| Notes forming part of accounts [line items] | | |
| Disclosure of notes and other explanatory information [text block] | | |
| Disclosure of general information about reporting entity [abstract] | | |
| Disclosure of general information about reporting entity [text block] |
GENERAL
AlJazira Takaful Taawuni Company (the "Company"), is a Saudi Joint Stock Company incorporated in the Kingdom of Saudi Arabia pursuant to the Council of Ministers’ resolution No. 137 dated 27 Rabi' Al-Thani 1431H (corresponding to 12 April 2010) and Royal Decree No. M/23 dated 28 Rabi' Al-Thani 1431H corresponding to 13 April 2010. The Company obtained its Commercial Registration 4030251980 on 2 Ramadan 1434H corresponding to 10 July 2013 and Ministry of Commerce and Industry’s Resolution dated 24 Sha’baan 1434H corresponding to 03 July 2013. The Company operates only in the Kingdom of Saudi Arabia. The Company has the following branches and the assets, liabilities and results of operations of the Branches are included in these interim condensed financial statements:
Branch | CR Number | Date | Riyadh | 1010519290 | 24 Jumada Al-Awal 1440 | Madinah | 4650081845 | 21 Rabi’ Al-Awal 1438 | AlKhobar | 2051224259 | 24 Jumada Al-Awal 1440 |
The registered office address of the Company is: Al Musadia Plaza (3), Al Madinah Road, P.O. Box 5215, Jeddah 21422, Kingdom of Saudi Arabia.
The objectives of the Company are to engage in providing insurance products that includes protection and saving insurance products and related services in accordance with its By-Laws and applicable regulations in the Kingdom of Saudi Arabia. The Company received licence number TMN/34/201312 dated 15 Safar 1435H (corresponding to 18 December 2013) from the Saudi Arabian Monetary Authority (SAMA) to conduct insurance business. The Company is owned 98.02% by Saudi founding shareholders’ and general public subject to Zakat and 1.98% by non-Saudi founding shareholders’ subject to income tax.
The insurance portfolio and related assets and liabilities have been acquired from a founding shareholder by the Company on the completion of valuation and approval by SAMA. During the year ended 31 December 2019, the Company and Bank AlJazira have received a no objection certificate from SAMA to transfer the insurance portfolio through letter dated 26 Rabi ’Al-Thani 1441H (corresponding to 23 December 2019). The insurance portfolio has been transferred with effect from 01 January 2020 and the financial impact of transfer are as follows:
|
| Carrying value of assets and liabilities |
|
| SR'000 | Assets |
|
| Available for sale investments held to cover unit-linked liabilities |
| 996,927 | Due from Bank AlJazira (“the founding shareholder”) |
| 53,552 | Reinsurers’ share of outstanding claims |
| 4,941 | Total assets |
| 1,055,420 |
|
|
| Liabilities |
|
| Outstanding claims |
| 4,941 | Unit reserves |
| 996,927 | Mathematical reserve |
| 10,980 | Other reserves |
| 11,658 | Surplus from Insurance Operations |
| 28,468 | Accrued expenses and other liabilities |
| 2,446 | Total liabilities |
| 1,055,420 |
Furthermore, in accordance with the Transitional Agreement (the “Agreement”) between the Company and Bank AlJazira (“the founding shareholder”), all the general and administrative costs up to the transfer of the insurance portfolio will be shared by the Company and the founding shareholder in the ratio of 17% and 83%, respectively. Currently, the Company is also using fixtures, furniture and equipment of a founding shareholder. Moreover, in accordance with the Agreement, the Company was receiving a management fee for managing the insurance portfolio of the founding shareholder, at a rate ranging from 10% to 20% of total revenue of the founding shareholder’s portfolio (“Portfolio Management fee”). As per the agreement, the management fee is not effective for the period subsequent to 01 April 2015. However, with effect from 01 January 2020, these provisions of the Agreement are not applicable.
GENERAL (continued)
The Company has announced the signing of a non-binding Memorandum of Understanding (the “MOU”) with Solidarity Saudi Takaful Company on 23 Shawwal 1440H (corresponding to 26 June 2019) to evaluate a potential merger between the two Companies. Both companies will conduct technical, financial, legal and actuarial due diligence and engage in non-binding discussions on the terms and conditions of the potential merger. The MOU would expire at the earlier of the signing of the merger agreement or in the third quarter of 2020. The merger will however remain conditional upon shareholders’ and regulatory approvals. The Company and Solidarity Saudi Takaful Company have agreed that, in the event the proposed merger occurs, it will be implemented by way of a share swap wherein, after the proposed merger is completed, the Company will issue new shares to Solidarity Saudi Takaful Company shareholders’ in exchange for all issued shares of Solidarity Saudi Takaful Company.
The two companies have initially agreed that the methodology used for valuation will be based on equity book value (after any mutually agreed due diligence adjustments) and that the swap ratio between the Company and the shareholders’ of Solidarity Saudi Takaful Company shall be calculated using the respective adjusted equity book value per share as at a mutually agreed cut-off date. The Company has appointed a financial advisor for the proposed merger. Subsequent to the year end, the Company has appointed external consultants to conduct financial, legal and actuarial due diligence. | 1 |
| Disclosure of basis of preparation of financial statements [text block] |
2. BASIS OF PREPARATION
Basis of presentation
The interim condensed financial statements of the Company as at and for the period ended 30 June 2020 have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting (“IAS 34”) as endorsed in the Kingdom of Saudi Arabia and other standards and pronouncements issued by the Saudi Organisation for Certified Public Accountants (“SOCPA”) (referred to as “IFRS as endorsed in KSA”).
The interim condensed financial information is prepared under the going concern basis and the historical cost convention, except for the measurement of investments (excluding held to maturity) at their fair value.
The Company’s interim condensed statement of financial position is presented in order of liquidity. Except for fixtures, furniture and equipment, statutory deposit, employee benefits, outstanding claims, claims incurred but not reported, unit reserves, mathematical reserve and other reserves, all other assets and liabilities are of short-term nature, unless, stated otherwise.
As required by the Saudi Arabian Insurance Regulations (the Implementation Regulations), the Company maintains separate books of accounts for “Insurance Operations” and “Shareholders’ Operations”. Accordingly, assets, liabilities, revenues and expenses clearly attributable to either operation, are recorded in the respective accounts.
The interim condensed financial statements do not include all of the information required for full annual financial statements and should be read in conjunction with the annual financial statements as of and for the year ended 31 December 2019. The interim condensed financial statements may not be considered indicative of the expected results for the full year. These interim condensed financial statements are expressed in Saudi Arabian Riyals (SR) and are rounded off to the nearest thousands.
Critical judgments, accounting estimates and assumptions
The preparation of interim condensed financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these interim condensed financial statements, the significant judgments made by the management in applying the Company’s accounting policies and the key sources of estimation uncertainty including the risk management policies were the same as those that applied to the annual financial statements as at and for the year ended 31 December 2019. However, the Company has reviewed the key sources of estimation uncertainties disclosed in the last annual financial statements and updated them where required. The changes in circumstances may require further enhanced disclosures in the financial statements of the Company for subsequent periods (please also refer note 18).
Seasonality of operations
There are no seasonal changes that may affect Insurance Operations of the Company. | 2 |
| Disclosure of summary of significant accounting policies [abstract] | | |
| Disclosure of summary of significant accounting policies, general comment [text block] |
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies adopted by the Company for the preparation of these interim condensed financial statements are in accordance with International Financial Reporting Standards (IFRS) as endorsed in the Kingdom of Saudi Arabia and are consistent with those used for the preparation of the annual financial statements for the year ended 31 December 2019.
New IFRS, IFRIC and amendments thereof, adopted by the Company
The Company has adopted the following new standards, amendments and revisions to existing standards, which were issued by the International Accounting Standards Board (IASB):
Standard/ Amendments | Description |
|
| Amendments to IAS 1 and IAS 8 | Definition of Material | Amendments to IFRS 3 | Definition of a Business | Conceptual Framework | Amendments to References to Conceptual Framework in IFRS Standards |
The adoption of the relevant new and amended standards and interpretations applicable to the Company did not have any significant impact on these interim condensed financial statements.
Standards issued but not yet effective
Standards issued but not yet effective up to the date of issuance of the Company’s interim condensed financial statements are listed below. The listing is of standards and interpretations issued, which the Company reasonably expects to be applicable at a future date. The Company intends to adopt these standards when they are effective.
Standard/ Interpretation |
Description | Effective from periods beginning on or after the following date |
|
|
| IFRS 9 | Financial Instruments | See note below | IFRS 17 | Insurance Contracts (note below) | See note below |
IFRS 17 – Insurance Contracts Overview This standard has been published on 18 May 2017, it establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts and supersedes IFRS 4 – Insurance contracts.
The new standard applies to insurance contracts issued, to all reinsurance contracts and to investment contracts with discretionary participating features provided the entity also issues insurance contracts. It requires to separate the following components from insurance contracts:
embedded derivatives, if they meet certain specified criteria; distinct investment components; and any promise to transfer distinct goods or non-insurance services.
These components should be accounted for separately in accordance with the related standards (IFRS 9 and IFRS 15).
