EMAAR ANNUAL REPORT

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2 EMAAR ANNUAL REPORT

3 CONTENTS Letter to Shareholders Business Review Corporate Governance Investor Relations Board Directors Principal Officers Group Structure Management Structure Consolidated Financial Statements

4 LETTER TO SHAREHOLDERS CHAIRMAN S MESSAGE TO SHAREHOLDERS Adversity is true measure resilience. Extreme turbulence is real test that reveals integrity an organisation s foundation. The last twelve months our financial year, 2009, have been a humbling as well as instructive experience for all us at Emaar. Multiple challenges, compressed within span a single year, honed our leadership management skills, provided tough lessons for a lifetime. Today, Burj Khalifa soars 828 meters into skies, its unprecedented height supported by an innovative structural system. This singular feat architecture engineering Burj Khalifa by Skidmore, Owings, Merrill Chicago serves to remind us that dreams must be grounded on firm foundations. Only n can we stay true to our course fulfil our commitments to our stakeholders. Emaar s resilience strength is pivotal to continuity our organisation. Financial independence allows Emaar to st on solid ground control our own destiny. Pritable growth in good years coupled with prudent cost management has allowed Emaar to build a healthy balance sheet approximately USD 17 billion, with a comparatively low debt obligation. Net debt to net worth for Emaar is below 18 percent. Hence, despite challenges 2009, Emaar was able to dedicate itself to project delivery, including completion launch Burj Khalifa. FINANCIAL HIGHLIGHTS Financial Performance As a result concerted effort by Company to optimize resource use during a challenging year internationally, Company continued to deliver robust performance. The Group recorded annual net prits from continued operations AED 2,051 million (US$ 558 million), as compared to restated net prits from continued operations AED 4,191 million (US$ 1,141 million) in Annual revenue for 2009 was AED 8,413 million (US$ 2,290 million) as compared to restated revenue AED 10,717 million (US$ 2,918 million) in The restatement prit revenue year 2008 relates to change in revenue recognition policy from percentage completion method to completed contract method in accordance with International Financial Reporting Stards (IFRS). During 2009, Group has recorded losses relating to write down its net investment AED 1,762 million (US$ 480 million) in WL Homes, Group s US subsidiary, upon discontinuation its significant operations. The net prit after losses from discontinued operations attributable to equity holders was AED 327 million (US$ 89 million) in 2009 as compared to AED 167 million (US$ 45 million) in As a result Group s revenue diversification business segmentation strategies, revenue from Malls Hospitality increased significantly during The Group implemented a number customer oriented policies, which assisted in maintaining gross prit margins at 2008 levels. The Group was able to maintain pritability levels for its core businesses despite taking into account provisions made by its associated companies in financial sector, Amlak Finance Dubai Banking Group towards ir loans advances portfolio. ACHIEVEMENTS IN 2009 Property Development Dubai Amidst an economic slow-down in Dubai, we renewed our focus on project delivery for property development, leveraging on cost-economies for speedier completion hover. We hed over Alma townhomes La Avenida luxury villas in Arabian Ranches well over five months ahead schedule. Projects delivered by Emaar during year also included Burj Views in Downtown Dubai Fairways in The Views. International Markets In tem with Dubai, we increased momentum delivery for our international projects with Tuscan Valley houses 5

5 in Turkey as well as Mirador villas in Canyon Views, Islamabad, Pakistan. The year also witnessed our completion Marassi Beach Clubhouse, which has become a popular tourist spot in Sidi Abdel Rahman region Egypt. Emaar continues to tap on region s strong dem for integrated lifestyle communities. In Saudi Arabia, Emaar Middle East launched second phase villas in Al Khobar Lakes. In Egypt, we enjoyed good customer response to Mivida ready-to-live homes second phase The Apartments in Samarah Dead Sea Resort Jordan. In Lebanon, we signed a management agreement to develop BeitMisk, a master-planned community set in Norrn Metn region. With India en route to economic recovery, Emaar MGF Limited has proceeded to file its Draft Red Herring Prospectus with Securities Exchange Board India. This is in line with our joint venture company s plans to enter India s capital market with an initial public fering AED 2,938 million (IR 38,500 million or USD 830 million). Emaar continues to make strong progress with its international forays. Several projects are expected to come on line next year in Saudi Arabia, Morocco, Syria, Jordan Saudi Arabia. The World s Most Prestigious Kilometre In 2009, we had pride pleasure watching Downtown Dubai take shape dramatic form. We completed Burj Khalifa, The Dubai Mall, The Dubai Fountain, The Old Town, The Old Town Isl, The Residences, South Ridge, Emaar Square Emaar Boulevard, which sprang collectively from blueprint to reality. Today, residents visitors Downtown Dubai can immerse mselves in a holistic, world-class experience that integrates home, work play against dramatic backdrop iconic projects, including world s tallest tower, one world s largest malls world s tallest performing water-music spectacle. The world s tallest tower Emaar unveiled Burj Khalifa to world in a spectacular inauguration ceremony on 4th January 2010 to mark fourth anniversary Accession Day His Highness Sheikh Mohammed Bin Rashid Al Maktoum as Ruler Dubai. It was a milestone in history Emaar, which was witnessed by 400,000 people on site as well as an international audience receiving broadcast across world. At Top, Burj Khalifa s outdoor observation deck located on 124th storey is highest in world has opened its door to overwhelming public response. Burj Khalifa received its first residents in February 2010 as we hed over prestigious Armani Residences on levels 9 to 16. These residents are first over 12,000 people to live work in mixed-use tower that combines luxurious apartments, prime fice space world s first Armani Hotel. One world s largest malls We opened The Dubai Mall in a st opening in November 2008 with over 600 stores. By October 2009, in less than a year from its st opening, The Dubai Mall had attracted 30 million visitors, boosted by opening new stores in mall, which topped 1000 stores by last quarter year. The Dubai Mall has also established itself as one region s largest family leisure destinations in The Dubai Aquarium & Underwater Zoo houses over 33,000 aquatic animals holds Guinness World Record for world s largest acrylic panel. KidZania first in region is an award-winning children s edutainment concept that incorporates a dedicated city designed to promote physical intellectual growth children through pressional role-play. In addition, mall s 22-screen REEL Cinema sprawls over 150,000 square feet is largest in Dubai. We are pleased to note that The Dubai Mall is playing a key role in reinforcing Dubai s prominence on global retail map. Toger with Burj Khalifa The Dubai Fountain, it has become a valuable driver tourism growth in Emirate. Through our mall hospitality projects, Emaar was able to contribute to economy with creation nearly 12,000 new jobs in Dubai. The world s tallest performing water-music spectacle Designed by creators Fountains Bellagio in Las Vegas, The Dubai Fountain is set within 30-acre lake in Downtown Dubai shoots water jets as high as 500 ft (150 metres), equivalent to that a 50-storey building. On 8th May 2009, His Highness Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice President & Prime Minister Ruler Dubai, formally opened The Dubai Mall, marked by unveiling The Dubai Fountain. Through this magnificent opening ceremony, we were able to pay tribute to His Highness inspiring leadership vision courage, growth imagination. Hospitality Leisure Armani Hotel Dubai Emaar will ficially launch Armani Hotel Dubai on 22nd April, Gracing Burj Khalifa from concourse to level 8, 6

6 in addition to levels 38 39, Armani Dubai will be first hotel in a historic collaboration between Giorgio Armani S.p.A Emaar. The Armani Hotel Dubai marks debut a global chain hotels, resorts residences designed by Giorgio Armani. It will be followed by launch Armani Hotel Milano, Armani Resort in Marrakech Armani Residences villas for Marassi in Egypt. We are targeting Armani hotels, resorts residences for global cities, including New York, Tokyo, Shanghai London. The Address Hotels + Resorts In 2009, Emaar reiterated our commitment to build our hospitality leisure businesses as growth engines for our organisation. Today, The Address Hotels + Resorts is a premier hotel br. Created owned by our subsidiary, Emaar Hospitality Group, operates a portfolio five hotels, including The Address Downtown Dubai, The Address Montgomerie Dubai The Palace The Old Town. Emaar Hospitality Group also owns manages a diversified portfolio hospitality assets, including hotels, serviced residences, golf resorts, a polo equestrian club, recreation clubs Dubai Marina Yacht Club Marinas was a year significant development for our hospitality business. In September, Emaar opened The Address Dubai Mall, a five-star premium hotel that is directly linked to The Dubai Mall. In October, Emaar opened The Address Dubai Marina. Comming a prime waterfront location at Dubai Marina, 220-room hotel is situated within Dubai s new business leisure hub. Beyond Dubai, Address Hotels + Resorts br entered European market with a management contract to operate Domaine de Lavagnac, a luxury resort developed by Residence De Lavagnac SARL in Languedoc- Roussillon, South France. The Address Hotels + Resorts br also signed a management contract with Jnan Amar Polo retreat in Morocco. The br is slated to open its first hotel in Egypt at Emaar s Uptown Cairo project. In due course, The Address Hotels + Resorts br will spread its wings. Future destinations include Shanghai, Jordan, Saudi Arabia, Syria, Turkey, London, Los Angeles New York. BUILDING A BRIDGE TO THE FUTURE In face an epic crisis, confusion paralysis are spontaneous reactions to mounting turbulence. But crises can only be ignored at our own peril. Dubai is facing its most severe economic challenge to date its real estate sector, which formed a significant part economy, has been similarly affected. We must confront today s harsh realities adopt decisive actions. In preparation, we armed Emaar for long haul by taking a hard-nosed approach managing costs at an early stage. More important, we recognised that today re is a need for developing real estate targeted towards increasing middle class across countries we operate in. Management during crises is about unearthing good from bad, siphoning positives from negatives. Do crises present an unparalleled opportunity to remake reposition ourselves? Can challenges be transformed into a springboard? Can an organisation emerge with a more solid business model? In such times, Emaar s onerous responsibility to our stakeholders is to focus on opportunity reinvention. In our exploration for new possibilities, we returned to Emaar s basic purpose from day one. Emaar builds more than just homes, we build communities lives. In an environment filled with flux, our purpose is immutable constant that gives our endeavours meaning purpose beyond prit. It is in our purpose that we discover new seeds for growth. Moving forward, Emaar will shift its focus to a new market segment in Dubai. We will divert our resources to affordable housing, where re is a genuine untapped dem by a major demographic low mid to mid income earners. Low construction costs for affordable housing increase financial viability this business strategy. A second positive point to emerge from 2009 is reinforcement Emaar s br equity. Perhaps stronger than any written testimonial, Emaar continued to deliver amidst escalating uncertainty. Through sheer act building, we built Emaar Br. Emaar s unwavering commitment to reach finish line is a precious asset on which we can leverage for growth beyond Emaar must continue its focus on realising existing projects, on optimizing ir value bringing m to fruition. By building Emaar s br equity, we can also build br extensions successfully. In 2004, Emaar took direction to diversify its geographical markets business segments. This strategy has produced a stable stream recurring income, a wide base unleveraged operating assets strong cash flows. An even stronger positive is that se alternative streams recurring cash flows can be furr enhanced in long run. We can invest in Emaar s future by leveraging on strong head-starts made by Malls Hospitality segments in Dubai. We can bring se businesses to maturity on our home ground while planting Emaar flag abroad. Our forays into international markets with se segments have already begun in earnest in Egypt, Turkey Syria. Emaar has developed a proven formula for value creation by transforming l into visionary lifestyle communities. Emaar created waterfront living at Dubai Marina with one largest man-made marinas forming heart development. In tem, we developed infrastructure at Dubai Marina serviced l plots that were sold to developers for 7

7 construction premium residences. This strategy generated cash flows prits for our Group. We can replicate it with Emaar s sizeable international l bank, where developing economies have potential fering high rates return. Emaar has significant growth prospects across markets business segments. We have a strong balance sheet which holds key to maintaining Emaar s financial independence agility. Core assets can be monetised proceeds used to fund growth. Malls Hospitality segments exemplify Emaar s robust scalable businesses that are totally unleveraged. We can extract value from se businesses through initial public ferings. In addition, we can fund Emaar s expansion in promising markets, such as Egypt Turkey, via equity route. Emaar MGF has already initiated process an IPO in India. Emaar will remain vigilant on its debt level. Value creation financial prudence are inseparable bed-fellows. The turmoil last financial year has driven this message home with devastating force. We will make concerted efforts to reduce our reliance on debt capital markets. Downturns don t last forever. This simple truth reminds us to keep our focus firmly on long view. We must embrace change, opportunity stakeholders. We must build new revenue sources realize full value our assets. Resilient people companies face reality with staunchness, make meaning hardship, improvise solutions from thin air. Resilience determines who succeeds who fails. Resilience is rebounding. His Highness Sheikh Mohammed Bin Rashid Al Maktoum inspired Emaar with courage to dream bigger, build better strive higher. Emaar has been blessed in our ability to complete existing projects despite turbulence vindicate His Highness leadership, passion wisdom. Our vision geographical diversification business segmentation, outlined in 2006, remains intact. Only timeframe has been extended. We remain unwaveringly committed to our goals. 8

8 BUSINESS REVIEW In a challenging year for businesses globally, Emaar Properties PJSC focused its energies on on-schedule completion announced projects in 2009 with opening Burj Khalifa in first week 2010 serving as crowning glory Company s achievements in project development. Emaar took concerted efforts to optimize resource use efficiency by working closely with all stakeholders to make Company resilient deliver results. Emaar s Hospitality Mall subsidiaries were significant contributors to Company s revenue stream, with year witnessing opening two new hotels gr inauguration The Dubai Mall, world s largest shopping centre, which attracted more than 37 million visitors in its first year operation. Highlighting Emaar s successful business segmentation strategy, in 2009 Company opened two new hotels, The Address Dubai Mall The Address Dubai Marina increasing portfolio Emaar s own hotel br to five, including The Address Downtown Dubai, The Palace - The Old Town, The Address Montgomerie Dubai. The Company s Healthcare subsidiary, Emaar Healthcare Group opened its first world-class medical centre in Dubai The Dubai Mall Medical Centre - in 2009 Emaar continued its focus on geographic expansion concentrated its energies on completing projects in key overseas markets. Emaar MGF L Limited, Company s joint venture in that country, has filed its Draft Red Herring Prospectus with Securities Exchange Board India to enter capital market with an initial public fering AED billion (INR35 billion; US$750 million). Emaar MGF L Limited is also on course with completion Commonwealth Games Village 2010, a residential complex set in 27.7 acres in Delhi with an estimated saleable area 1.8 million sq ft. Emaar has made considerable progress with its master-planned communities in India, Syria, Morocco, Jordan, Saudi Arabia Egypt, with several hundred homes to be hed over this year. With Tuscan Valley houses in Turkey Mirador villas in Canyon Views in Pakistan, Emaar has already hed over its pioneering master-planned communities overseas a trend that complements company s delivery track-record in Dubai. In 2010, Emaar will continue its focus completing announced projects, strengning its business subsidiaries continuing to explore growth opportunities in new geographies. UNITED ARAB EMIRATES In 2009, Emaar focused on project delivery completion projects, delivered approximately 3,100 residential units during year. Despite challenges global financial crisis, Emaar hed over Alma townhomes in Arabian Ranches five months ahead schedule complementing h over La Avenida, a cluster 17 luxury villas within Arabian Ranches, eight months ahead schedule. A community 212 luxury homes, Alma townhomes in Arabian Ranches had gained overwhelming investor response when launched in Emaar also hed over Burj Views, a three-tower residential complex, with several apartments opening to prime views Burj Khalifa, world s tallest building, The Dubai Fountain, world s tallest performing fountain. The homes are located along outer edge Downtown Dubai, described as most prestigious square kilometre on earth. Also highlighting Emaar s focus on project delivery was h-over homes in Lts in Downtown Dubai, as well as serviced residences at The Address Dubai Mall The Address Downtown Dubai. Furr establishing appeal Downtown Dubai as one most sought-after premier lifestyle destinations in Dubai, Emaar unveiled an iconic residential project, The Palace Residences, to strong investor response. Part The Old Town Isl development, The Palace Residences are on a class ir own with 65 units, all m completed fered for viewing. Customers had choice opting to live in or benefit from lease options provided by The Address Hotels + Resorts, hotel br owned by Emaar Hospitality Group. Emaar welcomed residents Ghadeer in The Lakes Fairways in The Views, both established residential communities that are part Emirates Living. In Dubai Marina, Emaar hed over homes in Marina Quays The Address Dubai Mall serviced residences. Emaar also successfully recertified its Quality Management System (QMS) for ISO 9001:2008 certification, latest global benchmark in stards excellence. 9

9 Emaar was originally certified to ISO 9001:2000 by LQRA in September After completion its three year validity period, Emaar underwent a stringent recertification audit in August-September 2009 to audit Company s QMS to ISO 9001:2008 stards. Downtown Burj Dubai Emaar s flagship project in UAE, Downtown Dubai is a vibrant mixed-use 500-acre community in heart city continues to gain international headlines due to its iconic components that include Burj Khalifa, world s tallest building; The Dubai Mall, world s largest shopping centre; The Dubai Fountain, world s tallest performing fountain. Burj Khalifa Described as both a Vertical City A Living Wonder, Burj Khalifa is world s tallest building. At 828 metres (2,716.5 ft), 200-storey Burj Khalifa has over 160 habitable storeys, most any building in world. The tower was inaugurated on January 4, 2010, to coincide with fourth anniversary Accession Day His Highness Sheikh Mohammed Bin Rashid Al Maktoum as Ruler Dubai. With a total built-up area 5.67 million sq ft, Burj Khalifa features 1.85 million sq ft residential space over 300,000 sq ft prime fice space. That is in addition to area occupied by Armani Hotel Dubai Armani Residences. The tower fers luxurious recreational leisure facilities including four swimming pools, a private library, an exclusive residents lounge, health wellness facilities, At.mosphere, world s highest fine dining restaurant at Level 122. The world s highest observation deck with an outdoor terrace on level 124, At Top, is a must-see attraction fers breathtaking views city surrounding emirate. Armani Residences Dubai Armani Residences Dubai has been designed personally by Giorgio Armani, is a reflection his personal approach to elegance style. Located on levels 9 to 16, 144 one two-bedroom suites highlight Armani s smooth, understated style combined with space furnishings that focus on compatibility materials, form lighting, in a superb, stly luminous setting. In addition to full access to services fered by Armani Hotel Dubai such as concierge, 24/7 room service, housekeeping, library, spa, gym swimming pool, residents Armani Residences will also have access to recreational facilities entertainment venues within Burj Khalifa. The Armani Hotel Dubai The world-first Armani Hotel Dubai opens to world in From room designs to carefully selected textiles fabrics, to impeccable service, every aspect Armani Hotel experience will bear signature fashion legend Giorgio Armani. Armani Hotel Dubai targets connoisseurs who value excellence, understated style elegance. Offering 160 guest rooms suites, restaurants a spa, covering more than 269,000 sq ft, Armani Hotel Dubai brings to life Stay with Armani promise, an exceptional experience defined by highest stards aestics service excellence. The Residences The world s most prestigious address will be home to a select few. With 900 residences including studios one, two, three four-bedroom apartments, The Residences at Burj Khalifa are designed for connoisseur. The homes are spread over levels tower. The Corporate Suites The Corporate Suites are located on highest levels Burj Khalifa. They occupy 37 floors, with top three floors merged into a single fice. The entrance lobby is at Concourse tower. In addition to valet parking, express lifts take fice visitors directly to a lounge lobby at Level 123. The Offices A complement to The Corporate Suites is The Offices, a 12-storey annex with direct access to Burj Khalifa The Dubai Mall. Parking spaces for The Offices will be fered at mall tower for convenience tenants. The Offices have a total area 337,000 sq ft. 10

10 The Dubai Fountain A world-class water, light music spectacle in a 30-acre lake within Downtown Dubai, The Dubai Fountain is located near Burj Khalifa The Dubai Mall. At over 900 ft (275 metres) in length, The Dubai Fountain is designed by California-based WET is world s tallest performing fountain. Over 6,600 lights 25 colour projectors create a visual spectrum over 1,000 different water expressions that will appeal to visitors. Different combinations water-forms Dubai Fountain perform to selected musical pieces chosen from a range classical to contemporary Arabic world music. The Dubai Fountain, when fully operational, has over 22,000 gallons water in air at any given moment. Its nozzles will take water to different heights from 70 to 500 ft. The 25 colour projectors provide full spectrum colour with a total output 500,000 lumens. The Old Town & The Old Town Isl Divided into six quarters, stocked with restaurants, outlets, hotels a fabulous Souk, The Old Town is all about living in comfort style, but with heritage inescapable culture all around. It s where age-old charm blends with new age expectations in perfect harmony. The Old Town development puts a more traditional face on modern, luxurious city living. With charm years gone by, The Old Town Isl fers an exceptional way to experience downtown living. At very heart Downtown Dubai, this charismatic neighbourhood is a mixture exquisite low-rise waterfront apartments; Souk Al Bahar a shopping mall with Arabesque architectural features; boutique fices The Palace - The Old Town hotel. With an appeal quite its own, this destination overlooks a lake is spruced with inner alleys, courtyards waterfront walkways. It s where lifestyle culture come toger in rare confluence. 8 Boulevard Walk The first residential tower in Downtown Dubai, 8 Boulevard Walk is located close to bustling Emaar Boulevard. Designed to elevate aspirations, this 35-storey tower claims its place at nerve centre Downtown Dubai. The Lts The Lts assures comfort spacious living features three towers - East, West Central - featuring spacious one, two, three-bedroom apartments also penthouses. All homes come with floor to ceiling windows that heighten feeling space light. The Residences A cluster 9 high-rise residential towers, The Residences has been hed over to customers. The Residences feature one, two, three, four-bedroom luxury residential suits, penthouses villas. Burj Park Burj Park is a prime-location development that combines style sophistication to create an ambience unparalleled indulgence. The project incorporates neo-classical architectural features fers views Burj Khalifa, waterfront, The Old Town Isl. The buildings fer state---art interiors world-class amenities. Boulevard Central Boulevard Central, a new residential project in Downtown Dubai, consists two high-rise apartment buildings in close proximity to Burj Khalifa. Strategically located on Emaar Boulevard, residents will be mere footsteps away from buzz cafes, stores vibrant street life. The project will feature studios, one, two three-bedroom apartments. Podium level amenities include swimming pool, children s play area, communal BBQ area, a fully-equipped gymnasium, a multipurpose room. 29 Burj Dubai Blvd 29 Burj Dubai Blvd is a stylish residential project in Downtown Dubai. Designed by Frank Williams & Partners Architects, 29 Burj Dubai Blvd fers luxurious podium level amenities, basement car parking an unparalleled lifestyle within a bustling boulevard. The project has an unmistakable retro-new York look with a distinct identity through Arab-style decorative grills, panels motifs. A frontal podium will feature a health club, ro garden swimming pool. 11

11 Claren Claren features two elegant mid-rise towers boulevard apartments that fer residents dual benefit greater privacy spacious living. Comprising studios, one, two three-bedroom apartments, Claren has an extensive range podium amenities, is located on vibrant Emaar Boulevard with easy access to Burj Khalifa. Burj Views Burj Views, hed over in 2009, is a three-tower residential complex within Downtown Dubai. The towers feature studios, one, two, three-bedroom apartments duplexes. A highlight Burj Views is exclusive retail space 1,800 sq m. The temperature-controlled shopping arcade, facing Burj Khalifa, can be accessed from all three towers. Boulevard Plaza Complementing majesty Burj Khalifa, Emaar launched a comming symbol style status within Boulevard s unique architectural collection. Boulevard Plaza is a place where business minds decision makers come toger to gain ir competitive edge. Boulevard Plaza is situated close to residential towers DIFC financial capital region. Stpoint Emaar gives a new perspective to residential towers with Stpoint, two high-rise stepped towers, designed by International Architects Smallwood, Reynolds, Stewart Stewart (SRSS). The towers feature studios, one, two, threebedroom apartments with amenities galore at podium level. 18 Burj Dubai Boulevard Sting centrally on Emaar Boulevard is 18 Burj Dubai Boulevard. The two-tower complex is inspired by its location proximity to a world attractions, is attuned to fashion, food entertainment. 18 Burj Dubai Boulevard not only fers residents ample opportunities to lead an ultra-modern lifestyle, but also represents ir savoire-faire style. The Mansion Emaar opened up a striking new window view Downtown Dubai The Dubai Fountain with The Mansion, an aestically spectacular architectural marvel, strategically located on Lake Promenade Emaar Boulevard. Located on inlet lake, The Mansion elegantly embraces a sense duality in all facets its architecture construction. A single tower 59 storeys with studios, one, two, three-bedroom apartments, all units at The Mansion open to views fountain Downtown Dubai. South Ridge Emaar has already hed over South Ridge, consisting 6 high-rise residential towers, which overlook vibrant lscape Downtown Dubai. South Ridge comprises one, two, three, four-bedroom apartments penthouses with a multitude amenities ranging from a swimming pool, children s wading pool play area, fully-equipped gymnasium, 2 squash courts, a badminton court, a golf simulator. M Burj Dubai Designed by internationally acclaimed, award-winning architects, M Burj Dubai consists two-towers, one with 50 floors or with 22. With a gr inviting lobby high majestic ceilings, captivating décor breas an impressive ambience. The towers feature one two-bedroom apartments surrounded by an exciting urbane lifestyle on Emaar Boulevard fers easy access to Burj Khalifa rest Downtown. The Gr Boulevard Adrian Smith brings his prolific design expertise to Downtown Dubai with The Gr Boulevard. With griose aestics well-spaced design, The Gr Boulevard is a mixed-use community accommodating two apartment buildings storeys respectively. Planted right on Emaar Boulevard, The Gr Boulevard is an address style sophistication where charm excitement define unparalleled ambience. But what gives this phenomenal masterpiece its true soul are framed views iconic Burj Khalifa, which complements fabulous amenities, a sculptural amphiatre opulent outdoors, in a true cultural haven. 12

12 Burj Place With a chic boulevard on left, a networked metro on right an adjoining highway, Emaar fers convenient connectivity at Burj Place. This ultra-modern development consists two 55-storey towers fering first-class homes located above fices conveniently situated on lower floors, while an adjoining corridor lines a path to a world-class hotel featuring cafes retail outlets. Emaar Square Emaar Square is one first commercial buildings launched by Emaar fering premium fice spaces, featuring state--art technology in one most desirable locations in Dubai. Positioned for success, Emaar Square is at centre Dubai s new business hub, to be serviced by new Metro station close to exclusive hotels apartments. Dubai Marina The largest man-made Marina in world one largest waterfront developments in region, Dubai Marina has a total development area 50 million sq ft. It encompasses a large canal with 3.5 km waterfront fering access to sea from both ends. Frilling canal are waterfront living apartments, fices, retails, a yacht club a hotel serviced residences. Emaar has unveiled six luxurious projects at Dubai Marina Al Majara, Al Sahab, Dubai Marina Towers, Marina Promenade, Marina Quays Park Isl. Five m Majara, Al Sahab, Dubai Marina Towers, Marina Promenade Marina Quays have been completed keys hed over to buyers. Park Isl will be hed over shortly. Dubai Marina Mall Complex The 150,000 sq m Dubai Marina Mall complex includes The Address Dubai Marina; Dubai Marina Mall a boutique mall with a family entertainment centre a Cineplex an 8-storey tower Gourmet Tower dedicated to diverse cuisines. Adjacent is Marina Plaza Extreme Waterfront Offices, only waterfront fices at Dubai Marina. Marina Plaza Marina Plaza is only commercial tower within Dubai Marina master-development. With its exceptional location on Marina a range features including flexible floor plans an 8 storey podium for parking, 28-storey boutique freehold Marina Plaza Office generated strong investors dem. Suites range from 3,742 to 4,030 sq ft in size with last floor dedicated to a penthouse lt fice 23,820 sq ft, with its own elevator, balcony space 3,358 sq ft, panoramic views entire Marina. The Extreme Waterfront Offices These boutique fices are in most exceptional location within Dubai Marina, in leg The Address Dubai Marina Hotel that extends directly into water. This allows for stunning views while creating an impression being immersed in Marina. With just 4 floors walls windows, exclusivity uninterrupted views across Marina are ensured. Sizes range from 926 sq ft per unit to 2,451 sq ft for a full floor. The last floor has soaring ceilings allowing for mezzanine space. The main lobby has a full wall window direct access to water with its own pier for easy drop f pick up by boat. All units sold in a few hours. Emirates Living Emirates Living is pioneering lifestyle concept by Emaar encompassing some its key master-planned residential communities including four single family communities - Emirates Hills, The Lakes, The Meadows, The Springs two multi-family communities - The Greens The Views. A collection neighbourhoods, Emirates Living embodies Emaar s commitment to delivering integrated living communities. The Lakes An established gated community, The Lakes is set amidst placid lakes a picturesque living environment. It comprises five distinct communities, Deema, Forat, Maeen, Zulal Ghadeer, newest community developed with five different types Mediterranean villas to choose from. All have access to vibrant Lakes Community Centre that features several recreational retail outlets, exclusive neighbourhood parks with own swimming pool, diverse recreational amenities over 11 miles walkway meering amongst greenery. The Lakes has now become one most sought-after single family community in Dubai. The Ghadeer homes were hed over in

13 The Views The Greens Both are master planned with exclusive amenities for residents which include lscaped swimming pools decks, gymnasiums, play areas, underground covered parking, 24 hour security, barbeque areas, neighbourhood shopping areas parks with walkways. The Views is exping with addition Mosela Tanaro - striking 24-storey buildings, drawing on Mediterranean influences with arched windows, expensive sundecks terracotta facades. Mosela is a waterside tower fering incredible views Emirates Golf Course water canal. Homes in Fairways, also part The Views, was hed over in Arabian Ranches A premium multi-billion Dirham desert development spread over 1,650 acres, Arabian Ranches has over 4,000 residential units 11 communities comprising one two-storey single-family homes inspired by diverse architectural styles, all with gardens balconies, is one most sought-after communities in Dubai. The masterplan also has exceptional golf equestrian facilities. Polo Homes Emaar unveiled an exclusive collection palatial residences - Polo Homes community - at Dubai Polo Equestrian Club. The Polo Homes, limited in number to just 71, surrounds polo fields forms one most impressive opulent residential communities by Emaar. In 2009, Emaar hed over Alma townhomes La Avenida within Arabian Ranches, several months ahead schedule. Golf Homes Emaar introduced a new addition to its golf community portfolio, also comprising Hattan Mirador, by fering discerning investors exclusive Golf Homes, set on scenic swaying dunes Arabian Ranches golf course. The Golf Homes community comprises only 18 detached villas available in three styles - Hacienda, Suncadia Castilla - featuring Arabian Spanish architectural elements. The villas feature luxurious architectural elements such as a courtyard, an entry court with a central fountain, a gr dinning room, gallerias a wrap-around promenade on a sun deck. The homes were successfully sold during an auction sale which attracted unprecedented investor end user interest. Umm Al Quwain Marina Umm Al Quwain Marina LLC, joint venture between government Umm Al Quwain Emaar Middle East, launched second phase homes at Umm Al Quwain Marina, following encouraging investor response to its Mistral villa community. The AED 12 billion Umm Al Quwain Marina features over 8,000 homes including 6,000 villas 2,000 townhomes, boutique hotels, retail outlets recreational facilities set in a marina-med environment. Umm Al Quwain Marina LLC broke ground for first phase residences construction is progressing as per schedule. INTERNATIONAL With six business segments more than 60 companies, Emaar has a collective presence in several key markets spanning Middle East, North Africa, Pan-Asia, Europe North America. The Company has established operations in United Arab Emirates, Saudi Arabia, Syria, Jordan, Lebanon, Egypt, Morocco, India, Pakistan, Turkey, USA, Canada United Kingdom. The Company also has fices development projects under consideration in Algeria, Libya, Indonesia China. In international markets also, Emaar focused on its strategy project completion h over during Highlights progress on country developments new projects launched in 2009 are listed below: SAUDI ARABIA In Saudi Arabia, Emaar, The Economic City (Emaar.E.C), a Tadawul-listed company, is developing largest private sectorled development in region, King Abdullah Economic City (KAEC), which has a development value over SR100 billion. Also in Kingdom, Emaar Middle East, a property development associate company Emaar focused on Middle East region, is developing SR6 billion Jeddah Gate Al Khobar Lakes, a multi-billion dollar luxury lakefront development set on 4.3 million sq m. Emaar is also fering full-furnished spacious studios one to three-bedroom serviced residences in Holy City Makkah. The Emaar Residences at Fairmont Makkah are located on floors 30 to 53 Makkah Clock Royal Tower, 14

