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ANNUAL REPORTS

Report and proposal of the board of directors

From 1 January 2020 to 31 December 2020

Dear shareholders,

  • The Board of Directors prepared during the fiscal year ending on 31/12/2020 the financial report as follows:

Operational revenue: KD 96,140 (compared to KD 387,864 in 2019), which means a KD 291,724 drop (75.2%).

Operational net profit: Total revenue for the fiscal year ending on 31/12/2020 reached KD 24,472 (compared to KD 341,519 in 2019), which means a KD 317,047 drop (92.8%).

Other expenses reached KD 71,668 in 2020 (compared to KD 46,345 in 2019), which means a KD 25,323 increase (54.6%).

Net profit for the fiscal year ending on 31/12/2020 reached KD 23,272 (compared to KD 326,357 in 2019), which means a KD 303,085 drop (92.8%).

Earnings per share reached 0.38 fils in 2020 (compared to 5.39 fils in 2019), which means a 92.8% drop.

Current projects: Due to the instability of real estate prices, and based on our studies for the Kuwaiti real estate market, we noticed a drop in prices. Therefore, there are no current projects until real estate prices in Kuwait stabilize.

Future projects:

  1. The Board of Directors observes and studies Kuwait’s real estate market to invest in real estate and increase investment revenues.
  2. The Board of Directors recommended not paying any bonuses for members of the board for the fiscal year ending on 31/12/2020.
  3. The Board of Directors recommended not distributing dividends for the fiscal year ending on 31/12/2020.
  4. The Board of Directors recommended deducting 10% of profits for the voluntary reserve account and 10% from the profits’ account to the legal reserve account.

Dealing with related parties

There were no dealings with related parties during the fiscal year ending on 31/12/2020.

REPORT OF THE INTERNAL AUDIT AND RISK MANAGEMENT COMMITTEE

From 1 January 2020 to 31 December 2020

In reference to the subject above, and after the end of the fiscal year on 31 December 2020, we are glad to present to you our report for the aforementioned period, which explains the company’s operations and activities that were under audit and point out the main remarks and recommendations. The following is a preview of the report:

First: Goals, extent and procedures of the audit operations

  1. Revenue audit.
  2. Payment check.
  3. Cash and cash equivalent audit.
  4. Financial statements’ verification.
  5. Administrative affairs’ audit.
  6. Administrative decisions’ follow up.

Second: Audit result

First: Goals, extent and procedures of the audit operations

  1. Revenue audit

The audit process covered all items of revenue from the company’s activities, examining registers and documents and verifying with the deposits in the company’s bank accounts.

  1. Payment check

The payments were checked through verifying exchange vouchers and support documents, checking their sufficiency and making sure that payments were made in exchange of operations for the company.

  1. Cash and cash equivalent audit

We reviewed monthly reports and matched them with the company’s bank accounts to find out that they were fully matched, and bank accounts were matching with the company’s records (after calculating bank reconciliations).

  1. Financial statements’ verification

Financial statements were reviewed and compared to monthly audit balances, while account statements were analyzed and compared with bank accounts. Furthermore, registers, exchange and receipt vouchers were examined.

  1. Administrative affairs’ audit

Administrative affairs were reviewed, including examining employees’ files, hiring procedures and commitment to internal regulations.

  1. Administrative decisions’ follow up

Administrative decisions issued by the Chairman of the Board and Chief Executive Officer during the same period were reviewed, and we found that they were fully implemented by the concerned departments.

Second item related to financial restructuring to reduce costs.

Second: Audit result

After carrying out the audit operations, we found that the company’s financial statements do not include any material errors except for what is mentioned under item number 6. Furthermore, we found that the company’s internal audit was good and effective. We also found that departments have executed decisions and policies related to this period. 

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