Annual Financial Statements PDF

RIYAD CAPITAI,
(A Limited Liabilily Company)
Finrncirl Strtements
For the year endcd 3l Dec€mber 2015
tog€lh€r wilh &€
INDf,Pf,NDENT AUDITORS' REPORT
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KPMG Al Foz.n &
P.no.r.
Cerlili.d Publlc Accounrlrt.
Teephone +966 r1 874 8500
Fax
rtuernel
+96611 874 8600
www kpmg com
SalahudeenAlAyoubi Road
P.
R
O
Box 92876
Lcence No
46/rrl323 ssuod rl8/1992
yadh 11663
Kingdom of
Sald Arab 6
INDDPDNDDN'I' AUI)ITORS' REPORT
'lb:'l'he Shareholders
Riyad Capital
(A Limited LiabiliF- Company)
Riyadh, Kingdom of Srudi Arabir
Wc havc audilcd the accompanying tinancial stalenlents of Riyrd Cspital ("the Clonrpany ) which
conrprise the balance sheel as at 3l Dcccmbcr 2015 and the related statemenls of ircornc, cash llows
and ohange\ in shareholdeN' equity for thc ycar thcrr ended and the atlached notcs ( l) lhrolgh (18)
which fbrm an integml pafi ofthe financial stllcDlonls.
Munq:eme t's relpottsihilil! rtD theJin ciol rlilementr
MaDagcDrenl is responsible fbr the preparatior aud fair prcsenlation ofihese linancial slalcnrcDls irl
accordance wilh gcncrally accepled accounting standards in lhc Kingdom of Saudi Arabi{ and in
cotnpliance \!ilh A(iclc 175 of the Regulalidrs lbr (i)npanies and lhc Conlpan!'s n|licles ol'
Associalion and tbr such inlemal control as managemenl deteflnires is nLlLcssnry lo crablc lhe
prcpaftllion of linancial stalemenls lhat arc frcc lio|n material nisslatemeDl. $4rclhcr duc rc Iiand or
crror. Managernenl has protided us wilh all thc inlbnnation and explanations lhnl wc rcqrirc rclali g
to our audil ofthese financial slalcmcnls.
A
uditots' rcspofisibil r"
Our rcsponsibility is to express an opinion on these financial stalcncnls based on our audit. W€
conduclod our audil in accordance with gcncrally accepled audiling standards in thc Ki gdonr ol Saudi
Arabia. lhose standards require thal wc cornply wilh relevanl ethical requircments arrd plan and
pcrli)rlll the audit to oblain reasonablc assuralce whether thc financial staternenls arc licc lionr
malcrial D)isstalcment.
Au rudil involves performing procedurcs lo oblaiD audit evid€Dce aboul the anrounts aDd disclosures
iu lhc linaDcial slalcnenls. The procedurcs sclcclcd dcpcnd on ourjudgmenl. including lhe assossnlcnl
ol lhc risks of malerial misslatemenl of lhc finaDcial slatemeDts. lvhclhcr due lo fi?ud or crrcr. ln
DlakiDg lhosc risk assessnrents. $e corsidcr intcmal conlrol relevanl lo lhc cnlitt's prtpar?lion and
lhir presenlalion oflhe financial stalements in ordcr lo dcsign audit procedures that arc appropriate in
thc circunrslances. but not for the purpose ol-exprcssiDg an opinion on the effeclivcncss ol lhe cnlil)'s
intcrnal control. An audil also includes evaluating tho approprialeness ofaccounting policies used and
thc rcasonableness of accounting cstimatcs made by nlanagcmcnt, as well as evaluatirg thc overall
prcscntalion of the linancial stalemenls.
Wo bclicvc lhal lhc audit evidence wc havc oblaincd is suflicient and appropriate rc provido a basis
fbr ouf opinion.
'eq6le.ed6ryryiilheKii96mols
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Opinion
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a)
present fairly, in all material respects, lhe financial position of the Company as at 31 D€cemb€r
2015, and the results of its operations and clsh tlows for the year then ended id accordaDce with
generally accepted accountitrg standards in the Kingdon of Saudi Arabia appropriate to the
circumstatcas ofthe Company; aDd
b)
comply with the requir€ments of the Regulations for Compani€s and the Company's Articles
Association with respect to the preparation and presentation of financial statements.
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In our opiniorl the financial stalements taken as a whole:
For KPMG Al Fozrn & Prrtrers
Certlficd Public Accourt rtr
Abdullah Hamad Al Fozan
Licanse No. 348
Dater
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Jumada
II
143?H
Corr€sponding to: l0 March 2016
of
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RIYAD CAPITAL
(A Limited l,iability Company)
BALANCE SHI]I]'I'
As at Jl Decenber 2015
(Sn di Anhian Riydls)
2015
20t4
582,079,185
132,7 | 5,142
92,841,019
5,180,897
680,r01,101
86.675,110
SSETS
Ilalanccs with bank
Accrucd illcome
l'rcpaynrents and othcr currenl asscls
Total currenf
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6.5
4
J
as$ets
Non-current asscts
Available-for-salc investmcnls
Capital work-in-prt)grcss
'I otal non-currcnt assets
Total sssets
6
7
lt,oot,942
1t2'7,392,194
rts,804,368
9,792,542
155,033,481
205,596,950
155,033,481
88srq9!{sL
23242s.6'7 5
LIABILITIES AND SHAREHOLDERS' EOUITY
Cuftent liabililics
Acorued cxpelses and other currcnl liabilities
Accrued Zakat
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otal current liabilities
28,621,041
22,345.613
32y'25,381
_1!,1l ryqe
54.49'7.582
N o n -c u r re nt li ub i liti e s
Lmployees'
c
24,672,548
24,672,548
61,097,929
d-o1-senice bencfi ls
Total non-current liabilitics
'I'otal liabilitics
SHAREHOLDERS' EOUITY
Sharc oapital
Statutory reservc
Rclained eanrirlgs
Unrealiscd gain on available-tbr-salc investments
Total shareholders' cquity
Total li{bilities aDd shareholders' equity
///
//
23,743,8',78
23,743,878
200,000,000
200,000,000
t00,000,000
519,653,t09
4,947,0t3
824,600,122
t00,000.000
587,282,M0
900,184.215
88L09!J5L
2!2125.61s
12.902,1'75
'l-he acconpanying notcs ( | to (18) l'onn an inlegml part ofthcse financial stalemenls.