SIGNIFICANT ACCOUNTING POLICIES (continued)
b) Standards issued but not yet effective (continued)
IFRS 17 – Insurance Contracts (continued)
Measurement In contrast to the requirements in IFRS 4, which permitted insurers to continue to use the accounting policies for measurement purposes that existed prior to January 2015, IFRS 17 provides the following different measurement models:
The General model is based on the following “building blocks”:
the fulfilment cash flows (FCF), which comprise:
probability-weighted estimates of future cash flows, an adjustment to reflect the time value of money (i.e. discounting) and the financial risks associated with those future cash flows, and a risk adjustment for non-financial risk;
the Contractual Service Margin (CSM). The CSM represents the unearned profit for a group of insurance contracts and will be recognized as the entity provides services in the future. The CSM cannot be negative at inception; any net negative amount of the fulfilment cash flows at inception will be recorded in profit or loss immediately. At the end of each subsequent reporting period the carrying amount of a group of insurance contracts is remeasured to be the sum of:
the liability for remaining coverage, which comprises the FCF related to future services and the CSM of the group at that date; and the liability for incurred claims, which is measured as the FCF related to past services allocated to the group at that date.
The CSM is adjusted subsequently for changes in cash flows related to future services but the CSM cannot be negative, so changes in future cash flows that are greater than the remaining CSM are recognized in profit or loss. Interest is also accreted on the CSM at rates locked in at initial recognition of a contract (i.e. discount rate used at inception to determine the present value of the estimated cash flows). Moreover, the CSM will be released into profit or loss based on coverage units, reflecting the quantity of the benefits provided and the expected coverage duration of the remaining contracts in the group.
The Variable Fee Approach (VFA) is a mandatory model for measuring contracts with direct participation features (also referred to as ‘direct participating contracts’). This assessment of whether the contract meets these criteria is made at inception of the contract and not reassessed subsequently. For these contracts, the CSM is also adjusted for in addition to adjustment under general model; changes in the entity’s share of the fair value of underlying items, changes in the effect of the time value of money and financial risks not relating to the underlying items.
In addition, a simplified Premium Allocation Approach (PAA) is permitted for the measurement of the liability for the remaining coverage if it provides a measurement that is not materially different from the general model or if the coverage period for each contract in the group is one year or less. With the PAA, the liability for remaining coverage corresponds to premiums received at initial recognition less insurance acquisition cash flows. The general model remains applicable for the measurement of incurred claims. However, the entity is not required to adjust future cash flows for the time value of money and the effect of financial risk if those cash flows are expected to be paid/received in one year or less from the date the claims are incurred.
Effective date The IASB issued an Exposure Draft Amendments to IFRS 17 during June 2019 and received comments from various stakeholders. The IASB is currently re-deliberating issues raised by stakeholders. The effective date of IFRS 17 and the deferral of the IFRS 9 temporary exemption in IFRS 4, is currently 01 January 2023. Earlier application is permitted if both IFRS 15 – Revenue from Contracts with Customers and IFRS 9 – Financial Instruments have also been applied. The Company intend to apply the standard on its effective date.
Transition Retrospective application is required. However, if full retrospective application for a group of insurance contracts is impracticable, then the entity is required to choose either a modified retrospective approach or a fair value approach.
SIGNIFICANT ACCOUNTING POLICIES (continued)
b) Standards issued but not yet effective (continued)
IFRS 17 – Insurance Contracts (continued)
Presentation and Disclosures The Company expects that the new standard will result in a change to the accounting policies for insurance contracts together with amendments to presentation and disclosures.
Impact The Company is currently assessing the impact of the application and implementation of IFRS 17. As of the date of the publication of these financial statements, the financial impact of adopting the standard has yet to be fully assessed by the Company. The Company has undertaken a Gap Analysis and the key areas of Gaps are as follows: Impact Area | Summary of Impact | Data impact and IT Systems | New chart of accounts to be developed for PAA/ GMM/VFA; Actuarial and accounting data will be needed at more granular level; Discount rates will need to be stored for group of contracts and tracked for interest accretion calculation under GMM; Embedded risk adjustment calculation in the actuarial system; Identification of key inputs for onerous contracts test as well as defining ‘facts and circumstance’ for PAA contracts; Calculation and tracking of contractual service margin; and Calculation of coverage period of risk attaching reinsurance contract.
| Impact on RI Arrangements | Insurance contract liabilities / assets is required to be reported gross of reinsurance and a separate reinsurance asset / liability shall be reported; The cash flows (after factoring any expected credit loss) shall be reported gross (before reinsurance) and undiscounted; and Cancellation clauses to be reviewed to assess the impact on measurement models relevant for these contracts.
| Process Impact | Finance, actuarial, underwriting and IT processes to be built suitable for IFRS 17 together with new set of controls and governance framework; New reconciliation processes to be put in place between accounting, actuarial and underwriting data sources; Setting up new accounting policies each suitable for measurement model and technical decisions for each area; Monitor terms and conditions attaching to insurance and reinsurance contracts; New expense allocation process acquisition costs, claims settlement costs and underwriting costs to be put in place to identify profitability at a contract level; For recognition, advance premium receipts to be compared to contract receipt date; Cash receipts for premiums need to be tracked at policy level; and System to track coverage period for future products need to be put in place.
| Impact on Policies & Control Frameworks | |
IFRS 9 - Financial Instruments This standard was published on 24 July 2014 and has replaced IAS 39. The new standard addresses the following items related to financial instruments:
Classification and measurement IFRS 9 uses a single approach to determine whether a financial asset is measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss. A financial asset is measured at amortized cost if both: the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows and; the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (“SPPI”).
SIGNIFICANT ACCOUNTING POLICIES (continued)
b) Standards issued but not yet effective (continued)
IFRS 9 - Financial Instruments (continued)
Classification and measurement (continued) The financial asset is measured at fair value through other comprehensive income and realized gains or losses would be recycled through profit or loss upon sale, if both conditions are met: the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows and for sale and; the contractual terms of cash flows are SPPI.
Assets not meeting either of these categories are measured at fair value through profit or loss. Additionally, at initial recognition, an entity can use the option to designate a financial asset at fair value through profit or loss if doing so eliminates or significantly reduces an accounting mismatch. For equity instruments that are not held for trading, an entity can also make an irrevocable election to present in other comprehensive income subsequent changes in the fair value of the instruments (including realized gains and losses), dividends being recognized in profit or loss.
Additionally, for financial liabilities that are designated as at fair value through profit or loss, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the effects of changes in the liability’s credit risk in other comprehensive income would create or enlarge an accounting mismatch in profit or loss.
Impairment The impairment model under IFRS 9 reflects expected credit losses, as opposed to incurred credit losses under IAS 39. Under the IFRS 9 approach, it is no longer necessary for a credit event to have occurred before credit losses are recognized. Instead, an entity always accounts for expected credit losses and changes in those expected credit losses. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition.
Hedge accounting IFRS 9 introduces new requirements for hedge accounting that align hedge accounting more closely with Risk Management. The requirements establish a more principles-based approach to the general hedge accounting model. The amendments apply to all hedge accounting with the exception of portfolio fair value hedges of interest rate risk (commonly referred to as “fair value macro hedges”). For these, an entity may continue to apply the hedge accounting requirements currently in IAS 39. This exception was granted largely because the IASB is addressing macro hedge accounting as a separate project.
Effective date The published effective date of IFRS 9 was 01 January 2018. However, amendments to IFRS 4 – Insurance Contracts: Applying IFRS 9 – Financial Instruments with IFRS 4 – Insurance Contracts, published on 12 September 2016, changes the existing IFRS 4 to allow entities issuing insurance contracts within the scope of IFRS 4 to mitigate certain effects of applying IFRS 9 before the IASB’s new insurance contract standard (IFRS 17 – Insurance Contracts) becomes effective. The amendments introduce two alternative options:
apply a temporary exemption from implementing IFRS 9 until the earlier of
the effective date of a new insurance contract standard; or annual reporting periods beginning on or after 01 January 2023. Additional disclosures related to financial assets are required during the deferral period. This option is only available to entities whose activities are predominately connected with insurance and have not applied IFRS 9 previously; or; adopt IFRS 9 but, for designated financial assets, remove from profit or loss the effects of some of the accounting mismatches that may occur before the new insurance contract standard is implemented. During the interim period, additional disclosures are required.
The Company has performed a detailed assessment beginning 01 January 2017: (1) The carrying amount of the Company’s liabilities arising from contracts within the scope of IFRS 4 (including deposit components or embedded derivatives unbundled from insurance contracts) were compared to the total carrying amount of all its liabilities; and (2) the total carrying amount of the company’s liabilities connected with insurance were compared to the total carrying amount of all its liabilities. Based on these assessments the Company determined that it is eligible for the temporary exemption. Consequently, the Company has decided to defer the implementation of IFRS 9 until the effective date of the new insurance contracts standard. Disclosures related to financial assets required during the deferral period are included in the Company’s financial statements.
SIGNIFICANT ACCOUNTING POLICIES (continued)
b) Standards issued but not yet effective (continued)
IFRS 9 - Financial Instruments (continued)
Impact assessment The impact is not expected to be significant. At present it is not possible to provide reasonable estimate of the effects of application of this new standard as the Company is yet to perform a detailed review.
| 3 |
| Disclosure of notes forming part of accounts [abstract] | | |
| Disclosure of investments [text block] |
INVESTMENTS
| 30 June 2020 (Unaudited) |
| 31 December 2019 (Audited) |
| Insurance operations | Shareholders’ operations | Total |
| Insurance operations | Shareholders’ operations | Total |
| SR’000 | SR’000 | SR’000 |
| SR’000 | SR’000 | SR’000 |
|
|
|
|
|
|
|
| Held to maturity investments (7.1) |
16,141 | 361,578 | 377,719 |
| 15,914 | 367,503 | 383,417 | FVIS investments (7.2) | 28,259 | 2,611 | 30,870 | | 27,997 | - | 27,997 |
|
|
|
|
|
|
|
| Total | 44,400 | 364,189 | 408,589 |
| 43,911 | 367,503 | 411,414 |
|
|
|
|
|
|
|
|
7.1 Held to maturity investments
Held to maturity investments represents Murabaha deposit of SR 179,917 thousand (31 December 2019: SR 185,153 thousand) with a maturity of three years held with Bank AlJazira “the founding shareholder” and Sukuk of SR 197,802 thousand (31 December 2019: SR 198,264 thousand) with a maturity of 12 to 30 years. The commission rate on Murabaha deposits at 30 June 2020 is 3.00% to 3.30% per annum (31 December 2019: 3.00% to 3.20% per annum) and coupon rate on Sukuk is 4.01% to 4.64% per annum (31 December 2019: 4.01% to 4.10%).
