Notes to The Consolidated Financial Statement
AL MAZAYA HOLDING COMPANY K.S.C.P. AND ITS SUBSIDIARIES
31 December 2013
Zakat
Contribution to Zakat is calculated at 1% of the profit of the Parent Company in accordance with the Ministry of Finance
resolution No. 58/ 2007.
Segment information
A segment is a distinguishable component of the Group that engages in business activities from which it earns revenues
and incurs costs. The operating segments are used by the management of the Group to allocate resources and assess
performance and the reporting is consistent with the internal reports provided to the chief operation decision maker.
Operating segments exhibiting similar economic characteristics, product and services, class of customers where appropriate
are aggregated and reported as reportable segments.
Foreign currency translation
Each entity in the Group determines its own functional currency and items included in the financial statements of each
entity are measured using that functional currency.
Transactions and balances
Transactions in foreign currencies are initially recorded by the Group entities at their respective functional currency rates
prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated
at the functional currency spot rate of exchange ruling at the reporting date. All differences are taken to the consolidated
statement of income. Tax charges and credits attributable to exchange differences on those monetary items are also
recorded in consolidated statement of income.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange
rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are
translated using the exchange rates at the date when the fair value is determined . The gain or loss arising on retranslation of
non-monetary items is treated in line with the recognition of gain or loss on change in fair value of the item (i.e., translation
differences on items whose fair value gain or loss is recognised in other comprehensive income or profit or loss is also
recognised in other comprehensive income or profit or loss, respectively).
Group companies
The assets and liabilities of foreign operations are translated into Kuwaiti Dinars at the rate of exchange prevailing at
the reporting date and their statement of incomes are translated at average exchange rates during the period where such
averages are reasonable approximation of actual rates. The exchange differences arising on the translation are recognised
in other comprehensive income. On disposal of a foreign operation, the component of other comprehensive income
relating to that particular foreign operation is recognised in the consolidated statement of income.
5. SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS
The preparation of the Group’s consolidated financial statements requires management to make judgments, estimates
and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in
outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.
Judgments
In the process of applying the Group's accounting policies, management has made the following judgements, apart from
those involving estimations, which has the most significant effect on the amounts recognised in the consolidated financial
statements:
Classification of property
The Group determines whether a property is classified as investment property or properties held for trading:
• Investment property comprises land and buildings which are not occupied substantially for use by, or in the
operations of, the Group, nor for sale in the ordinary course of business, but are held primarily to earn rental
income and/or capital appreciation.
• Properties held for trading comprises property that is held for sale in the ordinary course of business.
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