Appendix 1 - Accounting Policies Instructions No. 28 for 2024 — CBJ — JO

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Appendix No. (1) Licensed Insurance Companies Permitted to Conduct Insurance Business
Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Consolidated Financial Statements and the External Auditor's Report
for the Year Ended December 31, ....................

Contents	Page
External Auditor's Report	-
Consolidated Statement of Financial Position	-
Consolidated Statement of Profit or Loss	-
Statement of Profit or Loss - Life Insurance	-
Consolidated Statement of Other Comprehensive Income	-
Consolidated Statement of Changes in Equity	-
Consolidated Statement of Cash Flows	-
Notes to the Consolidated Financial Statements and forming an integral part thereof	-

Form (9/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Consolidated Statement of Financial Position
As at December 31, ....................

	Note No.	December 31 Current Year	December 31 Comparative Year
Assets
Deposits with banks	3
Financial assets at fair value through profit or loss	4
Financial assets at fair value through other comprehensive income	5
Financial assets at amortized cost	6
Investments in associates	7
Investments in subsidiaries and associates (in unconsolidated statements only)	8
Investment property	9
Right-of-use assets	10
Total Investments
Cash in hand and at banks	11
Insurance contract assets	12-13
Reinsurance contract assets	14
Deferred tax assets	15
Property and equipment	16
Intangible assets	17
Other assets	18
Assets of discontinued operations
Total Assets

Form (9/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

	Note No.	December 31 Current Year	December 31 Comparative Year
Liabilities and Equity
Liabilities
Insurance contract liabilities	12-13
Reinsurance contract liabilities	14
Banks payable / Trade payables	21
Accrued expenses
Lease liabilities
Provision for income tax	15
Deferred tax liabilities	15
Other provisions	19
Loans	20
Other liabilities	21
Subordinated loans	22
Liabilities of discontinued operations
Total Liabilities
Equity
Authorized and paid-up capital	23
Less: Treasury shares	24
Share premium (discount)	23
Mandatory reserve	25
Voluntary reserve	25
Special reserve	25
Foreign currency translation differences	26
Fair value reserve	27
Retained earnings (losses)	28
Total Equity - Shareholders of the Company
Subordinated loan	30
Non-controlling interests
Total Equity
Total Liabilities and Equity

Form (9/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Consolidated Statement of Profit or Loss
For the Year Ended December 31, ....................

	Note No.	December 31 Current Year	December 31 Comparative Year
Revenues
Insurance contract revenues	31
Insurance contract expenses	32
Results of insurance contract business
Reinsurance contract expenses	33
Reinsurance contract revenues	34
Results of reinsurance contract business
Net results of insurance and reinsurance contract business
Financing expenses / revenues - Insurance contracts	35
Financing expenses / revenues - Reinsurance contracts	36
Net financing results of insurance and reinsurance contracts
Net results of insurance and reinsurance contract business and financing
Interest income	37
Net gains (losses) on financial assets and investments	38
Dividends received from subsidiaries and associates	39
Other revenues	40
Total Revenues
Unallocated administrative and general expenses
Unallocated depreciation and amortization
Expected credit losses on financial assets and investments
Company's share of results of subsidiaries / separate
Company's share of results of associates
Financing expenses - Lease contracts
Gains (losses) on sale of property and equipment
Other expenses	43
Total Expenses
Profit (Loss) for the Year from Continuing Operations before Income Tax
Income Tax
Profit (Loss) for the Year from Continuing Operations after Income Tax
Profit (Loss) for the Year after Tax from Discontinued Operations
Profit for the Year Attributable to Shareholders of the Company
Profit for the Year Attributable to Non-controlling Interests
Earnings per Share for the Year	45

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Statement of Profit or Loss -- Life Insurance
For the Year Ended December 31, ....................