7. INVESTMENTS (continued)
7.1 Held to maturity investments (continued)
The movement in the held to maturity investments for the period/year ended 30 June 2020 and 31 December 2019 is as follows:
| Insurance operations | Shareholders’ operations | Total |
| SR‘000 | SR‘000 | SR‘000 |
|
|
|
| Balance at the beginning of the period | 15,914 | 367,503 | 383,417 | Commission booked on held to maturity investments | 227 | 5,739 | 5,966 | Disposals during the period | - | (8,000) | (8,000) | Commission received from held to maturity investments | - | (3,664) | (3,664) |
|
|
|
| Balance at the end of the period | 16,141 | 361,578 | 377,719 |
|
|
|
|
| 31 December 2019 (Audited) |
|
|
| Insurance operations | Shareholders’operations | Total |
| SAR‘000 | SAR‘000 | SAR‘000 |
|
|
|
| Balance at the beginning of the year | 15,458 | 306,923 | 322,381 | Placements during the year | - | 197,800 | 197,800 | Maturities during the year | - | (145,423) | (145,423) | Commission booked on held to maturity investments | 456 | 9,620 | 10,076 | Commission received from held to maturity investments | - | (1,417) | (1,417) |
|
|
|
| Balance at the end of the year | 15,914 | 367,503 | 383,417 |
|
|
|
|
7.2 FVIS investments
The fair value through income statement (“FVIS”) investments represent investment in ‘AlJazira Capital’ managed by a founding shareholder, amounting to SR 28,259 thousand (31 December 2019: SR 27,997 thousand), and investment in shares of companies listed on Tadawul, amounting to SR 2,611 thousand (31 December 2019: nil).
Movement in FVIS investments for the period/year ended 30 June 2020 and 31 December 2019 is as follows:
| Insurance operations | Shareholders’ Operations | Total |
| SR‘000 | SR‘000 | SR‘000 |
|
|
|
| Balance at beginning of the period | 27,997 | - | 27,997 | Purchases during the period | - | 15,320 | 15,320 | Disposals during the period | - | (12,671) | (12,671) | Changes in fair value | 262 | (38) | 224 |
|
|
|
| Balance at the end of the period | 28,259 | 2,611 | 30,870 |
|
|
|
|
7. INVESTMENTS (continued)
7.2 FVIS investments (continued)
| 31 December 2019 (Audited) |
|
|
| Insurance operations | Shareholders’ operations | Total |
| SR‘000 | SR‘000 | SR‘000 |
|
|
|
| Balance at beginning of the year | 43,072 | 30,376 | 73,448 | Disposals during the year | (15,810) | (35,295) | (51,105) | Purchases during the year | - | 4,919 | 4,919 | Changes in fair value | 735 | - | 735 |
|
|
|
| Balance at the end of the year | 27,997 | - | 27,997 |
|
|
|
|
|
|
|
|
| 7 |
| Disclosure of investments in available-for-sale investments [text block] |
6. AVAILABLE FOR SALE INVESTMENTS HELD TO COVER UNIT-LINKED LIABILITIES
| Initial cost value | Changes in fair value | 30 June 2020 (Unaudited) |
| SR'000 | SR'000 | SR'000 | Insurance Operations |
|
|
| AlJazira Saudi Riyal Murabaha Fund | 151,596 | 1,396 | 152,992 | AlJazira Diversified Aggressive Fund | 155,150 | (1,315) | 153,835 | AlJazira Diversified Balanced Fund | 42,735 | 169 | 42,904 | AlJazira Diversified Conservative Fund | 8,647 | 30 | 8,677 | AlJazira International Equities Fund | 191,473 | (2,334) | 189,139 | AlJazira Saudi Equities Fund | 263,230 | (21,040) | 242,190 | AlJazira European Equities Fund | 164,790 | (8,547) | 156,243 | AlJazira Japanese Equities Fund | 208,008 | 6,253 | 214,261 |
|
|
|
|
| 1,185,629 | (25,388) | 1,160,241 |
|
|
|
|
| Initial cost value | Changes in fair value | 31 December 2019 (Audited) |
| SR'000 | SR'000 | SR'000 | Insurance Operations |
|
|
| AlJazira Saudi Riyal Murabaha Fund | 732 | 18 | 750 | AlJazira Diversified Aggressive Fund | 122,153 | 18,544 | 140,697 | AlJazira Diversified Balanced Fund | 34,058 | 3,159 | 37,217 | AlJazira Diversified Conservative Fund | 6,272 | 242 | 6,514 |
|
|
|
|
| 163,215 | 21,963 | 185,178 |
|
|
|
|
Investment of Insurance Operations comprises of units of mutual funds dominated in Saudi Riyal managed by AlJazira Capital “the founding shareholder”. | 6 |
| Disclosure of premiums/ contributions and insurance/ reinsurance or takaful/ retakaful balance receivables [text block] |
5. CONTRIBUTIONS RECEIVABLE, NET
| 30 June 2020 (Unaudited) SR'000 | 31 December 2019 (Audited) SR'000 | Insurance Operations |
|
| Gross contributions receivable | 6,505 | 2,332 | Impairment of receivables | (849) | (238) |
|
|
| Contributions receivable, net | 5,656 | 2,094 |
|
|
|
| 5 |
| Disclosure of cash and cash equivalents [text block] |
CASH AT BANKS
| Insurance operations | Shareholders’ operations |
Total | 30 June 2020 (Unaudited) | SR‘000 | SR‘000 | SR‘000 |
Cash at banks | 94,907 | 555 | 95,462 |
|
|
|
|
31 December 2019 (Audited) |
|
|
|
|
|
|
| Cash at banks | 15,454 | 4,233 | 19,687 |
|
|
|
|
Cash at banks, except for an amount SR 0.5 million (31 December 2019: SR 0.5 million) are held with Bank AlJazira “the founding shareholder”. | 4 |
| Disclosure of gross unearned premiums/ contributions [text block] |
10. MOVEMENT IN UNEARNED CONTRIBUTIONS
| Six month period ended 30 June 2020 (Unaudited) |
| Year ended 31 December 2019 (Audited) |
| Gross | Reinsurers’ share | Net |
| Gross | Reinsurers’ share | Net |
| SR'000 | SR'000 | SR'000 |
| SR'000 | SR'000 | SR'000 |
|
|
|
|
|
|
|
| Balance at beginning of the period/year | 35,087 | (12,923) | 22,164 |
| 22,774 | (9,006) | 13,768 | Contributions written/(ceded) during the period/year |
86,104 |
(7,438) |
78,666 |
| 130,283 | (20,815) | 109,468 |
|
|
|
|
|
|
|
|
| 121,191 | (20,361) | 100,830 |
| 153,057 | (29,821) | 123,236 | Investible contributions and contributions earned during the period/year | (106,123) | 14,189 | (91,934) |
| (117,970) | 16,898 | (101,072) |
|
|
|
|
|
|
|
| Balance at the end of the period/year | 15,068 | (6,172) | 8,896 |
| 35,087 | (12,923) | 22,164 |
|
|
|
|
|
|
|
|
| 10 |
| Disclosure of gross outstanding claims/ benefits [text block] |
11. OUTSTANDING CLAIMS INCLUDING IBNR
| Six month period ended 30 June 2020 (Unaudited) |
| Year ended 31 December 2019 (Audited) |
| Gross | Reinsurers’ share | Net |
| Gross | Reinsurers’ share | Net |
| SR’000 | SR’000 | SR’000 |
| SR’000 | SR’000 | SR’000 | At beginning of the period/year |
|
|
|
|
|
|
| Reported claims | 33,525 | (29,422) | 4,103 |
| 10,015 | (7,918) | 2,097 | IBNR | 7,023 | (5,669) | 1,354 |
| 10,997 | (8,089) | 2,908 |
|
|
|
|
|
|
|
|
| 40,548 | (35,091) | 5,457 |
| 21,012 | (16,007) | 5,005 | Incurred during the period/year | 20,658 | (18,476) | 2,182 |
| 31,381 | (29,004) | 2,377 | (Paid)/recovered during the period/year | (7,409) | 6,387 | (1,022) |
| (11,845) | 9,920 | (1,925) |
|
|
|
|
|
|
|
| At end of the period/year | 53,797 | (47,180) | 6,617 |
| 40,548 | (35,091) | 5,457 |
|
|
|
|
|
|
|
| At end of the period/year |
|
|
|
|
|
|
| Reported claims | 41,673 | (37,306) | 4,367 |
| 33,525 | (29,422) | 4,103 | IBNR | 12,124 | (9,874) | 2,250 |
| 7,023 | (5,669) | 1,354 |
|
|
|
|
|
|
|
|
| 53,797 | (47,180) | 6,617 |
| 40,548 | (35,091) | 5,457 |
|
|
|
|
|
|
|
|
| 11 |
| Disclosure of zakat [text block] |
13. ZAKAT AND INCOME TAX
The Zakat and income tax payable by the Company has been calculated in accordance with Zakat and income tax regulations in the Kingdom of Saudi Arabia. The movement in the Zakat and income tax payable during the six month period ended 30 June 2020 and year ended 31 December 2019 is as follows:
a) Zakat
| 30 June 2020 (Unaudited) SR'000 | 31 December 2019 (Audited) SR'000 |
|
|
| Balance at the beginning of period/year | 982 | 907 | Zakat for the period/year | 772 | 947 | Zakat paid during the period/year | (954) | (872) |
|
|
| Balance at the end of the period/year | 800 | 982 |
|
|
|
b) Income tax
|
|
| Balance at the beginning of period/year | 128 | 132 | Income tax for the period/year | 81 | 100 | Income tax paid during the period/year | (99) | (104) |
|
|
| Balance at the end of the period/year | 110 | 128 |
|
|
| Total Zakat and income tax | 910 | 1,110 |
|
|
|
Status of assessments The Company has submitted its Zakat and income tax returns for the years 2014 to 2018 with General Authority of Zakat and Tax (“GAZT”) and obtained restricted certificates.