14 at Fairmont Hotel in tallest tower in Holy City developed by Saudi Bin Laden Group located in heart Abraj Al Bait. To drive sale Emaar Middle East projects to complement existing sales centres in Al Khobar Jeddah, company has opened a sales centre in Riyadh. King Abdullah Economic City KAEC is a 168 million sq m development located on Red Sea coast. It has six key components Sea Port, Central Business District, Industrial Zone, Educational Zone, Resort District Residential Communities. In 2009, Emaar.E.C hed over several residential units commercial l plots in Industrial Valley to investors with full services within first phase Industrial Valley (IV) on an area 1.5 million sq m with investments amounting to SR 300 million. Anor 4.3 million sq m area will be ready by Upon completion all phases, total size Industrial Valley will be 63 million sq m home to 2,500 factories will provide more than 150,000 job opportunities. The company also shifted its headquarters from Jeddah to KAEC, occupying one five fice buildings within Business Centre in Bay La Sun Village, first integrated residential community which was launched to overwhelming sales response. The infrastructure Bay La Sun Village has been completed, first bridge in KAEC was opened to traffic. The bridge spans 400 meters over water canals Bay La Sun connects with rest KAEC, was designed, constructed finalized in just 8 months with a cost SR 40 million. In anor key development, Emaar.E.C signed a Heads Terms Agreement with Saudi BinLadin Group (SBG) for establishing a new company that will be responsible for financing, developing, operating Port at KAEC. The first phase Seaport is scheduled to be operational by 2012 with an initial capacity approximately 1.7 million TEU (Twenty foot Equivalent Units), an estimated SR 4 billion investment. Last year, Emaar.E.C also signed a memorum understing with Saudi Post Corporation (SPC) to provide basic postal services to business residential area King Abdullah Economic City as well as develop postal system service in Economic City create an information center. Jeddah Gate Emaar Middle East made rapid progress on first phase Jeddah Gate, a mixed use master-planned community spanning over half a million sq m in Jeddah s new downtown area. The development features residential units, a five star hotel, commercial towers a range cultural, retail leisure outlets. Jeddah Gate, located in heart city, is positioned on two sites; first is spread over 413,000 sq m is located along King Abdullah Street; second is spread over 140,000 sq m along Abdullah Al Suleiman Street in close proximity to main railroad linking Holy Cities Makkah Madina to Jeddah. The project comprises 4,500 residential units, 230,000 sq m commercial space 75,000 sq m gross leaseable area for retailers. Emaar Middle East also unveiled Abraj Al Hilal, a key residential component Jeddah Gate. The three towers, ranging from 19 to 22-storeys, have an elegant architecture that blends contemporary traditional styles. Emaar Middle East achieved an impressive eight day cycle per floor in construction Abraj Al Hilal. One floor is added every eight days, marking rapid progress in construction residential tower, recording one best construction progress reports in Kingdom. The apartments, size 124 to 600 sq m, are modern fer a full range amenities high specifications. Sales are progressing work on site is well underway on schedule as planned. Al Khobar Lakes Emaar Middle East successfully launched Al Nada Al Ghadeer residential villages in first phase Al Khobar Lakes, a multi-billion dollar luxury lakefront development set on 4.3 million sq m featuring 80,000 sq m serene water bodies. Work on project is progressing as per schedule. The first phase has a development value US$1.2 billion features more than 2,000 private villas with retail leisure amenities. Spread over 250,000 sq m, this phase will have 11 mosques, educational complexes spanning over 28,000 sq m, a shopping centre, community centre, cfee shops & restaurants, healthcare facilities or amenities. The retail centre is located on an area 110,000 sq m will be an upscale shopping leisure destination. 15

15 Emaar Residences at Fairmont Makkah Emaar launched sale first phase fully-furnished spacious studios one to three-bedroom serviced apartments in Holy City Makkah. The Emaar Residences at Fairmont Makkah are located on floors 30 to 53 Makkah Clock Royal Tower, at Fairmont Hotel in tallest tower Holy City developed by Saudi Bin Laden Group situated in heart Abraj Al Bait, which is part King AbdulAziz Endowment The Two Holy Mosques. Ideal for pilgrims families, homes vary in size from 40 to 160 sq m, feature latest digital network or amenities. Pakistan In Pakistan, Emaar Pakistan, country subsidiary Emaar Properties, delivered first homes in Canyon Views, a master-planned community in Islamabad as per schedule during 2009, to high quality stards. Emaar has announced projects development value AED 8.8 billion in Pakistan including The Highls in Islamabad Crescent Bay in Karachi. Last year, Emaar Pakistan was awarded ISO 9001 Certification for its DHA Islamabad fice, PACRA (Pakistan Credit Rating Agency) awarded Emaar Pakistan Best Developer rating. The ISO registration applies to residential commercial property development, project management customer service operations Emaar DHA Islamabad. Canyon Views Canyon Views is an exclusive gated community within DHA Phase 2 Extension in Islamabad. Emaar Pakistan hed over Mirador villas in Canyon Views to customers. Work on Alma townhouses is ongoing. Canyon Views fers luxury single-family townhomes villas in a range finest architectural styles with easy access to amenities including retail, security, views green open spaces, sporting facilities, school Mosque. Crescent Bay Emaar Pakistan launched sale residences in seven towers Coral, Pearl Reef in Crescent Bay, Company s pioneering master-planned community in Karachi. Investor response was strong work is progressing currently. A 108-acre development, Crescent Bay features high mid-rise towers for residential commercial use, a shopping centre five-star beachfront hotel. The towers will contain approximately 4,000 residential apartments. Crescent Bay is located within Karachi s DHA Phase 8 in close proximity to DHA golf course EGYPT In 2009, Emaar Misr, wholly owned subsidiary Emaar Properties PJSC, launched EGP 5.75 billion Mivida community, a world-class, elegantly designed development in New Cairo City. Emaar Misr is one largest foreign direct investors in country s real estate sector with a development portfolio EGP billion. Emaar Misr s projects include EGP 9.92 billion Marassi; EGP 12 billion Uptown Cairo, EGP 5.75 billion Mivida in New Cairo City; EGP 4 billion Cairo Gate. H. H. Sheikh Khalifa City Highlighting Emaar s commitment to part in social housing projects, company signed an MoU with Abu Dhabi Municipality to develop manage, on a not-for-prit basis, 2.2 million sq m H. H. Sheikh Khalifa City, located in New Cairo on l provided by Egyptian Government. The project, is managed by Emaar Misr on behalf Abu Dhabi Municipality will feature affordable homes ranging in size from 70 to 90 sq m. The fully-integrated community will have well-knit roads, advanced power telecom connectivity, healthcare centres, educational institutions, retail outlets, places worship community centres. The social project is being developed under guidance Egyptian Ministry Housing, Utilities Urban Development aimed at providing homes jobs for Egyptian youth. Mivida Emaar launched Mivida, its newest master-planned community in New Cairo City which has received very good customers response. The EGP 5.75 billion project is located only 1.5 km from American University in Cairo. Spread over 3.8 million sq m, Mivida features 5,000 homes designed by international architects. The ready-to-live-in homes starting in size from 220 sq m, are designed in Santa Barbara, Tuscan, Mediterranean Andalusian architectural styles. 16

16 Cost-competitive fully-finished, Mivida homes bring to Cairo market a new innovative residential product with large green spaces, high quality stards integrated commercial, residential leisure facilities. Ideal for individuals families, work, live play environment Mivida fers a rich array lifestyle amenities including schools, business parks, hotels healthcare facilities for residents. A central park sprawling over 30 acres l 222 acres smaller community parks provide Mivida a relaxed charm. Uptown Cairo Emaar Misr achieved significant progress on Uptown Cairo in The EGP 12 billion residential, commercial leisure development is located at highest point downtown Cairo - Mokattam Hills, 200 metres above sea level providing a unique, high quality secured living environment. Uptown Cairo is largest lifestyle development within Cairo, is billed to evolve into true hub city with its easy accessibility from Maadi, Heliopolis, Nasr City Central Cairo. Spread over 4.5 million sq m, this self-contained development features a wide array facilities including a business park, town centre, an open-air integrated retail center, sporting & leisure facilities, a world-class golf course a variety luxurious residential villages. Marassi In 2009, Emaar Misr completed opened to public Beach Club in Marassi, which has recorded strong response from existing customers general public. Work on mixed-use community, launched to overwhelming customers response, is progressing according to plans with first homes to be hed over at end Emaar is also developing Armani Residences, developed by Emaar in partnership with Armani S.p.A, in Marassi. Personally fashioned by Giorgio Armani, resort-style residences feature a combination stacked villas 3 4-bedroom villas all facing Mediterranean Sea. Armani Residences in Marassi is first villa fering under Armani Residences br. A 1,544-acre tourist resort project development value EGP 9.92 billion, Marassi is located on Sidi Abdel Rahman Alamein. Marassi features seven distinct lifestyle districts, each with distinctive identities activities, inspired by Mediterranean architectural styles. The resort will feature up to 3,000 hotel rooms, a marina, golf course healthcare facilities. The Marina in Marassi will be largest in region with its own dry storage facility. Cairo Gate Emaar Misr s Cairo Gate Project located at start Cairo-Alexria road is a residential-cum-commercial project with a development spread over 670,000 sq m. The project is being considered for a large mixed use development. INDONESIA The Lombok Project Emaar signed a joint venture agreement with Perusahaan Pengelola Aset (PPA), state-owned Asset Management Company, to launch IDR 5,446 billion project spread over 1,200 hectares. The project is currently under review. JORDAN The Dead Sea Touristic Real Estate Investment Company, a venture Emaar Properties PJSC a group regional Jordanian investors, is developing Samarah Dead Sea Resort, a mixed-use project with a development value over JD 300 million. Samarah Dead Sea Resort Emaar International Jordan made strong progress on construction first phase Samarah Dead Sea. The resort s Rift Apartments are located directly on Dead Sea, adjacent to waterway across Wadi Mukheiris from King Hussein Bin Talal Convention Centre Samarah Dead Sea Resort Sales Centre. It features nine low rise buildings (The Apartments) located on seafront comprising 223 Mediterranean-styled multi-family apartments. Amenities include walkways, neighbourhood shopping easy access to a full-fledged Club House. The first phase, launched in 2007, will be ready for hover to customers in second half Emaar International Jordan opened a fully-equipped Sales Centre, first its kind in Kingdom, also opened its corporate fice in Amman at Rabia Towers, to drive sales marketing activities projects in Jordan. The fice displays a true-to-type model Samarah Dead Sea Resort. 17

17 SYRIA Emaar-IGO, a venture between Emaar Syria IGO, an fshore investment property development company, is developing SYP26 billion Eighth Gate project in Yafour, near Damascus. The Eighth Gate In 2009, Emaar-IGO recorded strong progress in construction eight fice buildings in addition to Damascus Stock Exchange building - a key component The Eighth Gate. Work on master-planned community is progressing with first fice building hed over to customers in December 2009 remaining ones scheduled to be hed over during The or components The Eight Gate development, including mall additional commercial buildings will also be launched during Billed as No. 1 business hub in Syria, integrated commercial percint will host a 32-storey fice tower a number fice buildings that provide commercial space for brokers, bankers or companies closely affiliated with Damascus Stock Exchange, among ors. The Eighth Gate has three zones - Commercial Centre, Waterfront Touristic Area. A mall inspired by souks Damascus fering high-end shopping experiences is part community. LIBYA Emaar Properties has signed a MoU with Zowara-Abou Kemash Development Zone to develop Zowara-Abou Kemash area on Mediterranean coast near Tripoli, Libya. It is largest international project Emaar is currently in a detailed review stage. EMAAR TURKEY Emaar Turkey is country-subsidiary Emaar Properties PJSC opened its Istanbul fice in June In a key development last year, Emaar purchased 40 per cent shares Cihan Kamer, Chairman Board Directors Atasay Group, to own entire shares Emaar Turkey. Emaar Turkey developed hed over first phase its first gated community renowned project, Tuscan Valley which has a development value US$700 million. The initial investment was followed by a furr US$400 million investment to purchase a prime l at Asian side Istanbul. Tuscan Valley Inspired by Tuscan architectural style, enriched with magnificent views Büyükçekmece Lake Marmara Sea, Tuscan Valley fers an elegant lifestyle for residents. The project is located in western part Istanbul, just 20 kms from Ataturk International Airport 45 minutes from city centre, covers 1.7 million sq m. Tuscan Valley includes 540 luxury units including villas, apartments townhouses, in 12 different types ranging in size from 149 to 940 sq m. The community includes fully-equipped facilities such as outdoor indoor swimming pools, spa, tennis, squash basketball courts soccer fields. A modern Tuscan Shopping Arcade will meet retail lifestyle needs residents. H over first phase homes in Tuscan Valley was achieved, according to plans, in 2009 neighbourhood is now an established lifestyle community. It is billed to become one prime residential destinations in Istanbul. New Istanbul Development Emaar Turkey acquired approximately 75,000 sq m prime l in February 2008 to develop a mixed-use project in Libadiye. Located in Istanbul Asian side within junction main highways, it is also in close proximity to proposed metro line that will join rail tube tunnel under Marmara Sea connecting Asia to Europe. The mixed-use project envisaged in prime l will feature residences, retail, commercial space, leisure entertainment components. The design project is being finalized with launch first units for sale construction scheduled to commence in INDIA Emaar MGF Developments Limited India rolls out India s largest FDI in real estate through projects in 26 cities pan India. Emaar MGF has a l bank in excess 11,000 acres with 82% l reserves in National Capital Regions 18

18 state capital regions. Emaar MGF has a long term commitment to India today has emerged as one leading real estate developers in country with projects planned across residential, commercial, retail hospitality sectors. The total development area currently planned is more than 430 million sq m including development residential, retail hospitality assets. Emaar s JV, Cyberabad Convention Centre Private Limited (CCCPL), built country s largest most technologically advanced conference centre - Hyderabad International Convention Centre (HICC) - Novotel Hyderabad. Emaar is also developing Boulder Hills, a residential cum leisure complex in Hydrebad. Emaar-MGF projects: Emaar-MGF has a rich portfolio projects in several key destinations, in various stages development. Most projects are expected to be hed over in 2010 thus bringing in a new dynamic to country s property sector. Among key projects is Mohali Hills, a master-planned community spread over 3,000 acres. It features residential plots, townhouses villas, supported by an integrated infrastructure civic amenities including lscaped gardens, shopping recreational centres. The Views at Mohali Hills has an estimated saleable area 1.9 million sq ft all which is currently under development has been launched for sale. The Central Plaza at Mohali Hills will serve as centre community, providing a dynamic tenant mix ranging from supermarkets, laundries pharmacies to eclectic boutiques stylish restaurants. The Commonwealth Games Village 2010 residential complex, a 27.7 acre project in Delhi with an estimated saleable area 1.8 million sq ft is anor prestigious project currently under development. It will be hed in March / April 2010 as committed to Government. The Palm Springs marked launch Emaar-MGF s first residential project in Gurgaon. Spanning across 20 acres, Palm Springs is a self-contained amenity-rich community, providing a harmonious blend lifestyle options; from low rise luxury villas to spacious apartment towers situated in acres elegantly lscaped gardens parks. Palm Drive is a 31.6 acre residential development in Gurgaon, Emaar-MGF s second residential project after Palm Springs. It will also have a mix apartments villas. Emerald Hills, Gurgaon is a 500 acre integrated master planned community with acres consisting 209 plots, 42 villas, 1,059 independent villa floors 1,029 apartments. Boulder Hills, Hyderabad is a 510-acre integrated master planned community in Hyderabad. Currently, 38.4 acres project has been launched featuring 103 plotted developments 306 apartments. Chennai Esplanade (Phase I), a 7 acre residential project ( part a 14 acre project) in North Chennai has an estimated saleable area 0.4 million sq ft all which is currently under development. Emaar MGF also aims to become provider choice for real estate solutions for commercial retail customers. Emaar-MGF will develop three JW Marriott-bred international luxury hotels in New Delhi, Hyderabad Kolkata one upper-moderate price-sector Courtyard by Marriott hotel in Amritsar. The company has signed a management agreement with InterContinental Hotel Group to develop hotels in Kolkata Dehradun. Holiday Inn in Kolkata will have about 250 keys. MOROCCO Emaar Morocco has unveiled three master-planned projects - Tinja, Oukaimeden Saphira - as part a MAD 42.6 billion MoU with Moroccan Government under patronage His Majesty King Mohammed VI, King Morocco. Emaar Morocco has also joined hs with Onapar, part ONA Group, to develop MAD 2.6 billion Amelkis II III, MAD 9.56 billion Bahia Bay. Tinja Emaar Morocco has made good progress on Aldea homes, launched to strong response. Forming one part six distinctive communities within Tinja project, Aldea enjoys a quaint location with villas by sea townhomes by forest. 19

19 Easily accessible from Tangiers International Airport, Tinja is located between renowned Diplomatic Forest Atlantic Ocean on 300 hectares pristine l. Aldea marks first phase Tinja, its modern homes integrated lifestyle amenities fer residents an exceptional lifestyle. Residents will have access to fitness centres, leisure complexes, green spaces, walkways, barbecue areas, beach clubs, riding clubs, hotels restaurants. The model homes will be completed in first quarter LEBANON BeitMisk is a residential community that spreads over approximately 655,000 sq m an exceptionally pristine location in Norrn Metn region. The project consists a major residential development that will comprise villas, townhouses apartments buildings situated in a splendid rural setting revolving around a vast community centre with retail public squares. The development is managed by Emaar Lebanon. CANADA Emaar exped its geographic presence in North America with a new subsidiary Emaar International, Emaar Canada, based in Vancouver, British Columbia, Canada. Emaar Canada launched sale its first project, Wills Creek, which is situated in prestigious community South Surrey, British Columbia. The project comprises a variety detached semi-detached villas a community centre; expansive green spaces on property with walking paths salmon bearing stream; close proximity to world class skiing, golfing 2010 Winter Olympic Venues. Additionally, Emaar Canada is in various stages development on multiple projects throughout Western Canada. Most notably are a high-rise project in Victoria, British Columbia a mid-rise residential project in Vancouver, British Columbia. CHINA Emaar Properties consolidated its expansion to China by signing a MoU with Shanghai China-News Enterprise Development Limited, a Chinese government entity subsidiary People s Daily Shanghai branch, to explore mixed-use property infrastructure development projects in key Chinese cities. The strategic partnership between Emaar Shanghai China-News Enterprise Development Limited marks one first public-private partnerships between Chinese government Dubai s leading property developers, highlighting increasing global role played by Dubai companies. Emaar had earlier marked a milestone in its expansion plans by being first Middle East developer to open a full-fledged fice in China in ALGERIA Emaar is currently reviewing four mixed-use projects development value US$20 billion in Algeria. Emaar is developing New City Sidi Abdellah; a tourist resort at Colonel Abbas; a waterfront development by Algiers Bay; a modern healthcare city at Staouali County. OTHER SECTORS EMAAR HOSPITALITY GROUP LLC Emaar Hospitality Group LLC is a wholly-owned subsidiary Emaar Properties, manages Emaar s hospitality & leisure projects across region. With a total portfolio hospitality leisure project assets development value AED 4 billion, Emaar Hospitality Group owns manages a diversified portfolio hospitality assets such as hotels, serviced residences, golf resorts, a polo equestrian club, recreation clubs Dubai Marina Yacht Club marinas. Emaar has also partnered with hospitality operators such as Sourn Sun Troon Golf to manage some its business units. Sourn Sun, Africa s leading hotel group, currently manages operates two properties Al Manzil Qamardeen Hotels at The Old Town in Downtown Dubai. Troon Golf manages championship golf course at The Address Montgomerie Dubai. 20

20 Emaar Hospitality has also launched Nuran Serviced Residences Hayya! health recreation clubs. The Address Hotels + Resorts In May 2008, Emaar Hospitality Group launched it 5 star premium flagship hotel br The Address Hotels + Resorts, in 2009, br exped its portfolio to feature five world-class properties. The Address Hotels + Resorts brings a new identity to hospitality service fering Dubai region. It also marks integration Emaar Hospitality Group s ferings to provide entire gamut services including operating hotels resorts. The Address features a bouquet experiences fering a unique essence for business leisure travellers within its properties. The Address will have a presence in all markets where Emaar Properties has a geographic footprint, starting f with five properties located in Dubai. These are The Address Downtown Dubai (opened in 2008), The Address Dubai Mall (opened on September 2009) The Address Dubai Marina (opened in December 2009). The Address Hotels + Resorts assumed management The Address Montgomerie Dubai in October The br also manages The Palace - The Old Town, a luxury hotel in Downtown Dubai, which has 242 well-appointed guest rooms suites. Emaar Hospitality Group plans to unveil The Address properties in key cities tourist destinations in Middle East North Africa region, Indian Subcontinent, Asia, Europe America over next ten years. The Address Hotels + Resorts has already exped to Europe North Africa through strategic tie-ups. The Address Hotels + Resorts signed its first international management contract with Azmi Abdelhadi (AAH) Group, a leading Saudi Arabian based business conglomerate, to operate a luxury property within Jnan Amar Polo Retreat, a premium mixed-use development in Marrakech. The Address Hotels + Resorts entered European market with a management contract to operate Domaine de Lavagnac, a luxury resort developed by Residence De Lavagnac SARL in Languedoc-Roussillon, South France. Scheduled to open in 2011, Domaine de Lavagnac is first five star tourism development in Languedoc comprises a 17th century chateau that is being transformed into a 70 suite hotel located in close proximity to Mediterranean coast. The Address Downtown Dubai, which opened to strong response globally, faces iconic Burj Khalifa, world s tallest building. As second tallest building in Downtown Dubai, architecture 63-floor hotel is unique breathtaking, enhancing mood venue as a premier lifestyle destination. The Address Dubai Mall is a luxury 5-star hotel linked to world s largest shopping entertainment destination The Dubai Mall. It is strategically located to fer ease access to many attractions within Downtown Dubai. Both hotels provide stunning views The Dubai Fountain tallest performing fountain in world. The Address Dubai Marina overlooks world s largest man-made Marina has a prime location in one Dubai s most popular lifestyle districts, Dubai Marina. Dubai Marina Mall, linked to hotel, fers 160 retail stores. Dubai Marina Yacht Club, located less than 500 metres away, lends guests an alternative original venue for dining, relaxing yachting opportunities. An idyllic golf retreat, The Address Montgomerie Dubai accomplishes perfect harmony by combining premium golf in sublime surroundings with that an exclusive retreat with luxury lifestyle amenities. The Address Montgomerie Dubai fers one most luxurious golf experiences in Middle East is first operational retreat hotel under The Address Hotels + Resorts portfolio. Located on The Old Town Isl in Downtown Dubai, The Palace - The Old Town is managed operated by The Address Hotels + Resorts. Open since September 2007, hotel has 242 well-appointed guestrooms suites including imperial suite with an enchanting Middle Eastern ambience. The hotel is situated by lake in Downtown Dubai fers prime views world s tallest tower, Burj Khalifa The Dubai Fountain. Arabian Ranches Golf Club Arabian Ranches Golf Club was built as a true 18 hole, par 72, desert style grass course, a signature course designed by Ian Baker-Finch in association with Nicklaus Design. The Spanish Colonial style Clubhouse boasts Ranches Restaurant, with a terrace fering panoramic scenic views over 9th 18th holes. Within Clubhouse re are 11 luxurious en-suite guest rooms all fering spectacular views golf course. 21

21 The Dubai Polo & Equestrian Club The Dubai Polo & Equestrian Club extends over 68 acres desert lscape. Apart from polo, regarded as Sport Kings, Club hosts show jumping dressage, horse riding desert hacking. The Club has a unique Spanish hacienda-styled clubhouse, where guests can relax at one four stylish lounges or dine al fresco on Argentinean cuisine cooked Asado style at Palermo Restaurant. The gr patio at Saha Courtyard is an ideal function venue. The Club also fers all modern amenities required for business meetings conferences. Dubai Marina Yacht Club Dubai Marina Yacht Club is port authority for all operations berthing in Dubai Marina canal, a 3.5 kilometre man-made waterway running through prestigious Dubai Marina residential development. Two four marinas, East Marina Clubhouse Marina, have opened. These will be joined by a furr two marinas to ultimately host over 500 yachts ranging from 6-36 metres in length. Al Manzil Qamardeen Hotels, The Old Town, Downtown Dubai Combining hi-tech business environments with a traditional Arabian feel, Al Manzil Qamardeen are four-star deluxe hotels operated by South African Hotel group Sourn Sun, are located within Downtown Dubai. Al Manzil, ideal for business travelers, features ground plus eight floors fers 197 rooms. Qamardeen Hotel fers 186 rooms including suites, queen twin rooms rooms for physically challenged. Nuran Serviced Residences Nuran Serviced Residences fers fully-serviced apartments defined by exceptional guest experiences for transient travellers guests on extended stays for assignments relocation. All residences are fully equipped with modern household conveniences appliances, recreational facilities include a complete range health fitness facilities within premises. Hayya! Health Clubs Hayya! is health fitness br that adds value to lifestyle residents in Emaar communities. Personalised, supervised pressional, Hayya! health clubs fer a comfortable environment for regular exercise relaxation. Hayya! clubs are located within The Lakes, Town Centre, Meadows Village The Old Town, Downtown Dubai. EMAAR MALLS GROUP Emaar Malls Group LLC, retail shopping mall subsidiary Emaar, drives Company s diversification into shopping malls. Emaar Malls Group currently manages operates a number successful shopping centres in Dubai including The Dubai Mall, one world s largest shopping entertainment destinations. Emaar Malls Group also manages Dubai Marina Mall, waterfront shopping mall catering for Dubai Marina community; Souk Al Bahar, an Arabesque lifestyle shopping mall in Downtown Dubai; Gold & Diamond Park, a gold jewellery destination; several retail community centres in Emaar s master-planned communities. Internationally, Emaar Malls Group is actively planning or developing shopping centres in Turkey, Syria, Egypt Kingdom Saudi Arabia or key markets in MENA region. The Dubai Mall The Dubai Mall marked its gr inauguration last year has a retail spread 1,200 outlets. The mall s key features include Dubai Aquarium & Underwater Zoo, Dubai Ice Rink, SEGA Republic, KidZania, a 22-screen Cineplex, entrance to At Top, Burj Khalifa, Fashion Avenue, The Grove, Gold Souk The Waterfall. Dubai Marina Mall Dubai Marina Mall opened in December 2008 caters to Dubai Marina community surrounding areas. With a GLA 390,000 sq ft, spread across four levels, Dubai Marina Mall features 160 stores tailored to lifestyle entertainment needs marina residents. 22

22 Souk Al Bahar Emaar Malls Group opened first phase Souk Al Bahar in November 2007 has over 100 stores an extensive waterfront promenade featuring 22 restaurants cafés. Souk Al Bahar is uniquely situated on The Old Town Isl overlooking lake, Burj Khalifa The Dubai Fountain. Gold & Diamond Park Since its launch in May 2001, Gold & Diamond Park strategically located at Interchange Four on Sheikh Zayed Road, has almost tripled amount retailers now has 90 stores parking facilities to accommodate over 1,500 cars. There are also 120 manufacturing units, commercial space for 350 fices. Retail Community Centres Emaar Malls Group s community portfolio includes: Arabian Ranches Community Centre, Emirates Hills Town Centre, Emaar Towers, Downtown Dubai, Marina Walk, The Greens Village, The Lakes Village, The Meadows Village The Springs. These are lifestyle centres dedicated to providing daily convenience retail for residents. Emaar Boulevard (Under Development) Emaar Boulevard, a 3.5km parade in Downtown Dubai, has over 1,100,000 sq ft retail GLA with 15,000 apartments 1,000 hotel rooms located above retail. The Eighth Gate Mall, Syria (Under Development) The Eighth Gate Mall, part Emaar s mixed-use project in Syria, has been designed over two--a-half levels with approximately 89,187 sq m GLA 62,648 sq m NLA. The retail fer will feature fashion accessories, extensive outdoor F&B, an entertainment precinct. KAEC (Under Development) In 2009, Emaar Malls worked with KAEC as ir retail consultant involving retail design, leasing, asset management its first residential communities Bay La Sun Esmeralda. New Istanbul Centre, Turkey (Schematic Design) Emaar Malls is consulting Emaar Turkey on retail development, leasing future management centre, which will fer a total Leasable Area 124,000 sq m retail over three levels. It will feature over 400 stores, 4,900 car parks large scale family based entertainment amenities. Uptown Cairo Mall Uptown Cairo, Emaar Misr s master-planned community in Egypt, with feature Uptown Cairo Mall Uptown Town Centre, with an array retail stores boutique outlets showcasing traditional craftsmanship. EMAAR RETAIL Emaar Retail LLC is a wholly owned subsidiary Emaar Malls Group LLC, drives Emaar s mall developments in key emerging markets across Middle East, North Africa Indian Subcontinent by creating right leisure retail mix for various markets. Emaar Retail LLC manages business operations for The Dubai Mall Dubai Marina Mall s retail, leisure entertainment brs including Dubai Aquarium & Underwater Zoo, Dubai Ice Rink, KidZania, SEGA Republic, Reel Cinemas ARMANI/CASA. Dubai Aquarium & Underwater Zoo is an integral part Emaar Retail LLC s diverse entertainment portfolio. Located strategically at centre The Dubai Mall, Dubai Aquarium is one largest indoor aquariums its kind in world at 51 m x 20 m x 11 m holds Guinness Record for The World s Largest Acrylic Panel m long x 8.3 m high. Dubai Aquarium has more than 33,000 aquatic animals, representing over 220 species, including Sharks Stingrays. The Underwater Zoo, an interactive, educational centre on Level 2, takes visitors through 36 additional displays over three aquatic environments Dubai Ice Rink is an Olympic-sized ice rink fering year-round entertainment at The Dubai Mall. Public skating disco sessions are popular with public. Skating lessons are on fer, as well as private or group skating lessons. 23

23 KidZania is an award winning children s edutainment concept that has been introduced to region for first time through an exclusive partnership with Emaar Retail LLC. KidZania is an 80,000 sq ft interactive mini-city that provides children ultimate in role-playing experiences, combining play with learning in a fun innovative approach. A new wave high-adrenaline gaming leisure in Dubai is fered by SEGA Republic, an indoor me park focused on action, adventure entertainment. The two-level 76,000 sq ft adventure zone is developed by Emaar Retail LLC in partnership with SEGA Corporation, Japan s leading indoor me park developer. Emaar Retail LLC has entered into a joint-venture with Cathay Organisation Holdings Ltd in Singapore, to form Reel Entertainment LLC. Based in Dubai, Reel Entertainment LLC will develop manage all cineplexes in shopping malls that Emaar Malls Group plans to develop in Middle East, North Africa Indian Subcontinent. Reel Entertainment has opened 22-screen Reel Cinemas, largest megaplex in Dubai, at The Dubai Mall, will open Reel Cinemas at Dubai Marina Mall in Emaar Retail LLC has partnered with Giorgio Armani S.p.A to open flagship store Armani/Casa in The Dubai Mall, which will be followed by or stores in region. EMAAR EDUCATION Emaar Education plans to open over 100 educational institutions including nurseries, international schools, business schools universities in locations close to within its master-planned communities in MENA region, Indian Subcontinent Asia. Emaar acquired Raffles Campus, Singapore-based educational provider to lend expertise in its educational initiative. Raffles International School Raffles International School in Dubai is licensed by Knowledge & Human Development Authority (KHDA), which works to enhance Dubai s education sector to international stards. Raffles International School has two campuses in Dubai - Umm Suqeim 3 (Umm Suqeim West Campus Umm Suqeim South Campus). In addition, Raffles is operating six nurseries located within Emaar s master-planned communities in Arabian Ranches, The Springs, The Lakes, Emirates Hills Downtown Dubai. Two new nurseries in Springs Town Centre Downtown Dubai opened in early Raffles International School also opened its Behror Campus, in Rajasthan, India. This is in addition to Emaar s first international school in Singapore Emaar International School which opened in Raffles Campus School Hospitality Raffles Campus, through its collaboration with Australia s Box Hill Institute, fers a unique Hospitality Management programme which provides vocational education training that equip students with essential skills required for employment. In addition, Raffles Campus also fers develops training programmes that are customised specifically for personnel engaged in hospitality sector industry. Raffles Campus fers full time part time programmes from Certificate to Advanced Diploma levels. Students will also undergo Industrial Attachment within hospitality industry during course study. The first intake Hospitality Management programme commenced in 2008, taking in students who have completed 12 years formal education. Raffles Campus also launched BTEC National Diploma programme fered by Edexcel, UK s largest awarding body fering academic vocational qualifications testing to schools, colleges, employers or places learning in UK internationally. In January 2009, Raffles Campus achieved ISO 9001:2008 by Lloyd s Register Quality Assurance (LRQA). Raffles Campus, with full-fledged training facilities including Front Office, Housekeeping, Food Beverages (bar counter restaurant setting) Kitchen Facilities, is located in Umm Suqeim 2. Raffles Campus has two or campuses in Singapore Vietnam fering Hospitality Management programmes. 24

24 EMAAR HEALTHCARE Emaar Healthcare Group LLC is wholly-owned subsidiary Emaar Properties PJSC. As part Emaar s commitment to developing integrated lifestyle communities Emaar Healthcare is developing holistic integrated healthcare facilities within se neighbourhoods. The focal areas Emaar Healthcare Group are emerging markets Middle East North Africa region, where it will develop world-class medical centres, hospitals clinics. Following opening in 2009 The Dubai Mall Medical Centre, Emaar Healthcare opened The Meadows Community Clinic is opening an additional clinic in early 2010 in Arabian Ranches, thus setting up foundations for a truly integrated Health System. The Dubai Mall Medical Centre Located in heart prestigious Downtown Dubai, state---art centre is a 60,000 sq ft premium multispeciality out-patient facility fering full range specialities including cardiology, orthopaedics, general surgery, paediatrics, family medicine, endocrinology, opthalmology, urology, gastroenterology, general medicine, obstetrics gynaecology. The Dubai Mall Medical Centre is Emaar Healthcare Group s first medical centre is envisaged as largest out-patient centre in region. Emaar Healthcare has partnered with Methodist International (MI), international arm US-based The Methodist Hospital, to deliver world-class healthcare innovations. Through this partnership, Emaar Healthcare Methodist International are working toger to ensure that patients receive highest quality care. The Dubai Mall Medical Centre fers a patient-centric approach in a hospitable caring environment with aim enhancing patient s lifestyle. In addition, patients also have option getting second opinions from The Methodist Hospital Specialists in US. The Dubai Mall Medical Centre is only healthcare provider its kind in area l serves a community 100,000 residents in surrounding area as well as over 37 million annual visitors to The Dubai Mall. With 50 modern Consulting Suites at The Dubai Mall Medical Centre, Emaar Healthcare strives to provide region s best in specialised care. On-site clinical services include modern paperless patient administration electronic medical records. HAMPTONS Emaar brought toger its entire property management services portfolio under Hamptons International br, which now serves as a one-stop shop for product sales, letting advisory services Emaar non-emaar properties in an international arena. Hamptons has a number branches in UAE including Abu Dhabi two branches in Dubai plans furr expansion throughout GCC this year with branch openings in Jeddah, Saudi Arabia, Cairo, Egypt. 25