	Note No.	Current Year	Comparative Year
Revenues
Insurance contract revenues	31
Insurance contract expenses	32
Results of insurance contract business
Reinsurance contract expenses	33
Reinsurance contract revenues	34
Results of reinsurance contract business
Net results of insurance and reinsurance contract business
Financing expenses / revenues - Insurance contracts	35
Financing expenses / revenues - Reinsurance contracts	36
Net financing results of insurance and reinsurance contracts
Net results of insurance and reinsurance contract business and financing
Interest income	37
Net gains (losses) on financial assets and investments	38
Dividends received from subsidiaries and associates	39
Other revenues	40
Total Revenues
Unallocated administrative and general expenses
Unallocated depreciation and amortization
Expected credit losses on financial assets and investments
Company's share of results of subsidiaries / separate
Company's share of results of associates
Financing expenses - Lease contracts
Gains (losses) on sale of property and equipment
Other expenses	43
Total Expenses
Profit (Loss) for the Year from Continuing Operations before Income Tax
Income Tax
Profit (Loss) for the Year from Continuing Operations after Income Tax
Profit (Loss) for the Year after Tax from Discontinued Operations
Profit for the Year Attributable to Shareholders of the Company
Profit for the Year Attributable to Non-controlling Interests
Earnings per Share for the Year	45

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Consolidated Statement of Other Comprehensive Income
For the Year Ended December 31, ....................

	Note No.	December 31 Current Year	December 31 Comparative Year
Profit (Loss) for the Year
Add: Other Comprehensive Income Items
Foreign currency translation differences
Change in fair value reserve through other comprehensive income
Effect of change in discount rate
Effect of change in actuarial assumptions

Total Other Comprehensive Income for the Year

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Consolidated Statement of Changes in Equity
For the Year Ended December 31, ....................

	Authorized and Paid-up Capital	Mandatory Reserve	Voluntary Reserve	Share Discount	Fair Value Reserve	Retained Earnings (Losses)	Total
Comparative Year
Balance as at January 1
Effect of accounting standards adjustments
Balance as at January 1 of Comparative Year after adjustment
"Restated" Comprehensive Income for the Year
Transferred to Reserves
Change in Fair Value of Financial Assets at Fair Value through Other Comprehensive Income
Dividends distributed
Increase in Capital
Others
Balance as at December 31

Current Year
Balance as at January 1
Transferred to Reserves
Total Comprehensive Income for the Year
Foreign currency translation differences
Change in Fair Value of Financial Assets at Fair Value through Other Comprehensive Income
Dividends distributed
Increase in Capital
Others

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Consolidated Statement of Cash Flows
For the Year Ended December 31, ....................

	Note No.	December 31 Current Year	December 31 Comparative Year
Cash Flows from Operating Activities
Profit (Loss) for the Year from Continuing Operations before Tax
Profit (Loss) for the Year from Discontinued Operations before Tax
Adjustments:
Depreciation and amortization
Interest income
Impairment loss on intangible assets
Depreciation of right-of-use assets
Financing costs of lease contract
End-of-service indemnity expense
Dividends distributed
Gains (losses) on sale of property and equipment
Change in Fair Value of Financial Assets through Profit or Loss
Expected credit losses on financial assets at amortized cost
Reversal of expected credit losses required
Reversal of impairment provision on investments no longer needed
Cash Flows from Operating Activities before Changes in Working Capital Items
Insurance contract assets
Retained reinsurance contract assets
Other assets
Insurance contract liabilities
Retained reinsurance contract liabilities
Other liabilities
Accrued expenses
Other provisions
Cash Flows from Operating Activities before Taxes and Paid Provisions
Paid end-of-service indemnity provision
Paid income tax
Net Cash Flows from Operating Activities
Cash Flows from Investing Activities
Deposits with banks maturing after three months
Purchase / Sale of property and equipment
Purchase / Sale of intangible assets
Purchase / Sale of investment property
Purchase / Sale of financial assets
Dividends received
Interest income received
Net Cash Flows from Investing Activities
Cash Flows from Financing Activities
Repayment of subordinated loan
Paid dividends distributed
Lease payments
Banks payable / Any company activity account item
Net Cash Flows from Financing Activities
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Cash and Cash Equivalents at End of Year
Others

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

Notes to the Consolidated Financial Statements and forming an integral part thereof
For the Year Ended December 31, ....................

(1) General a. The company .................... was established in .................... and registered as a Jordanian joint stock company under number () with authorized capital amounting to .................... dinars, divided into .................... shares, each share value .................... Jordanian dinars. The company conducts (state the nature of insurance business, branches of the company, and state the company's other objectives). b. The attached financial statements were approved by the Board of Directors in its meeting number () held on date .................... and are subject to the approval of the General Assembly of Shareholders.
c. The financial statements were approved by the company's regional management on date .................... (for foreign companies).