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RIYAD CAPITAL
(A Limited Liabilily Compa y)
STATEMEN'T OF INCOME
For the year ended 3l December 2015
(SauliArahian Riyals)
20t5
REVFJNUES
Asset managemenl fee, net
Conrmission on brokerage services, net
Corporate investment banking Iecs
Special cornmission income on deposits
Realiscd (loss) / gain on inveslmenls, net
Dividends income
Olher income
Total revenues
191,403,073
94,217,A54
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EXPENSES
Employees' salaries and related benefits
Other general and administmtive expenses
Total erpcnses
4,102,l 5',7
t29,723,809
21
233s7,ta2
24,25',7.312
6.l
3,009,74E
4,294,O94
13
$26,912'
2,t94,744_
1,303,576
423,756
318,948,217
375,112,t t6
1t2,458,009
t4
94.774.t47
54316,645 57.058,327
166,774,654 15t,832,474
152,173,623
Incomc bcfore Zakat
Zakat
N€t income for thc year
'l he accompanying nolcs
2014
223.339.642
(3,804,340) (5,583,500)
t48,369,28L 211.156,t42
(l)
lo
(l8) lbdn
an integral part oflhese financial statements.
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RIY,TD CAPITAL
(A I-imitcd l,iability Company)
S IATET\{EN1 ()t' CASIT I'LOWS
Ior the year cndcd 3l Decembcr 2015
(Sukli Antl,iun RiJul!)
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2015
cAsH
l'l,ow
r,'RoN{ oPlrRA'r'rNG
Acl Ivt ItEs
Nel incomc lbr dle ycar
Adjustt (ntt b rc.o1(il( nd inurn( to n.t L.^h lion1
o?eruling (r.1il' iIi(s
Realised loss / (gailr) on inveslrnenl, ncl
Dividend incorne
Employecs' cndof-serwice bcnclits
Zakat chargc lbr rhe year
Chugcs in opcfttting
as.\4.r
Prepaymcrrts and olhcr
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t4{r,369,283
2t'7.756.t42
826,912
(1,303,s76)
(2.t94.744)
6_s51,780
4.968.91J9
3,804J40
t58,248,739
226,1l3.Uu7
5,583,50q_
onl liabiliti$
ent asscts
2,821,045
(6,16s,909)
6,215,428
Accnred expcnscs and other cuncni liabililies
t6r,r79,303
Zakal paid
I-mployccs cnd<rf-service bcDolits paid
Net cash from operating activities
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201.t
(1,422,235)
(8,523,230)
2.606.296
2t5.774,718
(36,1sr,969)
(1,623,1l0)
,_J4,401,224
(
l.3se,6s8)
,2.111!!.!60
CASH FLOW I'ROIlI INVDS'I'ING ACTTVI'I'IES
(r,232,7
Purchase of held-for-tradi ng investn1ent
Procccds iiom sale of hcld-for-lradinB invcslll1onl
Purchase ol rvailable-fbr-sale iDvcslmcnls
Proceeds liorr sale of availablc-li)r-sale inveslmcnts
Dividend iucolnc
Capital work-in-progrcss
Nei crsh (uscd in) / from inlesling aclivilies
-_
rlt'
t,619,757
(56,376,049)
6,316,049
1,303,576
(9,792,542)
(58,041,967)
(8,962,19;;
10,834,855
a'72.657
cAsH FLOW nROM t'tN,\NCtNG AC't M'l'ltas
Dividcnds paid
Net cash usod in financing aolivities
Nct (decreasc) / increase in cash and cash cquivalents
Cash and cash equivalents al lhc begillning ol-tho year
Cash and c$sh equivalents at thc end ofthe ycar
L2!5,29!ML
, (215,998,2t.r)
(|
50,635,9s7)
2t 6.24'7
.'7
t'7
732,7t5,t42
5t6.121.425
stt2,0z2J!a
'7
32,1
|5
,) 42
Supplemcntnl non-cash information
Nct changes in fair value ofavailable-for-salc and lransfer to
iDc0me
starcnrcnt
(7,955,162)
'lhc accompanying notcs (l) to (18) fornl an integral pad ()1-thcse iinancial slalcmcnts.
