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AL MAZAYA HOLDING COMPANY K.S.C. (CLOSED) AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2008
(All amounts are in Kuwaiti Dinars)
Joint venture arrangements that involve the establishment of a separate entity in which each venturer
has an interest are referred to as jointly controlled entities.
The Group reports its interests in jointly controlled entities using the equity method of accounting.
Under the equity method, investments in joint ventures are carried in the consolidated balance sheet
at cost as adjusted for post-acquisition changes in the Group's share of the net assets of the joint
venture, less any impairment in the value of individual investments.
Where the Group transacts with its jointly controlled entities, unrealized profits and losses are
eliminated to the extent of the Group's interest in the joint venture.
I) Associates
Associates are those enterprises in which the Group has significant influence, but not control, over the
financial and operating policy decisions. The consolidated financial statements include the Group's
share of the results and assets and liabilities of associates under the equity method of accounting
from the date that significant influence effectively commences until the date that significant influence
effectively ceases, except when the investment is classified as held for sale, in which case it is
accounted for under IFRS 5 Non-current Assets Held for Sale and Discontinued Operations. Under
the equity method, investments in associates are carried in the consolidated balance sheet at cost as
adjusted for post-acquisition changes in the Group's share of the net assets of the associate, less any
impairment in the value of individual investments. Losses of an associate in excess of the Group's
interest in that associate which includes any long-term interests that, in substance, form part of the
Group's net investment in the associate are not recognized except to the extent that the Group has an
obligation or has made payments on behalf of the associate.
Gains or losses arising from transactions with associates are eliminated against the investment in the
associate to the extent of the Group's interest in the associate.
Any excess of the cost of acquisition over the Group's share of the net fair value of the identifiable
assets, liabilities and contingent liabilities of the associate recognized at the date of acquisition is
recognized as goodwill. The goodwill is included within the carrying amount of the investment in
associates and is assessed for impairment as part of the investment. Any excess of the Group's share
of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of
acquisition, after reassessment, is recognized immediately in the consolidated statement of income.
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