NOTES TO FINANCIAL STATEMENT

Investments in financial assets

	2019	2018
	AED	AED
Investments carried at FVTOCI
Quoted equity securities	38,005,863	24,604,003
Quoted Tier 1 perpetual securities	15,040,393	31,078,287
Unquoted Tier 1 perpetual securities	6,950,000	5,850,000
	59,996,256	61,532,290
Investments carried at FVTPL
Quoted equity securities	11,607,267	17,205,049
Unquoted debt securities	2,000,000	2,000,000
	13,607,267	19,205,049

 

The movement in the investments in financial assets is as follows:

	2019	2018
	AED	AED
Investments carried at FVTOCI
Fair value at 1 January	61,532,290	27,262,656
Purchases	12,034,256	39,159,148
Disposals	(17,817,189)	(2,409,486)
Change in fair value	4,246,899	(2,480,028)
Fair value at the end of the reporting period	59,996,256	61,532,290
Investments carried at FVTPL
Fair value at 1 January	19,205,049	13,616,061
Purchases	2,094,970	17,255,368
Disposals	(8,095,029)	(7,761,139)
Change in fair value taken to profit and loss	402,277	(3,905,241)
Fair value at the end of the reporting period	13,607,267	19,205,049

 

The geographical distribution of investments is as follows:

	2019	2018
	AED	AED
Quoted UAE equity securities	47,846,197	41,809,052
Quoted outside UAE debt securities	15,040,393	31,078,287
Unquoted UAE debt securities	8,950,000	7,850,000
Quoted outside UAE equity securities	1,766,933	–
	73,603,523	80,737,339

 

Management considers that the fair values of financial assets and financial liabilities that are not measured at fair value approximates to their carrying amounts as stated in the financial statements and are classified as level 3 in accordance with the IFRS 13 hierarchy.

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value into Levels 1 to 3 based on the degree to which the fair value is observable.

• Level 1 – fair value measurements derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 – fair value measurements derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
• Level 3 – fair value measurements derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs). Management has determined the fair value of these unquoted investments by applying an appropriate risk adjusted liquidity discount on the net assets of the investee companies.

	Note	Level 1	Level 2	Level 3	Total
		AED	AED	AED	AED
31 December 2019
Investments at FVTOCI
Investment in quoted securities	(a)	38,005,863	–	–	38,005,863
Quoted Tier 1 perpetual securities		15,040,393	–	–	15,040,393
Unquoted Tier 1 perpetual securities		–	–	6,950,000	6,950,000
		53,046,256	–	6,950,000	59,996,256
Investments at FVTPL
Investment in quoted equity securities	(a)	11,607,267	–	–	11,607,267
Unquoted Tier 1 perpetual securities		–	–	2,000,000	2,000,000
		11,607,267	–	2,000,000	13,607,267
31 December 2018
Investments at FVTOCI
Investment in quoted securities	(a)	24,604,003	–	–	24,604,003
Quoted Tier 1 perpetual securities		31,078,287	–	–	31,078,287
Unquoted Tier 1 perpetual securities		–	–	5,850,000	5,850,000
		55,682,290	–	5,850,000	61,532,290
Investments at FVTPL
Investment in quoted equity securities	(a)	17,205,049	–	–	17,205,049
Unquoted Tier 1 perpetual securities		–	–	2,000,000	2,000,000
		17,205,049	–	2,000,000	19,205,049

 

(a)  Fair values have been determined by reference to the quoted prices at the reporting date.

 

During the year, there were no transfers between Level 1 and Level 2 fair value measurement and no transfers into or out of Level 3 fair value measurements.