During 2019, GAZT has issued initial assessments for the years 2014 through 2018 disallowing investments from the Zakat base and withholding tax liability with additional Zakat liability of SR 41,166 thousand. The Company has filed an appeal against these initial assessments. The Preliminary Appeal Committee (“PAC”) issued their decision upholding GAZT’s treatment. The Company has filed an appeal against the PAC decision with the Higher Appeal Committee (“HAC”). The management is confident of a favourable outcome from the HAC. | 13 |
| Disclosure of technical reserve for insurance/takaful/reinsurance/retakaful operations [text block] |
UNIT RESERVES
| Six month period ended 30 June 2020 (Unaudited) SR'000 | Year ended 31 December 2019 (Audited) SR'000 |
|
|
| Balance at beginning of the period/year | 187,979 | 130,290 | Investible contributions, net | 66,219 | 57,466 | Insurance portfolio transfer (note 1) | 996,927 | - | Surrenders | (48,198) | (21,740) | Maturities | (13,748) | - | Change in fair value of available for sale investments (note 6) | (25,388) | 21,963 |
|
|
| Balance at the end of the period/year | 1,163,791 | 187,979 |
|
|
|
OTHER RESERVES
| Six month period ended 30 June 2020 (Unaudited) SR'000 | Year ended 31 December 2019 (Audited) SR'000 |
|
|
| Mathematical reserve (note 9.1) | 8,765 | 360 | Other reserves (note 9.2) | 12,277 | - |
|
|
|
| 21,042 | 360 |
|
|
|
Mathematical and other reserves are created, as per the report received from the Independent Actuary.
9.1Mathematical reserve
| Six month period ended 30 June 2020 (Unaudited) SR'000 | Year ended 31 December 2019 (Audited) SR'000 |
|
|
| Balance at beginning of the period/year | 360 | 557 | Insurance portfolio transfer (note 1) | 10,980 | - | Changes in mathematical reserve | (2,575) | (197) |
|
|
| Balance at the end of the period/year | 8,765 | 360 |
|
|
|
9.2Other reserves
| Six month period ended 30 June 2020 (Unaudited) SR'000 | Year ended 31 December 2019 (Audited) SR'000 |
|
|
| Insurance portfolio transfer (note 1) | 11,658 | - | Changes in other reserves | 619 | - |
|
|
| Balance at the end of the period/year | 12,277 | - |
|
|
|
| 8, 9 |
| Disclosure of earnings per share [text block] |
14. EARNINGS PER SHARE
The basic and diluted earnings per share have been calculated by dividing the net income for the period by the weighted average number of ordinary shares issued and outstanding at the period end. | 14 |
| Disclosure of related party transactions [text block] |
12. TRANSACTIONS WITH RELATED PARTIES Related parties represent major shareholders’, directors and key management personnel of the Company and entities controlled, jointly controlled or significantly influenced by such parties. All transactions with such related parties are conducted on normal terms and conditions, which are approved by management.
In addition to the disclosures set out in notes 1, 4, 6 and 7 following are the details of major related party transactions during the six month period ended:
Related parties | Nature of transaction | Amount of transactions |
|
| 30 June 2020 (Unaudited) | 30 June 2019 (Unaudited) |
|
| SR'000 | SR'000 | Bank AlJazira
| Commission earned from held to maturity investment | 2,765 | 4,861 |
| Commission income on deposits | 11 | 17 |
| Gross written contributions | 4,465 | 4,965 |
| Claims paid | 6,544 | 3,272 |
| Insurance portfolio transfer (note 1) | 53,552 | - |
| Investment in equity shares | 1,692 | - |
| Disposal of equity share | 567 | - |
|
|
|
| AlJazira Capital | Profit earned on mutual funds | 262 | 955 |
|
|
|
| Aman Insurance Agency Company | Commission | 935 | 923 |
|
|
|
| Board of Directors and Committee members | Gross written contributions | 30 | 28 |
|
|
|
| Key management personnel | Salaries, benefits and allowances, net | 4,263 | 627 |
| Gross written contributions | 44 | 21 |
|
|
|
|
Amount due from related parties
|
| 30 June 2020 (Unaudited) SR'000 | 31 December 2019 (Audited) SR'000 |
|
|
|
| Bank AlJazira |
| 7,932 | 28,176 | AlJazira Capital |
| 14,138 | 2,191 |
|
|
|
|
|
| 22,070 | 30,367 |
|
|
|
|
Contributions receivable shown in interim condensed statement of financial position includes SR 6,195 thousand (31 December 2019: SR 1,732 thousand) from Bank AlJazira (the founding shareholder).
| 12 |
| Disclosure of entity's operating segments [text block] |
OPERATING SEGMENTS INFORMATION
Operating segments are reported in manner consistent with the internal reporting provided to the chief operating decision maker. The Chief Operating Decision Maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as Managing Director that makes strategic decisions. For management purposes, the activities of Insurance Operations, which are all in the Kingdom of Saudi Arabia, are reported under three business units, as detailed below: Insurance – individual segment offers life insurance products on an individual basis including unit linked investment-oriented products.
Insurance – group life has segment offers life protection programmers to the members of organizations on a group basis, and credit protection benefits in respect of personal loan given by financing organization. This segment also includes protection benefits in respect of various credit facilities other than personal loans extended by the financing organizations to its customers.
The unallocated assets and liabilities are not reported to the Chief Operating Decision Maker under related segment and are monitored on a centralized basis.
Operating segments do not include Shareholders’ Operations of the Company.
16. OPERATING SEGMENTS INFORMATION (continued)
| As at 30 June 2020 (Unaudited) |
| Individual | Group | Total |
| SR'000 | SR'000 | SR'000 |
|
|
|
| ASSETS |
|
|
| Contributions receivable, net | - | 5,656 | 5,656 | Reinsurers’ share of unearned contributions | - | 6,172 | 6,172 | Reinsurers’ share of outstanding claims | 5,590 | 31,716 | 37,306 | Reinsurers’ share of claims incurred but not reported | - | 9,874 | 9,874 | Available for sale investments held to cover unit-linked liabilities | 1,160,241 | - | 1,160,241 |
|
|
|
|
| 1,165,831 | 53,418 | 1,219,249 | Unallocated assets: |
|
|
| Cash at banks |
|
| 95,462 | Investments |
|
| 408,589 | Due from related parties |
|
| 22,070 | Prepayments and other assets |
|
| 2,846 | Fixtures, furniture and equipment |
|
| 1,132 | Statutory deposit |
|
| 35,000 |
|
|
|
| TOTAL ASSETS |
|
| 1,784,348 |
|
|
|
| LIABILITIES |
|
|
| Reinsurance balances payable | 1,933 | 6,200 | 8,133 | Unearned contributions | - | 15,068 | 15,068 | Outstanding claims | 5,749 | 35,924 | 41,673 | Claims incurred but not reported | - | 12,124 | 12,124 | Unit reserves | 1,163,791 | - | 1,163,791 | Mathematical reserve | 8,765 | - | 8,765 | Other reserves | 12,277 | - | 12,277 |
|
|
|
|
| 1,192,515 | 69,316 | 1,261,831 | Unallocated liabilities and surplus: |
|
|
| Accrued expenses and other liabilities |
|
| 22,889 | Employee benefits |
|
| 2,985 | Zakat and income tax |
|
| 910 | Surplus from Insurance Operations |
|
| 34,487 |
|
|
|
| TOTAL LIABILITIES |
|
| 1,323,102 |
|
|
|
| EQUITY |
|
|
|
|
|
|
| Share capital |
|
| 350,000 | Statutory reserve |
|
| 30,595 | Retained earnings |
|
| 80,700 |
|
|
|
| TOTAL SHAREHOLDERS’ EQUITY |
|
| 461,295 |
|
|
|
| Remeasurement reserve of employee benefits - related to Insurance Operations |
|
| (49) |
|
|
|
| TOTAL EQUITY |
|
| 461,246 |
|
|
|
| TOTAL LIABILITIES AND EQUITY |
|
| 1,784,348 |
|
|
|
|
16. OPERATING SEGMENTS INFORMATION (continued)
| As at 31 December 2019 (Audited) |
| Individual | Group | Total |
| SR'000 | SR'000 | SR'000 |
|
|
|
| ASSETS |
|
|
| Contributions receivable, net | - | 2,094 | 2,094 | Reinsurers’ share of unearned contributions | - | 12,923 | 12,923 | Reinsurers’ share of outstanding claims | 77 | 29,345 | 29,422 | Reinsurers’ share of claims incurred but not reported | - | 5,669 | 5,669 | Available for sale investments held to cover unit-linked liabilities | 185,178 | - | 185,178 |
