NOTES TO FINANCIAL STATEMENT
Financial assets
| (Restated) | ||
| 31 December 2023 |
31 December
2022 |
|
| AED | AED | |
| Investments carried at FVTOCI | ||
| Quoted equity securities* | 2,901,238 | 30,997,354 |
| Quoted Tier 1 perpetual securities | 1,190,727 | 2,555,228 |
| Unquoted Tier 1 perpetual securities | 6,950,000 | 6,950,000 |
| 11,041,965 | 40,502,582 | |
| *Quoted equity securities amounting to AED 1,511,219 (31 December 2022: AED 4,503,420) are under the name of Chairman and are beneficially held and controlled by the Company. | ||
| Investments carried at FVTPL | ||
| Quoted equity securities | 66,070 | 6,948,829 |
| Unquoted debt securities (Note 9) | – | 7,000,000 |
| 66,070 | 13,948,829 | |
The movement in the investments in financial assets is as follows:
| (Restated) | ||
| 31 December 2023 |
31 December 2022 | |
| AED | AED | |
| Investments carried at FVTOCI | ||
| Fair value at 1 January | 40,502,582 | 51,296,714 |
| Additions | – | 11,330,115 |
| Disposals | (30,422,387) | (21,732,807) |
| Change in fair value | 961,770 | (391,440) |
| Fair value at the end of the reporting year | 11,041,965 | 40,502,582 |
| Investments carried at FVTPL | ||
| Fair value at 1 January | 13,948,829 | 12,249,031 |
| Additions | 3,973,624 | 10,119,102 |
| Disposals | (10,850,054) | (9,323,263) |
| Change in fair value taken to profit or loss | (6,329) | 903,959 |
| Reclassified to cash and cash equivalents (Note 9) | (7,000,000) | – |
| Fair value at the end of the reporting year | 66,070 | 13,948,829 |
The geographical distribution of investments is as follows:
| (Restated) | ||
| 31 December 2023 |
31 December 2022 | |
| AED | AED | |
| Quoted UAE equity securities | 1,621,351 | 36,674,355 |
| Quoted outside UAE Tier 1 Perpetual securities | 1,190,727 | 2,555,227 |
| Unquoted UAE debt securities (Note 9) | – | 7,000,000 |
| Unquoted UAE Tier 1 securities | 6,950,000 | 6,950,000 |
| Quoted outside UAE equity securities | 1,345,957 | 1,271,829 |
| 11,108,035 | 54,451,411 |
6.1 Fair value measurements
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.
Valuation techniques and assumptions applied for the purposes of measuring fair value
The fair values of financial assets and financial liabilities are determined using similar valuation techniques and assumptions as used for the year ended 31 December 2022.
Fair value of the Company’s financial assets and liabilities that are measured at fair value on recurring basis
Some of the Company’s financial assets and liabilities are measured at fair value at the end of the reporting period.
| Note | Level 1 | Level 2 | Level 3 | Total | |
| AED | AED | AED | AED | ||
| 31 December 2023 | |||||
| Investments at FVTOCI | |||||
| Investment in quoted securities | (a) | 2,901,238 | – | – | 2,901,238 |
| Quoted Tier 1 perpetual securities | (a) | 1,190,727 | – | – | 1,190,727 |
| Unquoted Tier 1 perpetual securities | – | – | 6,950,000 | 6,950,000 | |
| 4,091,965 | – | 6,950,000 | 11,041,965 | ||
| Investments at FVTPL | |||||
| Investment in quoted equity securities | (a) | 66,070 | – | – | 66,070 |
| 66,070 | – | – | 66,070 | ||
| 31 December 2022
(Restated) |
|||||
| Investments at FVTOCI | |||||
| Investment in quoted securities | (a) | 30,997,354 | – | – | 30,997,354 |
| Quoted Tier 1 perpetual securities | 2,555,228 | – | – | 2,555,228 | |
| Unquoted Tier 1 perpetual securities | – | – | 6,950,000 | 6,950,000 | |
| 33,552,582 | – | 6,950,000 | 40,502,582 | ||
| Investments at FVTPL | |||||
| Investment in quoted equity securities | (a) | 6,948,829 | – | – | 6,948,829 |
| Unquoted Tier 1 perpetual securities | – | – | 7,000,000 | 7,000,000 | |
| 6,948,829 | – | 7,000,000 | 13,948,829 |
- 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.
