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ANNUAL REPORT
2015
Notes to The Consolidated Financial Statement
AL MAZAYA HOLDING COMPANY K.S.C.P. AND ITS SUBSIDIARIES
31 December 2015
Impairment of receivable
An estimate of the collectible amount of receivable is made when collection of the full amount is no longer probable. For
individually significant amounts, this estimation is performed on an individual basis. Amounts which are not individually
significant, but which are past due, are assessed collectively and a provision applied according to the length of time past due,
based on historical recovery rates.
Fair value measurement
The Group measures financial instruments, such as, financial asset available for sale and non-financial assets, at fair value at each
consolidated statement of financial position date. Fair value is the price that would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on
the presumption that the transaction to sell the asset or transfer the liability takes place either:
• In the principal market for the asset or liability, or
• In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible to the Group. The fair value of an asset or a liability is measured
using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act
in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant›s ability to generate economic benefits
by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest
and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
Fair value measurement of financial instruments
Fair values for financial instruments traded in active markets are based on closing bid prices. For all other financial instruments
including financial instruments for which the market has become inactive, the fair value is determined by using appropriate
valuation techniques. Valuation techniques include the fair value derived from recent arm’s length transaction, comparison to
similar instruments for which market observable prices exist, discounted cash flow method or other relevant valuation techniques
commonly used by market participants. For investments in equity instruments, where a reasonable estimate of fair value cannot
be determined, the investment is carried at cost.
The fair value of financial instruments carried at amortised cost, other than short-term in nature is estimated by discounting the
future contractual cash flows at the current market interest rates for similar financial instruments.
Fair value measurement of non-financial instruments
Fair values of non-financial instruments are measured based on valuation provided by independent valuers.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair
value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
• Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities;
• Level 2 —Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or
indirectly observable;
• Level 3 —Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
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