|
|
|
|
| 185,255 | 50,031 | 235,286 | Unallocated assets: |
|
|
| Cash at banks |
|
| 19,687 | Investments |
|
| 411,414 | Due from related parties |
|
| 30,367 | Prepayments and other assets |
|
| 2,473 | Fixtures, furniture and equipment |
|
| 809 | Statutory deposit |
|
| 35,000 |
|
|
|
| TOTAL ASSETS |
|
| 735,036 |
|
|
|
| LIABILITIES |
|
|
| Reinsurers' balances payable | 160 | 10,615 | 10,775 | Unearned contributions | - | 35,087 | 35,087 | Outstanding claims | 257 | 33,268 | 33,525 | Claims incurred but not reported | - | 7,023 | 7,023 | Unit reserves | 187,979 | - | 187,979 | Mathematical reserve | 360 | - | 360 |
|
|
|
|
| 188,756 | 85,993 | 274,749 | Unallocated liabilities and surplus: |
|
|
| Accrued expenses and other liabilities |
|
| 18,651 | Employee benefits |
|
| 2,624 | Zakat and income tax |
|
| 1,110 | Surplus from Insurance Operations |
|
| 3,355 |
|
|
|
| TOTAL LIABILITIES |
|
| 300,489 |
|
|
|
| EQUITY |
|
|
|
|
|
|
| Share capital |
|
| 350,000 | Statutory reserve |
|
| 30,595 | Retained earnings |
|
| 54,001 |
|
|
|
| TOTAL SHAREHOLDERS’ EQUITY |
|
| 434,596 | Remeasurement reserve of employee benefits - related to Insurance Operations |
|
| (49) |
|
|
|
| TOTAL EQUITY |
|
| 434,547 |
|
|
|
| TOTAL LIABILITIES AND EQUITY |
|
| 735,036 |
|
|
|
|
16. OPERATING SEGMENTS INFORMATION (continued)
| For the three month period ended 30 June 2020 (Unaudited) |
| Individual | Group | Total |
| SR'000 | SR'000 | SR'000 | REVENUE |
|
|
| Gross written contributions: |
|
|
| Individual | 39,310 | - | 39,310 | Small Enterprises | - | - | - | Medium Enterprises | - | - | - | Corporate | - | 3,239 | 3,239 |
|
|
|
| Total gross written contributions | 39,310 | 3,239 | 42,549 | Contributions ceded: |
|
|
| Local | - | - | - | Foreign | (2,698) | (1,344) | (4,042) |
|
|
|
| Net written contributions | 36,612 | 1,895 | 38,507 | Changes in unearned contributions, net | - | 6,180 | 6,180 |
|
|
|
| Net contributions earned | 36,612 | 8,075 | 44,687 | Other underwriting income | 10,956 | - | 10,956 |
|
|
|
| TOTAL REVENUES | 47,568 | 8,075 | 55,643 |
|
|
|
| UNDERWRITING COSTS AND EXPENSES |
|
|
| Gross claims paid | (800) | (3,040) | (3,840) | Reinsurers’ share of claims paid | 800 | 2,578 | 3,378 |
|
|
|
| Net claims paid | - | (462) | (462) | Changes in outstanding claims, net | - | (66) | (66) | Changes in claims incurred but not reported, net | - | (512) | (512) |
|
|
|
| Net claims incurred | - | (1,040) | (1,040) | Investible contributions, net | (31,769) | - | (31,769) | Changes in mathematical reserve | 35 | - | 35 | Changes in other reserves | 181 | - | 181 | Policy acquisition costs | (1,939) | (10) | (1,949) | Supervision and inspection fees | (197) | (16) | (213) |
|
|
|
| TOTAL UNDERWRITING COSTS AND EXPENSES | (33,689) | (1,066) | (34,755) |
|
|
|
| NET UNDERWRITING INCOME | 13,879 | 7,009 | 20,888 |
|
|
|
| OTHER OPERATING (EXPENSES)/INCOME |
|
|
| Impairment of receivables |
|
| (487) | General and administrative expenses |
|
| (11,424) | Commission from held to maturity Investments |
|
| 3,003 | Commission income on deposits |
|
| 5 | Unrealized loss on FVIS investments |
|
| (150) | Realized gain on FVIS investments |
|
| 1,544 | Dividends from FVIS investments |
|
| 220 | Other income |
|
| 1,955 |
|
|
|
| TOTAL OTHER OPERATING EXPENSES, NET |
|
| (5,334) |
|
|
|
| Income before surplus, Zakat and income tax |
|
| 15,554 | Net income attributed to the Insurance Operations |
|
| (1,412) |
|
|
|
| Income for the period attributable to the shareholders’ before Zakat and income tax |
|
| 14,142 | Zakat |
|
| (393) | Income tax |
|
| (36) |
|
|
|
| NET INCOME FOR THE PERIOD ATTRIBUTABLE TO THE SHAREHOLDERS’ |
|
|
13,713 |
|
|
|
|
16. OPERATING SEGMENTS INFORMATION (continued)
| For the three month period ended 30 June 2019 (Unaudited) |
| Individual | Group | Total |
| SR'000 | SR'000 | SR'000 | REVENUE |
|
|
| Gross written contributions: |
|
|
| Individual | 16,974 | - | 16,974 | Small Enterprises | - | 3 | 3 | Medium Enterprises | - | 227 | 227 | Corporate | - | 4,406 | 4,406 |
|
|
|
| Total gross written contributions | 16,974 | 4,636 | 21,610 | Contributions ceded: |
|
|
| Local | - | - | - | Foreign | (237) | (167) | (404) |
|
|
|
| `Net written contributions | 16,737 | 4,469 | 21,206 | Changes in unearned contributions, net | - | 3,710 | 3,710 |
|
|
|
| Net contribution earned | 16,737 | 8,179 | 24,916 | Other underwriting income | 131 | - | 131 |
|
|
|
| TOTAL REVENUES | 16,868 | 8,179 | 25,047 |
|
|
|
| UNDERWRITING COSTS AND EXPENSES |
|
|
| Gross claims paid | (30) | (1,114) | (1,144) | Reinsurers’ share of claims paid | 8 | 692 | 700 |
|
|
|
| Net claims paid | (22) | (422) | (444) | Changes in outstanding claims, net | (68) | (425) | (493) | Changes in claims incurred but not reported, net | - | 263 | 263 |
|
|
|
| Net claims incurred | (90) | (584) | (674) | Investible contributions, net | (12,909) | - | (12,909) | Changes in mathematical reserve | 3 | - | 3 | Policy acquisition costs | (822) | (89) | (911) | Supervision and inspection fees | (85) | (23) | (108) |
|
|
|
| TOTAL UNDERWRITING COSTS AND EXPENSES | (13,903) | (696) | (14,599) |
|
|
|
| NET UNDERWRITING INCOME | 2,965 | 7,483 | 10,448 |
|
|
|
| OTHER OPERATING INCOME/(EXPENSES) |
|
|
| Impairment of receivables |
|
| (132) | General and administrative expenses |
|
| (2,233) | Commission from held to maturity Investments |
|
| 2,446 | Commission income on deposits |
|
| 5 | Unrealized gain on FVIS investments |
|
| 429 | Other income |
|
| 32 |
|
|
|
| TOTAL OTHER OPERATING INCOME, NET |
|
| 547 |
|
|
|
| Income before surplus, Zakat and income tax |
|
| 10,995 | Net income attributed to the Insurance Operations |
|
| (912) |
|
|
|
| Income for the period attributable to the shareholders’ before Zakat and income tax |
|
| 10,083 | Zakat |
|
| (230) | Income tax |
|
| (34) |
|
|
|
| NET INCOME FOR THE PERIOD ATTRIBUTABLE TO THE SHAREHOLDERS’ |
|
|
9,819 |
|
|
|
|
16. OPERATING SEGMENTS INFORMATION (continued)
| For the six month period ended 30 June 2020 (Unaudited) |
| Individual | Group | Total |
| SR'000 | SR'000 | SR'000 | REVENUE |
|
|
| Gross written contributions: |
|
|
| Individual | 81,454 | - | 81,454 | Small Enterprises | - | - | - | Medium Enterprises | - | 3 | 3 | Corporate | - | 4,647 | 4,647 |
|
|
|
| Total gross written contributions | 81,454 | 4,650 | 86,104 | Contributions ceded: |
|
|
| Local | - | - | - | Foreign | (5,432) | (2,006) | (7,438) |
|
|
|
| Net written contributions | 76,022 | 2,644 | 78,666 | Changes in unearned contributions, net | - | 13,268 | 13,268 |
|
|
|
| Net contributions earned | 76,022 | 15,912 | 91,934 | Other underwriting income | 18,754 | - | 18,754 |
|
|
|
| TOTAL REVENUES | 94,776 | 15,912 | 110,688 |
|
|
|
| UNDERWRITING COSTS AND EXPENSES |
|
|
| Gross claims paid | (860) | (6,549) | (7,409) | Reinsurers’ share of claims paid | 818 | 5,569 | 6,387 |
|
|
|
| Net claims paid | (42) | (980) | (1,022) | Changes in outstanding claims, net | 21 | (285) | (264) | Changes in claims incurred but not reported, net | - | (896) | (896) |
|
|
|
| Net claims incurred | (21) | (2,161) | (2,182) | Investible contributions, net | (66,219) | - | (66,219) | Changes in mathematical reserve | 2,575 | - | 2,575 | Changes in other reserves | (619) | - | (619) | Policy acquisition costs | (4,447) | (47) | (4,494) | Supervision and inspection fees | (408) | (23) | (431) |
|
|
|
| TOTAL UNDERWRITING COSTS AND EXPENSES | (69,139) | (2,231) | (71,370) |
|
|
|
| NET UNDERWRITING INCOME | 25,637 | 13,681 | 39,318 |
|
|
|
| OTHER OPERATING (EXPENSES)/INCOME |
|
|
| Impairment of receivables |
|
| (611) | General and administrative expenses |
|
| (20,931) | Commission from held to maturity Investments |
|
| 5,966 | Commission income on deposits |
|
| 11 | Unrealized gain on FVIS investments |
|
| 224 | Realized gain on FVIS investments |
|
