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AL-MAZAYA HOLDING COMPANY - K.S.C. (PUBLIC)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2023
(All amounts are in Kuwaiti Dinars)

f) Properties held for trading:
Properties acquired or being constructed for sale in the ordinary course of business, rather than to be held for
rental or capital appreciation, are held as properties held for trading and are measured at lower of cost or net
realizable value.

Cost includes freehold and leasehold rights for land, amount paid to contractors for construction, borrowing costs,
planning and design costs, cost of site preparation, professional fees for legal services, property transfer taxes,
construction overheads and other related costs.

Net realizable value is the estimated selling price in the ordinary course of business, based on market prices at the
reporting date and discounted for the time value of money if material, less costs to completion and the estimated
cost of sale. Non refundable commissions paid to sales or marketing agents on the sale of real estate units are
expensed when paid.

The cost of properties held for trading recognized in consolidated statement of profit or loss on disposal is
determined with reference to the specific cost incurred on the property sold and an allocation of any non-specific
costs based on the relative size of the property sold. Write down of properties held for trading is charged to other
operating expenses.

g) Investment properties:
Investment properties comprise completed property, property under construction or re-development and rights to
use real estate assets (Note 2 – w) that are held to earn rentals or for capital appreciation or both. Investment
properties are initially measured at cost including purchase price and transaction costs. Subsequent to initial
recognition, investment properties are stated at their fair value at the end of reporting period. Gains or losses
arising from changes in the fair value of investment properties are included in the consolidated statement of profit
or loss for the period in which they arise.

Subsequent expenditure is capitalised to the asset’s carrying amount only when it is probable that future economic
benefits associated with the expenditure will flow to the Group and the cost of the item can be measured reliably.
All other repairs and maintenance costs are expensed when incurred. When part of an investment property is
replaced, the carrying amount of the replaced part is derecognised.

Investment properties are derecognized when either they have been disposed off or when the investment property
is permanently withdrawn from use and no future economic benefit is expected from its disposal. Gains or losses
arising on the retirement or disposal of an investment property are recognized in the consolidated statement of
profit or loss.

Transfers are made to investment property when, and only when, there is a change in use, evidenced by the end
of owner occupation or commencement of an operating lease to another party. Transfers are made from investment
property when, and only when, there is a change in use, evidenced by commencement of owner occupation or
commencement of development with a view to sale. If owner-occupied property becomes an investment property,
the Group accounts for such property in accordance with the policy stated under property, plant and equipment up
to the date of change in use.

h) Investment in associates
Associates are those entities in which the Group has significant influence which is the power to participate in the
financial and operating policy decisions of the associate but is not control or joint control over those policies. Under
the equity method, investment in associates are carried in the consolidated statement of financial position at cost
as adjusted for changes in the Group’s share of the net assets of the associate from the date that significant
influence effectively commences until the date that significant influence effectively ceases, except when the
investment is classified as held for sale, in which case it is accounted as per IFRS 5 "Non-current Assets Held for
Sale and Discontinued Operations".

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