25 CORPORATE GOVERNANCE The first st-alone governance regulations for public joint stock companies were adopted by Securities Commodities Authority ( SCA ) in April However, in Emaar we are committed to maintaining highest stards business conduct corporate governance. We believe this is essential in operating a successful business, serving our shareholders maintaining Emaar s integrity in marketplace. Emaar s approach to governance is based on connection between governance excellence maximizing shareholder value. We report to all our stakeholders with accuracy transparency maintain full compliance with laws, rules regulations that govern our businesses. On 29 October 2009 Minister Economy issued Decree No. 518 for year 2009 in relation to Corporate Governance Regulations ( Regulations ). Public companies have an obligation to comply with Regulations as 1 May Emaar is currently working on achieving full compliance with Regulations by 1 May 2010, which will be reflected in Emaar s governance report for financial year This report focuses on Corporate Governance matters during financial year Board Directors One Board s main responsibilities is to provide effective governance over Company s affairs for benefit its shareholders, to balance interests its diverse stakeholders, including customers, employees, suppliers, local communities. Apart from its mated responsibilities, Board reviews approves annual business plans, strategic plans, operational initiatives, significant investments, funding initiatives, reviews overall financial performance Company, in addition to compensation remuneration senior management. In achieving above-mentioned strategic tasks, Board is required to act in good faith, provide insight at all times to consider interests Company as well as shareholders. The Company s Board consists eight members, which six are non-executive directors. The Board is headed by Chairman who schedules meetings, prepares agenda in consultation with Group Chief Executive Officer / Managing Director effectively administers flow information between senior management Board. To perform its duties, Board has direct access to senior management. If necessary, Board can seek independent pressional advice at Company s expense. The position Chairman Group Chief Executive Officer / Managing Director are held by two persons, in support effective clear supervision accountability at Board management levels. Members Board are prominent individuals with extensive experience in public administration, finance, legal, strategic management, retail commercial businesses. Furr details Directors, ir qualifications pressional experience are provided in Annual Report, under section Board Directors. The Board may establish ensure effective functioning board committees & sub committees as it considers necessary or appropriate to oversee critical or major functional areas to address matters which require detailed review or in-depth consideration. Furr details Board Committees are provided in following sections. Board Committees There are four Board Committees; Executive Committee, Audit Committee, Nominating Committee Remuneration Committee. These Committees ir composition are for calendar year Executive Committee The Executive Committee is established principally to assist Board in making decisions expeditiously to exercise authority functions set out below or as may be delegated to it by Board from time to time. The Committee is comprised a chairman two non-executive directors. The Executive Committee members are as follows: Mohamed Ali Rashed Alabbar (Chairman) Hussain Ahmad Dhaen Al Qemzi (Member) Ahmed Jamal Jawa (Member) 26

26 The objectives responsibilities Executive Committee are as follows: The formulation review policy matters. The overall planning deployment strategy towards achieving medium long term objective(s) Group. Urgent important business a confidential nature or orwise requiring an immediate /or discreet decision, which would, but for this delegation to Executive Committee, require attention decision Board. Decide on business matters which are an unusual or extraordinary nature or which have strategic or significant impact (financial or orwise) on Group. Oversee establishment operation risk management system, including reviewing adequacy risk management practices for material risks, such as credit, market, project, legal risks, regulatory compliance operational risks; Perform such or functions, exercise powers authorities as may from time to time be delegated to it by Board. Audit Committee The Audit Committee is comprised non-executive directors, all whom have accounting or related financial management expertise experience. Members Audit Committee are as follows: Majid Saif Ahmed Al Ghurair (Chairman) Dr. Lowai Mohd Khalfan Belhoul (Member) The main objective Audit Committee is to assist Board Directors in fulfilling its oversight fiduciary responsibilities to Emaar Properties PJSC its subsidiary associated companies ( Emaar Group ) to act in interest Emaar s shareholders stakeholders as a whole. The main objectives responsibilities Audit Committee are as follows: Oversee appraise quality Audit efforts Emaar Group s Internal Audit function its External Auditors. Review annually effectiveness Emaar Group s material Internal Controls, including operational compliance controls, risk management evaluate adherence. Ascertain adequacy Emaar Group s Corporate Governance policy processes ensure adherence reto. Serve as an independent objective party to review integrity financial information presented by management to shareholders, regulators general public. Provide communication between Board External Internal Auditors. Review ensure independence External Internal Auditors. In preview its scope work, Audit Committee responsibilities include review Interim, Annual Financial Statements Group Internal Control System. Furr, review scope includes rectifying measures reported noncompliances with provisions or requirements Law. The Audit Committee also reviews arrangements by which staff Company may, in confidence, raise concerns about possible fraudulent activities improprieties. The Audit Committee has a Hotline reporting mechanism, where staff may raise suspected concerns to Audit Committee for furr review. As mentioned above, main three functions that Audit Committee overlooks are; internal audit, internal control, risk management. The following gives a brief background on each se functions: Internal Audit It is policy Company s Board Directors to maintain support a quality Internal Audit function. It has been entrusted internally reports directly to Audit Committee. The Internal Audit is guided by its Charter that represents general authorization from Audit Committee to perform Internal Audit activities within a certain scope work in accordance with annual audit plan approved by Audit Committee. The Internal Audit Charter also sets out purpose, authority responsibility Internal Audit function. It establishes Internal Audit activity s position within organization, authorizes access to records, personnel physical properties relevant to performance engagements defines scope work. 27

27 The Internal Audit s core responsibility is to review effectiveness Internal Control systems within Company. Internal Audit covers all business processes support functions within Company, wher situated in UAE or internationally. Reports raised by Internal Audit are submitted to Audit Committee senior management Company. On an ongoing basis, Audit Committee monitors progress that management has made with respect to remedial actions taken on issues findings raised by Internal Audit. Internal Control The Board is responsible for ensuring that a framework appropriate policies on Internal Controls are maintained reviewed for ir effectiveness. The system Internal Controls is designed to provide reasonable assurance that company s objectives are achieved, assets are safeguarded, transactions are authorized properly recorded that material errors irregularities are eir prevented or would be detected in a timely manner. Additionally, establishing a sound system Internal Controls is meant to safeguard shareholders interests. Towards this, written policies, guidelines procedures, approval limits, automated controls performance monitoring mechanisms were established are in place. However, system is intended to enable group to identify manage risk inherent in its businesses accordingly can provide reasonable but not absolute assurance against material misstatement or losses. Assessment Internal Controls is obtained from ongoing reviews carried out by Internal Audit function reports from External Auditors Government Auditors on matters identified in course ir audits. Formal procedures are in place to deal with issues arising from se audits which are reviewed by senior management, considered by Audit Committee, furr reported to Board. Risk Management The Board Directors is responsible for Group s system Internal Control Risk Management, for reviewing its effectiveness. In order to discharge that responsibility, Board has initiated Enterprise-Wide Risk Management ( ERM ) process in 4th quarter 2007 to identify significant business risks facing Group. The Board has provided mate to Audit Committee, to oversee risk management process within Emaar assess wher re exist management s actions or plans to manage significant risks identified by management. Nominating Committee The Nominating Committee is comprised a chairman two non-executive directors, as follows: Mohamed Ali Rashed Alabbar (Chairman) Majid Saif Ahmed Al Ghurair (Member) Hussain Ahmad Dhaen Al Qemzi (Member) Objectives responsibilities Nominating Committee are as follows: Identify cidates review all nominations make recommendations for appointments to members board, committees top management. Review Board structure, size composition make recommendations to Board with regards to any adjustments that are deemed necessary. Determine criteria to be applied in identifying cidates reviewing nominations for appointments board, committees top management. Charged with responsibility re-nomination having regard to Directors contribution performance (e.g. attendance, preparedness, participation cour). Determine annually wher or not a Director is independent. Determine wher or not a director is able to has been adequately carrying out his duties as a Director. Assess performance Board its effectiveness as a whole by reference to Qualitative Quantitative Criteria. Assess contribution each individual Director to Board s effectiveness by adopting certain criteria. Review significant changes in job responsibilities key management positions. Remuneration Committee The Remuneration Committee is comprised two members who are knowledgeable in field executive compensation in view ir vast corporate experience. 28

28 Members Remuneration Committee are as follows: Majid Saif Ahmed Al Ghurair (Chairman) Ahmad Thani Rashed Al Matrooshi (Member) The objectives responsibilities Remuneration Committee are as follows: Assist Board in overseeing executive staff compensation development in Group. Determine review from time to time Remuneration Policy Emaar Group in best interest Company its shareholders. Review set compensation policies salaries, bonus incentives for executive directors senior executives. Ensure as far as possible, that remuneration compensation packages take due account environment circumstances, which are faced by various business units in markets countries in which Group operates. Administer Share Option Scheme any or share option schemes established from time to time for Emaar Group executives directors. Communication with Shareholders The Company does not practice selective disclosure price sensitive information. Information which could impact share price Company is released to public on a timely basis in an accurate manner. As a reflection Emaar s commitment to disseminating information transparently, Board approved a Disclosure Policy established a Disclosure Committee at management level. The Policy confirms in writing Emaar s commitment to provide investors stakeholders with material information in a broad non-exclusionary fashion. In 2009, Emaar disclosed all material information to authorities as per requirements disclosure regulations. Company website is used effectively in communicating with investors public. Annual reports or financial results are announced issued within matory periods. During Annual General Meeting, shareholders are given opportunity to share ir views direct ir queries regarding Company to directors senior management. Securities Transaction The Company has established a restrictions policy on share dealings which is issued to employees Company who may be in possession price-sensitive information. Communication with Stakeholders At Emaar, stakeholder rights established by laws or through mutual agreements are always respected. Corporate Values set guidelines for Board, executive management employees in undertaking ir duties responsibilities. These values also set background for Emaar s stakeholder engagement activities. 29

29 EMAAR INVESTOR RELATIONS 2009 was a year international economic challenges. Such an environment required a business strategy which also required effective communications to stakeholders. Emaar Properties continues to emphasize importance shareholder communication Investor Relations ensured that challenges management initiatives to meet se challenges were appropriately informed to shareholders through update stock market news, investor relations website media with timely accurate updates. We continue to review update our investor relations website, which provides relevant information such as financial reports, press releases, investor presentations, an investor calendar frequently asked questions. Through website, stakeholders may also register for SMS alerts contact investor relations department. Emaar won best Investor Relations website in region in 2009 by Hallvarsson & Halvarsson s Webranking in Gulf. Senior management met in one-on-one meetings with over 540 institutional investors. The Company also participated in investor conferences internationally. Equity research coverage Emaar increased in 2009 with new equity research coverage initiated by several regional international firms. 30

30 BOARD OF DIRECTORS MOHAMED ALABBAR Chairman, Emaar Properies PJSC Mohamed Alabbar is founding member Chairman Emaar Properties PJSC since Company s inception in July, Chairman Bahrain-based Al Salam Bank, an Islamic bank, Mr Alabbar is also a Board Member Noor Investment Group, an affiliate Dubai Group, leading diversified financial company Dubai Holding. Mr Alabbar is currently spearheading Emaar s growth strategy global expansion business segmentation into property development, hospitality & leisure, shopping malls, healthcare, education financial services. He also heads Emaar s joint venture with Italy s Giorgio Armani to set up Armani-bred luxury hotel resort chain in key international destinations. Mr Alabbar chairs Emaar MGF, joint venture Emaar MGF Developments Limited India, rolling out country s largest FDI in real estate. He is also Chairman RSH Limited, leading pan-asian marketer, distributor retailer international br-names. FDi magazine, published by Financial Times Group, named Mr Alabbar as Middle East Personality Year. Arabian Business, leading regional business magazine, ranked him second in its 2009 list Power 100: The World s Most Influential Arabs. Mr Alabbar holds an Honorary Doctorate in Humanities is a graduate in Finance Business Administration, both from Seattle University in United States. He works closely with regional NGOs, is especially committed to cause educational reform. A keen sportsman, he is an active member UAE endurance horse racing community. 31

31 HUSSEIN AL QEMZI Vice Chairman Hussain Al Qemzi, a Non-Executive Director, was appointed to Board as Vice Chairman Emaar Properties PJSC on March 8, He is a member Nomination Remuneration Committee Company - March A seasoned banking pressional with over 28 years experience working with leading banks in UAE, Hussain Al Qemzi now helms Noor Investment Group its flagship entity Noor Islamic Bank as its Group Chief Executive. With proven expertise in corporate consumer banking, he has proved his mettle in quality operations control strategic planning. Al Qemzi is currently on Board Emirates Institute for Banking Financial Studies, Emirates Media, DIFC, Awqaf Minors Affairs Foundation apart from Emaar Properties. Al Qemzi was formerly Chief Executive Sharjah Islamic Bank Chief Operating Officer DIFC, is credited with laying ground for a world-class financial centre. SAED AHMAD AL TAYER Director Saeed Ahmad Al Tayer was appointed to Board Emaar Properties PJSC on 29 April He is a member Nomination Remuneration Committee Company - March Saeed worked in Jebel Ali Port in early 80 s was part management group that started Jebel Ali Free Trade Zone in He was n appointed as Director Administration in 1987 served as Assistant Chairman Deputy Managing Director till In 1995 Saeed joined MAF (Majid Al Futtaim) Group was appointed as Vice President in charge development shopping centers Carrefour throughout Middle East, was appointed as Chairman group in Egypt. In 1999 he was promoted to be Group Vice President. Mr. Al Tayer left MAF Group to do his own business in He has also volunteered in social sports activity in city Dubai. He is Vice Chairman Al Nasr Sports Club. 32

32 KHALIFA HASSAN ALDABOOS Director Khalifa Hassan Aldaboos was appointed to Board Emaar Properties PJSC on April 29, He is a member Audit Internal Control Committee Company - March He serves on Board Jeema Mineral Water; M sharie Venture Capital, a subsidiary Dubai Investment Company; National Bonds Corporation; Emirates Investment Development PSC Emirates Rawabi. Investment Director with Investment Corporation Dubai, investment arm Government Dubai body responsible for managing emirate s assets, Khalifa was earlier Investment Director with Department Finance at His Highness The Ruler s Court Government Dubai, overseeing strategic investments. A banking pressional, he has worked with Emirates Bank International has extensive experience in capital market forex trading. Khalifa holds a Bachelor Science degree in Computer Information Systems Management Science from Metropolitan State College in Denver. DR. LOWAI BELHOUL Director Dr Lowai Belhoul was appointed to Board Emaar Properties PJSC as a Non-Executive Director, on March 8, He is a member Audit Internal Control Committee Company - March Dr Belhoul brings a wealth experience to Board as a result his current position as Director General Government Dubai Legal Affairs Department. A Law graduate from UAE University in 1984 PhD in Law from Exeter University in 2000, Dr Belhoul has an in-depth understing cross border legal issue, international law possesses an astounding insight into UAE laws. Previously, Dr Belhoul was a visiting lecturer at Dubai Police Academy fering specialist classes in Maritime Aviation Law. He has also served on several high-prile judicial committees formed by Orders His Highness Ruler Dubai. 33

33 MAJID SAIF AL GHURAIR Director Majid Saif Al Ghurair, a Non-Executive Director, was appointed to Board Emaar Properties PJSC on March 8, He is Chairman Audit Internal Control Committee Company - March Voted Business Leader Personality Year 2004, Majid Saif Al Ghurair is a UAE entrepreneur with a golden touch. As CEO Al Ghurair Private Company, he has demonstrated his entrepreneurial acumen in an array fields including trade retail, industry, manufacturing real estate. Steering company s growth through far-sighted vision innovation, he lends hs-on expertise to business conglomerate as President BurJuman Centre Reef Mall; Managing Director Gulf Extrusions Arabian Can Industry. Majid is also Chairman Shuaa Capital, Gulf Finance Corp, Drake & Scull International & Dubai Wing; a Board Member Mashreq Bank, National Cement Co, RAK Bank, Dubai Statistic Centre & Dubai Economic Council. A graduate in Accounting from Al Ain University, Majid was involved in formation Middle East Council Shopping Centers. He is also an active member World Economic Forum Young Global Leaders. AHMED JAMAL JAWA Director Ahmed Jamal Jawa, a Non-Executive Director, was appointed to Board Emaar Properties on March 8, He is Chairman Nomination Remuneration Committee Company - March Ahmed is President, CEO Board Member, Starling Holding Ltd, a global investment group that deals with private equity direct investments world-wide. Starling Holding Ltd has drawn its strength from Ahmed s in-depth understing financial markets. A Saudi national, he has enhanced Starling s fortunes through well-informed strategic investment plans. A board member Rak Petroleum, Ahmed is also President Contracting Trading Company (CTC), a Saudi Arabian firm that oversees investment opportunities options in GCC region Middle East. Credited with introducing a range Walt Disney licensed products to Middle East markets through Disney-Jawa Enterprises, a joint venture between Walt Disney Company Jawa family. Helming JV as Chairman, he supervised sales marketing Disney computer stware, interactive multimedia, toys. 34

34 home furnishing, personal care products, consumer electronics English Arabic videos in region. A graduate in Business Administration MBA from University San Francisco, Ahmed has served on Boards Novapark Swiss Hotel Group; Mirapolice, an entertainment company that builds me parks in France; Tricon Group, a US-based securities trading firm. Honoured as one Global Leaders for Tomorrow by World Economic Forum in February 1996 in Davos, Switzerl, Ahmed is trilingual, fluent in Arabic, English French. AHMAD THANI AL MATROOSHI Managing Director Executive Director board Emaar Properties PJSC. Ahmad Thani Al Matrooshi, an Executive Director, was appointed to Board Emaar Properties PJSC on March 8, As Managing Director at Emaar Properties PJSC, Ahmad oversees day to day operations within Emaar Group. Prior to joining Emaar in November 2005, Ahmad held position Chief Executive Officer at government-run Dubai Development Board (DDB) for almost a decade. At DDB, Ahmad ensured affordable housing competitive financing rates to all residents across Emirate. Before this move, Ahmad worked for 14 years as Deputy Director Dubai Chamber Commerce & Industry. Founder Chairman Dubai Property Society (DPS), he is dedicated to an ongoing forum that ensures a code ethics for real estate practices procedures. Ahmad holds memberships to a number important organizations as Dubai Investment Park. Born brought up in Dubai, United Arab Emirates, Ahmad holds a Bachelor Arts in Public Administration a Diploma in Property Management from NCFE - UK. 35

35 PRINCIPAL OFFICERS As March 2010 CORPORATE OFFICE Mohamed Ali Alabbar Chairman Emaar Properties PJSC Ahmad Thani Al Matrooshi Managing Director Emaar Properties PJSC Low Ping Executive Director - Finance Risk Emaar Properties PJSC Ayman Hamdy Executive Director - Legal & Company Secretary Emaar Properties PJSC Amit Jain Group Chief Financial Officer Emaar Properties PJSC Kenneth Foong Chief Information Officer Emaar Properties PJSC Fred Durie Chief Executive Officer - Joint Venture Companies Emaar Properties PJSC Mohammed El Dahan Executive Director, Internet Audit Emaar Properties PJSC UNITED ARAB EMIRATES Issam Galadari Chief Executive Officer Emaar Dubai LLC Naaman Atallah Chief Operating Officer Emaar Dubai LLC INTERNATIONAL Sergio Casari Chief Executive Officer Emaar International Raghuraj Balakrishna Chief Financial Officer Emaar International 36

36 Egypt Mohamed El Dahan Acting Chief Executive Officer Emaar Egypt Hazem Ashry General Manager Emaar Egypt India Shravan Gupta Executive Vice Chairman & Managing Director Emaar MGF L Private Limited Shrikant Joshi Chief Executive Officer Emaar MGF L Private Limited Jordan Peter Titus General Manager Emaar Jordan Lebanon Nabil Zard Abou Jaoude Managing Director Emaar Lebanon Morocco Yves Delmar Chief Executive Officer Emaar Morocco North America (United States America Canada) Robert Booth Chief Executive Officer North America Managing Director Emaar Properties (Canada) Limited Pakistan Dr. Dia Malaeb Regional CEO - Emaar Pakistan Emaar Middle East Emaar Pakistan Saudi Arabia Fahd Al-Rasheed Chief Executive Officer Managing Director King Abdullah Economic City Joseph J. Kilar President Real Estate Kind Abdullah Economic City Ahmad Al Kulli General Manager Emaar Middle East Syria Sarhad Haffar General Manager Emaar Syria Turkey Ozan Balaban 37

37 General Manager Emaar Turkey BUSINESS SEGMENTS Malls Retail Nasser Rafi Chief Executive Officer Emaar Malls Group LLC Arif Amiri Chief Executive Officer Emaar Retail LLC Hospitality Marc-Francois Dardenne Chief Executive Officer Emaar Hospitality Group LLC Emaar Hotels & Resorts LLC Healthcare Omar Al Shunnar Chief Executive Officer Emaar Healthcare Group LLC Education Ng Boon Yew Chief Executive Officer Emaar Education LLC OTHER BUSINESSES Naaman Atallah Group Managing Director Hamptons International Holding Pte Ltd Brian Etemad Managing Director Hamptons International Middle East Ali H. Odeh Chairman Chief Executive Officer Turner International Middle East LLC Salaam Al Shaksy Chief Executive Officer Dubai Bank PJSC Arif AlHarmi Chief Executive Officer Amlak Finance PJSC 38

38 Ali Farid Al Khatib Chief Executive Officer Emaar Financial Services LLC Mohammed Saeed Al Raqbani Chief Executive Officer Emaar Industries & Investments LLC 39

39 GROUP STRUCTURE As March 2010 EMAAR PROPERTIES PJSC EMAAR DUBAI LLC EMAAR INTERNATIONAL LLC EMAAR INVESTMENT HOLDING LLC EMAAR MALLS GROUP LLC EMAAR HOSPITALITY GROUP LLC EMAAR HOTELS & RESORTS LLC EMAAR EDUCATION LLC EMAAR HEALTHCARE GROUP LLC EMAAR INVESTMENTS EMAAR INDUSTRIES AND INVESTMENTS LLC EMAAR INVESTMENTS INTERNATIONAL LLC BAWADI JOINT VENTURE Real estate development in Dubai. Real estate development in international arena. Strategic acquisitions alliances. Development, lease, asset management retail facilities. Hotels, service apartments leisure facilities. Joint venture with Giorgio Armani. International stard pre-schools, schools tertiary educational facilities throughout South Asia MENA region. World class hospitals, medical centers healthcare facilities throughout South Asia MENA region. Financial Services Formed to complement government s drive to encourage private sector investment in light medium industries provide region with best manufacturing capabilities by tapping into prit growth potential migrating companies. Formed for international investments, mergers acquisitions. Joint venture with Bawadi LLC Emaar Services LLC Emaar District Cooling LLC Emaar Utilities LLC Emaar, The Economic City Emaar Middle East LCC Emaar Syria S.A. Emaar International Jordan Emaar Lebanon S.A. Emaar Misr for Development S.A.E. Emaar Morocco Emaar Algérie spa Emaar MGF L Limited Emaar Giga Karachi Limited & Emaar DHA Islamabad Limited Turner International Middle East LLC Global building service provider. Strategic alliance to tap MENA region. Hamptons International Holding Pte Ltd U.K. s leading realtor. An international showcase reaching a clientele network 130 fices across world. Dubai Mall LLC Emaar Retail LLC Emaar International Malls LLC Emaar Dubai Malls LLC RSH Limited Reel Cinema Emaar Hotels Group LLC Emaar Serviced Apartment Management LLC Nuran LLC Emaar International Hospitality LLC Emaar Hotels Management LLC Emaar Leisure Group LLC The Address Hotels & Resorts LLC The Address, Downtown Burj Dubai LLC The Address, Dubai Mall LLC The Address, Dubai Marina Mall LLC Raffles Campus Pte Ltd Emaar Education Management LLC Emaar International Education LLC Emaar MGF Education Pte Ltd Management agreement with Methodist International Emaar Financial Services LLC Brokerage company. Dubai Bank PJSC Important investment channel for Emaar Group resources. Amlak Finance PJSC Region s foremost Islamic financing company for home mortgages & vehicle finance. Largest publicly held financial company in UAE. PT Emaar Indonesia Emaar Properties Gayrimenkul Gelistirme Anonim Sirketi Emaar John Laing Homes Emaar Properties (Canada) Limited Emaar APIC Al Shamiyah Al Lettaweer Al Omarani Company

40 MANAGEMENT STRUCTURE EMAAR PROPERTIES PJSC As March 2010 Mohamed Ali Alabbar Chairman BOARD OF DIRECTORS Hussain Al Qemzi Vice Chairman Dr. Lowai Belhoul Director Khalifa Hassan AlDaboos Director Majid Saif Al Ghurair Director Ahmed Jamal Jawa Director Ahmad Thani Al Matrooshi Director Saeed Ahmad Al Tayeer Director CORPORATE OFFICE Ahmad Thani Al Matrooshi Managing Director Low Ping Executive Director Finance & Risk Amit Jain Group Chief Financial Officer Kenneth Foong Chief Information Officer Sergio Casari Chief Executive Officer International Fred Durie Chief Executive Officer Joint Venture Companies Ayman Hamdy Executive Director Legal & Company Secretary Mohammed El Dahan Executive Director Internal Audit EMAAR DUBAI LLC Emaar United Arab Emirates Issam Galadari Chief Executive Officer Naaman Atallah Chief Operating Officer EMAAR INTERNATIONAL LLC Saudi Arabia Emaar, The Economic City Fahd Al-Rasheed Chief Executive Officer Emaar Middle East Dr. Dia Malaeb Regional CEO - Emaar Pakistan Emaar Middle East Syria Sarhad Haffar General Manager Jordan Peter Titus General Manager Lebanon Nabil Zard Abou Jaoude Managing Director Egypt Mohammed El Dahan Acting Chief Executive Officer Morocco Yves Delmar Chief Executive Officer Algeria Abdelouahab Soufane General Manager India Shravan Gupta Executive Vice Chairman & Managing Director Pakistan Dr. Dia Malaeb Regional CEO - Emaar Pakistan Emaar Middle East Turkey Ozan Balaban General Manager USA & Canada Robert Booth Chief Operating Officer, North America Managing Director, Emaar Canada EMAAR INVESTMENT HOLDING LLC Turner International Middle East LLC Ali Odeh Chairman & Chief Executive Officer Hamptons International Holding Pte Ltd Naaman Atallah Group Managing Director EMAAR MALLS GROUP LLC Nasser Rafi Chief Executive Officer Emaar Retail Arif Amiri Chief Executive Officer EMAAR HOSPITALITY GROUP LLC EMAAR HOTELS & RESORTS LLC Joint venture with Giorgio Armani Marc Dardenne Chief Executive Officer EMAAR EDUCATION LLC Boon Yew Ng Chief Executive Officer EMAAR HEALTHCARE GROUP LLC Omar Al Shunnar Chief Executive Officer DUBAI BANK PJSC Salaam Al Shaksy Chief Executive Officer AMLAK FINANCE PJSC Arif Alharmi Chief Executive Officer EMAAR FINANCIAL SERVICES LLC Jassim Bin Hendi Chief Executive Officer EMAAR INDUSTRIES AND INVESTMENTS PVT LLC Mohammad Al Raqbani Chief Executive Officer

41 Emaar Properties PJSC Subsidiaries Consolidated Financial Statements 31 December 2009

42 12th Annual General Meeting Directors Report Consolidated Financial Statements 2009 Contents Directors Report Independent Auditors Report to Shareholders Emaar Properties PJSC its subsidiaries Consolidated Income Statement 08 Consolidated Statement Comprehensive Income 09 Consolidated Statement Financial Position 10 Consolidated Statement Cash Flows 11 Consolidated Statement Changes in Equity Notes to Consolidated Financial Statements Emaar Annual Report I 03

43 DIRECTORS REPORT The Board Directors Emaar Properties PJSC ( Company ) its Subsidiaries ( Group ) has pleasure in submitting consolidated statement financial position Group as 31 December 2009, related consolidated income statement, consolidated statement comprehensive income, consolidated statement cash flows consolidated statement changes in equity for year ended 31 December Principal activities The principal activities Group during year ended 31 December 2009 were property investment development, property management services, education, healthcare, hospitality, retail investment in providers financial services. Financial results The Group has recorded a net prit from continuing operations AED 2,051 million for year ended 31 December 2009 (2008: AED 4,191 million). The Group s losses from discontinued operations were AED 1,762 million (2008: AED 4,068 million). These losses primarily relate to write down Group s net investment in WL Homes, Group s subsidiary in United States, upon discontinuation its significant operations. The net prit attributable to equity holders Group after losses from discontinued operations was AED 327 million (2008: AED 166 million). In accordance with Articles Association Company UAE Federal Commercial Companies Law, an appropriation AED 33 million is made to general reserve from distributable prit AED 327 million. The transfer to statutory reserve has been suspended as reserve has reached 50% paid up share capital. In view current financial economic uncertainty, Board Directors Company have not recommended any dividend to shareholders for year 2009, which is subject to approval shareholders at forthcoming Annual General Meeting Company. Directors H.E. Mohamed Ali Alabbar Mr. Hussain Al Qemzi H.E. Dr. Lowai Mohamed Belhoul Mr. Majid Saif Al Ghurair Mr. Ahmad Jamal Jawa Mr. Khalifa Aldaboos Mr. Saeed Ahmad Al Tayer Mr. Ahmed Thani Al Matrooshi Auditors DIRECTORS REPORT (continued) (Chairman) (Vice Chairman) (Director) (Director) (Director) (Director) (Director) (Director) Ernst & Young were appointed as external auditors Group for year ended 31 December Ernst & Young are eligible for reappointment for 2010 have expressed ir willingness to continue in fice. On behalf Board Mohamed Ali Alabbar Chairman Dubai, United Arab Emirates 23 March 2010 The balance distributable prit AED 294 million after considering appropriation to general reserve will be transferred to retained earnings. Total shareholders funds as at 31 December 2009 amount to AED 28,677 million (2008: AED 28,107 million). Outlook 2010 The Group s primary focus in 2010 will be on timely completion existing real estate developments across global markets through stronger resource optimisation, development middle income housing as strategic growth area to meet growing dem for homes in emerging international markets continue to build on successful Group s diversified growth model by realising benefits its investments in shopping malls hospitality & leisure. The Group s effort would remain concentrated on optimum use resources with objective making Emaar a resilient company delivering results committed towards creating value for its shareholders. Emaar Annual Report I 04 Emaar Annual Report I 05

44 INDEPENDENT AUDITORS' REPORT TO THE SHAREHOLDERS OF EMAAR PROPERTIES PJSC AND ITS SUBSIDIARIES Report on Financial Statements We have audited accompanying consolidated financial statements Emaar Properties PJSC its subsidiaries ( Group ), which comprise consolidated statement financial position as at 31 December 2009, consolidated income statement, consolidated statement comprehensive income, consolidated statement cash flows consolidated statement changes in equity for year n ended, a summary significant accounting policies or explanatory notes. Management s Responsibility for Financial Statements Management is responsible for preparation fair presentation se financial statements in accordance with International Financial Reporting Stards applicable provisions articles association Emaar Properties PJSC UAE Commercial Companies Law 1984 (as amended). This responsibility includes: designing, implementing maintaining internal control, relevant to preparation fair presentation financial statements that are free from material misstatement, wher due to fraud or error; selecting applying appropriate accounting policies; making accounting estimates that are reasonable in circumstances. Auditors Responsibility Our responsibility is to express an opinion on se financial statements based on our audit. We conducted our audit in accordance with International Stards on Auditing. Those stards require that we comply with ethical requirements plan perform audit to obtain reasonable assurance wher financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about amounts disclosures in financial statements. The procedures selected depend on auditors judgement, including assessment risks material misstatement financial statements, wher due to fraud or error. In making those risk assessments, auditor considers internal control relevant to entity s preparation fair presentation financial statements in order to design audit procedures that are appropriate in circumstances, but not for purpose expressing an opinion on effectiveness entity s internal controls. An audit also includes evaluating appropriateness accounting policies used reasonableness accounting estimates made by management, as well as evaluating overall presentation financial statements. We believe that audit evidence we have obtained is sufficient appropriate to provide a basis for our audit opinion. Opinion In our opinion, consolidated financial statements present fairly, in all material respects, financial position Group as 31 December 2009, its financial performance its cash flows for year n ended in accordance with International Financial Reporting Stards. INDEPENDENT AUDITORS' REPORT TO THE SHAREHOLDERS OF EMAAR PROPERTIES PJSC AND ITS SUBSIDIARIES (continued) Emphasis INDEPENDENT matter AUDITORS' REPORT TO THE SHAREHOLDERS OF (i) EMAAR Without PROPERTIES qualifying our PJSC opinion AND we ITS draw SUBSIDIARIES attention to (continued) note 29 to financial statements. The Company is involved in arbitration proceedings with anor party resulting from a claim made by Emphasis or matter party in respect a conditional joint venture agreement in Kingdom Saudi Arabia. In (i) Without opinion qualifying Company s our opinion management we draw attention its legal to advisors, note 29 to claim financial is without statements. merit The Company is has involved good arguments in arbitration to refute proceedings substantially with anor this claim. party resulting The outcome from a claim dispute made by is however or party uncertain respect refore a conditional is not joint possible venture to agreement determine in impact Kingdom this Saudi matter Arabia. on In financial opinion statements. Company s management its legal advisors, claim is without merit Company has good arguments to refute substantially this claim. The outcome dispute is (ii) Furrmore, however uncertain without qualifying refore our it opinion is not possible we draw to attention determine to note 15 impact to financial this matter statements. on As financial at 31 statements. December 2009, Group has an investment in Amlak Finance PJSC ( Amlak ) with a carrying amount AED 944 million. The Federal Government UAE has announced that it is (ii) Furrmore, in discussions without qualifying relevant our authorities opinion we to potentially draw attention merge to note Amlak 15 to with or financial entities statements. in As conjunction at 31 December with 2009, steering committee Group has formed an investment by in UAE Amlak Ministry Finance Finance PJSC ( Amlak ) Industry with is a evaluating carrying amount various options AED 944 to secure million. sustainable The Federal funding Government for Amlak in UAE order has to enable announced it to that meet it its is commitments. in discussions with The Group s relevant management authorities is to not potentially in a position merge to Amlak assess with its or investment entities for any in impairment conjunction pending with steering outcome committee recommendations formed by from UAE steering Ministry committee. Finance Industry is evaluating various options to secure sustainable funding for Amlak in order to enable it to meet its Report commitments. on Or Legal The Group s Regulatory management Requirements is not in a position to assess its investment for any We impairment also confirm pending that, in our outcome opinion, recommendations consolidated from financial steering statements committee. include in all material respects, applicable requirements UAE Commercial Companies Law 1984 (as amended) Report articles on Or association Legal Regulatory Emaar Properties Requirements PJSC; proper books account have been kept by Emaar Properties We also confirm PJSC, an that, inventory our opinion, was duly carried consolidated out financial contents statements report include in all Board material Directors respects, relating applicable to se requirements consolidated financial UAE statements Commercial are Companies consistent Law with 1984 books (as amended) account. We have articles obtained all association information Emaar Properties explanations PJSC; which proper we required books for account purpose have been our kept audit by, Emaar to Properties best our PJSC, knowledge an inventory belief, was duly no violations carried out UAE Commercial contents Companies report Law Board 1984 (as amended) Directors relating or to articles se consolidated association financial Emaar statements Properties are PJSC consistent have occurred with during books account. year which We would have obtained have had all a material information effect on explanations business which Emaar we Properties required PJSC for or purpose on its financial our audit position., to best our knowledge belief, no violations UAE Commercial Companies Law 1984 (as amended) or articles association Emaar Properties PJSC have occurred during year which would have had a material effect on business Emaar Properties PJSC or on its financial position. Signed by Edward B. Quinlan (Registration No. 93) Partner For Signed Ernst by & Young Dubai, Edward United B. Quinlan Arab (Registration Emirates No. 93) 23 Partner March 2010 For Ernst & Young Dubai, United Arab Emirates 23 March 2010 Emaar Annual Report I 06 Emaar Annual Report I 07

45 Emaar Properties PJSC its Subsidiaries CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Year ended 31 December 2009 (US $1.00 = AED 3.673) Notes AED'000 AED'000 (Restated) Net prit for year 289, ,557 Or comprehensive income/ (loss): Decrease in hedging reserve 26 (328) (5,538) Increase/ (decrease) in unrealised reserve 26 43,200 (1,491,960) Increase/ (decrease) in foreign currency translation reserve 210,410 (896,062) Or comprehensive income/ (loss) for year 253,282 (2,393,560) Total comprehensive income/ (loss) for year 542,658 (2,270,003) ATTRIBUTABLE TO: Equity holders parent 574,093 (2,202,860) Non-controlling interest (31,435) (67,143) 542,658 (2,270,003) The attached notes 1 to 33 form part se consolidated financial statements. The attached notes 1 to 33 form part se consolidated financial statements. Emaar Annual Report I 08 Emaar Annual Report I 09 The attached notes 1 to 33 form part se consolidated financial statements.