| 1,544 | Dividends from FVIS investments |
|
| 220 | Other income |
|
| 4,475 |
|
|
|
| TOTAL OTHER OPERATING EXPENSES, NET |
|
| (9,102) |
|
|
|
| Income before surplus, Zakat and income tax |
|
| 30,216 | Net income attributed to the Insurance Operations |
|
| (2,664) |
|
|
|
| Income for the period attributable to the shareholders’ before Zakat and income tax |
|
| 27,552 | Zakat |
|
| (772) | Income tax |
|
| (81) |
|
|
|
| NET INCOME FOR THE PERIOD ATTRIBUTABLE TO THE SHAREHOLDERS’ |
|
|
26,699 |
|
|
|
|
16. OPERATING SEGMENTS INFORMATION (continued)
| For the six month period ended 30 June 2019 (Unaudited) |
| Individual | Group | Total |
| SR'000 | SR'000 | SR'000 | REVENUE |
|
|
| Gross written contributions: |
|
|
| Individual | 33,167 | - | 33,167 | Small Enterprises | - | 64 | 64 | Medium Enterprises | - | 227 | 227 | Corporate | - | 5,529 | 5,529 |
|
|
|
| Total gross written contributions | 33,167 | 5,820 | 38,987 | Contributions ceded: |
|
|
| Local | - | - | - | Foreign | (457) | (997) | (1,454) |
|
|
|
| Net written contributions | 32,710 | 4,823 | 37,533 | Changes in unearned contributions, net | - | 9,599 | 9,599 |
|
|
|
| Net contribution earned | 32,710 | 14,422 | 47,132 | Other underwriting income | 303 | - | 303 |
|
|
|
| TOTAL REVENUES | 33,013 | 14,422 | 47,435 |
|
|
|
| UNDERWRITING COSTS AND EXPENSES |
|
|
| Gross claims paid | (30) | (3,272) | (3,302) | Reinsurers’ share of claims paid | 9 | 2,378 | 2,387 |
|
|
|
| Net claims paid | (21) | (894) | (915) | Changes in outstanding claims, net | (89) | (1,340) | (1,429) | Changes in claims incurred but not reported, net | - | 1,039 | 1,039 |
|
|
|
| Net claims incurred | (110) | (1,195) | (1,305) | Investible contributions, net | (26,000) | - | (26,000) | Changes in mathematical reserve | 38 | - | 38 | Policy acquisition costs | (1,678) | (249) | (1,927) | Supervision and inspection fees | (166) | (29) | (195) |
|
|
|
| TOTAL UNDERWRITING COSTS AND EXPENSES | (27,916) | (1,473) | (29,389) |
|
|
|
| NET UNDERWRITING INCOME | 5,097 | 12,949 | 18,046 |
|
|
|
| OTHER OPERATING INCOME/(EXPENSES) |
|
|
| Impairment of receivables |
|
| (249) | General and administrative expenses |
|
| (4,748) | Commission from held to maturity Investments |
|
| 4,861 | Commission income on deposits |
|
| 17 | Unrealized gain on FVIS investments |
|
| 970 | Realized gain on FVIS investments |
|
| 20 | Other income |
|
| 129 |
|
|
|
| TOTAL OTHER OPERATING INCOME, NET |
|
| 1,000 |
|
|
|
| Income before surplus, Zakat and income tax |
|
| 19,046 | Net income attributed to the Insurance Operations |
|
| (1,514) |
|
|
|
| Income for the period attributable to the shareholders’ before Zakat and income tax |
|
| 17,532 | Zakat |
|
| (444) | Income tax |
|
| (70) |
|
|
|
| NET INCOME FOR THE PERIOD ATTRIBUTABLE TO THE SHAREHOLDERS’ |
|
|
17,018 |
|
|
|
|
| 16 |
| Disclosure of fair value of financial assets and liabilities [text block] |
15. FAIR VALUES OF FINANCIAL INSTRUMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
The Company’s financial assets consist of cash at banks, contributions receivable, available for sale investments held to cover unit-linked liabilities, FVIS investments, held to maturity investments, other receivables, due from Insurance Operations and its financial liabilities consist of other liabilities, reinsurance balances payable and outstanding claims. The fair values of financial instruments are not materially different from their carrying values. As at 30 June 2020, apart from the investments which are carried at fair value (note 6 and 7), there were no other financial instruments held by the Company that were measured at fair value.
15.FAIR VALUES OF FINANCIAL INSTRUMENTS (continued) The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments:
Level 1: quoted prices in active markets for the same instrument (i.e. without modification or repackaging); Level 2: quoted prices in active markets for similar assets and liabilities or other valuation techniques for which all significant inputs are based on observable market data; and Level 3: valuation techniques for which any significant input is not based on observable market data.
The following table presents the Company’s financial assets that are measured at fair values:
|
| 30 June 2020 (SR’000) Fair value (Unaudited) |
|
|
| Carrying value | Amortised cost | Level 1 | Level 2 | Total | Financial assets measured at fair value: |
|
|
|
|
| Available for sale investments held to cover unit- linked liabilities |
1,160,241 |
- |
- |
1,160,241 |
1,160,241 | Held to maturity investments | 377,719 | 197,802 | 179,918 | 204,452 | 384,370 | FVIS investments | 30,870 | - | 2,611 | 28,259 | 30,870 | Total | 1,568,830 | 197,802 | 182,529 | 1,392,952 | 1,575,481 |
|
| 31 December 2019 (SR’000) Fair value (Audited) |
|
|
| Carrying value | Amortised cost | Level 1 | Level 2 | Total | Financial assets measured at fair value: |
|
|
|
|
| Available for sale investments held to cover unit- linked liabilities |
185,178 |
- |
- |
185,178 |
185,178 | Held to maturity investments | 383,417 | 198,264 | 185,153 | 197,948 | 383,101 | FVIS investments | 27,997 | - | - | 27,997 | 27,997 | Total | 596,592 | 198,264 | 185,153 | 411,123 | 596,276 |
There are no financial assets where fair value is measurable as Level 3 fair value. There are no transfers between Level 1, Level 2 and Level 3 during the period. | 15 |
| Disclosure of board of director's approval of the financial statements [text block] |
19. APPROVAL OF THE INTERIM CONDENSED FINANCIAL STATEMENTS
These interim condensed financial statements have been approved by the Board of Directors on 27 Dhul Hijjah 1441H, corresponding to 17 August 2020. | 19 |
| Disclosure of other notes relevant to understanding of financial statements [text block] |
17. SUPPLEMENTARY INFORMATION
INTERIM CONDENSED STATEMENT OF FINANCIAL POSITION
|
Insurance operations |
Shareholders’ operations | 30 June 2020 (Unaudited) |
Insurance operations |
Shareholders’ operations | 31 December 2019 (Audited) |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | ASSETS |
|
|
|
|
|
| Cash at banks | 94,907 | 555 | 95,462 | 15,454 | 4,233 | 19,687 | Contributions receivable, net | 5,656 | - | 5,656 | 2,094 | - | 2,094 | Reinsurers’ share of unearned Contributions |
6,172 |
- |
6,172 | 12,923 | - | 12,923 | Reinsurers’ share of outstanding claims | 37,306 | - | 37,306 | 29,422 | - | 29,422 | Reinsurers’ share of claims incurred but not reported |
9,874 |
- |
9,874 | 5,669 | - | 5,669 | Available for sale investments held to cover unit-linked liabilities |
1,160,241 |
- |
1,160,241 | 185,178 | - | 185,178 | Investments | 44,400 | 364,189 | 408,589 | 43,911 | 367,503 | 411,414 | Due from related parties | 7,932 | 14,138 | 22,070 | 28,176 | 2,191 | 30,367 | Prepayments and other assets | 2,655 | 191 | 2,846 | 2,405 | 68 | 2,473 | Due from Insurance Operations | - | 50,494 | 50,494 | - | 29,407 | 29,407 | Fixtures, furniture and equipment | 1,132 | - | 1,132 | 809 | - | 809 | Statutory deposit | - | 35,000 | 35,000 | - | 35,000 | 35,000 |
|
|
|
|
|
|
|
| 1,370,275 | 464,567 | 1,834,842 | 326,041 | 438,402 | 764,443 | Less: Inter-operations eliminations | - | (50,494) | (50,494) | - | (29,407) | (29,407) |
|
|
|
|
|
|
| TOTAL ASSETS | 1,370,275 | 414,073 | 1,784,348 | 326,041 | 408,995 | 735,036 |
|
|
|
|
|
|
| LIABILITIES |
|
|
|
|
|
| Accrued expenses and other liabilities | 20,527 | 2,362 | 22,889 | 15,955 | 2,696 | 18,651 | Reinsurance balances payable | 8,133 | - | 8,133 | 10,775 | - | 10,775 | Unearned contributions | 15,068 | - | 15,068 | 35,087 | - | 35,087 | Outstanding claims | 41,673 | - | 41,673 | 33,525 | - | 33,525 | Claims incurred but not reported | 12,124 | - | 12,124 | 7,023 | - | 7,023 | Unit reserves | 1,163,791 | - | 1,163,791 | 187,979 | - | 187,979 | Mathematical reserve | 8,765 | - | 8,765 | 360 | - | 360 | Other reserves | 12,277 | - | 12,277 | - | - | - | Employee benefits | 2,985 | - | 2,985 | 2,624 | - | 2,624 | Zakat and income tax | - | 910 | 910 | - | 1,110 | 1,110 | Due to Shareholders' Operations | 50,494 | - | 50,494 | 29,407 | - | 29,407 | Surplus from Insurance Operations | 34,487 | - | 34,487 | 3,355 | - | 3,355 |