175.200
IIIYAD CAPITAL
(A l-imitcd Liability Company)
sTA'r'oMaN'r' oF cItANcus tN SHAREHOLDIRS, r]QUrTy
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For lhe ycar cndod 3l Decembcr 2015
tS, kh,4nrl,krn Rt|'".lt,
Unr€nliscd
garn on
availabl€S(ntolory
Shtre capital
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Ihhrcc rt I .laruary
2015
200,000,000
100,000,000
Nct changes in l;ir\alue ofavailablc,
lbr-sale investment
Unrealised los,t on a\ailable for-salc
invcstolents relcased to ircomc
slaleDcDt due to sale
Ncl irconre lbr the year
Dividcnds a,Vok, /-?.)
I}la
.e
nl3l
December 2015
Brlrncc al I Jrnuary 2014
Retrircd
scqilc!
!:!E$4srE
Total
587,282,040
12,902,115
900,184,215
(9,22e,t t3)
(9,229,U3)
r4s,369,2;
100.000.000
100,0u0,000
519,653,t09
,1,947,013
824,6nu,t22
98,242.i72
371-281,816
t2-726.975
6lr:.252.871
fairlalue ol alailablefor-salc inlcstne.ts
2,369.944
Unrealiicd sain on arailablc-{i,Fsale
i ,eshenrs released to irconrc
12.t91.714)
slalcnrcnr due to salc
2l'7.756.t42
Nel inconc fbr the year
Balance
al3l
Dccember 2014
(2t5,998,214)
(215,998,2r4)
200,000,000
Net changcs irr
'lransltr o slatutory resene
1,273,951 1,2?3,951
-- 148,369,283
1.757.928
(1.75?.928)
200.000.000 t00.000.000
587,282.040
-
2.169-9,1,1
\2.t94.144t
2l'7,756.t42
11.902.1?5 q00.t84.15
'[hc acconrpanyiDg notes (1) to (18) form an integral pan ofllroso flnnncial slatcn]ents
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RIYAD CAPITAI,
(A l-imilcd l.iability Company)
NOTFJS TO TIID 1'INANCIAI, STA'I'CMINTS
For lhe ycar cndcd 3l Decenbcr20l5
(SauliAruhiun Riyult)
l.
(apilal ("the Cornparry'') is a linrilcd liabilily conpaDr- eslablishcd and rcSistered in
Riyadh, thc Kingdom ol Saudi Arabia undcr cornmcrcial rcgistration No. 1010239234. daled l2
Shawwal l428ll (conesponcling to 24 Octobcr 2007).
Riyad
'Ihe principal activilies ofthe Company are dealing as a principal and agent. undcnvriling,
nranagemenl of inr.estmenl lunds and clients' ponfblios, arrnnging. providing advisory alld
cuslqly senices as pcr license of the Capital Market Aulhority ("CMA") nunbcr {)7070-37,
dated 4 Jumad Thani | 4281I (concsFrndins lo I I June 2007).
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'l hc ('onrpany's rcgistered office is localcd at the following address:
Itiyad Capilal
6775 I'akhassusi St., Olaya
Itiyadh 12331-3712
2l I l6
Itiyadh I1475
1,.O. Box
I]ASIS OF PREPARATION
a)
acccplcd accounting slandards
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Saudi Arabia issuqi
'l he financial statemenls wcrc authoriTed lbr issue by thc Board ofManagers
l437ll coresDondinq to 10 March 20l6.
b)
by lho
Saudi
Rosis
el
on I JurDada
ll
teasurc rcnl
'l'h€ llnancial statements havo bo()r prepared on historical cost basis oxccpt lbr availablo-lbrsalc invcst cnts, which are staled al Ibif valuu, using lhe accrxal basis of accounting aDd thc
going concern concepl.
n
,-urtctiontl and prese tation cuncncy
'l hcse financial stalements arc prcscntod in Saudi Arabian Riyals (SR) $hich is thc luncliural
currency of lhe Company. All financial inlbnnalion presenled has bccn round(d olT l() Dc:lrcsl
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in lhc Kingdom of
OrgaDizalion for Cerlificd Public Accounlanls ("SOCPA-') and to conply u,ilh lhe rcquircnrrrs
ol-thc Rcgulalions for Conlpanies and thc (irnpa y's Articles ofAssociation.
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Statcntentofcompliarrce
'l h€ accompanying financial statements havc bccn prepared in accordance with thc gcncrally
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ORGANIZATION AND PRINCIPAI, AC'I'IVITIES
stt.
d)
Usc ofcstintqte and judgrttetrts
'I he preparation
of financial statcncnts rcquires rnaDagemenl to make judgmenls. cslimalcs and
assurnplions thal affcct lhc appiication ol policies and reporled amount ol-asscls. liflbililics,
incomo ard expenses. Aciual results rnay diilcr liom lhcsc cstimales.
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litYAt) cAP AI(A Lirlilcd l.irhiliry Qmrpauy)
NOTES l O lll ITINANCIIAL STATITMIJNl
lor
2.
RASIS oI.' PREPARAl'ION (CON'I'INUED)
d)
I:s( ol cstitnutc urtdjttdgtt /1trs (Cortri utd)
Lslinrrlcs irr)d undcrlying assu:nptions i ! rjvieq,ed ol an ongoing basis. Rcvisrons lo
accoullilg cslin]ales arc rccognized in llro pcriod iD which thc cstimirlcs rrc lc\iscd and
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lulLrfc pcri{xls allcclcd.