46 Emaar Properties PJSC its Subsidiaries CONSOLIDATED STATEMENT OF FINANCIAL POSITION (US $1.00 = AED 3.673) Emaar Properties PJSC its Subsidiaries CONSOLIDATED STATEMENT OF CASH FLOWS Year ended 31 December 2009 (US $1.00 = AED 3.673) Notes AED'000 AED'000 AED'000 (Restated) (Restated) ASSETS Bank balances cash 9 2,266,835 5,392,986 4,726,616 Trade receivables ,354 1,058,354 1,263,695 Or receivables, deposits prepayments 11 3,211,297 3,510,821 2,705,232 Development properties 12 31,075,718 26,799,447 22,302,917 Securities , ,122 4,560,642 Loans to associates 14 2,005,146 1,636, ,829 Investments in associates 15 7,860,604 8,313,770 8,845,282 Property, plant equipment 16 6,821,705 5,414,196 7,433,222 Investment properties 17 8,546,087 13,248,196 5,635,573 Goodwill , ,391 2,961,968 TOTAL ASSETS 64,144,798 66,680,369 60,972,976 LIABILITIES AND EQUITY LIABILITIES Advances from customers 20 15,888,064 18,109,424 14,093,599 Trade or payables 21 9,545,382 9,680,254 5,918,899 Interest-bearing loans borrowings 22 8,625,104 9,174,165 7,703,753 Retentions payable 23 1,160,306 1,078,549 1,054,560 Provision for employees end--service benefits 24 46,934 37,092 18,394 TOTAL LIABILITIES 35,265,790 38,079,484 28,789,205 EQUITY Equity attributable to equity holders parent company Share capital 25 6,091,239 6,091,239 6,091,239 Treasury shares 25 (1,113) (1,113) - Employees performance share program (1,684) (1,684) (1,446) Reserves 26 14,711,373 14,431,863 16,494,778 Retained earnings 7,877,501 7,586,228 8,946,974 28,677,316 28,106,533 31,531,545 Non-controlling interest 201, , ,226 TOTAL EQUITY 28,879,008 28,600,885 32,183,771 TOTAL LIABILITIES AND EQUITY 64,144,798 66,680,369 60,972,976 The consolidated financial statements were authorised for issue on 23 March 2010 by: Chairman The attached notes 1 to 33 form part se consolidated financial statements. Director CONTINUING OPERATIONS Notes AED'000 AED'000 (Restated) OPERATING ACTIVITIES Prit before tax 2,027,754 4,188,878 Adjustments for: Share results associated companies ,469 (108,622) Depreciation 5 635, ,633 Provision for employees end--service benefits, net 24 9,842 18,698 Loss on disposal property, plant equipment 1,033 2,995 Cost share based payments Gain on disposal securities - (29,307) Provision for doubtful debts/ write f 5 94,484 - Impairment assets 79,677 - Cash from operations before working capital changes: 3,382,971 4,368,032 Trade receivables 18, ,642 Or receivables, deposits prepayments 74,984 (867,738) Development properties, net (3,019,744) (5,823,921) Advances from customers, net (2,221,360) 4,015,825 Trade or payables 53,751 4,258,885 Retentions payable 23 81,757 23,989 Income tax, net 8 (2,998) (4,464) Net cash (used in)/ from operating activities (1,632,178) 6,132,250 INVESTING ACTIVITIES Purchase securities (12,543) (298,605) Proceeds from disposal securities - 2,640,582 Deposit in escrow account for acquisition additional shares in subsidiary 18 - (23,665) Consideration for additional shares/ acquisition subsidiary net cash cash equivalents acquired 18 - (162,435) Additional investments loans to associates, net (635,121) (1,227,310) Amounts incurred on investment properties 17 (132,153) (149,026) Purchase property, plant equipment 16 (1,733,810) (5,839,820) Proceeds from sale property, plant equipment 6,420 2,821 Purchase treasury shares 25 - (1,113) Deposits under lien or maturing after three months 9 (283,053) 2,377,174 Net cash used in investing activities (2,790,260) (2,681,397) FINANCING ACTIVITIES Dividend paid (3,567) (1,198,845) Interest-bearing loans borrowings 22 2,004,542 2,802,400 Repayment interest bearing loans borrowings 22 (808,620) (537,160) Funds invested by non-controlling interest, net 17,211 92,373 Received on vesting share options 24-1,462 Net cash from financing activities 1,209,566 1,160,230 NET CASH (USED IN)/ FROM CONTINUING OPERATIONS (3,212,872) 4,611,083 DISCONTINUED OPERATIONS Net cash used in discontinued operations 7 (113,043) (1,537,199) (DECREASE)/ INCREASE IN CASH AND CASH EQUIVALENTS (3,325,915) 3,073,884 Net foreign exchange difference 10,850 (30,340) Cash cash equivalents at beginning period 9 5,175,223 2,131,679 CASH AND CASH EQUIVALENTS AT 31 DECEMBER 9 1,860,158 5,175,223 The attached notes 1 to 33 form part se consolidated financial statements. The attached notes 1 to 33 form part se consolidated Emaar Annual financial Report I 10statements. The attached notes 1 to 33 form part se consolidated Emaar Annual financial Report I 11statements. 7 8

47 Emaar Properties PJSC its Subsidiaries CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Year ended 31 December 2009 (US $1.00 = AED 3.673) Attributable to equity holders parent Employees performance Non Share Treasury share Retained controlling Total capital shares program Reserves earnings Total interest equity AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 Balance at 1 January 2009 (audited) 6,091,239 (1,113) (1,684) 14,431,863 15,480,448 36,000, ,601 36,562,354 Effect change in accounting policy (note 2.2) (7,894,220) (7,894,220) (67,249) (7,961,469) Balance at 1 January 2009 (restated) 6,091,239 (1,113) (1,684) 14,431,863 7,586,228 28,106, ,352 28,600,885 Prit for year , ,315 (37,939) 289,376 Or comprehensive income for year , ,778 6, ,282 Total comprehensive income/ (loss) for year , , ,093 (31,435) 542,658 Transfer to reserves (note 26) ,732 (32,732) Board meetings allowance (3,310) (3,310) - (3,310) Write down non-controlling interest a subsidiary (note 7) (278,079) (278,079) Movement in non-controlling interest, net ,854 16,854 Balance at 31 December ,091,239 (1,113) (1,684) 14,711,373 7,877,501 28,677, ,692 28,879,008 The attached notes 1 to 33 form part se consolidated financial statements. The attached notes 1 to 33 form part se consolidated financial statements. 9 Emaar Properties PJSC its Subsidiaries CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Year ended 31 December 2009 (US $1.00 = AED 3.673) Attributable to equity holders parent Employees performance Non Share Treasury share Retained controlling Total capital shares program Reserves earnings Total interest equity AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 Balance at 1 January 2008 (audited) 6,091,239 - (1,446) 16,494,778 13,951,469 36,536, ,226 37,188,266 Effect change in accounting policy (5,004,495) (5,004,495) - (5,004,495) Balance at 1 January 2008 (restated) 6,091,239 - (1,446) 16,494,778 8,946,974 31,531, ,226 32,183,771 Prit for year , ,586 (42,029) 123,557 Or comprehensive loss for year (2,368,446) - (2,368,446) (25,114) (2,393,560) Total comprehensive income/ (loss) for period (2,368,446) 165,586 (2,202,860) (67,143) (2,270,003) Transfer to reserves (note 26) ,531 (305,531) Dividends (1,218,248) (1,218,248) - (1,218,248) Board meetings allowance (3,310) (3,310) - (3,310) Share based payments Shares allocated to employees performance share program - - (1,700) - - (1,700) - (1,700) Issuance shares under employees performance share program (note 24) - - 1, ,462-1,462 Purchase treasury shares (note 25) - (1,113) (1,113) - (1,113) Movement in non-controlling interest, net (90,731) (90,731) Balance at 31 December 2008 (restated) 6,091,239 (1,113) (1,684) 14,431,863 7,586,228 28,106, ,352 28,600,885 The attached notes 1 to 33 form part se consolidated financial statements. The attached notes 1 to 33 form part se consolidated financial statements. Emaar Annual Report I 12 Emaar Annual Report I 13

48 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries NOTES At 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS 1 DOMICILE AND ACTIVITIES Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES 1 DOMICILE AND ACTIVITIES Emaar Properties Public Joint Stock Company ( Company or Parent ) was established as a public joint The accounting policies adopted are consistent with those previous financial year, except for adoption 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES Emaar stock company Properties by Public Ministerial Joint Decree Stock Company number 66 ( in Company year or The Company Parent ) was established on as a 23 public June 1997 new stards interpretations as 1 January 2009 early adoption IFRS 9, noted below. Except for joint stock commenced company by operations Ministerial on Decree 29 July number The 66 in Company year its subsidiaries The Company constitute was established Group on ( 23 June Group ). impact IFRIC 15 early adoption IFRS 9, adoption se stards interpretations did not have 1997 The accounting policies adopted are consistent with those previous financial year, except for adoption The commenced Company s registered operations fice on 29 is July at P.O Box The 9440, Company Dubai, United its subsidiaries Arab Emirates. constitute The shares Group ( Company Group ). are any effect on financial position or performance Group. new stards interpretations as 1 January 2009 early adoption IFRS 9, noted below. Except for The traded Company s on Dubai registered Financial fice Market. is at P.O. Box 9440, Dubai, United Arab Emirates. The shares Company are impact IFRS 2 Share-based IFRIC 15 Payment early - Vesting adoption Conditions IFRS 9, adoption Cancellations se stards interpretations did not have traded on Dubai Financial Market. any effect on financial position or performance Group. The principal activities Group are property investment development, property management services, The IASB issued amendment to IFRS 2 which clarifies definition vesting conditions prescribes The education, principal healthcare, activities retail, hospitality Group are property investment investment providers development, financial services. treatment for an award that is cancelled. The Group adopted this amendment as 1 January It did not have property management services, IFRS 2 Share-based Payment - Vesting Conditions Cancellations an impact on financial position or performance Group. education, healthcare, retail, hospitality investment in providers financial services. The IASB issued an amendment to IFRS 2 which clarifies definition vesting conditions prescribes On 27 June 2009, Company announced that Emaar Properties PJSC Dubai Holdings LLC (Dubai Holdings) treatment for an award that is cancelled. The Group adopted this amendment as 1 January It did not have On are 27 in progressive June 2009, discussion Company with announced regards to that ir Emaar intention Properties combining PJSC Dubai real Holdings estate activities LLC (Dubai Holdings) Company The IASB issued an amendment to IFRS 2 that clarified scope accounting for group cash-settled sharebased payment transactions. The Group adopted this amendment as 1 January It did not have an impact on an impact on financial position or performance Group. are in progressive real estate discussion subsidiaries with (Dubai regards Properties to ir LLC, intention Sama Dubai combining LLC real Tatweer estate LLC) activities Dubai Holdings. Company Subsequently real estate on 9 subsidiaries December 2009, (Dubai Properties Board LLC, Directors Sama Dubai LLC Company Tatweer decided LLC) not to proceed Dubai Holdings. with financial position or performance Group. The IASB issued an amendment to IFRS 2 that clarified scope accounting for group cash-settled sharebased IFRS 7 payment Financial transactions. Instruments: The Disclosures Group adopted this amendment as 1 January It did not have an impact on Subsequently proposed merger on as 9 it December was not economically 2009, Board viable in Directors current economic Company climate. decided not to proceed with proposed merger as it was not economically viable in current economic climate. financial position or performance Group. On 29 September 2009, Emaar MGF L Limited ( EMGF ), an associate Company domiciled in India, The amended stard requires additional disclosures about fair value measurement liquidity risk. Fair value On filed 29 its September Draft Red Herring 2009, Emaar Prospectus MGF ( DRHP ) L Limited with ( EMGF ), Securities associate Exchange Board Company India ( SEBI ) domiciled to enter in India, measurements related to items recorded at fair value are to be disclosed by source inputs using a three level fair IFRS 7 Financial Instruments: Disclosures filed capital its market Draft Red with Herring an initial Prospectus public fer ( DRHP ) ( IPO ) with Securities AED 2,763 million Exchange (Indian Board Rupees India 35,000 ( SEBI ) million). to enter EMGF value hierarchy, by class, for all financial instruments recognised at fair value. In addition, reconciliation between The amended stard requires additional disclosures about fair value measurement liquidity risk. Fair value capital have received market with final an observations initial public to fer its DRHP ( IPO ) from SEBI AED on 2, February million (Indian beginning ending balance for level 3 fair value measurements is now required, as well as significant Rupees 35,000 million). EMGF measurements related to items recorded at fair value are to be disclosed by source inputs using a three level fair transfers between levels in fair value hierarchy. The amendments also clarify requirements for liquidity risk have received final observations to its DRHP from SEBI on 18 February value hierarchy, by class, for all financial instruments recognised at fair value. In addition, reconciliation between disclosures with respect to derivative transactions assets used for liquidity management. The fair value beginning ending balance for level 3 fair value measurements is now required, as well as significant 2.1 BASIS OF PREPARATION measurement disclosures Group are presented in note 13. The liquidity risk disclosures Group are not transfers between levels in fair value hierarchy. The amendments also clarify requirements for liquidity risk significantly impacted by amendments are presented in note 31. The Group has elected not to provide 2.1 BASIS OF PREPARATION disclosures with respect to derivative transactions assets used for liquidity management. The fair value The consolidated financial statements Group have been prepared in accordance with International Financial comparative for se exped disclosures in current year in accordance with transitional reliefs fered in measurement disclosures Group are presented in note 13. The liquidity risk disclosures Group are not The Reporting consolidated Stards financial (IFRSs) statements as issued by Group International have been Accounting prepared in Stards accordance Board with ( IASB ) International applicable Financial se amendments. significantly impacted by amendments are presented in note 31. The Group has elected not to provide Reporting requirements Stards United (IFRSs) Arab Emirates as issued laws. by International Accounting Stards Board ( IASB ) applicable comparative IFRS 8 Operating for se Segments exped disclosures in current year in accordance with transitional reliefs fered in requirements United Arab Emirates laws. se amendments. The consolidated financial statements have been prepared in United Arab Emirates Dirhams (AED), which is This stard requires disclosure information about Group s operating segments replaces requirement The Company s consolidated functional financial presentation statements have currency been prepared all values in United are rounded Arab Emirates to nearest Dirhams thouss (AED), except which where to determine primary (business) secondary (geographical) reporting segments Group. Adoption this is IFRS 8 Operating Segments Company s orwise indicated. functional Each entity presentation in currency Group determines all values its own are rounded functional to currency nearest thouss items included except where in stard did not have any effect on financial position or performance Group. The Group determined that This stard requires disclosure information about Group s operating segments replaces requirement orwise financial statements indicated. Each each entity entity in are measured Group determines using that functional its own functional currency. operating segments were same as business segments previously identified under IAS 14 Segment currency items included in to determine primary (business) secondary (geographical) reporting segments Group. Adoption this Reporting. financial statements each entity are measured using that functional currency. stard did not have any effect on financial position or performance Group. The Group determined that The consolidated financial statements have been prepared on a historical cost basis except for derivative financial operating segments were same as business segments previously identified under IAS 14 Segment The instruments consolidated financial assets statements fair value have through been prepared or comprehensive on a historical cost income basis that except have for been derivative measured financial at fair IFRS 9 Financial Instruments (phase 1) Reporting. instruments value. The Group has early adopted IFRS 9 Financial Instruments (IFRS 9) in 2009 in advance its effective date. The financial assets fair value through or comprehensive income that have been measured at fair Group has chosen 31 December 2009 as its date initial application (i.e. date on which Group has assessed value. IFRS 9 Financial Instruments (phase 1) Basis consolidation its existing financial assets) as this is first reporting period end since first phase IFRS 9 was issued on 12 The Group has early adopted IFRS 9 Financial Instruments (IFRS 9) in 2009 in advance its effective date. The Basis consolidation November Subsidiary Companies Group has chosen 31 December 2009 as its date initial application (i.e. date on which Group has assessed its existing financial assets) as this is first reporting period end since first phase IFRS 9 was issued on 12 Subsidiary The consolidated Companies financial statements comprise financial statements Emaar Properties PJSC its Phase 1 IFRS 9 specifies how an entity should classify measure its financial assets. It requires all financial November The subsidiaries consolidated as 31 financial December statements The comprise financial statements financial statements subsidiaries Emaar are Properties prepared PJSC for same its assets to be classified in ir entirety on basis entity s business model for managing financial assets subsidiaries reporting year as as at 31 parent December company, using The consistent financial statements accounting policies. subsidiaries All intra-group are prepared balances, for transactions, same contractual cash flow characteristics financial assets. Financial assets are measured eir at Phase 1 IFRS 9 specifies how an entity should classify measure its financial assets. It requires all financial reporting income year expenses as parent prits company, losses using resulting consistent from accounting intra-group policies. transactions All intra-group that are recognised balances, transactions, in assets are amortised cost or fair value. Debt instruments are measured at amortised cost using effective interest rate method assets to be classified in ir entirety on basis entity s business model for managing financial assets income eliminated in expenses full. Subsidiaries prits are consolidated losses resulting from from date intra-group on which transactions control is transferred that are recognised to Group in assets cease are only if (i) asset is held within a business model whose objective is to hold assets in order to collect contractual contractual cash flow characteristics financial assets. Financial assets are measured eir at eliminated to be consolidated in full. Subsidiaries from date are on consolidated which control from is transferred date on out which control Group. is transferred to Group cease cash flows (ii) contractual terms financial asset give rise on specified dates to cash flows that are amortised cost or fair value. Debt instruments are measured at amortised cost using effective interest rate method to be consolidated from date on which control is transferred out Group. solely payments principal interest on principal amount outsting. The Group has elected to designate Non-controlling interests represent portion prit or loss net assets not held by Group are only if (i) asset is held within a business model whose objective is to hold assets in order to collect contractual debt instruments at amortised cost after initial measurement. Only financial assets that are classified presented cash flows (ii) contractual terms financial asset give rise on specified dates to cash flows that are Non-controlling separately interests represent consolidated portion income statement prit or loss within net equity assets in not held consolidated by Group statement are measured at amortised cost are tested for impairment. financial solely payments principal interest on principal amount outsting. The Group has elected to designate presented position, separately separately in consolidated from parent income shareholders' statement equity. within Acquisitions equity in non-controlling consolidated interests statement are accounted debt instruments at amortised cost after initial measurement. Only financial assets that are classified financial position, for using separately parent entity from extension parent shareholders' method, whereby, equity. Acquisitions difference between non-controlling consideration interests are Investments equity instruments are designated by Group at fair value through or comprehensive income. measured at amortised cost are tested for impairment. accounted book value for using share parent net entity assets extension acquired method, is recognised whereby, in goodwill. difference between consideration If equity instrument is designated as at fair value through or comprehensive income, all gains losses, book value share net assets acquired is recognised in goodwill. except for dividend income recognised in accordance with IAS 18 Revenue, are recognised in consolidated Associated Companies Investments in equity instruments are designated by Group as at fair value through or comprehensive income. statement comprehensive income are not subsequently reclassified to consolidated income statement. Associated If equity instrument is designated as at fair value through or comprehensive income, all gains losses, Companies companies are companies in which Group has significant influence, but not control, over except for dividend income recognised in accordance with IAS 18 Revenue, are recognised in consolidated Associated financial companies operating are policies. companies In in consolidated which financial Group has statements, significant investments influence, in but associated not control, companies over are The management has reviewed assessed all Group s existing financial assets as at date initial statement comprehensive income are not subsequently reclassified to consolidated income statement. financial accounted for operating using policies. equity method In consolidated accounting, financial from statements, date that significant investments influence associated commences companies until are application IFRS 9. As a result: accounted date that significant for using influence equity ceases. method Investments accounting, associated from date companies that significant are carried influence consolidated commences statement until The management Group s investments has reviewed in debt instruments assessed all meeting Group s required existing criteria financial are measured assets at as amortised at date cost; initial date financial that significant position influence at cost, plus ceases. post acquisition Investments changes in associated in Group s companies share are carried net assets in consolidated associate, statement less any application Group s IFRS equity 9. As investments a result: not held for trading have been designated as at fair value through or impairment financial position in value. at The cost, consolidated plus post acquisition income statement changes reflects in Group s Group s share share net assets results associate, its associates. less any comprehensive income. impairment in value. The consolidated income statement reflects Group s share results its associates. Group s investments in debt instruments meeting required criteria are measured at amortised cost; Group s equity investments not held for trading 12 have been designated as at fair value through or comprehensive income. Emaar Annual 11 Report I 14 Emaar Annual Report I

49 Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES (continued) IFRS 9 Financial Instruments (phase 1) (continued) 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES (continued) The Group has applied new stard from 1 January 2009 reclassified with effect from 1 January 2009 all IFRS available 9 Financial for sale securities Instruments that (phase were still 1) (continued) held at 31 December 2009 as fair value through or comprehensive The income. Group Restatement has applied comparative new stard figures from has 1 January not been 2009 performed reclassified following with adoption effect from this stard 1 January as 2009 it is not all available required for for early sale adoption securities that IFRS were 9. If still IFRS held 9 at had 31 not December been adopted 2009 in as 2009, fair value impact through impairment or comprehensive losses on income. available Restatement for sale investments comparative held as figures 31 December has not been 2009 performed would have following been adoption to reduce this prit stard for as year it is not by required AED 109 for million early adoption to increase IFRS 9. or If IFRS comprehensive 9 had not been income adopted for in 2009, year by impact same amount. impairment Earnings losses per on available share would for have sale been investments AED 0.04 held per as share. 31 December There is no 2009 impact would on total have comprehensive been to reduce income prit or equity for following year by AED adoption 109 million IFRS 9. to increase or comprehensive income for year by same amount. Earnings per share would have been AED 0.04 per share. There is no impact on total comprehensive income or equity following IAS adoption 1 Presentation IFRS 9. Financial Statements (Revised) The stard separates owner non-owner changes in equity. The statement changes in equity will include IAS only 1 details Presentation transactions Financial with owners, Statements with (Revised) non-owner changes in equity presented as a single line. In addition, companies The stard have separates an option owner to continue non-owner presenting changes a traditional in equity. The income statement statement changes complemented in equity by will a include second statement, only details statement transactions comprehensive with owners, with income non-owner (SOCI), changes or to present in equity a single presented statement, as a single also named line. In statement addition, companies comprehensive have an income, option that to continue includes presenting both elements. a traditional The Group income has taken statement option complemented presenting by an a income second statement, statement complemented statement by comprehensive statement income comprehensive (SOCI), or income. to present a single statement, also named statement comprehensive income, that includes both elements. The Group has taken option presenting an income statement IAS 1 has complemented also introduced by terminology statement changes comprehensive (including revised income. titles for financial statements) changes in format content financial statements. In addition, revised stard has required presentation IAS a third 1 has comparative also introduced period terminology in statement changes financial (including position revised at 1 January titles for 2008 financial due to statements) retrospective application changes in IFRIC format 15. content financial statements. In addition, revised stard has required presentation a third comparative period in statement financial position at 1 January 2008 due to retrospective application IAS 23 Borrowing Costs IFRIC 15. A revised IAS 23 Borrowing Costs was issued in March 2007, becomes effective for financial years beginning IAS on or 23 after Borrowing 1 January Costs The stard has been revised to require capitalisation borrowing costs when such costs A revised relate IAS to a 23 qualifying Borrowing asset. Costs A was qualifying issued asset in March is an 2007, asset that necessarily becomes effective takes a for substantial financial period years beginning time to get on or ready after for 1 January its intended use The or stard sale. The has Group been accounting revised to require policy was capitalisation already in accordance borrowing with costs this when revised such costs stard. relate to a qualifying asset. A qualifying asset is an asset that necessarily takes a substantial period time to get ready for its intended use or sale. The Group accounting policy was already in accordance with this revised IAS stard. 32 Financial Instruments: Presentation IAS 1 Puttable Financial Instruments Obligations Arising on Liquidation IAS The 32 stards Financial have Instruments: been amended Presentation to allow a limited IAS 1 scope Puttable exception Financial for Instruments puttable financial Obligations instruments Arising to be on classified Liquidation as equity if y fulfill a number specified criteria. The adoption se amendments did not have any The impact stards on financial have been position amended or performance to allow a limited Group. scope exception for puttable financial instruments to be classified as equity if y fulfill a number specified criteria. The adoption se amendments did not have any impact IAS 39 on Financial financial Instruments: position or Recognition performance Measurement Group. Eligible Hedged Items The amendment clarifies that an entity is permitted to designate a portion fair value changes or cash flow IAS variability 39 Financial a financial Instruments: instrument Recognition as a hedged item. Measurement This also covers Eligible Hedged designation Items inflation as a hedged risk The or portion amendment in particular clarifies situations. that an entity The is Group permitted has to concluded designate that a portion amendment fair will value have changes no impact or cash on flow financial variability position a financial or performance instrument as a Group. hedged item. This also covers designation inflation as a hedged risk or portion in particular situations. The Group has concluded that amendment will have no impact on financial IAS 40 Investment position or Property performance (Amended) Group. IAS 40 has been amended to bring within its scope investment property under construction. Consequently such IAS property 40 Investment is measured Property at fair value (Amended) when completed investment properties are measured at fair value. However, IAS adoption 40 has this been amendment amended to did bring not have within any its impact scope on investment financial property position under construction. Group as it uses Consequently cost model such for property measuring is its measured investment at fair properties. value when completed investment properties are measured at fair value. However, adoption this amendment did not have any impact on financial position Group as it uses cost model for measuring its investment properties. 13 Emaar Annual Report I 16 Emaar Annual Report I 17 13

