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AL-MAZAYA HOLDING COMPANY - K.S.C. (PUBLIC)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2023
(All amounts are in Kuwaiti Dinar)

The amortized cost of a financial asset is the amount at which the financial asset is measured at
initial recognition minus the principal repayments, plus the cumulative amortization using the
effective interest method of any difference between that initial amount and the maturity amount,
adjusted for any loss allowance. The gross carrying amount of a financial asset is the amortized
cost of a financial asset before adjusting for any loss allowance.

Cash and cash equivalents, term deposits, and trade receivables are classified as debt
instruments at amortized cost.

- Cash and cash equivalents
Cash and cash equivalents includes cash in hand and at banks, deposits held at call with
banks and other short-term highly liquid investments with original maturities of three months
or less that are readily convertible to a known amount of cash and are subject to an
insignificant risk of changes in value.

- Term deposits
Term deposits are placed with banks and have a contractual maturity of more than three
months.

- Trade receivables
Receivables are amounts due from customers and tenants for units sold or rent or services
performed in the ordinary course of business and is recognized initially at fair value and are
subsequently measured at amortized cost using the effective interest method, less allowance
for expected credit losses.

Equity instruments at FVTOCI
Upon initial recognition, the Group may elect to classify irrevocably some of its equity instruments
at FVTOCI when they are neither held for trading nor a contingent consideration arising from a
business combination. Such classification is determined on an instrument-by- instrument basis.

Equity investments at FVTOCI are subsequently measured at fair value. Changes in fair values
including foreign exchange component are recognized in other comprehensive income and
presented in the cumulative changes in fair values as part of equity. Cumulative gains and losses
previously recognized in other comprehensive income are transferred to retained earnings on
derecognition. Gains and losses on these equity instruments are never recycled to consolidated
statement of profit or loss. Dividends are recognized in consolidated statement of profit or loss
when the right of the payment has been established, except when the Group benefits from such
proceeds as a recovery of part of the cost of the instrument, in which case, such gains are
recorded in OCI. Equity instruments at FVTOCI are not subject to an impairment assessment.
Upon disposal, cumulative gains or losses are reclassified from cumulative changes in fair value
to retained earnings in the statement of changes in equity.

Financial assets at FVTPL
Financial assets that do not meet the criteria for being measured at amortized cost or FVTOCI
(see above) are measured at FVTPL. Specifically:
• Investments in equity instruments are classified as at FVTPL, unless the Group designates
an equity investment as at FVTOCI on initial recognition (see above).
• Debt instruments that do not meet the amortized cost criteria or the FVTOCI criteria (see
above) are classified as at FVTPL. In addition, debt instruments that meet either the
amortized cost criteria or the FVTOCI criteria may be designated as at FVTPL upon initial
recognition if such designation eliminates or significantly reduces a measurement or
recognition inconsistency ('accounting mismatch') that would arise from measuring assets or
liabilities or recognizing the gains and losses on them on different bases. The Group has not
designated any debt instruments as at FVTPL.

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