'l hc (itrrprtny cxcrciscs judgnrenl iu cousi(lcfing irrpainncnt ol availablc-li)Fsrlc iDvcstments.
This inoludcs delenninalion of a si!nilicant arcl prolonged dccliuo in lhc lllir value below its
cosi. h Innking lhis judgmc t. the (in)rpiDy cvxluates among othcr l:rclors. lhc \olatilib in
sharc pflccs.
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ACCOUN'I tN(; P()l,tCtES
accounting policies sel oul bclow have bccn applicd cor)sislcI]lly to all pclxrds
prescrrlod in thc Jirrarrcial slalc cDls. ( c iriIr colnparalive anrounts havc lrccD rcciassilied
l() conlirrlr l() 11lc current year's prcscnlitll(nr,
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thc ycal cntlotl 3l Dccember 2015
(&t tr<li,'1ruhiun Ri.'ols)
Cash ond (aslr aquivalehtt
C'lsb rn(l crsh cquivalcnls cornplisc caslt wilh banks rnci other shorl{crm highl), liquid
invcstnrcnls. il any. wi(h original Dralurities ol'lhree months or lcss. wllich nfc available 1{)
ihc (irnpany without any reslricti(nls.
b)
H cl d -t' r-t ra I i,
i n vcst,,, c n ts
":
IIcld-lin'lfidiDg xrvcslmenl \\,hich arc pLirchascd laf trading puDoscs flrc inili lly recordcd al
cosl irrd lhcn fc-measured ard slalcd in lhc balance sheet al narkcl valro lrrd includctl undcr
cuffcnl rsscls. ltc:rlizcd gain or loss on salo ol tradc sccurilies and changcs in markel value at
balrncc shcol (lrlc arc fccognised
1r)
strlcrrroul ol incomc.
A v1 i I a hl c -lb Fsa tu i n vc s t'ne n ts
Ar.rilable'laf sale ir\,eslnenls arc thosc inlcstments thal aro intcndcd k) be held lbr an
unspccilictl pcriod ol timc. which nray hc sokl ir) rcsponsc to Dccds ol li(lur(lit)'or ch:rn-!,js in
st\\'rirlc,'||r||rs\rnr rilcs. cxclflIgc r hs,,r cqurlv p ccs.
All
in\'cslr))crls classilled as "avflilflblc-li)f-srle" are inilially rccoBnire(l and subsequenlly
ill hir value. Unrealized gail oI loss arishg liorn a changc irr lhcir hif value is
rccognircd in "tJrrfealized gain/ (loss) ou invcslnrenls" u,itlrirr cquity. (h (ic-rccogDiri,,I. an)
cnmLrlarivo 8^irr or loss prcviously rccoglizcd irr cquity is includccl ilr lhc slaleurcnl oi Inconre.
Permarrcnl (lirninuli(D in value of thc ahovc ncDtioncd investments. il any. rs chargcd to thc
slalcnlcnl ol lnconre.
rDeasurc(i
For sccurilics tradcd in organized linancial nurkcts. f'air value is dctcminc(l hy rclcrencc lo
e)ichillgc q(otcd mafket bid priccs al lhc ck)sc ol business on lhe balancc shcct d:rlc. ljair valuc
ofnraDascd asscls and in\.cslDrcDls iD Dulrnl linds arc dclcnnincd by rulcrcncc lo dcclared nel
Foreign crchangc gain of loss on a\ailablo-lbr-sa1c dcbl secufily irrveslnrcntslirc rccogrlized in
slrtcnlcnl ol-income.
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RIYAI) CAPTTAI,
(A I_iDriled Liabilily ('ompany)
NOTES 'I'O TIII' I'INANCIAI, STATINIT.]N'IS
lof the ycar oudcd 3l Deccmber20l5
(&ttftli,lrahini Riyals)
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3.
SIGNIIICANI' ACCOUN'I'ING POI,ICI!]S (CONTINUI]D)
d)
L't pa i rm
a)
b)
t
c)
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as
setr
Fof asscl canied al f-air ralu€. inpr;rncnt is lhe diff'ereDcc bclwccD oosl and fair value,
lcss any rmpainncnl loss previously rccognized in thc slalcmetl ol iDoontc;
For assol carried at cosl, impai rrenl is thc diflerence betwccn oarryiug atnount and lhc
prcscnl value ol lulurc cash flo'"vs disoounted at the culTcnl ntafkct rate of retum lor a
similxr liMncial asset; and
|or assels carried al amortized cosl. impairment is thc dillironc€ b€nleen (xrrving
anrounl and the presenl value ol lullrc cash llows djscountcd at lhc original efleclivc
inlercsl mlc.
For cquily invcslrne ls hcld as available-lirFsalc. a significanl and prolorged decliDe in lair
valuc bclow ils cosl rcproseDts objeclivc cvidcnce ofimpainncnl. lhc in)painDent loss cannol
be rev€rscd lh()ugh stalemenl ofincoDrc {s lomg as thc asscl conlinues lo bc rccognized i.e. any
incrcasc in lair value alier irnpairnenl has bccrl rcoorded can only bc rcoognizcd in equity. O
de-recognilioD, any cumulative gail or loss pr€viously recognizcd ill cquity is included in the
slatelncnl ol inconr€ tbr the year.
