36 / 38
AL MAZAYA HOLDING COMPANY K.S.C. (CLOSED) AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2007
(All amounts are in Kuwaiti Dinars)
The Group's maximum exposure arising from default of the counter-party is limited to the carrying amount of
short-term deposits, receivables and due from related parties.
c) Foreign currency risk
The Group incurs foreign currency risk on transactions that are denominated in a currency other than the
Kuwaiti Dinar. The Group may reduce its exposure to fluctuations in foreign exchange rates through the use
of derivative financial instruments. The Group ensures that the net exposure is kept to an acceptable level,
by dealing in currencies that do not fluctuate significantly against the Kuwaiti Dinar.
The following table demonstrates the sensitivity to a reasonably possible change in the foreign exchange
rates.
2007
Increase / decrease
against Kuwaiti Dinars
Effect on profit
Effect on equity
5%
113,334
1,557,939
5%
8,911
5%
79
774
Year
AED
USD
LBP
2006
AED
USD
LBP
5%
5%
5%
246,014
1,664
103
d) Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in raising funds to meet commitments
associated with financial instruments. To manage this risk, the Group periodically assesses the financial
viability of customers and invests in bank deposits or other investments that are readily realizable.
Maturity Table for financial liabilities
2007
Within 1
1 to 3
3 to 12
month
months
months
1 to 5 ~ears
Total
Accounts payable and other
credit balances
672,718
4,336,830
42,827,276
47,836,824
Term loans
46,755,500
7,998,829
54,754,329
Wakala and Murabaha payables
7,039,068
3,000,000
10,039,068
Deferred consideration on
acquisition of properties
38,699,426
38,699,426
672,718
11,375,898
92,582,776
46,698,255
151,329,647
34