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AL MAlAYA HOLDING COMPANY K.S.C. (CLOSED) AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2008
(All amounts are in Kuwaiti Dinars)
1.
Establishment and activities
Al Mazaya Holding Company - K.S.C. (Closed) was incorporated on November 7, 1998 under the
Commercial Companies Law No. 15 of 1960 and amendments thereto.
The Parent Company is engaged in investment in local and foreign companies, real estate properties and
consultancy services.
The registered office of the Parent Company is at Salhia complex, Fahed AI Salem Street, P.O. Box 3546,
Safat 13036, Kuwait.
These consolidated financial statements were approved for issue by the Board of Directors on March 25,
2009. The shareholders' General Assembly has the power to amend these consolidated financial statements
after issuance.
2.
Significant accounting policies
The accompanying consolidated financial statements have been prepared in accordance with the
International Financial Reporting Standards issued by the InternationalAccounting Standard Board (IASB).
Significant accounting policies are summarized as follows:
a) Basis of preparation
The consolidated financial statements are presented in Kuwaiti Dinars and are prepared under the
historical cost convention, except that investments at fair value through income statement, certain
investments available for sale and investment properties are stated at their fair value. The accounting
policies applied by the Group are consistent with those used in the previous year except for the changes
due to implementation of certain amendments to revised lAS 39: Financial Instruments - Recognition
and Measurement and IFRS 7 Financial Instruments: Disclosures and the early application of IFRIC 15-
Agreements for the construction of Real Estate.
IFRIC 15 - Agreements for the construction of Real Estate
The Group had adopted early application of IFRIC 15 - Agreements for the construction of Real Estate.
This change in accounting policy had been accounted for respectively as per lAS 8 accounting policies,
changes in accounting estimates and errors. This had resulted in decreasing the balance of retained
earnings as of December 31, 2006 by KD 8,454,038 and decreasing the net profit for the year ended
December 31,2007 by KD 7,031,572.
The application of IFRIC 15 gives the guidance for accounting of revenue and associated expenses
regarding construction of real estate and whether the agreement is within the scope of lAS 11 -
Construction contract or lAS 18 - Revenue. An agreement for the construction of real estate meets the
definition of a construction contract where the buyer is able to specify the major structural elements of
the design of the real estate before construction begins and / or specify major structural changes once
construction is in progress and in that case lAS 11 - Construction contract applies.
In case of agreement for construction of real estate in which buyer has only limited ability to influence the
design of the real estate, it is within the scope of lAS 18 - Revenue.
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