50 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS NOTES At 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS NOTES At 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries At NOTES Emaar Properties 31 December TO THE 2009 CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS At NOTES 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES (continued) 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES (continued) 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES (continued) 2.2 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES (continued) IFRIC 15 Agreements for Construction Real Estate (continued) Improvements to IFRSs (continued) IFRIC CHANGES Agreements IN for ACCOUNTING Construction POLICIES Real Estate AND (continued) DISCLOSURES (continued) Improvements 2.2 CHANGES to IFRSs IN ACCOUNTING (continued) POLICIES AND DISCLOSURES (continued) IAS 16 Property, Plant Equipment Statement financial position IFRIC 15 Agreements for Construction Real Estate (continued) Replace IAS Improvements 16 Property, term to Plant net IFRSs selling (continued) Equipment price with fair value less costs to sell. The Group amended its accounting policy Statement financial position accordingly, Replace term which net did selling not result price in any with change fair in value financial less costs position. to sell. The Group amended its accounting policy At 31 December 2008 As previously Increase/ Statement financial position accordingly, IAS 16 Property, which Plant did not result Equipment in any change in financial position. At 31 December 2008 As reported previously (decrease) Increase/ Restated IAS Replace 18 Revenue term net selling price with fair value less costs to sell. The Group amended its accounting policy AED'000 reported (decrease) AED'000 AED'000 Restated The IAS accordingly, 18 IASB Revenue has which added did guidance not result (which in any change accompanies in financial stard) position. to determine wher an entity is acting as a At 31 December 2008 As AED'000 previously AED'000 Increase/ AED'000 principal The IASB or has an added agent. guidance The features (which to consider accompanies are wher stard) entity: to determine wher an entity is acting as a Assets reported (decrease) Restated principal IAS 18 Revenue or as an agent. The features to consider are wher entity: Assets Trade receivables AED'000 2,047,678 AED'000 (989,324) AED'000 1,058,354 The - IASB has has primary added responsibility guidance (which for providing accompanies goods stard) or service to determine wher an entity is acting as a Trade Or receivables, deposits prepayments 2,047,678 3,665,732 (989,324) (154,911) 1,058,354 3,510,821 principal - has or as inventory primary an agent. responsibility risk The features for to providing consider are wher goods or service entity: Assets Or Development receivables, properties deposits prepayments 19,177,852 3,665,732 7,621,595 (154,911) 26,799,447 3,510,821 has discretion inventory risk in establishing prices Trade receivables 2,047,678 (989,324) 1,058,354 Loans Development to associates properties 19,177,852 1,655,400 7,621,595 (19,314) 26,799,447 1,636,086 - bears has has discretion primary responsibility credit in risk establishing for prices providing goods or service Loans Or receivables, deposits prepayments 3,665,732 (154,911) 3,510,821 Investment to associates in associates 1,655,400 8,782,245 (468,475) (19,314) 1,636,086 8,313,770 - bears has inventory credit risk risk Development properties 19,177,852 7,621,595 26,799,447 The - Group has has discretion assessed in its establishing revenue arrangements prices Investment in associates 8,782,245 (468,475) 8,313,770 against se criteria concluded that it is acting as principal in Loans to associates 1,655,400 (19,314) 1,636,086 Liabilities all The arrangements. - Group bears has assessed The credit revenue its risk revenue recognition arrangements accounting against policy se has criteria been updated concluded accordingly. that it is acting as principal in Liabilities Investment in associates 8,782,245 (468,475) 8,313,770 all arrangements. The revenue recognition accounting policy has been updated accordingly. Advances from customers 4,072,537 14,036,887 18,109,424 IAS The Group 20 Accounting has assessed for Government its revenue arrangements Grants Disclosures against se criteria Government concluded Assistance that it is acting as principal in Trade Advances from or customers payables 9,766,101 4,072,537 14,036,887 (85,847) 18,109,424 9,680,254 Liabilities Loans IAS all arrangements. 20 granted Accounting with The for no revenue or Government low recognition interest Grants will accounting not be Disclosures exempt policy from has Government been requirement updated Assistance accordingly. to impute interest. Interest is to be Trade or payables 9,766,101 (85,847) 9,680,254 Advances from customers 4,072,537 14,036,887 18,109,424 imputed Loans granted on loans with granted no or with low below-market interest will not interest be exempt rates. from This amendment requirement did not to impute impact interest. Group. Interest is to be Equity Trade or payables 9,766,101 (85,847) 9,680,254 imputed IAS 20 Accounting on loans granted for Government with below-market Grants interest Disclosures rates. This amendment Government did Assistance not impact Group. Equity Retained earnings 15,480,448 (7,894,220) 7,586,228 IAS Loans 23 granted Borrowing with Cost no or low interest will not be exempt from requirement to impute interest. Interest is to be Retained Non-controlling earnings interest 15,480, ,601 (7,894,220) (67,249) 7,586, ,352 The IAS imputed definition 23 Borrowing loans borrowing granted Cost with costs below-market is revised to interest consolidate rates. This two amendment types items did not that impact are considered Group. components Equity Non-controlling interest 561,601 (67,249) 494,352 borrowing The definition costs borrowing into one - costs interest is revised expense to consolidate calculated using two types effective items that interest are considered rate method components calculated in Retained earnings 15,480,448 (7,894,220) 7,586,228 accordance borrowing IAS 23 Borrowing costs with IAS into Cost 39. one The - Group interest has expense amended calculated its accounting using policy effective accordingly interest which rate method did not calculated result in any in Non-controlling interest 561,601 (67,249) 494,352 IFRIC 16 Hedges a Net Investment in a Foreign Operation change accordance The definition in its with financial IAS borrowing 39. position. The costs Group is revised has amended to consolidate its accounting two types policy accordingly items that are which considered did not components result in any IFRIC The interpretation 16 Hedges is to a Net be applied Investment prospectively. in a Foreign IFRIC Operation 16 provides guidance on accounting for a hedge a net change borrowing in its costs financial into position. one - interest expense calculated using effective interest rate method calculated in The investment. interpretation As such is it to provides be applied guidance prospectively. on identifying IFRIC 16 provides foreign currency guidance risks on that accounting qualify for for hedge a hedge accounting a net IAS accordance 36 Impairment with IAS 39. Asset The Group has amended its accounting policy accordingly which did not result in any IFRIC investment. 16 Hedges a Net Investment in a Foreign Operation hedge As such a net it investment, provides guidance where within on identifying group foreign hedging currency instruments risks that can be qualify held for in hedge hedge accounting When IAS change 36 discounted in Impairment its financial cash position. flows Asset a net are used to estimate fair value less cost to sell additional disclosure is required about The interpretation is to be applied prospectively. IFRIC 16 provides guidance on accounting for a hedge net investment hedge how a net an investment, entity should where determine within group amount hedging foreign instruments currency gain can or be loss, held relating to hedge both a net When discount discounted rate, consistent cash flows with are used disclosures to estimate required fair when value less discounted cost to sell cash additional flows are disclosure used to estimate is required value about in investment. investment As such it provides guidance on identifying foreign currency risks that qualify for hedge accounting how hedging an entity instrument, should determine to be recycled amount on disposal foreign currency net investment. gain or loss, The relating Group to has both elected net to use. IAS discount 36 Impairment This amendment rate, consistent Asset had no with immediate disclosures impact required on when consolidated discounted financial cash statements flows are used to Group estimate because value in in investment hedge a net investment, where within group hedging instruments can be held in hedge a net recycle gain or loss hedging that instrument, arises from to be direct recycled method on disposal consolidation, net which investment. is method The Group Group has elected uses to recoverable use. When This discounted amendment cash amount its had flows cash no are immediate used to estimate generating impact units is on fair currently value consolidated less cost estimated using financial to sell additional value statements disclosure in use. Group is required because about investment recycle how an entity should determine amount foreign currency gain or loss, relating to both net complete its gain consolidation. or loss that As arises from Group did direct not method dispose f consolidation, any net investment, which is it has method had no impact Group uses on to recoverable discount amount rate, consistent its cash with generating disclosures units required is currently when estimated discounted using cash value flows in use. are used to estimate value in investment hedging instrument, to be recycled on disposal net investment. The Group has elected to IAS use. 38 This Intangible amendment Assets had no immediate impact on consolidated financial statements Group because complete financial position its consolidation. or performance As Group Group. did not dispose f any net investment, it has had no impact on recycle gain or loss that arises from direct method consolidation, which is method Group uses to Expenditure IAS recoverable 38 Intangible amount on advertising Assets its cash generating promotional units activities is currently is recognised estimated using as an value expense in when use. Group eir has financial position or performance Group. complete its consolidation. As Group did not dispose f any net investment, it has had no impact on right Expenditure to access on advertising goods or has promotional received activities service. This recognised amendment as an has expense no impact when on Group eir as has Group IFRIC 18 Transfer Assets from Customers financial position or performance Group. accounting right IAS 38 to Intangible access policy Assets is goods in compliance or has received with revised service. stard. This amendment has no impact on Group as Group IFRIC The interpretation 18 Transfer is to Assets be applied from prospectively. Customers IFRIC 18 interpretation provide guidance on how to account accounting Expenditure policy on advertising is in compliance promotional with revised activities stard. is recognised as an expense when Group eir has The for items interpretation property, is to plant be applied equipment prospectively. by recipients IFRIC 18 which interpretation have been provide received from guidance customers, on how or cash to account that is IFRIC 18 Transfer Assets from Customers 2.3 right to access SIGNIFICANT goods ACCOUNTING or has received JUDGEMENTS service. This amendment AND ESTIMATES has no impact on Group as Group for received items property, used to acquire plant or equipment construct specific by recipients assets. which It concludes have been that received when from item customers, property, or cash plant that is 2.3 accounting SIGNIFICANT policy is in compliance ACCOUNTING with revised JUDGEMENTS stard. AND ESTIMATES received The interpretation is to be applied prospectively. IFRIC 18 interpretation provide guidance on how to account equipment transferred used to acquire meets or construct definition specific an asset assets. from It concludes perspective that when recipient, item property, recipient plant should Judgements for equipment items property, plant equipment by recipients which have been received from customers, or cash that is recognise transferred asset at its meets fair value definition date an asset transfer. from The perspective entity must identify recipient, services recipient delivered should In Judgements 2.3 process SIGNIFICANT applying ACCOUNTING Group s accounting JUDGEMENTS policies, management AND ESTIMATES has made following judgements, apart received recognise used to acquire or construct specific assets. It concludes that when item property, plant allocate consideration asset its fair received value to on each date identifiable transfer. service, with The entity credit must recognised identify as services revenue in delivered accordance from In those process involving applying estimations, Group s which accounting have policies, most significant management impact has made on following amounts recognised judgements, in apart equipment allocate transferred meets definition an asset from perspective recipient, recipient should with IAS 18 consideration Revenue. The received Group has to each concluded identifiable that service, amendment with will credit have recognised no impact as on revenue financial accordance position consolidated from Judgements those involving financial statements. estimations, which have most significant impact on amounts recognised in recognise with asset at its fair value on date transfer. The entity must identify services delivered or performance IAS 18 Revenue. Group. The Group has concluded that amendment will have no impact on financial position consolidated In process financial applying statements. Group s accounting policies, management has made following judgements, apart allocate or performance consideration Group. received to each identifiable service, with credit recognised as revenue in accordance from Investment those properties involving estimations, which have most significant impact on amounts recognised in with IAS 18 Revenue. The Group has concluded that amendment will have no impact on financial position consolidated The Investment Group properties has financial elected statements. to adopt cost model for investment properties. Accordingly, investment properties are Improvements to IFRSs or Improvements performance Group. The carried Group at cost has less elected any accumulated to adopt depreciation cost model for investment any accumulated properties. impairment Accordingly, losses. investment properties are In May 2008 to April IFRSs 2009 IASB issued its first omnibus amendments to its stards, primarily with a Investment carried at cost properties less any accumulated depreciation any accumulated impairment losses. In view May to remove 2008 inconsistencies April 2009 IASB clarifying issued wording. its first There omnibus are separate amendments transitional to its provisions stards, for primarily each stard. with a Improvements to IFRSs Classification The Group has elected investment to adopt properties cost model for investment properties. Accordingly, investment properties are view The adoption to remove inconsistencies following amendments clarifying resulted wording. changes There are to separate accounting transitional policies provisions but did not for have each any stard. impact In May 2008 April 2009 IASB issued its first omnibus amendments to its stards, primarily with a The Classification carried Group at cost has less determined investment any accumulated that properties hotels depreciation serviced apartment any accumulated buildings impairment operated by losses. Group are to be classified The on adoption financial position following or performance amendments resulted Group. in changes to accounting policies but did not have any impact view to remove inconsistencies clarifying wording. There are separate transitional provisions for each stard. as The part Group property, has determined plant that equipment hotels rar serviced than investment apartment buildings properties. operated by Group are to be classified on financial position or performance Group. The adoption following amendments resulted in changes to accounting policies but did not have any impact as Classification part property, investment plant properties equipment rar than investment properties. IAS 1 Presentation Financial Statements Operating The Group lease has determined commitments-group that hotels as lessor serviced apartment buildings operated by Group are to be classified on IAS financial position or performance Group. Assets 1 Presentation liabilities classified Financial as Statements held for trading in accordance with IAS 39 Financial Instruments: Recognition as The Operating part Group property, lease has entered commitments-group plant into commercial equipment as rar lessor retail than property investment leases properties. on its investment property portfolio. The Group Assets Measurement liabilities are classified not automatically as held for classified trading in as accordance current in with statement IAS 39 Financial financial Instruments: position. This Recognition did not has The determined, Group has entered based on into an commercial evaluation retail terms property leases conditions its investment arrangements, property that portfolio. it retains The all Group IAS 1 Presentation Financial Statements result Measurement in any re-classification are not automatically financial instruments. classified as current in statement financial position. This did not significant has Operating determined, lease commitments-group risks based rewards on an evaluation as lessor ownership se terms properties conditions so accounts for arrangements, contracts that as operating it retains leases. all Assets result in any liabilities re-classification classified financial as held for instruments. trading in accordance with IAS 39 Financial Instruments: Recognition significant The Group risks has entered rewards into commercial ownership se retail properties property leases so on accounts its investment for contracts property portfolio. as operating The leases. Group Measurement are not automatically classified as current in statement financial position. This did not has determined, based on an evaluation terms conditions arrangements, that it retains all IAS 7 Statement Cash Flows Taxes IAS result in any re-classification financial instruments. Explicitly 7 Statement states that Cash only Flows expenditure that results in recognising an asset can be classified as a cash flow from The Taxes significant risks rewards ownership se properties so accounts for contracts as operating leases. Group is subject to income capital gains taxes in numerous jurisdictions. Significant judgement is required Explicitly investing activities. states that This only amendment expenditure will that impact results in presentation recognising in an asset statement can be classified cash flows. as a cash flow from The to determine Group is subject total to provision income for current capital gains deferred taxes in taxes. numerous jurisdictions. Significant judgement is required IAS investing 7 Statement activities. This Cash amendment Flows Taxes will impact presentation in statement cash flows. to determine total provision for current deferred taxes. Explicitly states that only expenditure that results in recognising 15 an asset can be classified as a cash flow from The Group is subject to income capital gains taxes in 16 numerous jurisdictions. Significant judgement is required investing activities. This amendment will impact presentation in statement cash flows. Emaar Annual 15 to determine total provision for current deferred taxes. 16 Report I 18 Emaar Annual Report I

51 Emaar Properties PJSC its Subsidiaries NOTES Emaar Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 2.3 SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES (continued) 2.4 Revenue SUMMARY recognition (continued) OF SIGNIFICANT ACCOUNTING POLICIES (continued) Estimation 2.3 SIGNIFICANT uncertainty ACCOUNTING JUDGEMENTS AND ESTIMATES (continued) Revenue Lease to buy recognition scheme (continued) Valuation Estimation uncertainty investment properties Sales under lease to buy scheme are accounted as follows: The Group hires services third party valuers to obtain estimates market value investment properties Lease to buy scheme for Valuation purposes investment ir properties impairment review disclosures in consolidated financial statements. Sales Rental under income lease during to buy scheme period are accounted lease is accounted as follows: for on a straight-line basis until such time lessee The Group hires services third party valuers to obtain estimates market value investment properties exercises its option to purchase; Impairment for purposes non financial ir impairment assets review disclosures in consolidated financial statements. Rental income during period lease is accounted for on a straight-line basis until such time lessee The Group determines wher non financial assets are impaired at least on an annual basis. This requires an exercises When its lessee option exercises to purchase; its option to purchase, a sale is recognised in accordance with revenue estimation Impairment non recoverable financial assets amount non financial assets by reference to cash-generating unit to which recognition policy for sale property as stated above; When lessee exercises its option to purchase, a sale is recognised in accordance with revenue The non Group financial determines asset is wher allocated. non Estimating financial assets recoverable are impaired amount at least is by on reference an annual to basis. higher This requires fair value an recognition When recognising policy for sale, revenue property is as stated amount above; which lessee has to pay at time exercising less estimation costs to sell recoverable value in amount use. A value non in financial use calculation assets by requires reference to Group cash-generating to make an estimate unit to which option to acquire property. expected non financial future cash asset flows is allocated. from Estimating cash-generating recoverable unit also amount to choose is by reference a suitable to discount higher rate in fair order value to When recognising sale, revenue is amount which lessee has to pay at time exercising calculate less costs to present sell values value in those use. cash A flows. value in use calculation requires Group to make an estimate Lease option investment to acquire property property. expected future cash flows from cash-generating unit also to choose a suitable discount rate in order to Rental income from investment properties is accounted for on a straight-line basis over lease term on ongoing Impairment calculate present accounts values receivable those cash flows. leases. Lease investment property An estimate collectible amount trade receivable is made when collection full amount is no longer Rental income from investment properties is accounted for on a straight-line basis over lease term on ongoing probable. Impairment For individually accounts receivable significant amounts, this estimation is performed on an individual basis. Amounts which leases. Interest revenue are An not estimate individually collectible significant, amount but which trade are past receivable due, are is assessed made when collectively collection a provision full amount applied is according no longer Interest revenue is recognised as interest accrues using effective interest method, under which rate used to probable. length For individually time past due, significant based on amounts, historical this recovery estimation rates. is performed on an individual basis. Amounts which Interest exactly discounts revenue estimated future cash receipts through expected life financial asset to net carrying are not individually significant, but which are past due, are assessed collectively a provision applied according Interest amount revenue financial is recognised asset. as interest accrues using effective interest method, under which rate used to Useful length lives property, time past plant due, based equipment on historical recovery rates. exactly discounts estimated future cash receipts through expected life financial asset to net carrying The Group's management determines estimated useful lives its property, plant equipment for calculating amount Services financial asset. depreciation. Useful lives This property, estimate plant is determined equipment after considering expected usage asset or physical wear tear. Revenue from rendering services is recognised when outcome transaction can be estimated reliably, by Management The Group's management reviews residual determines value estimated useful lives useful annually lives its property, future depreciation plant equipment charge would for be calculating adjusted Services reference to stage completion transaction at reporting date. where depreciation. management This estimate believes is determined useful after lives considering differ from previous expected estimates. usage asset or physical wear tear. Revenue from rendering services is recognised when outcome transaction can be estimated reliably, by Management reviews residual value useful lives annually future depreciation charge would be adjusted Borrowing reference to costs stage completion transaction at reporting date. where Cost to complete management projects believes useful lives differ from previous estimates. Borrowing costs directly attributable to acquisition, construction or production qualifying assets, which are The Group estimates cost to complete projects in order to determine cost attributable to revenue being Borrowing assets that necessarily costs take a substantial period time to get ready for ir intended use or sale, are added to recognised. Cost to complete These estimates projects include cost providing infrastructure activities, potential claims by sub Borrowing cost those costs assets, directly until such attributable time as to assets acquisition, are substantially construction ready or for production ir intended qualifying use or sale. assets, which are contractors The Group estimates cost cost meeting to complete or contractual projects obligations in order to determine customers. cost attributable to revenue being assets that necessarily take a substantial period time to get ready for ir intended use or sale, are added to recognised. These estimates include cost providing infrastructure activities, potential claims by sub All cost or those borrowing assets, until costs such are recognised time as in assets consolidated are substantially income statement ready for ir in intended period in use which or sale. y are incurred. contractors 2.4 SUMMARY cost OF meeting SIGNIFICANT or contractual ACCOUNTING obligations POLICIES to customers. All Income or tax borrowing costs are recognised in consolidated income statement in period in which y are incurred. Revenue 2.4 SUMMARY recognition OF SIGNIFICANT ACCOUNTING POLICIES Taxation is provided in accordance with relevant fiscal regulations countries in which Group operates. Provided it is probable that economic benefits will flow to Group revenue costs, if applicable, Income tax can Revenue be measured recognition reliably, revenue is recognised in consolidated income statement as follows: Current Taxation tax is provided is expected in accordance tax payable with on relevant taxable fiscal income regulations for year, countries using tax in rates which enacted Group or substantially operates. Provided it is probable that economic benefits will flow to Group revenue costs, if applicable, enacted at reporting date, any adjustments to tax payable in respect prior years. Sale can be measured property reliably, revenue is recognised in consolidated income statement as follows: Current tax is expected tax payable on taxable income for year, using tax rates enacted or substantially The Group recognises revenue when it is probable that economic benefits from sale will flow to Group, Income enacted tax at relating reporting to items date, recognised any adjustments directly in to equity tax is recognised payable in respect in equity prior not years. in income statement. Sale revenue property costs can be measured reliably risks rewards ownership property have been transferred The Group to recognises buyer, revenue which is when normally it is probable on unconditional that economic exchange benefits contracts. from For conditional sale will flow exchanges, to Group, sales Income Deferred tax income relating tax to is items provided, recognised using directly liability in equity method, is recognised on all in temporary equity differences not in income at reporting statement. date are recognised revenue only costs when can all be measured significant reliably conditions are risks satisfied. rewards ownership property have been between tax bases assets liabilities ir carrying amounts. transferred to buyer, which is normally on unconditional exchange contracts. For conditional exchanges, sales Deferred income tax is provided, using liability method, on all temporary differences at reporting date are In jurisdictions recognised only where when all Group significant transfers risks conditions rewards are satisfied. ownership property in its entirety at a single between Deferred income tax bases tax assets assets liabilities liabilities are measured ir carrying at tax amounts. rates that are expected to apply to period when point time, revenue associated costs are recognised at that point time. Although this trigger is asset is realised or liability is settled, based on laws that have been enacted at reporting date. determined In jurisdictions by reference where to Group sales transfers contract risks rewards relevant ownership local laws, so property may differ in its from entirety transaction at a single to Deferred income tax assets liabilities are measured at tax rates that are expected to apply to period when transaction, point time, in general revenue Group associated determines costs are point recognised recognition at that to point be time. at Although which this buyer trigger takes is Deferred asset is income realised tax or assets liability are recognised settled, for based all deductible on laws that temporary have been differences enacted at carry-forward reporting date. unused tax possession determined by reference property. to sales contract relevant local laws, so may differ from transaction to assets unused tax losses to extent that it is probable that taxable prit will be available against which transaction, in general Group determines point recognition to be time at which buyer takes deductible Deferred income temporary tax assets differences are recognised carry-forward all deductible unused temporary tax assets differences unused tax carry-forward losses can be utilised. unused tax possession In jurisdictions where property. Group transfers to buyer control significant risks reward ownership assets unused tax losses to extent that it is probable that taxable prit will be available against which work in progress in its current state as work progresses, revenues related costs development are deductible The carrying temporary amount differences deferred income carry-forward tax assets is reviewed unused at tax each assets balance sheet unused date tax losses reduced can be to utilised. extent recognised In jurisdictions a where progressive Group basis transfers using to percentage buyer control completion method. significant risks reward ownership that it is no longer probable that sufficient taxable prit will be available to allow all or part deferred income work in progress in its current state as work progresses, revenues related costs development are The tax asset carrying to be amount utilised. deferred income tax assets is reviewed at each balance sheet date reduced to extent recognised on a progressive basis using percentage completion method. that it is no longer probable that sufficient taxable prit will be available to allow all or part deferred income tax Cash asset to cash be utilised. equivalents For purpose statement cash flows, cash cash equivalents consist cash in h, bank balances Cash short-term cash deposits equivalents with an original maturity three months or less, net outsting bank overdrafts. For purpose statement cash flows, cash cash equivalents consist cash in h, bank balances short-term deposits with an original maturity three months or less, net outsting bank overdrafts Emaar Annual Report I 20 Emaar Annual Report I

52 Emaar Properties PJSC its Subsidiaries NOTES Emaar Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Trade 2.4 receivables SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Trade receivables are stated at original invoice amount less a provision for any uncollectible amounts. An estimate for Trade doubtful receivables debts is made when collection full amount is no longer probable. Bad debts are written f when re Trade is receivables no possibility are stated recovery. at original invoice amount less a provision for any uncollectible amounts. An estimate for doubtful debts is made when collection full amount is no longer probable. Bad debts are written f when Loans re is no possibility advances recovery. Loans advances are stated at amortised cost net interest suspended provisions for impairment. All loans Loans advances advances are recognised when cash is disbursed to borrowers. Loans advances are stated at amortised cost net interest suspended provisions for impairment. All loans Expenses advances incurred are recognised in making when loans cash or advances is disbursed are charged to borrowers. to income statement in year disbursing se loans advances. Expenses incurred in making loans or advances are charged to income statement in year disbursing se Financial loans advances. assets All financial assets are recognised derecognised on trade date when purchase or sale a financial asset is Financial made under assets a contract whose terms require delivery financial asset within timeframe established by market All financial concerned. assets Financial are recognised assets are derecognised initially measured on trade at cost, date plus when transaction purchase costs, or sale except a for financial those financial asset is assets made under classified a contract as at fair whose value terms through require prit delivery or loss, which financial are initially asset within measured timeframe at fair value. established All recognised by financial market concerned. assets are Financial subsequently assets measured are initially ir measured entirety at cost, eir plus amortised transaction cost or costs, fair value. except for those financial assets classified as at fair value through prit or loss, which are initially measured at fair value. All recognised The financial fair assets value are financial subsequently instruments measured that in ir are actively entirety traded at eir in amortised organised cost financial or fair markets value. is determined by reference to quoted market bid prices for assets fer prices for liabilities, at close business on reporting The fair value date. If quoted financial market instruments prices that are not are available, actively traded reference in organised can also financial be made markets to broker is or determined dealer price by quotations. reference to quoted market bid prices for assets fer prices for liabilities, at close business on reporting date. If quoted market prices are not available, reference can also be made to broker or dealer price The quotations. fair value floating rate overnight deposits with credit institutions is ir carrying value. The carrying value is cost deposit accrued interest. The fair value fixed interest bearing deposits is estimated using The fair discounted value floating cash flow rate techniques. overnight Expected deposits cash with flows credit are institutions discounted is at ir current carrying market value. rates The for carrying similar instruments value is cost at reporting deposit date. accrued interest. The fair value fixed interest bearing deposits is estimated using discounted cash flow techniques. Expected cash flows are discounted at current market rates for similar Classification instruments at financial reporting assets date. For purposes classifying financial assets an instrument is an equity instrument if it is a non-derivative Classification meets definition financial equity assets for issuer (under IAS 32 Financial Instruments: Presentation) except for certain For non-derivative purposes puttable classifying instruments financial presented assets as an equity instrument by is issuer. an equity All or instrument non-derivative if it is a financial non-derivative assets are debt meets instruments. definition equity for issuer (under IAS 32 Financial Instruments: Presentation) except for certain non-derivative puttable instruments presented as equity by issuer. All or non-derivative financial assets are Equity debt instruments. investments For subsequent measurements, all financial assets that are equity investments are measured at fair value eir through Equity investments Or Comprehensive Income (OCI) or through prit or loss. This is an irrevocable choice that Group has For made subsequent on early measurements, adoption all IFRS financial 9 Phase assets 1 or that will are make equity on investments subsequent are acquisition measured at equity fair value investments eir unless through Or equity Comprehensive investments are Income held for (OCI) trading, or through in which prit case, or y loss. must This be is measured an irrevocable at fair choice value that through Group prit or has loss. made on early adoption IFRS 9 Phase 1 or will make on subsequent acquisition equity investments unless equity investments are held for trading, in which case, y must be measured at fair value through prit Gain or loss. or loss on disposal equity investments is not recycled. Dividend Gain or loss income on disposal for all equity equity investments are is recorded not recycled. through consolidated income statement. Debt Dividend instruments income for all equity investments are recorded through consolidated income statement. Debt instruments are also measured at fair value through prit or loss unless y are classified at amortised cost. They Debt instruments are classified at amortised cost only if: Debt i. instruments asset is are held also within measured a business at fair model value whose through objective prit or is loss to hold unless y asset are to classified collect at contractual amortised cost. cash They are flows; classified at amortised cost only if: ii. i. asset contractual is held terms within a business debt model instrument whose give objective rise, on is to specified hold dates, asset to collect cash flows contractual that are solely cash flows; payments principal interest on principal outsting. ii. contractual terms debt instrument give rise, on specified dates, to cash flows that are solely payments principal interest on principal outsting. Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Financial 2.4 SUMMARY assets (continued) OF SIGNIFICANT ACCOUNTING POLICIES (continued) Financial Foreign exchange assets (continued) gains losses The fair value financial assets denominated in a foreign currency is determined in that foreign currency Foreign translated exchange at spot gains rate at losses end reporting period. The foreign exchange component forms part its fair The value fair gain value or loss. financial For financial assets assets denominated classified in a as foreign at fair currency value through is determined prit or in loss, that foreign foreign currency exchange translated component at is recognised spot rate at in end consolidated reporting income period. statement. The foreign For financial exchange assets component designated forms as part at fair its value fair value through gain or or comprehensive loss. For financial income assets any classified foreign exchange as at fair component value through is recognised prit or in loss, consolidated foreign statement exchange component comprehensive is recognised income. in For foreign consolidated currency income denominated statement. debt For instruments financial assets classified designated amortised as at fair cost, value through foreign exchange or comprehensive gains losses income are any determined foreign based exchange on component amortised is cost recognised asset in consolidated are recognised statement in or comprehensive gains losses income. line For item foreign in consolidated currency denominated statement debt comprehensive instruments income. classified at amortised cost, foreign exchange gains losses are determined based on amortised cost asset are recognised in or Derecognition gains losses financial line assets item in consolidated statement comprehensive income. A financial asset (or, when applicable, a part a financial asset or part a group similar financial assets) is Derecognition derecognised when: financial assets A financial The asset rights (or, to when receive applicable, cash flows a part from a financial asset have asset expired, or part a group similar financial assets) is derecognised The Group when: retains right to receive cash flows from asset, but has assumed an obligation to pay m in The full rights without to receive material cash delay flows to a from third party asset under have a expired, 'pass-through' arrangement, The Group has retains transferred right its to rights receive to cash receive flows cash from flows from asset, but asset has assumed eir: an obligation to pay m - in full has without transferred material substantially delay to all a third risks party under rewards a 'pass-through' asset, arrangement, or The - has Group neir has transferred its nor rights retained to receive substantially cash flows all from risks asset rewards eir: asset, but has - has transferred transferred control substantially asset. all risks rewards asset, or - has neir transferred nor retained substantially all risks rewards asset, but has When Group has transferred its right to receive cash flows from an asset has neir transferred nor retained transferred control asset. substantially all risks rewards asset nor transferred control asset, asset is recognised to When extent Group Group's has transferred continuing its right involvement to receive in cash flows asset. from Continuing an asset involvement has neir that transferred takes nor form retained a substantially guarantee over all transferred risks rewards asset is measured asset at nor transferred lower control original carrying asset, amount asset is recognised asset to extent maximum amount Group's consideration continuing that involvement Group in could be asset. required Continuing to repay. involvement that takes form a guarantee over transferred asset is measured at lower original carrying amount asset maximum Development amount properties consideration that Group could be required to repay. Properties acquired, constructed or in course construction for sale are classified as development properties. Development Unsold properties properties are stated at lower cost or net realisable value. Cost includes: Properties acquired, constructed or in course construction for sale are classified as development properties. Unsold properties Freehold are stated leasehold at rights lower for l cost or net realisable value. Cost includes: Amounts paid to contractors for construction Freehold Borrowing costs, leasehold planning rights for design l costs, costs site preparation, pressional fees for legal services, Amounts property transfer paid to contractors taxes, construction for construction overheads or related costs. Borrowing costs, planning design costs, costs site preparation, pressional fees for legal services, Non refundable property commissions transfer taxes, paid construction to sales or marketing overheads agents or on related sale costs. real estate units are expensed when related revenue is recognised. Non refundable commissions paid to sales or marketing agents on sale real estate units are expensed when Net related realisable revenue value is recognised. estimated selling price in ordinary course business, based on market prices at reporting date discounted for time value money if material, less costs to completion estimated Net costs realisable sale. value is estimated selling price in ordinary course business, based on market prices at reporting date discounted for time value money if material, less costs to completion estimated costs The cost sale. development properties recognised in consolidated income statement on disposal is determined with reference to specific costs incurred on property sold an allocation any non-specific costs based on relative The cost size development property properties sold. recognised in consolidated income statement on disposal is determined with reference to specific costs incurred on property sold an allocation any non-specific costs based on relative The Board size Directors property reviews sold. carrying values development properties on an annual basis. The Board Directors reviews carrying values development properties on an annual basis Emaar Annual Report I 22 Emaar Annual Report I

