pensions Limited and 51.53% in Goldlink Insurance Plc. The group comprises of two subsidiaries, an associate and the parent group.
2. Principal Activities
   The principal business of the group is underwriting of non-life insurance risks.
   The subsidiaries activities are:
   Veritas Glanvills Pensions Limited, the administration and management of pension fund assets. Veritas Health Care Limited provision of health insurance.
3. Components of Financial Statements
   The Consolidated Financial statements comprise the Statements of Comprehensive income, statements of Financial Position, Statement of Changes in Equity, Statements of Cash Flows, and the acgrouping Notes.
   Income and expenses (excluding the components of other comprehensive income) are recognised in the profit or loss segment of comprehensive income to arrive at the profit for the year.
   Other comprehensive income is recognised in the other comprehensive segment of the statement of other comprehensive income and comprises items of income and expenses that are not recognised in the statmement of profit or loss as required or permitted by IFRS.
   The addition of the profit for the year and the other comprehensive income gives the total comprehensive income for the year.
   Reclassification adjustments are amounts reclassified to statement of comprehensive income in the current period that were recognised in other comprehensive income in the current or previous periods. Transactions with the owners of the group in their capacity as owners are recognised in the statement of changes in equity.
4. Basis of preparation and measurement
   The Consolidated and separate financial statements are prepared in compliance with International Financial Reporting Standards (IFRS) and the requirements of the Companies and Allied Matters Act, Insurance Act, 2003 and regulatory guidelines as pronounced from time to time by National Insurance Commission (NAICOM). Historical cost basis was used in preparation of the financial statements as modified by the certain items of:
5. • Property plant and equipment at valuation
   • investment property at fair value
   • investment at fair value
   • impaired assets at their recoverable amounts
6. Compliance with IFRS
   These Consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards
   (IFRS) and IFRS Interpretations Committee (IFRIC) Interpretations applicable to companies reporting under IFRS as issued by the International Accounting Standards Board (IASB). Additional information required by national regulations have been included where appropriate
7. Going Concern status
   The consolidated financial statements have been prepared on the going corcern basis. The group has no intention or need to reduce subtantially its business operations. The management believes that the going concern assumption is appropriate for the group and group due to sufficient liquidity and based on historical experience that shortterm obligations will be refinanced in the normal course of business. Liquidity ratio and continuous evaluation of current ratio of the group is carried out to ensure that there are no going concern threats to the operation of the group.

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

1. Significant judgements and key sources of estimation uncertainty

In the process of applying the accounting policies adopted by the group, the Directors make certain judgements and estimates that may affect the carrying values of assets and liabilities in the next financial period. Such judgements and estimates are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the current circumstances. the directors evaluate these at each financial reporting date to ensure that they are still reasonable under the prevailing circumstances based on the information available.

The preparation of the group's financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the reporting date. however, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustement to the carrying amount of the asset or liability affected in the future. These factors should include:

The judgements made by the directors in the process of applying the group's accounting policies that have the most significant effect on the amounts recognised in the financial statements include:

1. • Claims arising from insurance contracts
     Liabilities for unpaid claims are estimated on a case by case basis. The liabilities recognised for claims fluctuate based on the nature and severity of the claim reported. Claims incurred but not reported are determined using statistical analyses and the group deems liabilities reported as adequate.
   • Deferred acquisition costs (DAC)
     Commissions that vary with and are related to securing new contracts and renewing existing contracts are capitalised as an intangible asset under Deferred Acquisition Costs (DAC). The amount of commission to be deferred is directly proportional to the time apportionment basis of the underlying premium income to which the acquisition cost is directly related.
   • Fair value of unquoted equity financial instruments
     The fair value of financial instruments where no active market exists or where quoted prices are not otherwise available are determined by using valuation techniques. In these cases, the fair values are estimated from observable data using valuation models.
   • Property, Plant and equipment
     Property, Plant and equipment represent one of the most significant proportion of the asset base of the group, accounting for about 26% of the group's total assets. Therefore the estimates and assumptions made to determine their carrying value and related depreciation are critical to the group's financial position and performance.
     The charge in respect of periodic depreciation is derived after determining an estimate of an asset's expected useful life and the expected residual value at the end of its life. Increasing an asset's expected life or its residual value would result in the reduced depreciation charge in the statmeent of comprehensive income.
     The useful lives and residual values of the property, plant and equipment are determined by management based on historical experience as well as anticipation of future events and circumstances which may impact their useful lives.
   • Goodwill
     Goodwill is evaluated for impairment annually or whenever we identify certain triggering events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or circumstances that might indicate an interim evaluation is warranted include, among other things, unexpected adverse business conditions, macro and reporting unit specific economic factors (for example, interest rate and foreign exchange rate fluctuations, and loss of key personnel), supply costs, unanticipated competitive activities, and acts by governments and courts.
     Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired. Impairment is determined for goodwill by assessing the recoverable amount of the cash generating unit to which the goodwill relates. Where the recoverable amount of the cash generating unit is less than their carrying amount, an impairment is recognized.
   • Deferred Tax Assets
     Deferred tax assets are recognised for all unused tax losses to the extent that it is probable that taxable profit will be available against which temporary differences can be utilised. Management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and other factors
2. Functional and presentation currency
3. 
   The consolidated financial statements are presented in Nigerian Naira (Naira), rounded to the nearest thousand, this is also the functional currency of the group.