|
|
|
|
|
|
|
| 1,370,324 | 3,272 | 1,373,596 | 326,090 | 3,806 | 329,896 | Less: Inter-operations eliminations | (50,494) | - | (50,494) | (29,407) | - | (29,407) |
|
|
|
|
|
|
| TOTAL LIABILITIES | 1,319,830 | 3,272 | 1,323,102 | 296,683 | 3,806 | 300,489 |
|
|
|
|
|
|
| EQUITY |
|
|
|
|
|
| Share capital | - | 350,000 | 350,000 | - | 350,000 | 350,000 | Statutory reserve | - | 30,595 | 30,595 | - | 30,595 | 30,595 | Retained earnings | - | 80,700 | 80,700 | - | 54,001 | 54,001 | Re-measurement reserve of employee benefits – related to Insurance Operations |
(49) |
- |
(49) | (49) | - | (49) |
|
|
|
|
|
|
| TOTAL EQUITY | (49) | 461,295 | 461,246 | (49) | 434,596 | 434,547 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| TOTAL LIABILITIES AND EQUITY | 1,319,781 | 464,567 | 1,784,348 | 296,634 | 438,402 | 735,036 |
|
|
|
|
|
|
|
17. SUPPLEMENTARY INFORMATION (continued)
INTERIM CONDENSED STATEMENT OF INCOME
| Three month period ended 30 June (Unaudited) |
| Insurance operations | Shareholders’ operations |
2020 | Insurance operations | Shareholders’ operations |
2019 |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 |
|
|
|
|
|
|
| REVENUE |
|
|
|
|
|
| Gross written contributions | 42,549 | - | 42,549 | 21,610 | - | 21,610 | Contributions ceded: |
|
|
|
|
|
| Local | - | - | - | - | - | - | Foreign | (4,042) | - | (4,042) | (404) | - | (404) |
|
|
|
|
|
|
| Net written contributions | 38,507 | - | 38,507 | 21,206 | - | 21,206 | Changes in unearned contributions, net |
6,180 |
- |
6,180 | 3,710 |
- | 3,710 |
|
|
|
|
|
|
| Net contribution earned | 44,687 | - | 44,687 | 24,916 | - | 24,916 | Other underwriting income | 10,956 | - | 10,956 | 131 | - | 131 |
|
|
|
|
|
|
| TOTAL REVENUES | 55,643 | - | 55,643 | 25,047 | - | 25,047 |
|
|
|
|
|
|
| UNDERWRITING COSTS AND EXPENSES |
|
|
|
|
|
| Gross claims paid | (3,840) | - | (3,840) | (1,144) | - | (1,144) | Reinsurers’ share of claims paid | 3,378 | - | 3,378 | 700 | - | 700 |
|
|
|
|
|
|
| Net claims paid | (462) | - | (462) | (444) | - | (444) | Changes in outstanding claims, net | (66) | - | (66) | (493) | - | (493) | Changes in claims IBNR, net | (512) | - | (512) | 263 | - | 263 |
|
|
|
|
|
|
| Net claims incurred | (1,040) | - | (1,040) | (674) | - | (674) | Investible contributions, net | (31,769) | - | (31,769) | (12,909) | - | (12,909) | Changes in mathematical reserve | 35 | - | 35 | 3 | - | 3 | Changes in other reserves | 181 | - | 181 | - | - | - | Policy acquisition costs | (1,949) | - | (1,949) | (911) | - | (911) | Supervision and inspection fees | (213) | - | (213) | (108) | - | (108) |
|
|
|
|
|
|
| TOTAL UNDERWRITING COSTS AND EXPENSES |
(34,755) |
- |
(34,755) | (14,599) | - | (14,599) |
|
|
|
|
|
|
| NET UNDERWRITING INCOME | 20,888 | - | 20,888 | 10,448 | - | 10,448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| OTHER OPERATING (EXPENSES)/ INCOME |
|
|
|
|
|
| Impairment of receivables | (487) | - | (487) | (132) | - | (132) | General and administrative expenses | (8,470) | (2,954) | (11,424) | (1,580) | (653) | (2,233) | Commission from held to maturity investments |
113 |
2,890 |
3,003 | 113 | 2,333 | 2,446 | Commission income on deposits | 5 | - | 5 | 4 | 1 | 5 | Unrealised gain / (loss) on FVIS investments |
115 |
(265) |
(150) | 251 | 178 | 429 | Realised gain on FVIS investments | - | 1,544 | 1,544 | - | - | - | Dividends from FVIS investments | - | 220 | 220 | - | - | - | Other income | 1,955 | - | 1,955 | 21 | 11 | 32 |
|
|
|
|
|
|
| TOTAL OTHER OPERATING (EXPENSES)/ INCOME |
(6,769) |
1,435 | (5,334) | (1,323) | 1,870 | 547 |
|
|
|
|
|
|
|
17. SUPPLEMENTARY INFORMATION (continued)
b) INTERIM CONDENSED STATEMENT OF INCOME (continued)
| Three month period ended 30 June (Unaudited) |
| Insurance operations | Shareholders’ operations |
2020 | Insurance operations | Shareholders’ operations |
2019 |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 |
|
|
|
|
|
|
| NET SURPLUS FROM OPERATIONS |
14,119 |
1,435 |
15,554 | 9,125 | 1,870 | 10,995 |
|
|
|
|
|
|
| Surplus transferred to Shareholders’ | (12,707) | 12,707 | - | (8,213) | 8,213 | - |
|
|
|
|
|
|
| NET INCOME FOR THE PERIOD BEFORE ZAKAT AND INCOME TAX |
1,412 |
14,142 |
15,554 | 912 | 10,083 | 10,995 |
|
|
|
|
|
|
| Zakat | - | (393) | (393) | - | (230) | (230) | Income tax | - | (36) | (36) | - | (34) | (34) |
|
|
|
|
|
|
| NET INCOME FOR THE PERIOD |
1,412 |
13,713 |
15,125 | 912 | 9,819 | 10,731 |
|
|
|
|
|
|
| Weighted average number of ordinary shares outstanding (in thousands) |
- |
35,000 |
- | - | 35,000 | - |
|
|
|
|
|
|
| Basic and diluted earnings per share for the period (SR) |
- |
0.392 |
- | - | 0.281 | - |
|
|
|
|
|
|
|
INTERIM CONDENSED STATEMENT OF COMPREHENSIVE INCOME
| Three month period ended 30 June (Unaudited) |
| Insurance operations | Shareholders’ operations |
2020 | Insurance operations | Shareholders’ operations |
2019 |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 |
|
|
|
|
|
|
| NET INCOME FOR THE PERIOD |
1,412 |
13,713 |
15,125 |
912 |
9,819 |
10,731 |
|
|
|
|
|
|
| Other comprehensive income | - | - | - | - | - | - |
|
|
|
|
|
|
| TOTAL COMPREHENSIVE INCOME FOR THE PERIOD |
1,412 |
13,713 |
15,125 |
912 |
9,819 |
10,731 |
|
|
|
|
|
|
|
17. SUPPLEMENTARY INFORMATION (continued)
INTERIM CONDENSED STATEMENT OF INCOME
| Six month period ended 30 June (Unaudited) |
| Insurance operations | Shareholders’ operations |
2020 | Insurance operations | Shareholders’ operations |
2019 |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 |
|
|
|
|
|
|
| REVENUE |
|
|
|
|
|
| Gross written contributions | 86,104 | - | 86,104 | 38,987 | - | 38,987 | Contributions ceded: |
|
|
|
|
|
| Local | - | - | - | - | - | - | Foreign | (7,438) | - | (7,438) | (1,454) | - | (1,454) |
|
|
|
|
|
|
| Net written contributions | 78,666 | - | 78,666 | 37,533 | - | 37,533 | Changes in unearned contributions, net | 13,268 | - | 13,268 | 9,599 |
- | 9,599 |
|
|
|
|
|
|
| Net contribution earned | 91,934 | - | 91,934 | 47,132 | - | 47,132 | Other underwriting income | 18,754 | - | 18,754 | 303 | - | 303 |
|
|
|
|
|
|
| TOTAL REVENUES | 110,688 | - | 110,688 | 47,435 | - | 47,435 |
|
|
|
|
|
|
| UNDERWRITING COSTS AND EXPENSES |
|
|
|
|
|
| Gross claims paid | (7,409) | - | (7,409) | (3,302) | - | (3,302) | Reinsurers’ share of claims paid | 6,387 | - | 6,387 | 2,387 | - | 2,387 |
|
|
|
|
|
|
| Net claims paid | (1,022) | - | (1,022) | (915) | - | (915) | Changes in outstanding claims, net | (264) | - | (264) | (1,429) | - | (1,429) | Changes in claims IBNR, net | (896) | - | (896) | 1,039 | - | 1,039 |
|
|
|
|
|
|
| Net claims incurred | (2,182) | - | (2,182) | (1,305) | - | (1,305) | Investible contributions, net | (66,219) | - | (66,219) | (26,000) | - | (26,000) | Changes in mathematical reserve | 2,575 | - | 2,575 | 38 | - | 38 | Changes in other reserves | (619) | - | (619) | - | - | - | Policy acquisition costs | (4,494) | - | (4,494) | (1,927) | - | (1,927) | Supervision and inspection fees | (431) | - | (431) | (195) | - | (195) |
|
|
|
|
|
|
| TOTAL UNDERWRITING COSTS AND EXPENSES | (71,370) | - | (71,370) | (29,389) | - | (29,389) |
|
|
|
|
|
|
| NET UNDERWRITING INCOME | 39,318 | - | 39,318 | 18,046 | - | 18,046 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| OTHER OPERATING (EXPENSES)/ INCOME |
|
|
|
|
|
| Impairment of receivables | (611) | - | (611) | (249) | - | (249) | General and administrative expenses | (17,039) | (3,892) | (20,931) | (3,530) | (1,218) | (4,748) | Commission from held to maturity investments | 227 | 5,739 | 5,966 | 226 | 4,635 | 4,861 | Commission income on deposits | 11 | - | 11 | 15 | 2 | 17 | Unrealized gain / (loss) on FVIS investments | 262 | (38) | 224 | 513 | 457 | 970 | Realized gain on FVIS investments | - | 1,544 | 1,544 | 20 | - | 20 | Dividends from FVIS investments | - | 220 | 220 | - | - | - | Other income | 4,474 | 1 | 4,475 | 98 | 31 | 129 |