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An assessnicDl is made al each balancc shccl dare to delennitrc rvhclhcr there is objedive
evidcncc lhrl .l spccific tinancial assct may be impaired- If such cvidence exisr\, rr)y
inrpain)rcnl loss is recognized in lhe statcnlent ofi,tcome. lnpflinnelrt is dclcnnined as follous:
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C.tp i ta l
r\, I k-i n -p ro g tes s
Capital work-ir-progress is slalcd at cost and not deprecialcd. Deprecialion on capital work-ioprogrcss conurences when lhc asscls arc rcndy lbr lhcir inteDded usc.
,
A provision is rccogtlizcd il,
as a resull ol pasl cvcnls, the Cornpany hos a present legal
consnrclivc obligation that can bc cslimalcd reliably, and it is pr'()bablo that an outllow
economic bcnclits will be requircd to sclll(j the obligation.
g)
Zakal
-fhe
Zakat chnrgc is computed based on thc Dcl incotDe ofthe Colrpany lirr the year betbre
zakat chnrgc. I bwever, the Comparry docs nol tile a separalc Zakal |() lhe Depanmenl of
Zakat ard lrcor)re lax I-DZII-') as Itiyad Uank ('-the Parenl (innpany') subrrilr a
coDsolidalcd ,' si glc Zakal rcturn tbr lhc cnlirc Group based on ils consolidatcd Zakat
base ar)d sclllcs Zakat liability accordingly. lhe Company s Zakol liabilily is accofdingly
payablo 1() thc |tarent Company and is linlited to the amounl ol_Zakal charged in thcsc
financial slfllcDrcnls.
cntl-of-sc rvice be,rcfilr
"es'
I-rnployecs' c d of servicc bcnefits, calculated in accordancc wilh Saudi Arabian labor
rcgulati(nrs, rrc accrucd and charged to slalcrncnl ofircomc.
Emplot
Assets
uniu
tuauagunent
to its
cuslonro$. \'"hich jnclude
managerner)l ol ccr'lair mutual funds. Such asscts arc held in tlducilry capacily and arc nol
trealcd as nsscts of the Company. ,^coodingly these arc nol includod in the financial
slalcmcnls ancl are frealed as oltbfllanoo sheet items,
The Coml)any olf-ers assel monagonlcnl services
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RIYAD CAPITAI,
(A Limitcd Liabilily Company)
TO'r'ttU t'tNANCtAt. STATEM[NtS
Iin the ycar cndcd 3l l)ecember 2015
(Suuli Arahiu Ri.yuls)
NO t'US
SICNIIICANT ACCOUN'I'ING POI,ICIES (CONl'INUED)
l
Reycnuc rccoghition
Speciql conmislioh incor c on .tcposits
t
Spccial commission incoNc on deposils lbr all conrmissioFbearing tinancial inslrutDcnrs,
are rccognizcd in the slatcmcnt of inoonlc on dle cflbclivc yicld basis. The ell'eclive yield
is the ratc thal cxaclly discounls lhc cstinMtcd fulure cash paymcnls arrd rcccipts through
lhc oxpccted lite o{ thc lirraDcial assot or liabilily (or, whorc appropriate. a shorter period)
lo lhc carrying amount of llrc linancial assct or liability. Whcn calculaling thc cffcctive
yiokl, the Conrpany cslirnalcs lulure cash llows considcrirg all coDtraclual tenns ofthe
linancial inslrunrent but not luturc crcdit k)sses.
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Assel nnrnganrcnl and ardrisor! fec income
Fees and comrnissions arc recognizgd whcn thc scrvicc has bceD provided. Pontblio and
olhcr managenrenl advisory aDd scrvicc lces ar€ rccognized bascd o rhc applicablc
service contracts, usually oD a linrc-proportionalc basis, liccs rcccived oD asset
managcnrenl. linarrcial planning ar)d cuslody scrviccs arc rccog[izcd over lhe period when
lbc scrvice is provided.
Di'idend incoma
Dividend incorne is rccognizcd whcn thc righl to receive dividend is csrablishcd.
Rro*cragc contmission
lncomc from brokcrage services are rccogni:,!d whc[ lhc dcal is cxcculed.
U nd e rx,ri t i ng fee i n con c
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Underwriling {cc iucornc is reogDized as revenue when lhc sharcs arc alldtcd lo tlrc
k)
h'o rc iEn c u r n! n cy lra n s la lion
'fransactions denominated in lbrcign currcncics arc transl:rlcd to the lunctional currency ollhe Company al cxchangc ralc$ ruling on thc date ol a hansacliol. Monclary asscts and
liabilitics dcnominatcd in lbreign currency nt thc balancc shcct dalc arc lraDslalcd t() thc
functi(rral currency of the Company al thc l'orcign cxchaDgo ratc ruliDg al lhrl dale.
llxchange ditl'ere'rces arising on suclr lransla(iors arc rccognizcd itr thc slatcDrcDl of
inco e currcnlly.
AII cxpcllsos nol diroclly atlributable lo the eaflriDS ol'reveDue arc classilied ns general
and adminislrative expenses.
4-
ACCRUI'D INCOME
Accruod income inoludes oorpomlc invoslrncDl balkiDg I'cos and asscl InanagcrrrcDl Iccs
eanled but nol collcclcd by thc Courpauy.