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

1.9 Changes in accounting policy and disclosures

New and amended standards and interpretations

The group applied for the first time, certain standards and amendments, which are effective for annual periods beginning on or after 1 January 2022. Their adoption has not had any material impact on the disclosures or on the amounts reported in these financial statements.

The group has not early adopted any other standard, interpretation or amendment that has been issued but not yet effective.

Amendments to IFRS 3 Reference to the Conceptual Framework

The group has adopted the amendments to IFRS 3 Business Combinations for the first time in the current year. The amendments update IFRS 3 so that it refers to the 2018 Conceptual Framework instead of the 1989 Framework. They also add to IFRS 3 a requirement that, for obligations within the scope of IAS 37 Provisions, Contingent Liabilities and Contingent Assets, an acquirer applies IAS 37 to determine whether at the acquisition date a present obligation exists as a result of past events. For a levy that would be within the scope of IFRIC 21 Levies, the acquirer applies IFRIC 21 to determine whether the obligating event that gives rise to a liability to pay the levy has occurred by the acquisition date.

Amendments to IAS 16 Property, Plant and Equipment- Proceeds before Intended Use

The group has adopted the amendments to IAS 16 Property, Plant and Equipment for the first time in the current year. The amendments prohibit deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced before that asset is available for use, i.e. proceeds while bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Consequently, an entity recognises such sales proceeds and related costs in profit or loss. The entity measures the cost of those items in accordance with IAS 2 Inventories. The amendments also clarify the meaning of 'testing whether an asset is functioning properly'. IAS 16 now specifies this as assessing whether the technical and physical performance of the asset is such that it is capable of being used in the production or supply of goods or services, for rental to others, or for administrative purposes. If not presented separately in the statement of comprehensive income, the financial statements shall disclose the amounts of proceeds and cost included in profit or loss that relate to items produced that are not an output of the entity's ordinary activities, and which line item(s) in the statement of comprehensive income include(s) such proceeds and cost.

Amendments to IAS 37 Onerous Contracts-Cost of Fulfilling a Contract

The group has adopted the amendments to IAS 37 for the first time in the current year. The amendments specify that the cost of fulfilling a contract comprises the costs that relate directly to the contract. Costs that relate directly to a contract consist of both the incremental costs of fulfilling that contract (examples would be direct labour or materials) and an allocation of other costs that relate directly to fulfilling contracts (an example would be the allocation of the depreciation charge for an item of property, plant and equipment used in fulfilling the contract).

Annual

Improvements to IFRS Accounting Standards 2018- 2020 Cycle

The group has adopted the amendments included in the Annual Improvements to IFRS Accounting Standards 2018-2020 Cycle for the first time in the current year. The Annual Improvements include amendments to four standards.

IFRS 1 First-time Adoption of International Financial Reporting Standards.