(1,2) Basis of Preparation of Financial Statements

The consolidated financial statements of the company and its subsidiaries were prepared in accordance with the standards issued by the International Accounting Standards Board and in accordance with local laws in effect and under the forms established by the Central Bank of Jordan.
The consolidated financial statements were prepared in accordance with the historical cost principle, except for financial assets at fair value through profit or loss or other comprehensive income, the details of which are shown in their specific accounting policies.
The Jordanian Dinar is the currency of presentation of the consolidated financial statements, which represents the company's functional currency.
The most important accounting policies followed in preparing the consolidated financial statements, which have been disclosed, have been applied on a consistent basis for all years presented unless otherwise stated.
The preparation of consolidated financial statements in accordance with International Financial Reporting Standards requires the use of significant and specific accounting estimates, and also requires management to use its own estimates in the process of applying the company's accounting policies.

(2,2) Basis of Consolidation of Financial Statements

The consolidated financial statements represent the financial statements of the company and its subsidiaries under its control. Control is achieved when the company has the ability to control the financial and operating policies of the subsidiaries in order to obtain benefits from their activities, and transactions, balances, revenues, and expenses between the company and its subsidiaries are eliminated in full (the names of all subsidiaries, their capital, ownership percentage, nature of the company, and date of acquisition are stated).
The results of operations of subsidiaries are consolidated in the consolidated statement of profit or loss from the date of acquisition, which is the date when the company actually transfers control to the subsidiaries, and the results of operations of subsidiaries that have been disposed of are consolidated in the consolidated statement of profit or loss until the date of disposal, which is the date when the company loses control over the subsidiaries.
The financial statements of the company / for subsidiaries for the same financial year of the insurance company are prepared using the same accounting policies followed by the insurance company. If the company / subsidiaries follow accounting policies that differ from those followed by the insurance company, necessary adjustments are made to the financial statements of the company / subsidiaries to conform to the accounting policies followed by the insurance company.
Non-controlling interests represent that part of the equity in subsidiaries not owned by the company. Non-controlling interests are shown in the net assets of subsidiaries as a separate item within the equity of the group.
In the event that separate financial statements are prepared for the company as a standalone entity, investments in subsidiaries are shown at cost.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

(2,3) Application of New and Amended International Financial Reporting Standards The company applied the following new and amended standards during the year:
The application of these new and amended standards did not result in a material effect on the financial amounts of the current and prior accounting periods (or the application of these new and amended standards and their interpretations resulted in changes in the accounting policies followed by the company in the following areas, which had an effect on the financial amounts of the current year and prior years).

(2,4) Changes in Accounting Policies
(1,4,2) New Standards, Interpretations, and Amendments Effective from January 1, .................... The company applied International Financial Reporting Standard No. 17 "Insurance Contracts", where it assessed the impact of applying the standard, determined the gap between the previous situation and the requirements of the standard, and prepared a risk assessment system through actuarial statistical models for various insurance contracts, in addition to updating information technology systems to ensure the availability of all necessary databases to apply actuarial models and prepare systems for estimating future cash flows for contracts, determining the present value of cash, in addition to updating accounting policies and procedures and updating other operational policies, which had an effect on the financial statements. The company also re-evaluated the models used to recognize insurance contract revenues according to the requirements of the standard as shown in the applied policies in Note (2,5).

The transition provisions for applying the standard require retrospective application by following the following approaches (Full Retrospective / Modified Retrospective / Fair Value. (The transitional approach followed by the company is stated)), with recognizing the cumulative effect of applying the standard as an adjustment to the opening balance of retained earnings (or any other component of equity, if necessary) at the beginning of the year.

The effect of applying the standard and the adjustment to the opening balance of retained earnings is disclosed in the Consolidated Statement of Changes in Shareholders' Equity.

The effect of application is also disclosed, along with a summary of the restatement of financial statement items for the year ended as of December 31, ....................

Disclosure of accounting policies classification of current and non-current liabilities (amendments to International Accounting Standard No. (1) "Presentation of Financial Statements" and IFRS Practice Statement 2).
Disclosure of accounting policies (amendments to International Accounting Standard No. (8) "Accounting Policies, Changes in Accounting Estimates and Errors").
Deferred taxes related to assets and liabilities arising from a single transaction (amendments to International Accounting Standard No. (12) "Income Taxes").