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RIYAD CAPITAI,
(A I imjted Liabilily Cor)rprny)
NO'I]iS TO THE ]'INANCIAI, STA'I'EI\If N'I'S
t
lilr
(Suuli
I
Prepaid rcnl
Refunclablo dcposits
I'rcpakl soiiware rnainlcrliu)cc ard subscril)tion
Prepaid housing allowarrcc
Prepaid insurance expensc
Receivablcs fi()m dispo$l ol inveshnenl
Others
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1,698,?34
4t2.7tal
903.979
44ti.9lt2
t96.42r,1
2l t.355
4.166. t9ll
17s.340
sJso$et
8.00r,942
lhir
Cost
2015
2014
vNlue
2015
2014
183,085,099
143.307.166
InvcslDrcnr lunds (Norc
l6b)
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185,726,049
-lt!l,8!:Jss
1.
r
s,r3ri06
Quolcd cquity sharcs
37,000,000
5.t31.306
r
42,13 1,306
12,7
r9,262
t95,804,36Ii
I1.726.
5
I55.031.4't
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CAPITAI, WORK.IN.PROGRESS
Ihc arrount
represcnt thc implemenlalioD cost for ncw systenrs, which is under pfogrcss
is cxpectcd to bc conplclod in 2016.
3l l)cocmber20l5,and
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Accruecl crnployees rijlalcd cxpenses
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l,5o t,200
943,9r?
6t 4,766
244,457
AVAII,ABI,E-FOR-SAI-Ii INVES'I'MEN'I'S
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20t4
2015
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Decembcr 2{) | 5
Afthia Rivttls)
3
PR|jPAYMENTS ANI) OI'HER CURRIINT ASS[)'I'S
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th€ ycar cndcd
ACCRUI]D EXPENSI.]S AND OI'III]R CURRDN'I' I,IARILII'IES
2{l
/\ccruco cxpenses
Wilhholding tax payablc
Olhers
l5
2A!4
t3,000,000
9,643,t | lt
914,105
10,000.000
sJl!!,818
2.t89,134
442L041
22,345.613
9.t01.221
1.052.25ri
ACCITUI']I) ZAKAI'
The Courpany does nol submil a separatc Zakal rclum as lhe Parcnl Company sub ils a
consolid^tcd / singlc Znkat retum for lhc cntire (;roup bnsed on ils consolidatcd Zakat basc and
s€1tles Zaka( liabilily acoordingly. The Company is nol rcquircd to mako any paymcnt to Zakat
authoritics accordingly. Zakal aDounl charged in thcsc linancial slalcnrclts is payable to thc
Parcnl (innpany, who uhimalely sclllcs the Zakal liabilily on bchall ol lhc Conrpany (Nolc
r6.6).
The Company's sharc ol Zakal fbr thc ycar amounled to SR 3.E04.140 (2014: SR 5,583.500).
which hns bcon estinlatcd bascd on the (i)mpany's incornc for lhe ycar bclbre Zakat irncl rs
chargcd lo statemenl ol incorne (Nolc 16.6).
RIYAI) CAPITAL
(A Limitcd l.iability Company)
Nol'ES TO TIIE }'INANCIAL STAI'EI\I]]NTS
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Iror thc ycar endcd
( Sdtkl
10.
3l
Dccember 2015
i .4 ft l,nnt Rilttl;)
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SIIARU CAPITAI,
AsatllDecembcr20l5,theCompan) s paid-up sharc capital ol SR 200 milli( (31 Deccmber
2014: SR 200 nillion) rvas di\.ided inlo 20 millior sharcs (31 Dece'nber 2014: 20 million
sharcs) ofSR l0 each.
ll.
SI
Al UTORY RlilsllRVE
Ll accordancc \\,ith thc Company's Articlcs ol Associnlim and thc Rcgulalions fbr Cornpini$
in the Kingdom ol Saudi Arabia, thc Company is requircd () transtar at l€asl l0% of its net
incoDlc cach year lo slnlubry resen€ unlil such resene equals to 50% of ils sharc capilal. I'his
rcscrl€ is nol availablc lbr dislribuliol to lhe sharcholdcrs. As al 3l Dcccmbcr 2014. lhe
slalulory rcsene balancc rcached b 50% of lhe Compan) s share capilal. Tho Board of
MaDagers have rcsolvcd lC' disconlinuc addjtioral tmnslcr 1() statutory lescrvo once the
thrcshold ol50% is reached.
12.
I)IVIDtsND DISTRIAU'I'ION
'lhc lloard of
Managcrs in lheir mecting hcld on 23 Rabi ll 1436H (co.responding to 12
|cbruary 2015) appn)ved the cash dividcnds of SR 215.99 urilli(D equivalent lo SR 10.8 per
sharc. li)r the year cndcd ll December 2014. During the cufier)l fiDancial year, tho Company
have distributed SI{ 215.99 million to ils sharcholders.
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RI]ALISED (I,OSS) / GAIN ON INVI'S'I'MENTS.
NFJ'I'
2015
I{calised gair ou salc ofheld-for+radirrg ilrvcsl]ncDts, rel
llerlised (loss) l8ain oD avajlable lor salc iDvcslments, Det
447,039
(1,273,951) l.l:)4,?!4
{q?qp!2)
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?!14
a2!!l!:
O'I'IIER GENERAI, AND ADMINIS'I'RATIVE EXPENSES
20I5
16.3
ScNicc charges
I{ont and relalcd cxpcnscs
Lo!!al and profcssi(na1 lces
()thers
1q_l-4
26,623,011
6,?39,334
4,417,932
16,536,335
54,316,645
I5.