53 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Property, plant equipment 2.4 Investment SUMMARY in an associate OF SIGNIFICANT ACCOUNTING POLICIES (continued) 2.4 Property, SUMMARY plant equipment OF SIGNIFICANT are stated ACCOUNTING at cost less accumulated POLICIES depreciation (continued) any impairment in value. The Group s investment in its associate is accounted for using equity method accounting. Goodwill relating Depreciation is calculated on a straight-line basis over estimated useful lives as follows: Investment to associate in an is associate included in carrying amount investment is not amortised or separately tested for Property, plant equipment The impairment. Group s Where investment re in has its been associate a change is accounted recognised for directly using in equity equity method associate, accounting. Goodwill Group recognises relating Property, Leasehold plant improvements equipment are stated at cost less accumulated 2-5 years depreciation any impairment in value. to its share associate any changes is included in discloses carrying this, when amount applicable, investment statement is not changes amortised in equity. or separately Unrealised tested gains for Depreciation Sales centers is calculated on a straight-line basis over estimated 1-5 useful years lives as follows: impairment. losses resulting Where re from has transactions been a change between recognised Group directly in associate equity are eliminated associate, to Group extent recognises Or buildings years its interest share in any associate. changes discloses this, when applicable, in statement changes in equity. Unrealised gains Leasehold Computers improvements fice equipment 2-5 years years losses resulting from transactions between Group associate are eliminated to extent Sales Plant, centers machinery heavy equipment years years interest The share in associate. prit associates is shown on face consolidated income statement. This is prit Or Motor buildings vehicles years years attributable to equity holders associate refore is prit after tax minority interests in Computers Furniture fixtures fice equipment years years The subsidiaries share prit associates. associates is shown on face consolidated income statement. This is prit Plant, Leisure, machinery entertainment heavy & or equipment assets years years attributable to equity holders associate refore is prit after tax minority interests in Motor vehicles 3-5 years subsidiaries After application associates. equity method, Group determines wher it is necessary to recognise an additional Furniture No depreciation fixtures is charged on capital work in progress. The 2 useful - 10 years lives depreciation method are reviewed impairment loss on Group s investment in its associates. The Group determines at each reporting date wher Leisure, periodically entertainment to ensure & that or assets method period depreciation 2-25 years are consistent with expected pattern After re is application any objective evidence equity method, that investment Group determines associate wher is it impaired. is necessary If this to recognise case an additional Group economic benefits from se assets. impairment calculates loss amount on Group s impairment investment as in difference its associates. between The Group recoverable determines amount at each reporting associate date wher its No depreciation is charged on capital work in progress. The useful lives depreciation method are reviewed re carrying is any value objective recognises evidence that amount in investment consolidated in income associate statement. is impaired. If this is case Group periodically Expenditure to incurred ensure to that replace method a component period an item depreciation property, are plant consistent equipment with that expected is accounted pattern for calculates amount impairment as difference between recoverable amount associate its economic separately benefits is capitalised from se assets. carrying amount component that is replaced is written f. Or subsequent carrying Interest value in a joint venture recognises amount in consolidated income statement. expenditure is capitalised only when it increases future economic benefits related item property, plant The Group has interests in joint ventures which are jointly controlled. A joint venture is a contractual arrangement Expenditure equipment. All incurred or expenditure to replace a is component recognised in an item consolidated property, income plant statement equipment as expense that is is accounted incurred. for Interest whereby in two a joint or more venture parties undertake an economic activity that is subject to joint control, a jointly controlled separately is capitalised carrying amount component that is replaced is written f. Or subsequent The entity Group is a joint has venture interests that in joint involves ventures establishment which are jointly a separate controlled. entity A joint which venture is venturer a contractual has an interest. arrangement The expenditure Property, plant is capitalised equipment only when are reviewed it increases for future impairment economic whenever benefits events or related changes item in circumstances property, plant indicate whereby Group recognises two or more its interest parties in undertake joint an ventures economic using activity equity that is method subject until to joint date control, which a jointly Group controlled ceases equipment. that carrying All or amount expenditure property, is recognised plant in equipment consolidated may not income be recoverable. statement Whenever as expense carrying is incurred. amount entity to have is joint a joint control venture over that involves joint venture. establishment The interest in a separate joint entity venture in is which carried in venturer consolidated has an interest. statement The property, plant equipment exceeds ir recoverable amount, an impairment loss is recognised in income Property, statement. plant The recoverable equipment amount are reviewed is higher for impairment fair value whenever less costs events to sell or changes property, in plant circumstances equipment indicate Group financial recognises position its at interest cost, plus in post-acquisition joint ventures changes using in equity Group s method share until net date assets on which joint Group venture, ceases less that value carrying in use. amount The fair value property, less plant costs to sell equipment is amount may not obtainable be recoverable. from Whenever sale property, carrying plant amount to any have impairment joint control in value. over The joint consolidated venture. The income interest statement in joint reflects venture Group s is carried share in consolidated results statement its joint equipment property, in plant an arm s equipment length transaction exceeds ir while recoverable value in use amount, is an present impairment value loss estimated is recognised future in cash income venture. financial position at cost, plus post-acquisition changes in Group s share net assets joint venture, less flows statement. expected to The arise recoverable from amount continuing is use higher property, fair value plant less costs equipment to sell property, from its disposal plant at equipment end any impairment in value. The consolidated income statement reflects Group s share results its joint its useful value life. in use. The fair value less costs to sell is amount obtainable from sale property, plant venture. The financial statements joint venture are prepared for same reporting year as parent company, using consistent accounting policies. equipment in an arm s length transaction while value in use is present value estimated future cash flows The financial statements joint venture are prepared for same reporting year as parent company, using expected Reversal to arise impairment from losses continuing recognised use in property, prior plant years is equipment recorded when from re its disposal an indication end that its consistent Business combinations accounting policies. goodwill useful impairment life. losses recognised for property, plant equipment no longer exist or have reduced. Business combinations are accounted for using acquisition method accounting. This involves recognising Business identifiable combinations assets (including goodwill previously unrecognised intangible assets) liabilities (including contingent Reversal Investment properties impairment losses recognised in prior years is recorded when re is an indication that Business liabilities combinations excluding are future accounted restructuring) for using acquired acquisition business method at fair value. accounting. This involves recognising impairment Properties held losses for recognised rental or for capital property, appreciation plant purposes equipment are classified no longer exist as investment or have reduced. properties. Investment identifiable assets (including previously unrecognised intangible assets) liabilities (including contingent properties are measured at cost less any accumulated depreciation any accumulated impairment losses. Investment Depreciation properties liabilities Goodwill acquired excluding a future business restructuring) combination is initially acquired measured business at at fair cost value. being excess cost is charged on a straight-line basis over estimated useful lives as follows: business combination over Group s interest in net fair value acquiree s identifiable assets, liabilities Properties held for rental or capital appreciation purposes are classified as investment properties. Investment properties Buildings are measured at cost less any accumulated depreciation years any accumulated impairment losses. Goodwill contingent acquired liabilities. in a business Following combination initial recognition, is initially measured goodwill is at measured cost being at cost excess less any accumulated cost Depreciation Fixed furniture is charged fixtures on a straight-line basis over estimated 10 useful years lives as follows: business impairment combination losses. For over purpose Group s impairment interest in testing, net fair goodwill value acquired acquiree s in a business identifiable combination assets, is, liabilities from acquisition contingent date, liabilities. allocated to Following each initial Group s recognition, cash generating goodwill units, is or measured Groups at cash cost generating less any units, accumulated that are Movable furniture fixtures 4 years Buildings years impairment expected to losses. benefit For from purpose synergies impairment combination, testing, goodwill irrespective acquired wher in a business or assets combination or liabilities is, from Fixed The useful furniture life fixtures depreciation method are reviewed periodically 10 years to ensure that method period acquisition Group are assigned date, allocated to those to units each or Group Group s units. cash Each generating unit or Group units, or units Groups to which cash generating goodwill units, is allocated: that are Movable depreciation furniture are consistent fixtures with expected pattern economic 4 benefits years from se assets. expected to benefit from synergies combination, irrespective wher or assets or liabilities Group are represents assigned to those lowest units level or Group within units. Group Each at which unit or Group goodwill units is monitored which for goodwill internal is management allocated: The Properties useful are life transferred depreciation from investment method are properties reviewed to development periodically properties to ensure when, that method only when, period re is a purposes; depreciation change in use, are evidenced consistent by with commencement expected pattern development economic with benefits a view from to sale. se Such assets. transfers are made at represents is not larger than lowest a segment level within based on eir Group at Group s which primary goodwill or is Group s monitored secondary for internal reporting management format carrying value properties at date transfer. purposes; determined in accordance with IFRS 8 Segment Reporting Properties are transferred from investment properties to development properties when, only when, re is a is not larger than a segment based on eir Group s primary or Group s secondary reporting format change The Group in use, determines evidenced at each by commencement reporting date wher development re is any with objective a view to evidence sale. Such that transfers investment are made properties at Where goodwill determined forms in accordance part a cash with generating IFRS 8 Segment unit (Group Reporting cash generating units) part operation carrying are impaired. value Whenever properties carrying at date amount transfer. an investment property exceeds ir recoverable amount, an within that unit is disposed f, goodwill associated with operation disposed f is included in carrying impairment loss is recognised in income statement. The recoverable amount is higher investment Where amount goodwill operation forms part when determining a cash generating gain unit or (Group loss on disposal cash generating operation. units) Goodwill part disposed operation f in The property s Group net determines selling price at each reporting value date in use. wher The re net selling is any price objective is evidence amount obtainable that investment from properties sale an within this circumstance that unit is is disposed measured f, based goodwill on relative associated values with operation disposed f is included portion in carrying cash are investment impaired. property Whenever in an arm s carrying length amount transaction an while investment value in property use is exceeds present ir value recoverable estimated amount, future cash an amount generating unit operation retained. when determining gain or loss on disposal operation. Goodwill disposed f in impairment flows expected loss to is arise recognised from in continuing income use statement. this investment The recoverable property amount from is its disposal higher at investment end its this circumstance is measured based on relative values operation disposed f portion cash property s useful life. net selling price value in use. The net selling price is amount obtainable from sale an Goodwill generating is unit tested retained. for impairment annually (at 31 December) when circumstances indicate that carrying value investment property in an arm s length transaction while value in use is present value estimated future cash may be impaired. Impairment is determined by assessing recoverable amount cash generating unit or group flows Reversal expected impairment to arise from losses recognised continuing use in this prior investment years is recorded property when from re its disposal an indication end that its Goodwill cash generating is tested units, for impairment to which goodwill annually relates. (at 31 December) Where recoverable when circumstances amount indicate cash generating that carrying unit or group value useful impairment life. losses recognised for investment property no longer exist or have reduced. may cash be generating impaired. Impairment units is less is than determined carrying by assessing amount, an impairment recoverable loss amount is recognised. cash generating unit or group cash generating units, to which goodwill relates. Where recoverable amount cash generating unit or group Reversal impairment losses recognised in prior 21 years is recorded when re is an indication that cash generating units is less than carrying amount, 22 an impairment loss is recognised. impairment losses recognised for investment property no longer exist or have reduced. Emaar Annual Report I 24 Emaar Annual Report I

54 Emaar Properties PJSC its Subsidiaries 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Derivative financial instruments The Group enters into derivative financial instruments to manage its exposure to foreign exchange rate risk, including foreign exchange forward contracts. Derivatives are initially recognised at fair value at date derivative contract is entered into are subsequently remeasured to ir fair value at end each reporting period. The resulting gain or loss is recognised in prit or loss immediately unless derivative is designated effective as a hedging instrument, in which event timing recognition in prit or loss depends on nature hedge relationship. The Group designates derivatives as hedges foreign currency risk firm commitments (cash flow hedges). A derivative with a positive fair value is recognised as a financial asset; a derivative with a negative fair value is recognised as a financial liability. Hedge accounting The Group designates certain hedging instruments, as eir fair value hedges or cash flow hedges. Hedges foreign exchange risk on firm commitments are accounted for as cash flow hedges. At inception hedge relationship, entity documents relationship between hedging instrument hedged item, along with its risk management objectives its strategy for undertaking various hedge transactions. Furrmore, at inception hedge on an ongoing basis, Group documents wher hedging instrument is highly effective in fsetting changes in fair values or cash flows hedged item. Fair value hedges Changes in fair value derivatives that are designated qualify as fair value hedges are recognised in prit or loss immediately, toger with any changes in fair value hedged asset or liability that are attributable to hedged risk. The change in fair value hedging instrument change in hedged item attributable to hedged risk are recognised in line consolidated statement comprehensive income relating to hedged item. Hedge accounting is discontinued when Group revokes hedging relationship, when hedging instrument expires or is sold, terminated, or exercised, or when it no longer qualifies for hedge accounting. The fair value adjustment to carrying amount hedged item arising from hedged risk is amortised to consolidated income statement from that date. Cash flow hedges The effective portion changes in fair value derivatives that are designated qualify as cash flow hedges is recognised in or comprehensive income. The gain or loss relating to ineffective portion is recognised immediately in consolidated income statement, is included in or gains losses line item. Amounts previously recognised in or comprehensive income accumulated in equity are reclassified to prit or loss in periods when hedged item is recognised in consolidated income statement, in same line consolidated statement comprehensive income as recognised hedged item. However, when forecast transaction that is hedged results in recognition a non-financial asset or a non-financial liability, gains losses previously accumulated in equity are transferred from equity included in initial measurement cost non-financial asset or non-financial liability. Hedge accounting is discontinued when Group revokes hedging relationship, when hedging instrument expires or is sold, terminated, or exercised, or it no longer qualifies for hedge accounting. Any gain or loss accumulated in equity at that time remains in equity is recognised when forecast transaction is ultimately recognised in consolidated income statement. When a forecast transaction is no longer expected to occur, gain or loss accumulated in equity is recognised immediately in consolidated income statement. Impairment financial assets The Group assesses at each reporting date wher re is any objective evidence that a financial asset or a group financial assets is impaired. A financial asset or a group financial assets is deemed to be impaired if, only if, re is objective evidence impairment as a result one or more events that has occurred after initial recognition asset (an incurred loss event ) that loss event has an impact on estimated future cash flows financial asset or group financial assets that can be reliably estimated. Evidence impairment may include indications that debtors or a group debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, probability that y will enter bankruptcy or or financial reorganisation where observable data indicate that re is a measurable decrease in estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults. 23 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries NOTES At 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Trade 2.4 SUMMARY or payables OF SIGNIFICANT ACCOUNTING POLICIES (continued) Trade Liabilities are or recognised payables for amounts to be paid in future for goods or services received, wher billed by Liabilities supplier or are not. recognised for amounts to be paid in future for goods or services received, wher billed by supplier Loans or not. borrowings Loans After initial borrowings recognition, interest bearing loans borrowings are subsequently measured at amortised cost using After effective initial recognition, interest rate interest method. bearing Gains loans losses borrowings are recognised are in subsequently consolidated measured income at amortised statement cost when using liabilities effective are interest derecognised rate method. as well Gains as through losses amortisation are recognised process. in consolidated income statement when liabilities End service are derecognised benefits as well as through amortisation process. End The Group service provides benefits end service benefits to its employees. The entitlement to se benefits is usually based upon The employees Group provides final end salary service length benefits to service, its employees. subject to The entitlement completion to se a minimum benefits is service usually period. based upon The expected employees costs final se salary benefits are length accrued over service, period subject to employment. completion a minimum service period. The With expected respect costs to its se UAE benefits national are employees, accrued over Group period makes employment. contributions to a pension fund established by With General respect Pension to its UAE Social national Security employees, Authority calculated Group makes as a percentage contributions to a employees pension fund salaries. established The Group s by General obligations Pension are limited Social to se Security contributions, Authority which calculated are expensed as a percentage when due. employees salaries. The Group s Provisions obligations are limited to se contributions, which are expensed when due. Provisions Provisions are recognised when Group has a present obligation (legal or constructive) arising from a past event, Provisions costs are to recognised settle obligation when Group are both has probable a present obligation able to be (legal reliably or constructive) measured. arising from a past event, Share based costs to payment settle transactions obligation are both probable able to be reliably measured. Share Employees based (including payment transactions senior executives) Group also receive remuneration in form share based Employees payment transactions, (including whereby senior executives) employees render services Group also as consideration receive remuneration for equity in instruments form ( equity share settled based payment transactions ). transactions, The cost whereby equity-settled employees transactions render services with employees as consideration is measured for equity by reference instruments to ( equity fair value settled at transactions ). date at which The cost awards equity-settled are granted. transactions The cost with equity-settled employees is transactions measured by with reference employees to is fair recognised, value at toger date with at which a corresponding awards increase are granted. in equity, The cost over equity-settled period in which transactions performance with employees conditions is are recognised, fulfilled toger ending on with a date corresponding on which increase employees in equity, become over fully period entitled in to which award performance ( vesting date ). conditions The are cumulative fulfilled ending expense on recognised date on for which equity-settled employees transactions become at each fully reporting entitled to date until award ( vesting vesting date date ). reflects The cumulative extent to which expense recognised vesting period for equity-settled has expired transactions Group s at each best reporting estimate date until number vesting equity date instruments reflects extent that will to which ultimately vest. vesting The period income has statement expired charge or Group s credit for best a estimate period represents number movement equity in instruments cumulative that expense will ultimately recognised vest. as at The beginning income statement end charge that period. or credit for a period represents movement in cumulative expense recognised Under Company as at beginning Programme, awards, end that which period. represent right to purchase Company s ordinary shares at Under par, are allocated Company to eligible Programme, employees awards, (including which represent executive directors) right to purchase Company. Company s ordinary shares at par, Foreign are allocated currency to translations eligible employees (including executive directors) Company. Foreign The consolidated currency financial translations statements are presented in UAE Dirhams (AED) which is functional currency The parent consolidated company. financial Each company statements in are Group presented determines in UAE its Dirhams own functional (AED) which currency is functional items included currency in parent financial company. statements Each each company entity in are measured Group determines using that functional its own functional currency. currency items included in financial Transactions statements in foreign each currencies entity are are measured recorded using in that functional functional currency currency. at rate ruling at date Transactions transaction. Monetary in foreign assets currencies liabilities are recorded denominated in functional in foreign currency currencies at are rate retranslated ruling at at date rate transaction. exchange ruling Monetary at assets reporting date. liabilities All differences denominated are taken in foreign to consolidated currencies income are retranslated statement. at Any goodwill rate exchange arising on ruling acquisition at reporting a foreign date. operation All differences any are fair taken value to adjustments consolidated to income carrying statement. amounts Any assets goodwill arising liabilities on arising acquisition on acquisition a foreign are operation treated as assets any fair value liabilities adjustments foreign to carrying operation amounts translated assets at liabilities closing rate. arising on acquisition are treated as assets liabilities foreign operation translated at closing As at rate. reporting date, assets liabilities subsidiaries with functional currencies or than AED are As translated at into reporting AED date, at rate assets exchange liabilities ruling at subsidiaries reporting date with functional ir income currencies statements or are than translated AED are at translated weighted into average AED at exchange rate rates exchange for ruling year. The at differences reporting arising date on ir income translation statements are taken are directly translated to at consolidated weighted average statement exchange comprehensive rates for income. year. The On differences disposal arising an on entity, translation deferred are taken cumulative directly amount to consolidated recognised in statement equity relating comprehensive to that entity is income. recognised On in disposal consolidated an entity, income statement. deferred cumulative amount recognised Contingencies in equity relating to that entity is recognised in consolidated income statement. Contingencies Contingent liabilities are not recognised in consolidated financial statements. They are disclosed unless Contingent possibility liabilities an outflow are not resources recognised embodying in consolidated economic benefits financial is remote. statements. A contingent They are asset disclosed is not recognised unless possibility in consolidated an outflow financial resources statements embodying but disclosed economic when an benefits inflow is remote. economic A contingent benefits is asset probable. is not recognised in consolidated financial statements but disclosed when an inflow economic benefits is probable. Emaar Annual Report I 26 Emaar Annual 24 Report I 27 24

55 Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 2.4 Fair values SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) For investments traded in an active market, fair value is determined by reference to quoted market bid prices. Fair values For The investments fair value traded interest-bearing an active items market, is estimated fair value based is determined on discounted by reference cash flows to quoted using market interest bid rates prices. for items with similar terms risk characteristics. The fair value interest-bearing items is estimated based on discounted cash flows using interest rates for items with For unquoted similar terms equity investments, risk characteristics. fair value is determined by reference to market value a similar investment or is based on expected discounted cash flows. For unquoted equity investments, fair value is determined by reference to market value a similar investment or The is fair based value on expected forward foreign discounted exchange cash flows. contracts is calculated by reference to current forward exchange rates with same maturity. The fair value forward foreign exchange contracts is calculated by reference to current forward exchange rates with Treasury same shares maturity. Treasury shares consist Company s own shares that have been issued, subsequently repurchased by Treasury company shares not yet reissued or cancelled. These shares are accounted for using cost method. Under cost Treasury method shares average consist cost share Company s repurchased own shares is shown that as have deduction been from issued, subsequently total shareholders repurchased equity. by When company se shares are not reissued, yet reissued gains or are cancelled. credited These to a separate shares are capital accounted reserve for in using shareholders cost method. equity, Under which is nondistributable. average Any realised cost losses share are repurchased charged directly is shown to retained as deduction earnings. from Gains total realised shareholders on sale equity. reissue When cost method se shares shares first are used reissued, to fset gains any are previously credited recorded to a separate losses capital in order reserve retained shareholders earnings equity, capital which is reserve nondistributable. account. No cash Any dividends realised are losses paid are on charged se shares. directly to retained earnings. Gains realised on sale reissue shares are first used to fset any previously recorded losses in order retained earnings capital reserve account. No cash dividends are paid on se shares. 2.5 NEW STANDARDS AND INTERPRETATIONS NOT YET EFFECTIVE The 2.5 IASB NEW IFRIC STANDARDS have issued AND a number INTERPRETATIONS stards NOT interpretations YET EFFECTIVE with an effective date after date se financial statements. The management has set out below only those which may have a material impact on The financial IASB statements IFRIC in have future issued periods. a number stards interpretations with an effective date after date se financial statements. The management has set out below only those which may have a material impact on financial IFRS 3 statements (Revised) in Business future periods. Combinations IAS 27 (Amended) Consolidated Separate Financial Statements IFRS The revised 3 (Revised) stards Business are effective Combinations prospectively for IAS business 27 (Amended) combinations Consolidated affected in financial Separate periods Financial beginning Statements on or after 1 July IFRS 3 (Revised) introduces a number changes in accounting for business combinations The revised stards that will are impact effective prospectively amount goodwill for business recognised, combinations reported affected results in financial periods period beginning that an acquisition or after occurs, 1 July future IFRS reported 3 (Revised) results. introduces a number changes in accounting for business combinations that will impact amount goodwill recognised, reported results in period that an acquisition IAS 27 requires occurs, that a change future reported in ownership results. interest a subsidiary (without loss control) to be accounted for as an equity transaction. Therefore, such a transaction would no longer give rise to goodwill, nor give rise to a gain IAS or loss. 27 requires that a change in ownership interest a subsidiary (without loss control) to be accounted for as an equity transaction. Therefore, such a transaction would no longer give rise to goodwill, nor give rise to a gain or IAS loss. 17 Leases amendment This amendment is effective for financial periods beginning on or after 1 January This amendment deletes much IAS 17 Leases existing amendment wording in stard to effect all leases l (where title does not pass) were This operating amendment leases. is The effective amendment for financial requires periods that in beginning determining on wher or after 1 January lease l This (eir amendment separately deletes or in much combination with existing or wording property) in is an stard operating to or a finance effect all lease, leases same l criteria (where are title applied does as not for pass) any or were operating asset. This leases. may have The amendment impact in requires future that that in more determining leases wher l will be lease treated l as finance (eir leases separately rar or than in combination operating leases. with or property) is an operating or a finance lease, same criteria are applied as for any or asset. This may have impact in future that more leases l will be treated as finance leases rar than operating IAS 39 Financial leases. Instruments: Recognition Measurement Eligible Hedged Items This amendment was issued in July 2008 is effective for financial years beginning on or after 1 July The IAS amendment 39 Financial addresses Instruments: designation Recognition a one-sided Measurement risk in a hedged Eligible item, Hedged Items designation inflation as a hedged This amendment risk or portion was issued in particular in July situations is effective for financial years beginning on or after 1 July The amendment addresses designation a one-sided risk in a hedged item, designation inflation as a hedged risk or portion in particular situations. Emaar Properties PJSC its Subsidiaries 3 SEGMENT INFORMATION Business segments: For management purposes, Group is organised into two major business segments. The real estate segment develops sells condominiums, villas, commercial units plots l related retail, residential commercial leasing activities. Or segments include businesses that individually do not meet criteria for a reportable segment as per IFRS 8. These businesses are property management services, education, healthcare, hospitality investment in providers financial services. Income from sources or than real estate segment hospitality is included in or operating income. Geographic segments: The Group is currently developing a number international business opportunities outside United Arab Emirates that will have a significant impact in future periods. The domestic segment includes business activity operations in UAE international segment includes business activity operations outside UAE. Business segments The following table represents revenue prit information certain asset liability information regarding business segments for years ended 31 December : Real estate Ors Eliminations Total AED 000 AED 000 AED 000 AED 000 Revenue Revenue from external customers 7,759, ,155 (13,262) 8,413,262 Total revenue 7,759, ,155 (13,262) 8,413,262 Results Prit for year before impairment assets, income tax, finance costs, finance income, share results associated companies 2,573,623 (56,247) (14,522) 2,502,854 Assets liabilities Segment assets 60,475,682 9,965,633 (6,296,517) 64,144,798 Segment liabilities 35,038,541 5,687,519 (5,460,270) 35,265,790 Or Segment Information Capital expenditure (property, plant equipment) 610,007 1,123,803-1,733,810 Depreciation (property, plant equipment) 164, , , Emaar Annual Report I 28 Emaar Annual Report I

56 Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS Emaar Properties PJSC its Subsidiaries 3 SEGMENT INFORMATION (continued) 3 Business SEGMENT segments (continued) INFORMATION (continued) Business 2008 (restated): segments (continued) Real estate Ors Eliminations Total 2008 (restated): AED 000 AED 000 AED 000 AED 000 Real estate Ors Eliminations Total Revenue AED 000 AED 000 AED 000 AED 000 Revenue from external customers 10,145, ,950 (5,124) 10,717,111 Revenue Total Revenue revenue from external customers 10,145, ,950 (5,124) 10,717,111 Results Total revenue Prit for year before Results impairment assets, Prit income for tax, finance year before costs, finance impairment income, assets, share results income tax, associated finance costs, companies 10,145,285 3,856, ,950 (119,725) (5,124) (2,642) 10,717,111 3,734,039 finance income, share Assets results associated liabilities companies Segment assets 3,856,406 62,197,116 (119,725) 9,203,522 (2,642) (4,720,269) 3,734,039 66,680,369 Assets liabilities Segment assets 62,197,116 9,203,522 (4,720,269) 66,680,369 Segment liabilities 37,818,036 4,382,967 (4,121,519) 38,079,484 Segment liabilities 37,818,036 4,382,967 (4,121,519) 38,079,484 Or Segment Information 3 SEGMENT INFORMATION (continued) Geographic segments (continued) 2008 (restated): Domestic International Total AED 000 AED 000 AED 000 Revenue Revenue from external customers 10,623,202 93,909 10,717,111 Total revenue 10,623,202 93,909 10,717,111 Assets Segment assets 41,191,333 17,175,266 58,366,599 Investment in associates 2,552,415 5,761,355 8,313,770 Total assets 43,743,748 22,936,621 66,680,369 Or Segment Information Capital expenditure (property, plant equipment) 5,471, ,218 5,848,188 Or Capital Segment expenditure Information (property, 4 REVENUE AND COST OF REVENUE plant equipment) 4,403,104 1,445,084-5,848,188 Capital expenditure (property, Depreciation plant equipment) (property, 4,403,104 1,445,084-5,848,188 AED'000 AED'000 plant equipment) 99, , ,411 (Restated) Depreciation (property, Revenue plant equipment) 99, , ,411 Geographic segments The following tables represent revenue prit information certain asset liability information regarding Revenue from property sales: Geographic geographic segments for years ended 31 December Sale condominiums 4,312,397 6,052,642 The following tables represent revenue prit information certain asset liability information regarding Sale villas 1,728,705 2,511,140 geographic 2009: segments for years ended 31 December Sale plots l 135, ,726 Domestic International Total Sale commercial ors 59, , : AED 000 AED 000 AED 000 Domestic International Total Revenue from hospitality 667, ,949 Revenue AED 000 AED 000 AED 000 Revenue from external customers 7,775, ,434 8,413,262 Rental income from leased properties related income 1,509, ,958 Revenue Total Revenue revenue from external customers 7,775, ,434 8,413,262 8,413,262 10,717,111 Assets Total revenue 7,775, ,434 8,413,262 Cost revenue Segment assets 40,814,181 15,470,013 56,284,194 Investment Assets in associates 2,175,987 5,684,617 7,860,604 Cost revenue property sales: Segment assets 40,814,181 15,470,013 56,284,194 Cost condominiums 2,802,559 3,868,877 Total Investment assets in associates 42,990,168 2,175,987 21,154,630 5,684,617 64,144,798 7,860,604 Cost villas 753, ,973 Cost plots l 8,957 24,621 Or Total assets Segment Information 42,990,168 21,154,630 64,144,798 Cost commercial ors 32, ,337 Capital Or Segment expenditure Information (property, Operating cost hospitality 447, ,653 plant equipment) 1,583, ,847 1,733,810 Capital expenditure (property, Operating cost leased properties 268, ,894 plant equipment) 1,583, ,847 1,733,810 4,313,806 5,487, Emaar Annual Report I 30 Emaar Annual Report I

57 Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 5 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES Emaar Properties PJSC its Subsidiaries 5 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES AED'000 AED' Payroll related expenses AED' ,536 AED' ,625 Sales marketing expenses 188, ,547 Depreciation Payroll related property, expenses plant equipment (note 16) 322, , , ,625 Depreciation Sales marketing investment expenses properties (note 17) 313, , ,547 85,637 Property Depreciation management property, expenses plant equipment (note 16) 322,200 66, ,996 70,671 Depreciation L registration investment fees properties (note 17) 313,512 72,498 85,637 96,930 Property Provision management for doubtful expenses debts/ write f 66,926 94,484 70,671 - L Pre-operating registration expenses fees 72,498 51,737 96,930 69,462 Provision Or expenses for doubtful debts/ write f 348,128 94, ,870 - Pre-operating expenses 51,737 69,462 Or expenses 1,911, ,128 1,904, ,870 1,911,865 1,904,738 6 FINANCE INCOME 6 FINANCE INCOME AED'000 AED' Finance income on fixed deposits with banks AED' ,815 AED' ,829 Or finance income 198, ,793 Finance income on fixed deposits with banks 156, ,829 Or finance income 198, , , , , ,622 7 DISCONTINUED OPERATIONS 7 On 19 February DISCONTINUED 2009, Group s OPERATIONS US subsidiary, WL Homes LLC along with its affiliates, filed Chapter 11 petitions in US Bankruptcy Court for District Delaware. The Chapter 11 process allows reorganisation On company s 19 February debts 2009, Group s continuation US subsidiary, operations WL Homes during LLC reorganisation along with its process. affiliates, On filed 5 June Chapter bankruptcy petitions in court US had Bankruptcy ordered Court conversion for District from reorganisation Delaware. under The Chapter Chapter process to liquidation allows reorganisation under Chapter 7 due company s to restructuring debts plan not continuation being acceptable operations to unsecured during creditors. reorganisation As a result, process. carrying On 5 values June 2009 net bankruptcy assets relating court to WL had Homes ordered LLC conversion were fully written from reorganisation f during under year. Chapter 11 to liquidation under Chapter 7 due to restructuring plan not being acceptable to unsecured creditors. As a result, carrying values net assets The results relating for to WL year Homes from LLC discontinued were fully operations written f during carrying year. value net assets written f relating to WL Homes LLC as at 31 December 2009 were as follows:- The results for year from discontinued operations carrying value net assets written f relating to WL Homes LLC as at 31 December 2009 were as follows: AED'000 AED'000 7 DISCONTINUED OPERATIONS (continued) Net assets written f AED'000 AED'000 Assets Bank balances cash 94,139 - Or receivables, deposits prepayments 177,370 - Development properties 3,284,004 - Investments in associates 296,382 - Property, plant equipment 7,647 - Total assets 3,859,542 - Liabilities Trade or payables 177,924 - Interest-bearing loans borrowings 1,706,763 - Non controlling interest 278,079 - Total liabilities 2,162,766 - Net assets written f (1,696,776) - Net loss from discontinued operations (1,761,919) (4,067,890) ATTRIBUTABLE TO: Equity holders parent (1,762,655) (4,070,068) Non-controlling interest 736 2,178 (1,761,919) (4,067,890) Earnings per share attributable to equity holders: - basic diluted earnings per share AED (0.29) AED (0.67) The cash flow statement discontinued operations is as follows: AED 000 AED 000 Cash used in operating activities (117,946) (599,982) Cash from/ (used in) investing activities 43,482 (106,071) Revenue AED'000 5,637 1,191,221 AED'000 Cash used in financing activities (38,579) (831,146) Cost revenue (28,337) (2,354,494) Revenue 5,637 1,191,221 Net cash used in discontinued operations (113,043) (1,537,199) Cost Gross loss revenue for year (28,337) (22,700) (2,354,494) (1,163,273) Gross Selling, loss general for year administrative expenses (22,700) (45,768) (1,163,273) (377,859) The Group has established a new subsidiary company EJL Homes LLC ( EJL ) in United States America Net finance cost (220) (5,360) (USA). The EJL s registered fice is at Delaware, USA. The principal activity EJL is property investment Or Selling, income general administrative expenses (45,768) 7,089 (377,859) 51,617 development. EJL has acquired certain assets liabilities WL Homes LLC. Net Share finance results cost associated companies (note 15) (3,544) (220) (50,438) (5,360) Or Impairment income Goodwill 7,089 - (2,522,577) 51,617 Share results associated companies (note 15) (3,544) (50,438) Net Impairment loss for Goodwill year (65,143) - (2,522,577) (4,067,890) Net loss for year 29 (65,143) (4,067,890) Emaar Annual Report I 32 Emaar Annual Report I

58 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries 8 INCOME TAX 8 INCOME TAX AED 000 AED 000 Income statement: Current income tax expense AED 000 (233) AED 000 (5,626) Deferred income tax 23,774 8,195 Income statement: Current income tax expense 23,541 (233) (5,626) 2,569 Deferred income tax 23,774 8,195 Current liabilities: Balance at 1 January 23,541 17,091 21,555 2,569 For year 233 5,626 Current Paid during liabilities: year (3,231) (10,090) Balance at 1 January 17,091 21,555 For Balance year at 31 December 14, ,091 5,626 Paid during year (3,231) (10,090) The Balance tax expense at 31 December relates to tax payable on prit earned by subsidiaries, as 14,093 adjusted in accordance 17,091 with taxation laws regulations countries in which Group operates. The tax expense relates to tax payable on prit earned by subsidiaries, as adjusted 2009 in accordance 2008 with taxation laws regulations countries in which Group operates. AED 000 AED 000 (Restated) The relationship between tax expense accounting prit can be explained as follows: AED 000 AED 000 (Restated) Accounting The relationship prit between before tax tax expense accounting prit 265, ,988 can be explained as follows: Accounting Effect higher prit tax before rates in tax or jurisdictions 265,835 (233) 120,988 (5,626) Effective income tax rate 0.09% 4.65% Effect higher tax rates in or jurisdictions (233) (5,626) The Effective income income tax charge tax rate arises primarily from Group s operations in United States 0.09% America, Morocco, India, 4.65% Egypt, Pakistan United Kingdom. 9 The income BANK tax BALANCES charge arises AND primarily CASH from Group s operations in United States America, Morocco, India, Egypt, Pakistan United Kingdom BANK BALANCES AND CASH AED 000 AED 000 Emaar Properties PJSC its Subsidiaries 9 BANK BALANCES AND CASH (continued) Bank balances cash denominated in following currencies: AED 000 AED 000 United Arab Dirham (AED) 1,777,815 4,511,892 United States Dollar (USD) 42, ,707 Egyptian Pound (EGP) 251, ,788 Moroccan Dirham (MAD) 7,850 99,413 Or currencies 187, ,186 2,266,835 5,392,986 Cash at banks earns interest at floating rates based on prevailing bank deposit rates. Short term fixed deposits are made for varying periods between one day three months, depending on immediate cash requirements Group, earn interest at respective short-term deposit rates. Fixed deposits having a maturity after three months earn interest at rates between 1% 5% per annum (2008: between 6% 8% per annum). 10 TRADE RECEIVABLES AED'000 AED'000 AED'000 (Restated) (Restated) Amounts receivable within 12 months, net 749, , ,020 Amounts receivable after 12 months, net 231, , , ,354 1,058,354 1,263,695 Trade receivables include AED 414,162 thouss (2008: AED 865,413 thouss, 2007: AED 909,303 thouss) relating to sale properties where amounts are payable in installments se installments are accrued but not yet due under agreed credit terms. The above trade receivables are net f AED 58,539 thouss (2008: nil, 2007: nil) relating to provision for Cash in h , ,041 doubtful debts. Current call deposit accounts AED ,458 AED ,688 Fixed deposits maturing within three months 1,130,192 4,182,494 At 31 December, ageing analysis trade receivables is as follows: Cash in h 7,508 5,041 Current Cash cash call equivalents deposit accounts 1,860, ,458 5,175, ,688 Past due but not impaired Fixed deposits maturing within three months 1,130,192 4,182,494 Neir past Deposits under lien (note 22) 387,557 - Cash cash equivalents 1,860,158 5,175,223 due nor Less than 30 Between Between More than 90 Fixed deposits maturing after three months 19, ,763 Total impaired days 30 to 60 days 60 to 90 days days Deposits under lien (note 22) 387,557 - AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 2,266,835 5,392,986 Fixed deposits maturing after three months 19, ,763 Bank balances cash located: , , ,390 66,826 61, ,332 2,266,835 5,392,986 Within UAE 1,777,815 4,511, Bank Outside balances UAE cash located: 489, ,094 (Restated) 1,058, , ,325 30,334 12,372 38,910 Within UAE 1,777,815 4,511,892 2,266,835 5,392,986 Outside UAE 489, , (Restated) 1,263,695 1,095, ,447 13,358 4,947 32, ,266,835 5,392,986 Emaar Annual Report I 34 Emaar Annual Report I