|
|
|
|
|
|
| TOTAL OTHER OPERATING (EXPENSES)/ INCOME | (12,676) | 3,574 | (9,102) | (2,907) | 3,907 | 1,000 |
|
|
|
|
|
|
|
17. SUPPLEMENTARY INFORMATION (continued)
d) INTERIM CONDENSED STATEMENT OF INCOME (continued)
|
| Six month period ended 30 June (Unaudited) |
| Insurance operations | Shareholders’ operations |
2020 | Insurance operations | Shareholders’ operations |
2019 |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 |
|
|
|
|
|
|
| NET SURPLUS FROM OPERATIONS | 26,642 | 3,574 | 30,216 | 15,139 | 3,907 | 19,046 |
|
|
|
|
|
|
| Surplus transferred to Shareholders’ | (23,978) | 23,978 | - | (13,625) | 13,625 | - |
|
|
|
|
|
|
| NET INCOME FOR THE PERIOD BEFORE ZAKAT AND INCOME TAX | 2,664 | 27,552 | 30,216 | 1,514 | 17,532 | 19,046 |
|
|
|
|
|
|
| Zakat | - | (772) | (772) | - | (444) | (444) | Income tax | - | (81) | (81) | - | (70) | (70) |
|
|
|
|
|
|
| NET INCOME FOR THE PERIOD | 2,664 | 26,699 | 29,363 | 1,514 | 17,018 | 18,532 |
|
|
|
|
|
|
| Weighted average number of ordinary shares outstanding (in thousands) | - | 35,000 | - | - | 35,000 | - |
|
|
|
|
|
|
| Basic and diluted earnings per share for the period (SR) | - | 0.763 | - | - | 0.486 | - |
|
|
|
|
|
|
|
INTERIM CONDENSED STATEMENT OF COMPREHENSIVE INCOME
| Six month period ended 30 June (Unaudited) |
| Insurance operations | Shareholders’ operations |
2020 | Insurance operations | shareholders’ operations |
2019 |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 |
|
|
|
|
|
|
| NET INCOME FOR THE PERIOD | 2,664 | 26,699 | 29,363 | 1,514 | 17,018 | 18,532 |
|
|
|
|
|
|
| Other comprehensive income | - | - | - | - | - | - |
|
|
|
|
|
|
| TOTAL COMPREHENSIVE INCOME FOR THE PERIOD | 2,664 | 26,699 | 29,363 | 1,514 | 17,018 | 18,532 |
|
|
|
|
|
|
|
17. SUPPLEMENTARY INFORMATION (continued)
INTERIM CONDENSED STATEMENT OF CASH FLOWS
| Six month period ended 30 June (Unaudited) |
| Insurance operations | Shareholders’ operations |
2020 | Insurance operations | Shareholders’ operations |
2019 |
| SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | SR'000 | OPERATING ACTIVITIES |
|
|
|
|
|
| Net income for the period before Zakat and income tax | 2,664 | 27,552 | 30,216 | 1,514 | 17,532 | 19,046 | Adjustments for non-cash items: |
|
|
|
|
|
| Reinsurers’ share of unearned contributions | 6,751 | - | 6,751 | 6,028 | - | 6,028 | Unearned contributions | (20,019) | - | (20,019) | (15,627) | - | (15,627) | Impairment of receivables | 611 | - | 611 | 249 | - | 249 | Commission from held to maturity investments | (227) | (5,739) | (5,966) | (226) | (4,635) | (4,861) | Unrealized (gain) / loss on FVIS investments | (262) | 38 | (224) | (513) | (457) | (970) | Realized gain on FVIS investments | - | (1,544) | (1,544) | (20) | - | (20) | Dividends from FVIS investments | - | (220) | (220) | - | - | - | Depreciation | 126 | - | 126 | 55 | - | 55 | Employee benefits | 443 | - | 443 | 330 | - | 330 |
|
|
|
|
|
|
|
| (9,913) | 20,087 | 10,174 | (8,210) | 12,440 | 4,230 | Changes in operating assets and liabilities: |
|
|
|
|
|
| Contributions receivable, net | (4,173) | - | (4,173) | (1,809) | - | (1,809) | Reinsurers’ share of outstanding claims | (2,943) | - | (2,943) | (12,920) | - | (12,920) | Reinsurers’ share of claims incurred but not reported | (4,205) | - | (4,205) | 809 | - | 809 | Available for sale investments held to cover unit-linked liabilities, net | 21,864 | - | 21,864 | (28,887) | - | (28,887) | Due from related parties | 73,796 | (11,947) | 61,849 | (12,028) | - | (12,028) | Prepayments and other assets | (250) | (123) | (373) | (279) | (111) | (390) | Accrued expenses and other liabilities | 2,126 | (334) | 1,792 | 1,353 | (1,328) | 25 | Reinsurers' balances payable | (2,642) | - | (2,642) | (1,385) | - | (1,385) | Outstanding claims | 3,207 | - | 3,207 | 14,349 | - | 14,349 | Claims incurred but not reported | 5,101 | - | 5,101 | (1,848) | - | (1,848) | Unit reserve | (21,115) | - | (21,115) | 28,449 | - | 28,449 | Mathematical reserve | (2,575) | - | (2,575) | (38) | - | (38) | Other reserves | 619 | - | 619 | - | - | - | Due to Shareholders' Operations | 21,087 | - | 21,087 | 12,956 | - | 12,956 | Due from Insurance Operations | - | (21,087) | (21,087) | - | (12,956) | (12,956) |
|
|
|
|
|
|
| Cash from/(used in) operations | 79,984 | (13,404) | 66,580 | (9,488) | (1,955) | (11,443) | Zakat and income tax paid | - | (1,053) | (1,053) | - | (975) | (975) | Employee benefits paid | (82) | - | (82) | (16) | - | (16) |
|
|
|
|
|
|
| Net cash from/(used in) operating activities | 79,902 | (14,457) | 65,445 | (9,504) | (2,930) | (12,434) |
|
|
|
|
|
|
| INVESTING ACTIVITIES |
|
|
|
|
|
| Proceeds from disposal of HTM investments | - | 8,000 | 8,000 | - | - | - | Proceeds from disposal of FVIS investments | - | 14,215 | 14,215 | 10,000 | - | 10,000 | Purchase of FVIS investments | - | (15,320) | (15,320) | - | - | - | Commission received from HTM investments | - | 3,664 | 3,664 | - | - | - | Dividends from FVIS investments | - | 220 | 220 | - | - | - | Purchase of fixtures, furniture and equipment | (449) | - | (449) | (404) | - | (404) |
|
|
|
|
|
|
| Net cash (used in)/from investing activities |
(449) |
10,779 |
10,330 | 9,596 | - | 9,596 |
|
|
|
|
|
|
| Net increase / (decrease) in cash at banks | 79,453 | (3,678) | 75,775 | 92 | (2,930) | (2,838) | Cash at banks at the beginning of the period | 15,454 | 4,233 | 19,687 | 13,208 | 3,854 | 17,062 |
|
|
|
|
|
|
| Cash at banks at the end of the period | 94,907 | 555 | 95,462 | 13,300 | 924 | 14,224 |
|
|
|
|
|
|
|
18. IMPACT OF COVID 19
On 11 March 2020, the World Health Organisation (“WHO”) declared the Coronavirus (“COVID-19”) outbreak as a pandemic in recognition of its rapid spread across the globe. This outbreak has also affected the GCC region including the Kingdom of Saudi Arabia. Governments all over the world took steps to contain the spread of the virus. Saudi Arabia in particular has implemented closure of borders, released social distancing guidelines and enforced country wide lockdowns and curfews.
In response to the spread of the Covid-19 virus in the Kingdom of Saudi Arabia where the Company operates and its consequential disruption to the social and economic activities in the Saudi Arabia market, the Company’s management has proactively assessed its impacts on its operations and has taken a series of proactive and preventative measures and processes to ensure:
As with any estimate, the projections and likelihoods of occurrence are underpinned by significant judgment and rapidly evolving situation and uncertainties surrounding the duration and severity of the pandemic, and therefore, the actual outcomes may be different to those projected. The impact of such uncertain economic environment is judgmental, and the Company will continue to reassess its position and the related impact on a regular basis.
To cater for any potential impacts, the Covid-19 pandemic may have had on the financial assets of the Company, the Company has performed an assessment in accordance with its accounting policy, to determine whether there is an objective evidence that a financial asset or a group of financial assets has been impaired. For debt financial assets, these include factors such as, significant financial difficulties of issuers or debtors, default or delinquency in payments, probability that the issuer or debtor will enter bankruptcy or other financial reorganization, etc.
Based on these assessments, the Company’s management believes that the Covid-19 pandemic has had no material effects on Company’s reported results for the three and six month periods ended 30 June 2020. The Company’s management continues to monitor the situation closely. | 17, 18 |