ASSD'I'S
r)
Invcstmen! asscts nrrnaged by the CorDpany nmounti g lo SI{ 26.1 billion as al
2015 (31 Dcccmbor 2014: SR 29.2 billion); aDd
b)
(-li|jnts'cash accounls rvith Riyad Bank anrounting lo SR 2.1i63
(3 I Dccember 2014r SR 2,629 nil!nrn).
26.623.044
6.763.742
20.439.6t2
s7,058,327
UNDIR MANAGtrMENT
milli
3l
l)cccmber
asal31 Deccnrber20l5
(:onsistcDl $ilh thc (innpaDy's accounling policy. as thesc aru hcld by thc (ittttpany tn
liduciary capacity. such bala ccs are not inclllded in the ClompaDy's linancial stalernonts
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IIIYAD CAPI'I'AI,
(,^ l.imired l-iabilily Cornpany)
NOl'tis TO TI i lrtNANCtAl, S1AI'EMItNl S
Irof thc yoar cndcd 3l Dcccmbor 2015
(S tkli Arahidn I?iydls)
RELA'I'!]I) PARTY TRANSAC'I'IONS AND I]ALANCES
16.
of the Company comprisc ol l{iyad Bank aDd its subsidiaries and aftlliated
invcslncrl lunds Dmnagcd by tho (bnpany. The tfansactions are carried ou1
on Drulually agreed terms approved by thc nra'ragc,ncnl ol lhc (bmpany. l ransactjons iru
Relalcd panies
cornpanies and lh€
mainly wilh thc Parcrrl Clompany.
Transactiotts tr,ith rc Parcnt Company includc thc folhtwhtg:
2015
Transactions
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Drrployees end<rl'-servicc be[cfi ts
Dividends paid
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16.t -___7.N.1!_
16.2 ___j._2_
t6.3 __4@!!!_
Spccial comr)rissioD income on deposils
Corporalc irlvcslmcnl baikjDg lccs
Service charges
ReDl expenses
l6.l
2014
t6.7
4,294,O94
1f21.812
26&2]pL
!M!tl
10,847
|,461,312
l.t 67.tE5
215.998.214
llris rcpreser)ts special connrission inconlc earued on lime deposits placed with lhc Parcnl
Conrpa y-
16.2
l his rcprescnts lees canrcd fronr advisory work pcrlbnncd by thc Company on rcccivablc
lirctorirrS arrarrgenrenls enlered into by lhe l,arenl Conlpany wilh the end-customer.
16.3 Sen'ice charSes include cosl of IT suppon. banking services. nrarketinS. human resources and
olher bick-olli(( cxpc scs. which arc pcrlonncd by lhc Parcnl Compamy under a Sen,ice b\.el
Asr(tn,cnr.
16.4 All lhe abo\.c lransacli()ns arc sctllcd through thc bank account nraintainod with thc
Parent
Company on periodic basis and no balances nre outstanding in resDect oflhe above lransaclrons.
16.5 Tbe Conrpany maiDtains ils baDk accouuls with lhc l'aronl Company and held bank
balances of SR 582.079.185 at 3l Decenrber 2015 (ll December 2014: SR
'732.'7 |
5
,142).
16.6 As explained in Note 9, thc Cornpany's Zakat liability is paid to Zakal authorities by lhe
Parcnt Company and thus the accfiied Zakat is due to the Parenl Company.
16.7 This represents the dividcnd paid to l{iyad Capital from thc cxccss rctained eanrings,
bouSht lbrward lion previous periods as paft of a nranagement decisi()n.
16.8 'lhe Parenl cornpany, as a settlement agent lbr Riyad Capilal, has issucd a letter of
guarantcc to thc Saudi Slock Uxchangc (Tadawlrl) relating b the settlcmcnt of
transactions processcd through l{iyad Chpilal al lhc requesl ofthe exchange.
b)
Trunsactio
s
a
d balunces wilh
,rulual .litnds managed by rh. Comp.tny:
20t5
2014
Transactions
Asset nranagenront
t46,23142L
1'cc
Dividcnd incomc
111,819&r
1,303r5?q
llalances
Investments in inveshnent f'unds
Accrued incorne - Assol Dranagcnronl lcc
1E3,085,099
14,168,09L
n
1,13.307,366
66,372,861
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I{IYAI) CAPII'AL
(A Limilcd Lirbility Company)
NO'I'ES TO I'HE TINANCIAL STATF:MTNl'S
For the ycrr cndcd 3l Dccemtrer 2015
(Srl.li /1t hiun Rit'uls)
I7. FIN
NC]IAI, INSI'RUI\,IENTS AND RISK MANAGIIMIiNl'
l:inaucial i slrunrcnls cilrdcd on thc Lralaucc sheet includc bllanccs \\'i1h bank, avail blctbr salc investr)rcDts anci certain olbof rsscls and othef liabilitics.
Crcdit Risk
Credil risk is lhc risk tlrar one pany q,ill hil to discharge an obliglli{ and will causc lhc olhcr
panv 10 iDcur ir linallcial loss. Ilalances with bank is the only clnss oj llnancial asscls hcld by
the Cornpdny which is cxposed to crcdil risk. Balanccs wilh bar)k arc placcd $rth the I)arcDl
(\mrpany, which hns sound credit ralir)g aDd hcuce the crcdil risk is limilcd.