59 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries 11 OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS 11 OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS AED' AED' AED' AED'000 (Restated) AED'000 AED'000 (Restated) Advances to contractors ors 1,029,460 1,209,716 1,034,137 Advances for to contractors acquisition leasehold ors interests 1,029,460 1,234,612 1,209,716 1,028,924 1,034, ,201 Advances Prepayments for acquisition leasehold interests 1,234, ,930 1,028, , , ,549 Prepayments Receivables from service companies 137, , , , ,549 42,754 Deposits Receivables for from acquisition service companies l subsidiary 137,001 89, , , ,400 42,754 Value Deposits added for acquisition tax recoverable l subsidiary 164,419 89, , , ,400 - Accrued Value added interest tax recoverable or income 164,419 33, ,664 67,025 80,936 Accrued Recoverable interest from non or controlling income interest 33,549 14,414 67,025 28,855 80,936 36,876 Recoverable Or deposits from non receivables controlling interest 393,697 14, ,579 28, ,379 36,876 Or deposits receivables 393, , ,379 3,211,297 3,510,821 2,705,232 3,211,297 3,510,821 2,705, DEVELOPMENT PROPERTIES 12 DEVELOPMENT PROPERTIES AED' AED' AED' AED'000 (Restated) AED'000 (Restated) AED'000 (Restated) (Restated) Balance at beginning year 26,799,447 22,302,917 13,441,087 Balance Add: cost at incurred beginning during year year 26,799,447 6,726,854 11,793,832 22,302,917 14,496,968 13,441,087 Add: transfer cost incurred from during investment year property (note 17) 6,726,854 4,520,750 11,793,832-14,496,968 1,875,000 Less: Add: transfer cost transferred from investment to cost property revenue (note during 17) year (3,626,319) 4,520,750 (7,297,302) (7,510,138) 1,875,000 Less: impairment cost transferred development to cost revenue properties during (refer note year below) (3,626,319) (61,010) (7,297,302) - (7,510,138) - Less: write impairment down development properties (refer note below) (61,010) Less: relating write to down discontinued development operations properties (note 7) (3,284,004) - - relating to discontinued operations (note 7) (3,284,004) Balance at end year 31,075,718 26,799,447 22,302,917 Balance at end year 31,075,718 26,799,447 22,302,917 Development properties located: Development properties located: Within UAE 20,440,293 14,487,581 11,714,857 Outside Within UAE UAE 10,635,425 20,440,293 12,311,866 14,487,581 10,588,060 11,714,857 Outside UAE 10,635,425 12,311,866 10,588,060 31,075,718 26,799,447 22,302,917 31,075,718 26,799,447 22,302,917 Management Group has assessed its development properties for impairment as at 31 December Based Management on review, Group Group has has provided assessed an its impairment development loss properties AED for 61,010 impairment thouss as (2008: at 31 December nil, 2007: nil) relating Based on to initial review, cost incurred Group on has certain provided aboned an impairment international loss projects AED 61,010 excess thouss carrying (2008: value nil, over 2007: nil) realisable relating to value initial certain cost incurred development on certain properties. aboned international projects excess carrying value over realisable value certain development properties. The fair value development properties is determined by Group based on valuations carried out by The independent fair value valuers. The development fair value properties development is determined properties by is determined Group based by reference on valuations to carried discounted out net by cash independent flow, which valuers. depict The fair residual value value development group properties in development is determined properties by reference net amount to collected discounted from net cash sales flow, which cost depict incurred residual to date. value Accordingly, group fair in development value development properties properties net amount is arrived collected at AED from sales 35,231,714 thouss cost incurred (2008: AED to date. 42,275,446 Accordingly, thouss). fair value development properties is arrived at AED 35,231,714 thouss (2008: AED 42,275,446 thouss). For purpose comparison fair value to carrying value development properties, which comprise For cost incurred purpose to date comparison for projects fair under value to construction carrying value unsold development inventory, properties, realised value which from comprise sale cost properties incurred under to date construction for projects is added under to construction above stated fair value. unsold inventory, realised value from sale properties under construction is added to above stated fair value. The fair value development properties including realised value from sale properties under construction The AED fair value 15,323,922 development thouss (2008: properties AED including 16,912,611 thouss) realised value is AED from sale 50,555,636 properties thouss under (2008: construction AED 59,188,057 AED 15,323,922 thouss) thouss compared (2008: to AED carrying 16,912,611 value thouss) AED 31,075,718 is AED 50,555,636 thouss (2008: thouss AED (2008: 26,799,447 AED thouss). 59,188,057 thouss) compared to carrying value AED 31,075,718 thouss (2008: AED 26,799,447 thouss). Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries 13 SECURITIES 13 SECURITIES AED AED AED 000 AED 000 Financial assets at fair value through or comprehensive income 936, ,122 Financial assets at fair value through or comprehensive income 936, ,122 Securities located: Securities Within UAE located: 906, ,668 Within Outside UAE 906,042 30, ,668 22,454 Outside UAE 30,619 22, , , , ,122 Fair value hierarchy Fair The Group value hierarchy uses following hierarchy for determining disclosing fair value financial instruments by The valuation Group technique: uses following hierarchy for determining disclosing fair value financial instruments by valuation technique: Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities Level 1: 2: quoted or techniques (unadjusted) for prices which in active all inputs markets which for identical have a significant assets or liabilities effect on recorded fair value are Level observable, 2: or eir techniques directly or for indirectly which all inputs which have a significant effect on recorded fair value are observable, Level 3: techniques eir directly which or use indirectly inputs which have a significant effect on recorded fair value that are not based on Level observable 3: techniques market data. which use inputs which have a significant effect on recorded fair value that are not based on observable market data Level 1 Level 2 Level 3 AED AED 000 Level 1 AED 000 Level 2 AED 000 Level 3 AED 000 AED 000 AED 000 AED 000 Financial assets at fair value through Financial or comprehensive assets at fair income value through 936, , , ,145 or comprehensive income 936, , , ,145 Financial assets at fair value through or comprehensive income include fund investments managed by an external Financial fund manager. assets Equity at fair investments value through are or in quoted, comprehensive unquoted income index include linked fund securities. investments managed by an external fund manager. Equity investments are in quoted, unquoted index linked securities. 14 LOANS TO ASSOCIATES 14 LOANS TO ASSOCIATES AED' AED' AED' AED'000 (Restated) AED'000 (Restated) AED'000 (Restated) (Restated) Amlak Finance PJSC (i) 875, , ,667 Emaar Amlak MGF Finance L PJSC Limited (i) ir related parties (ii) 460, , , , ,667 - Golden Emaar MGF Ace Pte L Ltd Limited (iii) ir related parties (ii) 608, , , , ,276 - Golden Prestige Ace Resorts Pte Ltd SA (iii) 608, ,425 70, ,276 70,000 Amelkis Prestige Resorts SA 33,234-70,000 54,569 70,000 54,563 Amelkis Or associates Resorts SA 33,234 27,915 54,569 48,591 54,563 48,323 Or associates 27,915 48,591 48,323 2,005,146 1,636, ,829 2,005,146 1,636, ,829 (i) The amount owed by Amlak Finance PJSC ( Amlak ) is unsecured earns an average return ranging from (i) The 3% to amount 4.5% per owed annum by Amlak (2008: Finance average PJSC return ( Amlak ) ranging from is unsecured 3% to 7% per annum). earns average return ranging from 3% to 4.5% per annum (2008: average return ranging from 3% to 7% per annum). The above loan includes AED 634,025 thouss relates to credit facility extended to Amlak in normal The course above business loan includes for settlement AED 634,025 instalment thouss payments relates to relating credit to sale facility properties, extended to where Amlak customers in normal have course availed financing business facility for settlement from Amlak. instalment An amount payments AED relating 196,615 to thouss sale properties, was received where from customers Amlak during have availed year financing ended 31 facility December from Amlak. The An Group s amount management AED 196,615 believes thouss that was loan received due from Amlak is during fully recoverable year ended (also 31 refer December note (ii)). The Group s management believes that loan due from Amlak is fully recoverable (also refer note 15 (ii)). (ii) The amounts owed by Emaar MGF L Limited ir related parties are unsecured earns a compound (ii) The return amounts 15% owed per annum by Emaar (2008: MGF 10% L per annum). Limited ir related parties are unsecured earns a compound return 15% per annum (2008: 10% per annum). (iii) The amount owed by Golden Ace Pte Ltd is unsecured earns a return ranging from 5.03% to 11.20% per (iii) The annum amount (2008: owed 6.36% by per Golden annum). Ace Pte Ltd is unsecured earns a return ranging from 5.03% to 11.20% per annum (2008: 6.36% per annum). Emaar Annual Report I 36 Emaar Annual 34 Report I

60 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries 15 INVESTMENTS IN ASSOCIATES AED'000 AED'000 AED'000 (Restated) (Restated) Carrying value investment in: Emaar MGF L Limited 2,901,579 2,745,198 3,592,632 Emaar The Economic City (Saudi Joint Stock Company) quoted (i) 2,348,919 2,486,278 2,536,543 Amlak Finance PJSC quoted (ii) 944,418 1,113,598 1,036,386 Dubai Banking Group PJSC (iii) 429, , ,179 Emaar Bawadi LLC 359, ,593 - Turner International Middle East Ltd 225, , ,741 Emaar Industries Investment (Pvt) JSC 198, , ,479 Dead Sea Company for Tourist Real Estate Investment 137, , ,864 Emrill Services LLC 14,601 11,244 7,113 Emaar Financial Services LLC 6,468 6,179 43,299 Or associates 294, , ,046 7,860,604 8,313,770 8,845,282 (i) The market value shares held in Emaar The Economic City (quoted on Saudi Stock Exchange Tadawul) as at 31 December 2009 was AED 2,487,775 thouss (2008: AED 2,319,957 thouss, 2007: AED 5,740,134 thouss). (ii) On 23 November 2008, UAE Ministry Finance announced that it has started ficial procedure to merge Amlak Finance PJSC ( Amlak ) Tamweel PJSC ( Tamweel ), two leading Sharia-compliant real estate finance providers in United Arab Emirates, under Emirates Development Bank to create largest real estate finance institution in country under umbrella Federal Government United Arab Emirates. In view above circumstances, trading for Amlak was suspended pending merger. On 4 February 2009, Ministry Finance has formed a Steering Committee with aim to review merger Amlak Tamweel recommend possible ways two companies can go forward. The Steering Committee in connection with proposed merger is evaluating various options to secure sustainable funding in order to enable Amlak to continue to meet its commitments. The Steering Committee is expected to give its recommendation to government on restructuring plan in near future. The Group s management is not in a position to assess its investments for any impairment pending recommendations from Steering Committee. The market value shares held in Amlak (quoted on Dubai Financial Market) at date suspension trading was AED 735,677 thouss (2008: AED 735,677 thouss, 2007: AED 3,700,024 thouss). (iii) During year 2007, Dubai Banking Group PJSC ( DBG ), an associate Company, invested in convertible bonds Shuaa Capital PSC ( Shuaa ), convertible into shares at conversion price AED 6 per share upon maturity bond (which was originally 31 October 2008 extended upto 31 October 2009). Subsequently in July 2009 through a settlement agreement between DBG Shuaa, conversion price number shares were adjusted to AED 2.91 per share providing 48% voting rights to DBG in Shuaa. Based on revised conversion price in comparison with n prevailing market price Shuaa, DBG has recorded an impairment AED 514,000 thouss in respect ir investment in Shuaa. Accordingly, Group has recorded its share impairment AED 154,200 thouss for its 30% interest in DBG. 15 INVESTMENTS IN ASSOCIATES (continued) The Group has following ownership interest in its significant associates: Country Ownership incorporation Emaar MGF L Limited India 43.86% 43.33% Emaar The Economic City (Saudi Joint Stock Company) KSA 30.59% 30.59% Amlak Finance PJSC UAE 48.08% 48.08% Turner International Middle East Ltd UAE 50.00% 50.00% Dubai Banking Group PJSC UAE 30.00% 30.00% Emaar Industries Investments (Pvt) JSC UAE 40.00% 40.00% Emaar Financial Services LLC UAE 37.50% 37.50% Emrill Services LLC UAE 33.33% 33.33% Prestige Resorts SA Morocco 50.00% 50.00% Amelkis Resorts SA Morocco 50.00% 50.00% Orientis Invest Morocco 50.00% 50.00% Golden Ace Pte Ltd Singapore 30.00% 30.00% Emaar Bawadi LLC UAE 50.00% 50.00% Dead Sea Company for Tourist Real Estate Investment Jordan 29.33% 29.33% The following table summarises information Group s investment in associates: AED'000 AED'000 AED'000 (Restated) (Restated) Group s share in assets liabilities its associates: Current assets 17,797,314 12,194,378 8,788,969 Non-current assets 5,850,908 12,862,725 7,345,845 Total assets 23,648,222 25,057,103 16,134,814 Current liabilities 14,140,088 15,250,358 7,616,782 Non-current liabilities 3,242,446 2,938,930 1,978,475 Total liabilities 17,382,534 18,189,288 9,595,257 Net assets 6,265,688 6,867,815 6,539,557 Goodwill 1,594,916 1,445,955 1,445,955 Investment in preference shares ,770 7,860,604 8,313,770 8,845,282 Share associates revenues results: Revenues 1,795,209 1,587,543 1,540,828 Results: Continuing operations (534,469) 108, ,628 Discontinued operation (refer note 7) (3,544) (50,438) (29,296) (538,013) 58, ,332 Emaar Annual Report I 38 Emaar Annual Report I

61 Emaar Properties PJSC its Subsidiaries 16 PROPERTY, PLANT AND EQUIPMENT (continued) Plant, Leisure, Computers machinery Furniture entertainment Leasehold L fice heavy Motor or Capital improvements buildings equipment equipment vehicles fixtures assets work-in- progress Total AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 Cost: At 1 January ,239 1,389, , ,194 20, ,455 3,003 5,479,692 7,769,502 Additions 13, ,413 75,680 35,835 21,151 96,270-5,420,913 5,848,188 Transfers - 683,915 5,425 10,457-11, ,140 (982,187) - Disposals (4,232) (29,584) (406) (1,107) (1,283) (893) - - (37,505) Transfer to investment properties (note 17) (7,549,234) (7,549,234) Foreign currency translation differences (7,271) (61,228) (10,994) (35,667) (14,582) (7,245) - (788) (137,775) At 31 December ,662 2,167, , ,712 25, , ,143 2,368,396 5,893,176 Accumulated depreciation/ impairment: At 1 January , ,884 51,902 38,281 9,590 71,770 1, ,280 Depreciation charge for year 7,553 74,106 28,581 48,477 10,520 41,446 4, ,411 Disposals (380) (29,522) (325) (152) (1,043) (267) - - (31,689) Foreign currency translation differences (1,262) (5,491) (7,169) (14,750) (8,212) (4,138) - - (41,022) At 31 December , ,977 72,989 71,856 10, ,811 6, ,980 Net carrying amount: At 31 December ,848 1,980,056 98, ,856 14, , ,465 2,368,396 5,414,196 Emaar Annual Report I 40 Emaar Annual Report I 41

62 Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries 16 PROPERTY, PLANT AND EQUIPMENT (continued) 16 PROPERTY, PLANT AND EQUIPMENT (continued) The depreciation charge for year is allocated as follows: The depreciation charge for year is allocated as follows: 2009 AED AED AED 000 AED 000 Continuing operations 322, ,996 Continuing Discontinued operations 322, ,996 6,415 Discontinued operation 455 6, , , , ,411 Emaar Properties PJSC its Subsidiaries 17 INVESTMENT PROPERTIES (continued) During year ended 31 December 2009, cost relating to plot l at L Usailly, UAE amounting to AED 4,520,750 thouss was transferred from investment properties to development properties upon commencement development. The fair value investment properties is AED 14,981,486 thouss (2008: AED 24,701,919 thouss) compared with a carrying value AED 8,546,087 thouss (2008: AED 13,248,196 thouss). Investment properties represent Group s interest in l buildings situated within United Arab Emirates. 17 INVESTMENT PROPERTIES 17 INVESTMENT PROPERTIES Furniture L Buildings Furniture fixtures Total AED 000 L Buildings AED 000 AED 000 fixtures AED 000 Total AED 000 AED 000 AED 000 AED 000 Cost Cost At 1st January 2009 Additions At 1st January ,548,847 4,548,847-8,821,662 8,821, ,153 3,606 3,606-13,374,115 13,374, ,153 Transfers Additions to development properties (note 12) (4,520,750) - 132, (4,520,750) 132,153 Transfers to development properties (note 12) (4,520,750) - - (4,520,750) 28,097 8,953,815 3,606 8,985,518 28,097 8,953,815 3,606 8,985,518 Accumulated depreciation: Accumulated At 1 January depreciation: 2009 At Depreciation 1 January charge 2009 for year , , ,613 3,306 3, , , ,919 Depreciation charge for year - 313, , ,030 3, , ,030 3, ,431 Net carrying amount: Net At carrying 31 December amount: ,097 28,097 8,517,785 8,517, ,546,087 8,546,087 Furniture L Buildings Furniture fixtures Total AED 000 L Buildings AED 000 AED 000 fixtures AED 000 Total AED 000 AED 000 AED 000 AED 000 Cost: Cost: At 1 January 2008 Additions At 1 January ,548,847 4,548,847-1,123,402 1,123, ,026 3,606 3,606-5,675,855 5,675, ,026 Transfers Additions from property, plant - 149, ,026 Transfers equipments from property, (note 16) plant equipments (note 16) - - 7,549,234 7,549, ,549,234 7,549,234 At 31 December ,548,847 8,821,662 3,606 13,374,115 At 31 December ,548,847 8,821,662 3,606 13,374,115 Accumulated depreciation: Accumulated At 1 January depreciation: 2008 At Depreciation 1 January 2008 charge for year ,076 85,537 37,076 3,206 3, ,282 85,637 40,282 Depreciation charge for year - 85, ,637 At 31 December ,613 3, ,919 At 31 December ,613 3, ,919 Net carrying amount: Net At carrying 31 December amount: 2008 At 31 December ,548,847 4,548,847 8,699,049 8,699, ,248,196 13,248, BUSINESS COMBINATIONS Acquisition Emaar Properties Gayrimenkul Geliştirme A.Ş. On 1 October 2008, Group had acquired an additional 40% holding in Emaar Properties Gayrimenkul Geliştirme A.Ş. ( Emaar Turkey ), an unlisted limited liability company in Turkey, reby resulting in 100% ownership control entity. The fair value identifiable assets liabilities Emaar Turkey at date acquisition were: Emaar Annual 39 Report I 42 Emaar Annual Report I Recognised on acquisition AED 000 Carrying value AED 000 Bank balances cash 23,206 23,206 Or receivables, deposits prepayments 103, ,557 Development properties 2,140,744 2,042,604 Property, plant equipment 5,452 5,452 2,272,959 2,174,819 Trade or payables 176, ,151 Interest-bearing loans borrowings 1,631,558 1,631,558 1,807,709 1,807,709 Net assets acquired 465, ,110 Less: interest held by Group prior to acquisition (279,150) Total acquisition cost 186,100 The total acquisition cost AED 186,100 thouss was paid in cash. Cash outflow on acquisition: 2008 AED 000 Cash paid to minority interest holders (162,435) Deposit in escrow account (23,665) Net cash outflows (186,100) The deposit in escrow account was released paid to minority interest holders in January 2009.

63 Emaar Properties PJSC its Subsidiaries 19 GOODWILL AED 000 AED 000 Balance at 1 January 439,391 2,961,968 Impaired during year (i) - (2,522,577) Balance at 31 December 439, ,391 (i) On 1 June 2006 (acquisition date), Group acquired 100% voting shares WL Homes LLC, a residential home builder, an unlisted limited liability company headquartered in Newport Beach, California, United States America. On acquisition date, Group had recorded a goodwill amounting to AED 2,522,577 thouss. The management Group had undertaken an impairment review goodwill as at 31 December Based on review Group s future intentions with respect to restructuring this investment in light unprecedented slowdown in US housing market, Group had decided to write down entire goodwill AED 2,522,577 thouss recorded at time acquisition. Subsequently, during year ended 31 December 2009 Group has written down its entire net investment in WL Homes LLC (refer note 7). (ii) On 24 August 2006 (acquisition date), Group acquired 100% voting shares Hamptons, Group Limited, a property management consultant, an unlisted limited liability company, headquartered in London, United Kingdom (UK). On acquisition date, Group had recorded a goodwill amounting to AED 427,724 thouss. This goodwill has been allocated to cash generating unit has been tested for impairment using a value in use model. The calculation value in use is sensitive to following assumptions: Gross margins Gross margins are based on expectations management based on past experience expectation future market conditions. Discount rates Discount rates reflect management s estimate specific risks. The discount rate is based on risk free rate investment s country, market risk premium related to industry individual unit related risk premium/ discount. This is benchmark used by management to assess performance to evaluate future investment proposals. Management estimates that such discount rate to be used for evaluation investment should be between 9% 11%. Growth rate estimates Management prepares a five year budget based on ir expectations future results, reafter a growth rate 0.5% to 1% is assumed (iii) In 2006 Group acquired 100% voting shares Raffles Company Pte Ltd, an education provider, an unlisted limited liability company in Singapore. On acquisition date, Group had recorded a goodwill amounting to AED 11,667 thouss. 20 ADVANCES FROM CUSTOMERS AED'000 AED'000 AED'000 (Restated) (Restated) Balance at 1 January 18,109,424 14,093,599 8,573,883 Add: amount collected during year 5,530,384 15,347,208 18,452,827 Less: revenue recognised during year (7,751,744) (11,331,383) (12,933,111) Balance at 31 December 15,888,064 18,109,424 14,093,599 Emaar Properties PJSC its Subsidiaries TRADE TRADE AND AND OTHER OTHER PAYABLES PAYABLES AED'000 AED'000 AED'000 AED'000 AED'000 AED'000 (Restated) (Restated) Project Project contract contract cost cost accruals accruals 5,485,910 5,485,910 5,523,867 5,523,867 2,799,037 2,799,037 Or Or payables payables accruals accruals 1,852,346 1,852,346 1,871,271 1,871,271 1,706,598 1,706,598 Trade Trade payables payables 1,214,591 1,214,591 1,295,644 1,295, , ,271 Payable Payable to to non non controlling controlling interest interest 901, , , , , ,016 Dividends Dividends payable payable 77,257 77,257 80,825 80,825 61,422 61,422 Income Income tax tax payable payable (note (note 8) 8) 14,093 14,093 17,091 17,091 21,555 21,555 9,545,382 9,545,382 9,680,254 9,680,254 5,918,899 5,918, INTEREST-BEARING INTEREST-BEARING LOANS LOANS AND AND BORROWINGS BORROWINGS AED 000 AED 000 AED 000 AED 000 Balance Balance at at 1 January January 9,174,165 9,174,165 7,703,753 7,703,753 Borrowings Borrowings drawn drawn down down during during year year 2,004,542 2,004,542 2,802,400 2,802,400 Borrowings Borrowings repaid repaid during during year year (808,620) (808,620) (537,160) (537,160) Net Net borrowings borrowings during during year year relating relating to to discontinued discontinued operations operations (38,220) (38,220) (794,828) (794,828) Write Write down down borrowing borrowing relating relating to to discontinued discontinued operations operations (refer (refer note note 7) 7) (1,706,763) (1,706,763) - Balance Balance at at December December 8,625,104 8,625,104 9,174,165 9,174,165 Maturing Maturing within within months months 4,499,761 4,499,761 4,563,896 4,563,896 Maturing Maturing after after months months 4,125,343 4,125,343 4,610,269 4,610,269 Balance Balance at at end end year year 8,625,104 8,625,104 9,174,165 9,174,165 The The above above represent represent balances balances due: due: Within Within UAE UAE 4,726,826 4,726,826 3,911,693 3,911,693 Outside Outside UAE UAE 3,898,278 3,898,278 5,262,472 5,262,472 8,625,104 8,625,104 9,174,165 9,174,165 The The Group Group has has following following secured secured unsecured unsecured interest-bearing interest-bearing loans loans borrowings: borrowings: Secured Secured - Indian Indian Rupees Rupees (INR) (INR) 1,287,501 1,287,501 thouss thouss (AED (AED 101, ,655 thouss) thouss) loan loan from from financial financial institutions, institutions, secured secured by by way way first first charge charge on on certain certain immovable immovable properties properties receivables receivables in in India, India, carries carries interest interest at at bench bench mark mark rate rate plus plus 3.33% 3.33% per per annum. annum. This This loan loan is is payable payable in in quarterly quarterly installments installments fully fully repayable repayable by by United United States States Dollar Dollar (USD) (USD) 13,073 13,073 thouss thouss (AED (AED 48,018 48,018 thouss) thouss) loan loan from from commercial commercial bank, bank, secured secured against against real real estate estate owned owned by by Group Group in in Turkey, Turkey, carries carries interest interest at at US$ US$ LIBOR LIBOR plus plus 1.20% 1.20% per per annum. annum. Loan Loan is is fully fully repayable repayable by by Canadian Canadian Dollar Dollar (CAD) (CAD) 21,184 21,184 thouss thouss (AED (AED 74,218 74,218 thouss) thouss) loan loan from from financial financial institution, institution, secured secured against against real real estate estate owned owned by by Group Group in in Canada, Canada, carries carries interest interest at at Prime Prime Rate Rate plus plus 5.75% 5.75% per per annum annum fully fully repayable repayable by by Canadian Canadian Dollar Dollar (CAD) (CAD) 4,515 4,515 thouss thouss (AED (AED 15,819 15,819 thouss) thouss) loan loan from from financial financial institution, institution, secured secured against against real real estate estate owned owned by by Group Group in in Canada, Canada, carries carries interest interest at at 9.50% 9.50% per per annum annum fully fully repayable repayable by by Emaar Annual Report I 44 Emaar Annual Report I

64 Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 22 INTEREST-BEARING LOANS AND BORROWINGS (continued) Emaar Properties PJSC its Subsidiaries Emaar Properties PJSC its Subsidiaries NOTES At 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS Secured (continued) 22 INTEREST-BEARING LOANS AND BORROWINGS (continued) 22 INTEREST-BEARING LOANS AND BORROWINGS (continued) 22 INTEREST-BEARING LOANS AND BORROWINGS (continued) - Great British Pound (GBP) 4,700 thouss (AED 27,886 thouss) loan from financial institution, secured Unsecured (continued) Secured (continued) against Group s specific lease hold properties, carries interest at bank s base rate plus 1.50% per annum. Unsecured (continued) - USD 50,000 thouss (AED 183,650 thouss) loan from commercial bank, carries interest at US$ LIBOR plus - Great USD 303,000 British Pound thouss (GBP) (AED 4,700 1,112,919 thouss thouss) (AED 27,886 loan from thouss) commercial loan from bank, financial secured institution, against real secured estate 4.95% per annum is repayable in owned against by Group s specific in Turkey, lease carries hold properties, interest at carries US$ LIBOR interest plus at bank s 4.75% base per rate annum plus 1.50% is repayable per annum. in The - USD 50,000 thouss (AED 183,650 thouss) loan from commercial bank, carries interest at US$ LIBOR plus bank issuing st by letter credit facility has lien on certain cash collateral amounting to AED 387, % per annum is repayable in USD 303,000 thouss (AED 1,112,919 thouss) loan from commercial bank, secured against real estate - USD 20,000 thouss (AED 73,460 thouss) loan from commercial bank, carries interest at US$ LIBOR plus thouss (note 9). owned by Group in Turkey, carries interest at US$ LIBOR plus 4.75% per annum is repayable in The 6% per annum is repayable in USD 20,000 thouss (AED 73,460 thouss) loan from commercial bank, carries interest at US$ LIBOR plus bank - USD issuing 22,559 st thouss by letter (AED 82,859 credit facility thouss) has lien funding on certain facility cash from collateral financial amounting institutions, to secured AED 387,557 against 6% per annum is repayable in thouss real estate (note owned 9). by Group in United States America (USA), carries interest rate at US$ LIBOR plus 7.50% per - Saudi Riyal (SAR) 200,000 thouss (AED 196,000 thouss) funding facility from commercial bank annum fully repayable in carrying interest at SAIBOR plus 2% per annum fully repayable by USD 22,559 thouss (AED 82,859 thouss) funding facility from financial institutions, secured against - Saudi Riyal (SAR) 200,000 thouss (AED 196,000 thouss) funding facility from commercial bank real estate owned by Group in United States America (USA), carries interest rate at US$ LIBOR plus 7.50% per carrying interest at SAIBOR plus 2% per annum fully repayable by USD 60,000 thouss (AED 220,380 thouss) loan from commercial bank, secure against certain assets owned - Indian Rupees (INR) 67,000 thouss (AED 5,290 thouss) funding facility from commercial bank carrying annum by Group fully in repayable United Arab in Emirates (UAE) carries interest rate at bank s base rate plus 4% per annum fully interest at 9.50% per annum fully repayable by Indian Rupees (INR) 67,000 thouss (AED 5,290 thouss) funding facility from commercial bank carrying repayable by USD 60,000 thouss (AED 220,380 thouss) loan from commercial bank, secure against certain assets owned interest at 9.50% per annum fully repayable by Moroccan Dirham (MAD) 80,000 thouss (AED 37,351 thouss) short term loan from commercial bank by - Pakistani Group in Rupee United (PKR) Arab 776,758 Emirates thouss (UAE) carries (AED interest 33,874 thouss) rate at bank s loan base from rate commercial plus 4% per bank, annum secure against fully carrying interest at 52 weeks treasury bond rate plus 1.15% per annum. receivables repayable by from projects in Pakistan carries interest rate at KIBOR plus 2% per annum. - Moroccan Dirham (MAD) 80,000 thouss (AED 37,351 thouss) short term loan from commercial bank carrying interest at 52 weeks treasury bond rate plus 1.15% per annum. Pakistani Rupee (PKR) 776,758 thouss (AED 33,874 thouss) loan from commercial bank, secure against - USD 81,128 thouss (AED 297,984 thouss) funding facility from commercial bank carries interest rate at - Lebanese Pound (LBP) 38,441,250 thouss (AED 93,976 thouss) long term loan from commercial bank, receivables from projects in Pakistan carries interest rate at KIBOR plus 2% per annum. 3.50% to 4.70% per annum. secured against certain assets in Lebanon carries interest rate at benchmark rate plus 1% per annum fully - USD 81,128 thouss (AED 297,984 thouss) funding facility from commercial bank carries interest rate at repayable by % to 4.70% per annum. - Lebanese Pound (LBP) 38,441,250 thouss (AED 93,976 thouss) long term loan from commercial bank, Unsecured against certain assets in Lebanon carries interest rate at benchmark rate plus 1% per annum fully 23 RETENTIONS PAYABLE repayable by RETENTIONS PAYABLE - AED 150,000 thouss short term loan from commercial bank carries interest rate at EIBOR plus 5% per Unsecured annum fully repayable by AED 000 AED AED 200, ,000 thouss short short term term loan loan from from commercial bank bank carries carries interest interest rate rate FDR at EIBOR plus 1% plus per 5% annum per AED 000 AED 000 Retentions payable within 12 months 798, ,694 annum fully repayable fully repayable by by Retentions payable after 12 months 361, ,855 Retentions payable within 12 months 798, ,694 AED 200,000 thouss short term loan from commercial bank carries interest rate at FDR plus 1% per annum - AED 350,000 thouss short term loan from commercial bank carries interest rate at 8.25% per annum Retentions payable after 12 months 361, ,855 fully repayable by ,160,306 1,078,549 fully repayable by ,160,306 1,078,549 AED 350,000 thouss short term loan from commercial bank carries interest rate at 8.25% per annum - AED 125,000 thouss short term loan from commercial bank carries interest rate at 6.50% per annum fully repayable by fully repayable by EMPLOYEE BENEFITS AED 125,000 thouss short term loan from commercial bank carries interest rate at 6.50% per annum - AED 8,446 thouss long term loan from commercial bank carries interest rate at 7.50% per annum fully 24 EMPLOYEE BENEFITS fully repayable by Employee Performance Share Programme repayable by The Company has an Employee Performance Share Programme ( The Programme ) to recognise retain good Employee Performance Share Programme AED 8,446 thouss long term loan from commercial bank carries interest rate at 7.50% per annum fully performing staff. The Programme gives employee right to purchase Company s shares at par. The shares - USD 80,000 thouss (AED 293,840 thouss) loan from financial institutions in USA, carries interest at The Company has an Employee Performance Share Programme ( The Programme ) to recognise retain good repayable by carry full dividend voting rights, option can be exercised at any time from stipulated vested dates on US LIBOR plus 0.60% per annum fully repayable by performing staff. The Programme gives employee right to purchase Company s shares at par. The shares condition that employee is still under employment at exercise date. There are no cash settlement carry full dividend voting rights, option can be exercised at any time from stipulated vested dates on USD 80,000 thouss (AED 293,840 thouss) loan from financial institutions in USA, carries interest at alternatives options have no contractual expiry date. - Pakistani Rupee (PKR) 4,024,654 thouss (AED 175,513 thouss) loan from commercial bank, bearing condition that employee is still under employment at exercise date. There are no cash settlement US LIBOR plus 0.60% per annum fully repayable by interest at KIBOR plus 2.50% per annum. alternatives options have no contractual expiry date. The following table illustrates number (No.) weighted average exercise prices (WAEP), movements Pakistani Rupee (PKR) 4,024,654 thouss (AED 175,513 thouss) loan from commercial bank, bearing in, share options during year. - USD 1,000,000 thouss (AED 3,673,000 thouss) Musharaka Islamic Syndicated facility. This facility is The following table illustrates number (No.) weighted average exercise prices (WAEP), movements interest at KIBOR plus 2.50% per annum repayable in 2012 with an option early repayment without penalty to Group bears a prit rate LIBOR in, share options during year. No. WAEP No. WAEP plus 2% per annum USD 1,000,000 thouss (AED 3,673,000 thouss) Musharaka Islamic Syndicated facility. This facility is No. WAEP No. WAEP repayable in 2012 with an option early repayment without penalty to Group bears a prit rate LIBOR Outsting at 1 January 59,743 AED ,446,049 AED Egyptian Pound (EGP) 1,021,493 thouss (AED 684,012 thouss) funding facilities from commercial plus 2% per annum. Granted during year ,749 AED 1.00 banks, carries interest at rates at 11% to 13.5% per annum. Outsting at 1 January 59,743 AED ,446,049 AED 1.00 Exercised during year - - (1,462,055) AED 1.00 Granted during year 75,749 AED 1.00 Egyptian Pound (EGP) 1,021,493 thouss (AED 684,012 thouss) funding facilities from commercial - USD 50,000 thouss (AED 183,650 thouss) loan from commercial bank, carries interest at 8.75% per annum Exercised during year - - (1,462,055) AED 1.00 banks, carries interest at rates at 11% to 13.5% per annum. Outsting at 31 December 59,743 AED ,743 AED 1.00 is repayable in Outsting at 31 December 59,743 AED ,743 AED 1.00 USD 50,000 thouss (AED 183,650 thouss) loan from commercial bank, carries interest at 8.75% per annum - USD 48,000 thouss (AED 176,304 thouss) loan from commercial bank, carries interest at US$ LIBOR plus is repayable in The weighted average fair value options granted during year was AED nil per share (2008: AED 10 per 3.15% per annum is repayable in share). The weighted average fair value options granted during year was AED nil per share (2008: AED 10 per - USD 48,000 thouss (AED 176,304 thouss) loan 43 from commercial bank, carries interest at US$ LIBOR plus share). 3.15% per annum is repayable in Emaar Annual Report I 46 Emaar Annual 44 Report I

