Notes to The Consolidated Financial Statement
AL MAZAYA HOLDING COMPANY K.S.C. AND ITS SUBSIDIARIES
31 December 2012
28. RISK MANAGEMENT
Introduction
Risk is inherent in the Group’s activities but it is managed through a process of ongoing identification, measurement and
monitoring, subject to risk limits and other controls. This process of risk management is critical to the Group’s continuing
profitability.
Risk management structure
The Board of Directors of the Parent Company are ultimately responsible for the overall risk management approach and for
approving the risk strategies and principles.
The major risks to which the Group is exposed in conducting its business and operations, and the means and organisational
structure it employs in seeking to manage them strategically in building shareholder value are outlined below.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same
geographic region, or have similar economic features that would cause their ability to meet contractual obligations to be
similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of
the Group’s performance to developments affecting a particular industry or geographical location.
In order to avoid excessive concentrations of risk, the Group’s policies and procedures include specific guidelines to focus
on country and counter party limits and maintaining a diversified portfolio. Identified concentrations of credit risks are
controlled and managed accordingly.
53
The following table shows a reconciliation of the opening and closing amount of level 3 financial assets which are
recorded at fair value.
-
)1,567,200(
At 1 January
2011
KD
Loss
recorded in the
consolidated
statement of
income
KD
Financial assets available for sale:
Equity securities
Managed portfolio
Loss recorded
in other
comprehensive
income
KD
Net
purchases,
sales and
settlements
KD
At
31 December
2012
KD
)1,841,188(
)570,094(
4,626,679
9,774,316
)230,304(
)30,362(
2,555,187
7,606,660
210,000
)1,910,077(
At 1 January
2010
KD
Loss
recorded in the
consolidated
statement of
income
KD
Financial assets available for sale:
Equity securities
Managed portfolio
Gain recorded
in other
comprehensive
income
KD
Net
purchases,
sales and
settlements
KD
At
31 December
2011
KD
)28,223(
)16,331(
4,419,702
11,490,663
25,200
210,061
4,626,679
9,774,316
