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ANNUAL REPORT 2020

Financial Statements for the year ended 31 December 2020
Notes to the financial statements

6. INVESTMENT PROPERTIES (Continued)

Year 2019 Freehold land Buildings Total

RO’000 RO’000 RO’000

Cost

At the beginning of the year and at the end 238 943 1,181
of the year

Depreciation

At 31 December 2018 -- 499 499

Charge for the year -- 47 47

At 31 December 2019 -- 546 546

Net book values

At 31 December 2019 238 397 635

At 31 December 2018 238 444 682

The following further notes apply:

a) The rental income during the year from the investment properties amounted to RO 121,000
(2019 – RO 102,000) [refer note 20].

b) At the end of the reporting period, the Company has assessed if there are any indicators
for impairment of investment property, especially considering the impact of the COVID 19
pandemic, on the real estate sector in the Sultanate of Oman.

The Management has estimated the recoverable amount to be more than the carrying value,
and accordingly concluded no impairment loss has arisen for the year. The recoverable
amount has been calculated based on the estimate of the value in use using a discount rate
of 8% per annum.

c) At the end of the reporting period, the fair values of the investment properties amounted
to RO 1,741,000 (2019 – RO 1,596,000) based on an open market valuation undertaken by
professional valuers. The Management believes the fair value of the investment property at
the end of the reporting period to be not materially different from the fair value assessed.

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