65 Emaar Properties PJSC its Subsidiaries 24 EMPLOYEE BENEFITS (continued) Employee Performance Share Programme (continued) The fair value vested shares is determined by reference to ficial price list published by Dubai Financial Market (DFM) for 5 consecutive trading days prior to after vested date. As options are granted deep in money, management considers this to be an appropriate means valuation. The expenses recognised during year in respect programme were AED nil (2008: AED 757 thouss). End Service Benefits The movement in provision for employees end service benefits was as follows: AED 000 AED 000 Balance at 1 January 37,092 18,394 Provided during year 21,293 25,526 Paid during year (11,451) (6,828) Balance at 31 December 46,934 37,092 An actuarial valuation has not been performed as net impact discount rates future increases in staff salaries is not likely to be material. 25 SHARE CAPITAL AED 000 AED 000 Authorised capital 6,096,325,000 shares AED 1 each (31 December 2008: 6,096,325,000 shares AED 1 each) 6,096,325 6,096,325 Issued fully paid-up 6,091,238,503 shares AED 1 each (31 December ,091,238,503 shares AED 1 each) 6,091,239 6,091,239 During year ended 31 December 2008, Company obtained necessary regulatory approvals to undertake a share buy-back program a total 200 thous shares were purchased from market at an average price AED 5.57 per share amounting to AED 1,113 thouss. Emaar Properties PJSC its Subsidiaries 26 RESERVES Net Foreign unrealised currency Statutory Capital General Hedging gains/ (losses) translation reserve reserve reserves reserves reserve reserve Total AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 Balance at 1 January ,808,707 4,004 2,152,114 6,084 52, ,191 16,494,778 Decrease in unrealized reserve (5,538) (1,491,960) - (1,497,498) Decrease in foreign currency translation reserve (870,948) (870,948) Net income expense recognised directly in equity (5,538) (1,491,960) (870,948) (2,368,446) Net movement during year , ,531 Balance at 1 January ,808,707 4,004 2,457, (1,439,282) (399,757) 14,431,863 (Decrease)/ increase in unrealised reserve (328) 43,200-42,872 Increase in foreign currency translation reserve , ,906 Net income expense recognised directly in equity (328) 43, , ,778 Net movement during year , ,732 Balance at 31 December ,808,707 4,004 2,490, (1,396,082) (195,851) 14,711,373 Emaar Annual Report I 48 Emaar Annual Report I 49 45

66 Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS NOTES At 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS 26 RESERVES (continued) 26 According RESERVES to Article (continued) number 57 Articles Association Company Article 193 U.A.E. Federal Commercial Companies Law, 10% annual net prits are allocated to statutory reserve anor According to Article number 57 Articles Association Company Article 193 U.A.E. 10% to general reserve. The transfers to statutory reserve may be suspended when reserve reaches 50% Federal Commercial Companies Law, 10% annual net prits are allocated to statutory reserve anor paid-up capital. Transfers to general reserve may be suspended by ordinary general assembly when reserve 10% to reaches general 50% reserve. paid-up The transfers capital. to statutory reserve may be suspended when reserve reaches 50% paid-up capital. Transfers to general reserve may be suspended by ordinary general assembly when reserve The statutory reaches reserve 50% is in excess paid-up capital. 50% paid-up share capital Group refore in accordance with a resolution Annual General Meeting, Group has ceased furr transfers to this reserve. The statutory reserve is in excess 50% paid-up share capital Group refore in accordance with The a resolution statutory reserve Annual includes: General Meeting, Group has ceased furr transfers to this reserve. The - statutory AED 2,475,000 reserve thouss includes: being premium collected at AED 15 per share (shares par value at that time was AED 10 per share) on 1:1.65 rights issue during year ended 31 December 1998; - AED 2,475,000 thouss being premium collected at AED 15 per share (shares par value at that time was - AED 10 11,321,656 per share) thouss on 1:1.65 being rights issue premium during collected year to ended date 31 at AED December 4 per 1998; share on 1:1 rights issue announced during year ended 31 December AED 11,321,656 thouss being premium collected to date at AED 4 per share on 1:1 rights issue The announced capital reserve during was created year ended from gain 31 December on sale treasury shares in The Net unrealised capital reserve gains/ was (losses) created reserve: from gain on sale treasury shares in Net - unrealised This reserve gains/ records (losses) fair reserve: value changes in financial assets fair value through or comprehensive income. Foreign - This currency reserve translation records fair reserve: value changes in financial assets fair value through or comprehensive income. Foreign - The currency foreign translation currency translation reserve: reserve is used to record exchange difference arising from translation financial statements foreign subsidiaries associates. - The foreign currency translation reserve is used to record exchange difference arising from translation financial statements foreign subsidiaries associates. 27 DIVIDENDS 27 The Board DIVIDENDS Directors Company has proposed not to pay dividend for year ended 2009 (No dividend was paid for year ended 2008). The Board Directors Company has proposed not to pay dividend for year ended 2009 (No dividend was paid for year ended 2008). 28 EARNINGS PER SHARE 28 Basic earnings EARNINGS per share PER are SHARE calculated by dividing net prit/ (loss) for year attributable to equity holders parent by weighted average number ordinary shares outsting during year. The weighted average Basic earnings per share are calculated by dividing net prit/ (loss) for year attributable to equity holders numbers shares outsting during year previous year have been adjusted for events that have parent by weighted average number ordinary shares outsting during year. The weighted average changed number shares outsting without a corresponding change in resources. For diluted earnings per numbers share, weighted shares average outsting numbers during shares year have been adjusted previous for year rights have issue been shares adjusted to be allotted for events after that have year changed end. The information number necessary shares outsting to calculate basic without a diluted corresponding earnings change per share in is resources. as follows: For diluted earnings per share, weighted average numbers shares have been adjusted for rights issue shares to be allotted after year end. The information necessary to calculate basic diluted earnings per share is 2009 as follows: 2008 AED 000 AED Earnings: (Restated) AED 000 AED 000 Total operations Earnings: (Restated) - Net prit for year attributable to equity holders parent 327, ,586 Total operations - Net prit for year attributable to equity holders parent 327, ,586 Continuing operations - Net prit for year attributable to equity holders parent 2,089,970 4,235,654 Continuing operations - Net prit for year attributable to equity holders parent 2,089,970 4,235,654 Discontinued operations - Net loss for year attributable to equity holders parent (note 7) (1,762,655) (4,070,068) Discontinued operations - Net loss for year attributable to equity holders parent (note 7) (1,762,655) (4,070,068) Shares (in thouss): Weighted average number shares outsting for Shares (in thouss): calculating basic diluted EPS 6,091,239 6,091,239 Weighted average number shares outsting for calculating basic diluted EPS 6,091,239 6,091, Emaar Annual Report I Emaar Properties PJSC its Subsidiaries NOTES Emaar Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS 28 EARNINGS PER SHARE (continued) 28 EARNINGS PER SHARE (continued) Earnings per share: (Restated) Total operations Earnings Basic per diluted share: earnings per share AED 0.05 (Restated) AED 0.03 Total operations Continuing - Basic diluted operations earnings per share AED 0.05 AED Basic diluted earnings per share AED 0.34 AED 0.70 Continuing operations Discontinued - Basic diluted operations earnings per share AED 0.34 AED Basic diluted earnings per share AED (0.29) AED (0.67) Discontinued operations - Basic diluted earnings per share AED (0.29) AED (0.67) 29 CONTINGENCIES AND COMMITMENTS Guarantees 29 CONTINGENCIES AND COMMITMENTS The Group has following guarantees outsting as at 31 December 2009: Guarantees The 1. Group Loans has taken following by an associated guarantees company outsting from as at commercial 31 December banks 2009: amounting to AED 110,694 thouss (2008: AED 111,032 thouss) are guaranteed by Group. 1. Loans taken by an associated company from commercial banks amounting to AED 110,694 thouss 2. Loans taken by an associated company from commercial banks amounting to AED 1,414,839 thouss (2008: AED 111,032 thouss) are guaranteed by Group. (2008: AED 1,352,130 thouss) are guaranteed by Group. The majority shareholder in associate 2. has Loans provided taken by an Group associated a counter company guarantee from commercial indemnity banks up to amounting its share to liability AED 1,414,839 for any claim thouss made against (2008: AED Group 1,352,130 arising thouss) from guarantee. are guaranteed by Group. The majority shareholder in associate has provided Group a counter guarantee indemnity up to its share liability for any claim made 3. The Group has issued a financial guarantee AED 79,776 thouss (2008: AED 79,865 thouss) as a against Group arising from guarantee. security for letter guarantee issued by a commercial bank for performance its contractual 3. obligations. The Group has issued a financial guarantee AED 79,776 thouss (2008: AED 79,865 thouss) as a security for letter guarantee issued by a commercial bank for performance its contractual 4. The Group has issued a financial guarantee AED 6,839 thouss (2008: AED 6,676 thouss) as a obligations. security for letter guarantee issued by a commercial bank for performance its contractual 4. obligations. The Group has issued a financial guarantee AED 6,839 thouss (2008: AED 6,676 thouss) as a security for letter guarantee issued by a commercial bank for performance its contractual 5. The Group has provided a financial guarantee AED 5,000 thouss (2008: AED 5,000 thouss) as a obligations. security for letter guarantee issued by a commercial bank for issuance trade license from 5. Government The Group has provided Dubai. a financial guarantee AED 5,000 thouss (2008: AED 5,000 thouss) as a security for letter guarantee issued by a commercial bank for issuance trade license from 6. The Group has provided a financial guarantee AED 1,847 thouss (2008: nil) as a security to Dubai Government Dubai. Customs for importing goods. 6. The Group has provided a financial guarantee AED 1,847 thouss (2008: nil) as a security to Dubai 7. The Customs Group for importing has provided goods. a corporate guarantee AED 110,190 thouss (2008: AED 110,190 thouss) to a commercial bank as a security for guarantees issued by bank on behalf 7. associated The Group company has provided Group. a corporate guarantee AED 110,190 thouss (2008: AED 110,190 thouss) to a commercial bank as a security for guarantees issued by bank on behalf Commitments associated company Group., Group had commitments AED 9,180,026 thouss (2008: AED 17,705,411 thouss) Commitments including project commitments AED 9,074,091 thouss (2008: AED 16,110,055 thouss). This represents At 31 December value 2009, contracts Group issued had as commitments 31 December 2009 AED net 9,180,026 invoices thouss received (2008: accruals AED made 17,705,411 at that date. thouss) including project commitments AED 9,074,091 thouss (2008: AED 16,110,055 thouss). This represents value contracts issued as 31 December 2009 net invoices received accruals made at that Certain date. claims were submitted by contractors relating to different projects Group in ordinary course business from which it is anticipated that no material un-provided liabilities will arise. Certain claims were submitted by contractors relating to different projects Group in ordinary course The business Group from had which entered it is anticipated into a joint that venture no material agreement un-provided ( agreement ) liabilities will with arise. Bawadi LLC, (a subsidiary Tatweer LLC) to jointly develop l in Bawadi development in Dubai. According to terms agreement, Group The Group is committed had entered to contribute into a joint AED venture 3,850,000 agreement thouss ( over agreement ) expected with construction Bawadi period LLC, (a 7 subsidiary to 10 years. Tatweer LLC) to jointly develop l in Bawadi development in Dubai. According to terms agreement, Group is committed to contribute AED 3,850,000 thouss over expected construction period 7 to 10 years. 48 Emaar Annual Report I 51 48

67 Emaar Properties PJSC its Subsidiaries 29 CONTINGENCIES AND COMMITMENTS (continued) Operating lease commitments Group as lessee The Group has entered into various operating lease agreements for properties, fice facilities equipment. Future minimum payments under se operating leases are as follows: AED 000 AED 000 Within one year 515, ,124 After one year but not more than five years 309,936 75, , ,993 Operating lease commitments Group as lessor The future minimum lease payments receivable under non-cancellable operating leases contracted for at reporting date but not recognised as receivables, are as follows: AED 000 AED 000 Within one year 1,048, ,719 After one year but not more than five years 1,919,316 3,136,220 More than five years 401, ,148 3,369,048 4,170,087 Legal claim The Company was involved in arbitration proceedings with Jadawel International Company ( Claimant ) with regard to a conditional joint venture agreement in Kingdom Saudi Arabia. The conditions such agreement never materialised. Arbitrators have given an award in favour Company in which all claims by claimant were rejected by arbitrators, who declared joint venture agreement to be ineffective, unenforceable with no legal effect on Company. The claimant has filed an appeal against award before Board Grievances (BOG). The BOG unexpectedly reversed arbitration award issued a ruling directing Company to pay USD 228,000 thouss (AED 837,444 thouss) to Claimant to deliver share certificates representing 18,610,000 shares in Company (after share split) along with prits realised by se shares from date signing joint venture agreement, being 28 December The Company is also directed by said ruling to pay arbitrator fees amounting to SAR 45,000 thouss (AED 44,074 thouss). All or items relief claimed by parties are dismissed by BOG. The Company has filed an appeal against ruling BOG on 26 August 2009 to Appellant Chamber for commercial cases requesting revocation BOG judgement ratification Arbitration Award. In opinion Company s management its legal advisors, claim is without merit Company has good arguments to refute substantially this claim. Emaar Properties PJSC its Subsidiaries NOTES Emaar Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS At NOTES 31 December TO THE 2009 CONSOLIDATED FINANCIAL STATEMENTS 29 CONTINGENCIES AND COMMITMENTS (continued) Contingent 29 CONTINGENCIES liabilities AND COMMITMENTS (continued) Contingent (i) On 29 liabilities March 2006, Company entered into an option agreement ( agreement ) with an investment bank ( investor ). The agreement provided right to investor to require Company to buy back all (i) On 29 March 2006, Company entered into an option agreement ( agreement ) with an investment shares purchased by investor in one Group s associate companies, in event an Initial Public bank ( investor ). The agreement provided right to investor to require Company to buy back all Offering ( IPO ) associate not occurring within 39 months date purchase shares associate. shares purchased by investor in one Group s associate companies, in event an Initial Public An IPO did not occur within above defined period. Offering ( IPO ) associate not occurring within 39 months date purchase shares associate. Subsequently An IPO did not on occur 29 September within above 2009, defined Company period. investor entered into an agreement, whereby Company has provided promissory notes aggregating to USD 61 million (AED 224 million) to investor (being Subsequently on 29 September 2009, Company investor entered into an agreement, whereby purchase price shares associate purchased by investor associated costs) agreed to Company has provided promissory notes aggregating to USD 61 million (AED 224 million) to investor (being use all reasonable endeavors to conclude an Initial Public Offering by 30 June Accordingly, on 29 September purchase price shares associate purchased by investor associated costs) agreed to 2009, associate filed Draft Red Herring Prospectus ( DRHP ) with SEBI seeking approval for IPO. The shares use all reasonable endeavors to conclude an Initial Public Offering by 30 June Accordingly, on 29 September purchased by investor are also fered for sale in DRHP proposed IPO. 2009, associate filed Draft Red Herring Prospectus ( DRHP ) with SEBI seeking approval for IPO. The shares According purchased by to investor terms are also agreement, fered for sale investor is DRHP entitled to dem proposed payments IPO. in respect all or any promissory notes in event that an IPO does not occur by 30 June 2010 equivalent shares purchased by According to terms agreement, investor is entitled to dem payments in respect all or any investor would be transferred to Company. In event IPO occurs net proceeds from sale promissory notes in event that an IPO does not occur by 30 June 2010 equivalent shares purchased by shares in IPO is lesser than purchase price shares, investor can dem payment promissory investor would be transferred to Company. In event IPO occurs net proceeds from sale note for difference between net proceeds from sales shares purchase price se shares. shares in IPO is lesser than purchase price shares, investor can dem payment promissory Therefore, note difference Group s between liability is net contingent proceeds from dependent sales upon shares outcome purchase an price IPO se associate shares. not happening before 30 June Therefore, Group s liability is contingent dependent upon outcome an IPO associate not happening (ii) The before Company 30 June also entered into option agreements with various parties ( Investors ), whereby Company agreed to use its voting or rights in associate to ensure that Company achieves listing (ii) The Company also entered into option agreements with various parties ( Investors ), whereby associate s equity shares on or before 31 March 2010 at a price which is not less than average investment price. Company agreed to use its voting or rights in associate to ensure that Company achieves listing If shares in IPO are issued at a price less than average investment price, Company shall be liable to pay associate s equity shares on or before 31 March 2010 at a price which is not less than average investment price. investors a compensation amount which shall be equal to difference between average investment price If shares in IPO are issued at a price less than average investment price, Company shall be liable to pay price at which shares are issued for listing multiplied by number shares held by each investor. investors a compensation amount which shall be equal to difference between average investment price The maximum price at contingent which shares exposure are issued Company for listing is multiplied AED 220 by million number as per shares options held agreements, by each investor. event non occurrence IPO or if IPO price is lower than original purchase price shares by investors. The maximum contingent exposure Company is AED 220 million as per options agreements, in event 30 non occurrence TRANSACTIONS IPO or WITH if IPO RELATED price is lower PARTIES than original purchase price shares by investors. For 30 TRANSACTIONS purpose se financial WITH statements, RELATED parties PARTIES are considered to be related to Group, if Group has ability, directly or indirectly, to control party or exercise significant influence over party in making financial For purpose se financial statements, parties are considered to be related to Group, if Group has operating decisions, or vice versa, or where Group party are subject to common control or common ability, directly or indirectly, to control party or exercise significant influence over party in making financial significant influence. Related parties may be individuals or or entities. operating decisions, or vice versa, or where Group party are subject to common control or common Related significant party influence. transactions Related parties may be individuals or or entities. During financial year, following were significant related party transactions, which were carried out in Related party transactions normal course business on terms agreed between parties: During financial year, following were significant related party transactions, which were carried out in normal course business on terms agreed between parties: AED 000 AED Associates: AED 000 AED 000 Net interest income on deposits / investments from Dubai Banking Group PJSC 15,411 17,331 Associates: Islamic finance income from Amlak Finance PJSC 49,830 33,206 Net interest income on deposits / investments from Dubai Banking Group PJSC 15,411 17,331 Interest income earned on loan to Golden Ace Pte Ltd 29,959 16,128 Islamic finance income from Amlak Finance PJSC 49,830 33,206 Interest income earned on loan to Emaar MGF L Limited ir related parties 61,233 16,944 Interest income earned on loan to Golden Ace Pte Ltd 29,959 16,128 Interest income earned on loan to Emaar MGF L Limited ir related parties 61,233 16,944 Directors ir related parties Sale plot l - 351,687 Directors ir related parties Sale plot l - 351,687 Or related parties: Islamic finance income from Al Salam Bank, Bahrain 4,433 5,000 Or related parties: Islamic finance income from Al Salam Bank, Sudan 1,147 1,152 Islamic finance income from Al Salam Bank, Bahrain 4,433 5,000 Islamic finance income from Al Salam Bank, Sudan 1,147 1,152 The members board directors received board meetings allowance totaling AED 4,300 thouss (2008: AED 3,881 thouss). The members board directors received board meetings allowance totaling AED 4,300 thouss (2008: AED 3,881 thouss). Emaar Annual Report I Emaar Annual 50 Report I 53 50

68 Emaar Properties PJSC its Subsidiaries 31 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES Overview The Group has exposure to following risks from its use financial instruments: a) Credit risk, b) Market risk, c) Liquidity risk. This note presents information about Group s exposure to each above risks, Group s objectives, policies processes for measuring managing risk, Group s management capital. The Board Directors has overall responsibility for establishment oversight Group s risk management framework. Senior Group management are responsible for developing monitoring Group s risk management policies report regularly to Board Directors on ir activities. The Group s current financial risk management framework is a combination formally documented risk management policies in certain areas informal risk management policies in ors. The Group s risk management policies (both formal informal) are established to identify analyse risks faced by Group, to set appropriate risk limits controls, to monitor risks adherence to limits. Risk management policies systems are reviewed regularly to reflect changes in market conditions Group s activities. The Group Audit Committee oversees how management monitors compliance with Group s risk management policies procedures reviews adequacy risk management framework in relation to risks faced by Group. The Group Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular adhoc reviews risk management controls procedures, results which are reported to Audit Committee. The Group s principal financial liabilities, or than derivatives, comprise bank borrowings, overdrafts trade payables. The main purpose se financial instruments is to raise finance for Group s operations. The Group has various financial assets such as trade receivables cash short-term deposits, which arise directly from its operations. The Group also enters into derivative transactions, primarily forward currency contracts. The purpose is to manage currency risks arising from Group s operations its sources finance. The Board Directors reviews agrees policies for managing each se risks which are summarised below: a) Credit risk Credit risk is risk financial loss to Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group is exposed to credit risk principally from its receivables from customers, or receivables from its financing activities, including deposits with banks financial institutions, foreign exchange transactions or financial instruments. Trade or receivables The Group s exposure to credit risk is influenced mainly by individual characteristics each customer. The demographics Group s customer base, including default risk industry country, in which customers operate, has less an influence on credit risk. The Group earns its revenues from a large number customers spread across different geographical segments. However, geographically 90 percent (2008: 95 percent) Group s trade receivables are based in Middle East North Africa. The Group has entered into contracts for sale residential commercial units plots l on an installment basis. The installments are specified in contracts. The Group is exposed to credit risk in respect installments due. However, legal ownership residential commercial units plots l is transferred to buyer only after all installments are recovered. In addition, installment dues are monitored on an ongoing basis with result that Group s exposure to bad debts is not significant. The Group does not require collateral in respect trade or receivables. Emaar Annual Report I 54 Emaar Annual Report I 55 52

69 Emaar Properties PJSC its Subsidiaries 31 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) a) Credit risk (continued) Trade or receivables (continued) The Group establishes an allowance for impairment at each reporting date that represents its estimate incurred losses in respect trade or receivables. The main components this allowance are a specific loss component that relates to individually significant exposures, a collective loss component established for groups similar assets in respect losses that have been incurred but not yet identified. The collective loss allowance is determined based on historical data payment statistics for similar financial assets. Financial instruments cash deposits With respect to credit risk arising from or financial assets Group, which comprise cash cash equivalents, financial assets at fair value through or comprehensive income certain derivative instruments, Group s exposure to credit risk arises from default counterparty, with a maximum exposure equal to carrying amount se instruments. Credit risk from balances with banks financial institutions is managed by Group's treasury in accordance with Group's policy. The Group limits its exposure to credit risk by only placing balances with international banks local banks good repute. Given prile its bankers, management does not expect any counterparty to fail to meet its obligations. Guarantees The Group s policy is to provide financial guarantees only to its subsidiaries certain associates. For details guarantees outsting at reporting date refer note 29. b) Market risk Market risk is risk that changes in market prices, such as currency risk, interest rate risk equity prices will affect Group s income or value its holdings financial instruments. Financial instruments affected by market risk include loans borrowings, deposits, financial assets at fair value through or comprehensive income derivative financial instruments. The objective market risk management is to manage control market risk exposures within acceptable parameters, while optimising return. The Group also enters into derivative transactions, primarily forward currency contracts. The purpose is to manage currency risks arising from Group s operations its sources finance. It is, has been throughout years Group s policy that no trading in derivatives shall be undertaken. Exposure to interest rate risk Interest rate risk is risk that fair value or future cash flows a financial instrument will fluctuate because changes in market interest rates. The Group's exposure to risk changes in market interest rates relates primarily to Group's long-term debt obligations with floating interest rates. The Group manages its interest rate risk by having a balanced portfolio fixed variable rate loans borrowings. Interest on financial instruments having floating rates is re-priced at intervals less than one year interest on financial instruments having fixed rate is fixed until maturity instrument. Or than commercial overall business conditions, Group s exposure to market risk for changes in interest rate environment relates mainly to its investment in financial products fixed deposits. Emaar Annual Report I Emaar Annual Report I 57

70 Emaar Properties PJSC its Subsidiaries Emaar NOTES Properties TO THE CONSOLIDATED PJSC its Subsidiaries FINANCIAL STATEMENTS Emaar Properties PJSC its Subsidiaries 31 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) b) 31 Market FINANCIAL risk (continued) RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) b) Exposure Market to equity risk (continued) price risk Equity price risk is risk that fair values equities decrease as result changes in levels equity Exposure indices to equity value price risk individual stocks. The non-trading equity price risk exposure arises from Group s investment Equity price portfolio. risk is Equity risk that price risk fair arises values from equity equities instrument decrease held as as result fair value changes through in or levels comprehensive equity income indices held by value Group. individual Management stocks. The Group non-trading monitors equity price securities risk in exposure its investment arises portfolio from based Group s on investment market indices. portfolio. Material Equity investments price risk within arises from portfolio equity instrument are managed held by as qualified fair value fund through managers or as comprehensive well as on an income individual held basis. by All Group. buy Management sell decisions related Group to portfolio monitors managed equity securities on an individual its investment basis are portfolio approved based by on market Board indices. Directors. Material The primary investments goal within Group s portfolio investment are managed strategy by is qualified to maximise fund investment managers returns. as well as on an individual basis. All buy sell decisions related to portfolio managed on an individual basis are approved by Board The effect Directors. on equity The (as primary a result goal a change Group s in fair investment value strategy equity instruments is to maximise held investment as fair value returns. through or comprehensive income at 31 December 2009) due to a reasonably possible change in equity indices, with all or variables The effect held on equity constant, (as is a as result follows: a change in fair value equity instruments held as fair value through or comprehensive income at 31 December 2009) due to a reasonably possible change in equity indices, with all or variables held constant, is as follows: Change in Effect on Change in Effect on equity 2009 equity equity price 2008 equity Change price in equity % Effect on AED 000 equity Change in equity % price Effect on AED 000 equity price Quoted investments +10% % AED , % % AED ,956 Quoted c) Liquidity investments risk +10% 53, % 35,956 c) Liquidity Liquidity risk is risk risk that Group will not be able to meet its financial obligations as y fall due. The Group monitors its risk to a shortage funds using a recurring liquidity planning tool. This tool considers maturity Liquidity both its financial risk is investments risk that Group financial will assets not be (e.g. able trade to meet receivables, its financial or obligations financial as assets) y fall due. projected The Group cash monitors flows from its operations. risk to a shortage funds using a recurring liquidity planning tool. This tool considers maturity both its financial investments financial assets (e.g. trade receivables, or financial assets) projected cash The flows cash from flows, operations. funding requirements liquidity Group companies are monitored on a centralised basis, under control Group Treasury. The objective this centralised system is to optimise efficiency The effectiveness cash flows, funding management requirements Group s liquidity capital Group resources. companies The Group s are monitored objective on a is centralised to maintain basis, a balance under between control continuity Group funding Treasury. The flexibility objective through this centralised use bank system overdrafts, is to bank optimise borrowings efficiency finance effectiveness leases contracts. The management Group manages Group s liquidity capital risk by resources. maintaining The Group s adequate objective reserves, is banking to maintain facilities a balance between borrowing continuity facilities, by funding continuously flexibility monitoring through forecasted use bank actual overdrafts, cash flows bank borrowings matching maturity finance leases priles contracts. financial The assets Group liabilities. manages liquidity risk by maintaining adequate reserves, banking facilities borrowing facilities, by continuously monitoring forecasted actual cash flows matching maturity The priles Group financial currently assets has sufficient liabilities. cash on dem to meet expected operational expenses, including servicing financial obligations. The Group currently has sufficient cash on dem to meet expected operational expenses, including servicing The financial table below obligations. summarises maturity prile Group s financial liabilities based on contractual undiscounted payments. The table below summarises maturity prile Group s financial liabilities based on contractual undiscounted Financial liabilities payments. On Less than 3 3 to 12 1 to 5 Over dem months months years 5 years Total Financial liabilities AED 000 On Less AED 000 than 3 AED to 12 AED to 5 AED 000 Over AED 000 As at 31 December 2009 dem months months years 5 years Total AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 As Due at to 31 banks December ,531 2,241,445 2,613,274 4,192,448 72,441 9,160,139 Retention payable - 143, , ,406-1,160,306 Payable Due to banks to non-controlling interest 40,531-2,241,445-2,613,274-4,192, ,185 72,441-9,160, ,185 Dividend Retention payable 77, , , , ,160,306 77,257 Or Payable liabilities to non-controlling interest 83,642-3,264,095-2,115,684-1,534, , ,398-7,173, ,185 Dividend payable 77, ,257 Or Total liabilities undiscounted 83,642 3,264,095 2,115,684 1,534, ,398 7,173,093 financial liabilities 201,430 5,649,128 5,384,270 6,989, ,839 18,471,980 Total undiscounted financial liabilities 201,430 5,649,128 5,384,270 6,989, ,839 18,471, Emaar Annual Report I FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) c) Liquidity risk (continued) Financial liabilities On Less than 3 3 to 12 1 to 5 Over dem months months years 5 years Total AED 000 AED 000 AED 000 AED 000 AED 000 AED 000 As at 31 December 2008 (Restated) Due to banks 255,639 1,854,872 3,199,385 4,783,819 39,977 10,133,692 Retention payable - 89, , ,855-1,078,549 Payable to non-controlling interest , ,556 Dividend payable 80, ,825 Or liabilities 42,782 2,161,019 2,217,931 2,582, ,086 7,193,164 Total undiscounted financial liabilities 379,246 4,104,903 5,802,998 8,861, ,063 19,377,786 d) Capital management The Group policy is to maintain a strong capital base so as to maintain investor, creditor market confidence to sustain future development business. The primary objective Group s capital management strategy is to ensure that it maintains a strong credit rating healthy capital ratios in order to support its business maximise shareholder value. The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Group s policy is to keep gearing ratio between 33% 50%. The Group includes within net debt, interest bearing loans borrowings, less cash cash equivalents. Capital includes equity attributable to equity holders parent less net unrealised gains reserve., Groups gearing ratio is 18% (31 December 2008: 12%). The Board seeks to maintain a balance between higher returns that might be possible with higher levels borrowings advantages security afforded by a sound capital position. The Board Directors also monitors return on capital, which Group defines as net operating income divided by total shareholders equity, excluding minority interests. The Board Directors also monitors level dividends to shareholders, return capital to shareholders or issue new shares to maintain or adjust capital structure. There were no changes in Group s approach to capital management during year. Neir Company nor any its subsidiaries is subject to externally imposed capital requirements or than statutory requirements in jurisdictions where Group entities are incorporated. 32 FAIR VALUES OF FINANCIAL INSTRUMENTS Financial instruments comprise financial assets financial liabilities. Financial assets Group include bank balances cash, trade receivables, securities, loans advances, or receivables due from related parties. Financial liabilities Group include customer deposits, loans from financial institutions, accounts payable retentions payable. The fair values financial assets liabilities are not materially different from ir carrying value unless stated orwise. Emaar Annual Report I 59 56

71 Emaar Properties PJSC its Subsidiaries 33 HEDGING ACTIVITIES Cash flow hedges, Group held certain forward exchange contracts designated as hedges expected future payments under construction contracts entered by its subsidiaries for which Group has firm commitments. The forward exchange contracts are being used to hedge foreign currency risk firm commitments. The nominal amounts se contracts are AED 5,312 thouss (2008: AED 60,007 thouss) Assets Liabilities Assets Liabilities AED 000 AED 000 AED 000 AED 000 Forward exchange contracts Fair value Emaar Annual Report I 60 57