Notes to The Consolidated Financial Statement
AL MAZAYA HOLDING COMPANY K.S.C. AND ITS SUBSIDIARIES
31 December 2012
The financial assets of the Group are distributed over the following geographical regions:
The Group’s exposure is predominately to real estate and construction sectors.
There is no concentration of credit risk with respect to real estate receivables, as the Group has a large number of tenants.
2012
KD
5,460,094
12,822,242
7,030
18,289,366
Geographical regions:
Kuwait
Dubai
Other
2011
KD
16,802,019
16,670,147
11,146
33,483,312
2012
KD
13,386,421
4,902,945
18,289,366
Bank balances and short term deposits
Accounts receivable
2011
KD
23,536,354
9,946,958
33,483,312
28.1 Credit risk
Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party
to incur a financial loss. The Group manages credit risk by setting limits for individual counter-parties, monitors credit
exposures, and continually assesses the creditworthiness of counterparties, with the result that the Group’s exposure to
bad debts is not significant.
The Group trades only with recognised, creditworthy third parties. In addition, receivable balances are monitored on an
ongoing basis. For transactions that do not occur in the country of the relevant operating unit, the Group does not offer
credit terms without the approval of the Group management.
With respect to credit risk arising from the other financial assets of the Group, which comprise bank balances, short term
deposits and account receivables, the Group’s exposure to credit risk arising from default of the counterparty, with a
maximum exposure equal to the carrying amount these instruments.
Due to the nature of the Group’s business, the Group does not take possession of collaterals.
28.1.1 Gross maximum exposure to credit risk
The table below shows the gross maximum exposure to credit risk across the Group’s financial assets.
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