The amendment provides additional relief to a subsidiary which becomes a first-time adopter later than its parent in respect of accounting for cumulative translation differences. As a result of the amendment, a subsidiary that uses the exemption in IFRS 1:D16(a) can now also elect to measure cumulative translation differences for all foreign operations at the carrying amount that would be included in the parent's consolidated financial statements, based on the parent's date of transition to IFRS Accounting Standards, if no adjustments were made for consolidation procedures and for the effects of the business combination in which the parent acquired the subsidiary. A similar election is available to an associate or joint venture that uses the exemption in IFRS 1:D16(a).

IFRS 9 Financial Instruments

The amendment clarifies that in applying the '10 per cent' test to assess whether to derecognise a financial liability, an entity includes only fees paid or received between the entity (the borrower) and the lender, including fees paid or received by either the entity or the lender on the other's behalf.

IFRS 16 Leases

The amendment removes the illustration of the reimbursement of leasehold improvements.

IAS 41 Agriculture

The amendment removes the requirement in IAS 41 for entities to exclude cash flows for taxation when measuring fair value. This aligns the fair value measurement in IAS 41 with the requirements of IFRS 13 Fair Value Measurement to use internally consistent cash flows and discount rates and enables preparers to determine whether to use pre-tax or post-tax cash flows and discount rates for the most appropriate fair value measurement.

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VERITAS KAPITAL ASSURANCE PLC

Unaudited Financial Statement

For the period ended 30 September 2023

1.10 Summary of significant accounting policies 1.10.1 Introduction to summary of accounting policies

The principal accounting policies applied in the preparation of these consolidated and separate financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

1. New and revised IFRS Accounting Standards in issue but not yet effective
   The following new and amended standards have been issued but are yet to become effective as at December 31, 2022.

IFRS 17 (including the June 2020 and December 2021 amendments to IFRS 17)

IFRS 17 Insurance Contracts

IFRS 17 establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts and supersedes IFRS 4 Insurance Contracts.

IFRS 17 outlines a general model, which is modified for insurance contracts with direct participation features, described as the variable fee approach. The general model is simplified if certain criteria are met by measuring the liability for remaining coverage using the premium allocation approach.

The general model uses current assumptions to estimate the amount, timing and uncertainty of future cash flows and it explicitly measures the cost of that uncertainty. It takes into account market interest rates and the impact of policyholders' options and guarantees.

In June 2020, the IASB issued Amendments to IFRS 17 to address concerns and implementation challenges that were identified after IFRS 17 was published. The amendments defer the date of initial application of IFRS 17 (incorporating the amendments) to annual reporting periods beginning on or after 1 January 2023. At the same time, the IASB issued Extension of the Temporary Exemption from Applying IFRS 9 (Amendments to IFRS 4) that extends the fixed expiry date of the temporary exemption from applying IFRS 9 in IFRS 4 to annual reporting periods beginning on or after 1 January 2023.

In December 2021, the IASB issued Initial Application of IFRS 17 and IFRS 9-Comparative Information (Amendment to IFRS 17) to address implementation challenges that were identified after IFRS 17 was published. The amendment addresses challenges in the presentation of comparative information.

IFRS 17 must be applied retrospectively unless impracticable, in which case the modified retrospective approach or the fair value approach is applied.

For the purpose of the transition requirements, the date of initial application is the start of the annual reportingperiod in which the entity first applies the Standard, and the transition date is the beginning of the period immediately preceding the date of initial application.

Amendments to IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures-Sale or Contribution of Assets between an Investor and its Associate or Joint Venture

The amendments to IFRS 10 and IAS 28 deal with situations where there is a sale or contribution of assets

between an investor and its associate or joint venture. Specifically, the amendments state that gains or losses

resulting from the loss of control of a subsidiary that does not contain a business in a transaction with an

associate or a joint venture that is accounted for using the equity method, are recognised in the parent's profit

or loss only to the extent of the unrelated investors' interests in that associate or joint venture. Similarly, gains

and losses resulting from the remeasurement of investments retained in any former subsidiary (that has

become an associate or a joint venture that is accounted for using the equity method) to fair value are

recognised in the former parent's profit or loss only to the extent of the unrelated investors' interests in the new

associate or joint venture.

The effective date of the amendments has yet to be set by the IASB; however, earlier application of the

amendments is permitted. The directors of the group anticipate that the application of these amendments may

have an impact on the Group's consolidated financial statements in future periods should such transactions

arise.

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