Notes to The Consolidated Financial Statement
AL MAZAYA HOLDING COMPANY K.S.C.P. AND ITS SUBSIDIARIES
31 December 2013
Fair value measurement
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group determines whether
transfers have occurred between Levels in the hierarchy by re-assessing categorisation (based on the lowest level input that
is significant to the fair value measurement as a whole) at the end of each reporting period.
Interest in joint ventures
Jointly controlled entities
The Group has investment in joint venture, which are jointly controlled entity, whereby the venturers have a contractual
arrangement that establishes joint control over the economic activities of the entities. The arrangement requires unanimous
agreement for financial and operating decisions among the venturers. The Group recognises its interest in the joint venture
using the equity method. Under the equity method, investment in a joint venture is initially recognised at cost and adjusted
thereafter for the post-acquisition change in the Group’s share of net assets of the joint venture. Any goodwill arising on the
acquisition of the Group’s interest in a jointly control entity is accounted for in accordance with the Group’s accounting
policy for goodwill arising on the acquisition of joint venture.
The Group recognises in the consolidated statement of income its share of the total recognised profit or loss of the
joint venture from the date that influence or ownership effectively commenced until the date that it effectively ceases.
Distributions received from a joint venture reduce the carrying amount of the investment. Adjustments to the carrying
amount may also be necessary for changes in the Group’s share in the joint venture arising from changes in the joint
venture’s equity that have not been recognised in the joint venture’s statement of income. The Group’s share of those
changes is recognised directly in equity. Unrealised gains on transactions with an joint venture are eliminated to the extent
of the Group’s share in the joint venture. Unrealised losses are also eliminated unless the transaction provides evidence of
impairment in the asset transferred
Jointly controlled assets
The Group has joint control of certain properties held for trading. The Group recognises its interests in the jointly controlled
asset using the proportionate consolidation method whereby the Group includes its share of the asset and liabilities and
related income and expenses on a line by line basis in its consolidated financial statements.
Investment in associates
An associate is an entity over which the Group has significant influence. Significant influence is the power to participate
in the financial and operating policy decisions of the investee, but is not control or joint control over those policies.
The considerations made in determining significant influence are similar to those necessary to determine control over
subsidiaries.
The Group’s investment in its associate is accounted for using the equity method. Under the equity method, the investment
in the associate is carried in the consolidated statement of financial position at cost plus post acquisition changes in the
Group’s share of net assets of the associate. Unrealised gains and losses resulting from transactions between the Group and
the associate are eliminated to the extent of the interest in the associate.
The Group recognises in the consolidated statement of income its share of the total recognised profit or loss of the associate
from the date that influence or ownership effectively commenced until the date that it effectively ceases. Distributions
received from an associate reduce the carrying amount of the investment. Adjustments to the carrying amount may also be
necessary for changes in the Group’s share in the associate arising from changes in the associate’s equity that have been
recognised in the associate’s statement of comprehensive income.
The Group’s share of those changes is recognised directly in equity. Unrealised gains on transactions with an associate are
eliminated to the extent of the Group’s share in the associate. Unrealised losses are also eliminated unless the transaction
provides evidence of impairment in the asset transferred.
An assessment of investment in an associate is performed when there is an indication that the asset has been impaired, or
that impairment losses recognised in prior years no longer exist. Whenever impairment requirements of IAS 36, indicate
that investment in an associate may be impaired, the entire carrying amount of investment is tested by comparing its
recoverable amount with its carrying value.
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