Spccidl cotfitfiissiatn rate risk
Special cornrnission ratc risk arises liom the possibilily that thc chrr)gcs in comnrss(nr ratcs
rvill afTecl cilhcr lhe fhar valuc or the luturc cash lk^ys ol lhc linancial instrurrents. lhc
Conrpary docs nol have it significaDl spcci:rl comrnission
risk cxcept fbr thal rclatilrS to
'nlc
lin1e dcposils lhal aru placed uiih lhc l)arcDl (irnpa)ry lrorr liuio l{) liD)c. I hcsc deposits cnn_v
fioating spccial oorrinission mtc and havc sl)on tcrDr maturity. All dcfosils are subjecl l(r rcpricing on r rcSulir basis. Manage cDl lcgulafiy uronitors thc changljs ilr special oonlnission
rate and as thc doposits arc shon lenn. Innnrgcncnl believes tha( lho spccial corrrnissiou ratc
risk lo thc Coulpnry on thcsc dcposits is also nol significant.
Liqui.litf
,.i!,k
I-,quidil)- risk is lhc isk thnr aD ente{,isc *'ill encounter dilliculty iu raisi g Iunds lo nrcct
conDitmenls associatcd u'ith lhe financial iustru)nenls. Liquidily risk rnay rcsult lionr the
iDabilil]- kr scll llnaDcial asscl quickly al nD anounl close to its lilir value. Financial asscls ol'
lhc CimrpaDy as rl ycar-end nrainly iDcluded balanccs wilh baDk and availablclirFslllc
invesimcnts which oan be utilizcd to nrccl changing Iiclui.lity roquircments. ManagcrncDl
monilors lilrccaslcd cish llow on a reg hr basis and ensures lh:tt positive cash llows liorD
opcralinltrctivili€s rrc rnantained to lirnd lhc CoDrpany's futurc cornnrilments.
Currarrc)' risk
\\'ill llLrctuale due lo charrgcs in
Ibrcign exchangc latcs. The Compnny's lransaclions arc p Dcipally in Slt and
Culrcncy risk is thc lisk lhal the value ol a liDarcial mstrunrenl
exposures in lincigD cun-encies arc not si8nillcanl therelorc lhcro is uo sigrilicanl curcncy risk.
F'aif !alue is thc iunount fbr which an assct could b€ €xchangcd. or il liatlility setll€d. bctwccn
knorvledgcable ryillinS parlics iD an arm's lcngth lransaclor. As thc.cconpanying linancinl
slatcnenls arc prop:rrcd urdcr the historical cos( nelhod. excepr li)r lhc nrcasureDenl oi lhc
a\'ailable l_or salc jDvcslmerrls al lair v luc, dilferences may arisc bctwccu the book valuc and
lhe iair \aluc oslirnales. Managcncnl bclicves that lhc l-air valuos ol-1he Compa y's llnanciirl
asscls and lirbililios arc nol malcially dillorurl lio:n their carrying vrlucs.
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RIY,TI) CAPITAL
(A Limilcd Liabilily Company)
NO'l ES TO TIIE fINANCIAL STATT[{Uh"TS
Itr the ycar cnded 3l DcccDtbsr 20l5
(Sdtxli At.ahin Rivul,
I8. RI'(;UI,ATORY CAPII'AI,
REOUIITI.]MENT
ANI) C]API'I'AI,
AI)LOUACY
RATIO
-l
hc Capilal Markcl Aulhority (1he "CMn ') has issuei Prudcnlial Rules (rhc -Rules") dar!'d 30
l)cccDrber 2012 (corrcsponding to 17 Salar l4l4H). nccording to the Rulos. lhd aMA has
pr'cscibed the liar)rowo* and guidance fogardirrg the mininru,ll rljgulalory capllal requiremcnt
aDd ils calculation rDcthodology as pr{isoribed undcr thesc llulcs. In accordaDcc rvith this
luclhodology, lhe (ltnpany has calcLrlalcd ils minimuln oapihl requircd and capil{l adcquacy
rillios:rs follo$s:
sR'000
l)cccmbcr
2015
2014
As at
(lspital Basc:
'I icr I oapital
'licr 2 capital
'l otal Capital
3l
819,653
1,911
824,600
Base
Minimum Capiial Rcquircd:
('rcdil risk weighled asscls
100,505
Oporali(ma1 risk wcighlcd assets
Markcl risk wcighted flsscls
5r,124
516
'l otal Minimum Cspital Required
887,282
t2,902
900.I84
'7
|,232
52.4ti2
201
152,175
._ t21,9lL
67?32s
.'779?lq
'7.26
Capitrl Adequact Rrtio:
Surplus irl Clapital
Capital Adequacy Ratio (times)
5.12
Capilnl Ilaso oflhe Conpanv comprise ofl
'l icr-l capital consists ()l paid-up share capil1l1, rctaincd earnings. rcscrvcs cxcluding rijvalualion
f icr-2 capilal coDsisrs rsvalualion reserves.
l hc miDirnum capital rcquifements fbr markcl. credit and opcrrli()ral risk are calculatcd as per
thc roquircmcnls speciliod in thc Rulcs.
'l hc ('ompao!'s objeclir'es. rlJrcn managing capital. are lo conlply \vilh lhe capilal rcqrircmcrts
sel bJ (-MA: lo salagrrfd lhc Co rpa ljs abilily., to conti rc as n gr)irrg conccnl: aod l() Drainlain
a slrong capital base.
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