The company has disclosed accounting policies in line with the requirements of the International Accounting Standards Board and its amendments regarding the presentation of financial statements "IFRS Practice Statement 2" under the requirements of the Central Bank of Jordan. (The effect of other new standards and policies is disclosed according to the answers of the licensed insurance company).

(2,4,2) New Standards, Interpretations, and Amendments Not Yet Effective Standards not yet effective are added when announced by the International Accounting Standards Board.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

(2,5) Use of Estimates and Assumptions
The preparation of consolidated financial statements and the application of accounting policies requires the company's management to make estimates and judgments that affect the amounts of financial assets and liabilities and the disclosure of contingent liabilities. These estimates and judgments also affect revenues, expenses, and provisions, as well as changes in fair value shown in the statement of profit or loss and within shareholders' equity. In particular, the company's management is required to issue important judgments and estimates to estimate the amounts and timing of future cash flows. The estimates mentioned are necessarily based on assumptions and multiple factors with varying degrees of judgment and uncertainty, and actual results may differ from estimates due to changes resulting from the conditions and circumstances of those estimates in the future.

(The nature and amount of changes in the estimated amounts included in previous financial year reports are disclosed, if these changes have a material effect on the current statements).

Our estimates within the consolidated financial statements are reasonable and detailed as follows:
(1,5,2) Expected Credit Losses
The company applies (the method used by the company to calculate expected credit losses is stated), which is mandated by International Financial Reporting Standard No. (9), for recognizing impairment of expected credit losses over the life of receivables and contractual assets based on credit risk and homogeneous ages.

Expected loss rates are based on the company's historical credit losses encountered over the previous three-year period up to the end of the current year. Historical loss rates are then adjusted for current and future information on macroeconomic factors that affect the company's customers (the factors on which the company relied in determining expected credit losses are stated) in accordance with instructions issued by the Central Bank of Jordan on this matter.

(2,5,2) Impairment of Financial Assets
The company reviews the values recorded in the records for financial assets at the date of the financial statements to determine if there are indicators indicating impairment in their value. In the event that such indicators exist, the fair value is estimated to determine the impairment loss.

(3,5,2) Income Tax
The financial year is charged with its share of income tax expense according to systems, laws, and international financial reporting standards.

Current Taxes
Current tax expenses are calculated based on taxable profits. Taxable profits differ from profits declared in the income statement because financial profits include non-taxable revenues or non-deductible expenses in the financial year but in subsequent years, or accumulated tax-accepted losses, or items that are not taxable or accepted for deduction for tax purposes. Taxes are calculated according to the tax rates approved by laws, regulations, and instructions in the Hashemite Kingdom of Jordan.
Deferred Taxes
Deferred taxes are the taxes expected to be paid or recovered as a result of temporary timing differences between the value of assets or liabilities in the financial statements and the value on which the taxable profit is calculated. Taxes are calculated using the liability method, and deferred taxes are calculated according to the tax rates expected to be applied when settling the tax liability or realizing deferred tax assets.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited Company)
Amman - Hashemite Kingdom of Jordan

The balance of deferred tax assets is reviewed at the date of the financial statements and is reduced in the event that it is expected that the benefit of those deferred tax assets will not be utilized partially or fully, or if the tax liability is settled or no longer needed.

(4,5,2) Property, Equipment, and Intangible Assets Management periodically re-estimates the productive lives of tangible and intangible assets for the purpose of calculating annual depreciation and amortization based on the general condition of those assets and estimates of expected productive lives in the future, and impairment losses (if any) are recorded in the statement of profit or loss.

(5,5,2) Present Value of Future Cash Flows Cash flows are defined as all amounts expected to be collected and expected to be paid within the scope of the insurance contract / retained reinsurance contract after adjustment to reflect the timing and uncertainty of those amounts, based on actuarial assumptions and the company's experience in managing the group of insurance contracts / retained reinsurance contracts. Future cash flows are recognized at present value (the assumptions followed in estimating future cash flows and the future cash flows that were considered are stated, as well as the method used to discount those cash flows, the discount rate, and the yield curve used, in addition to the justification for adopting the method used in calculating discount rates and the mechanism for handling insurance financing income or expense (through the statement of profit or loss or the statement of other comprehensive income)). When setting assumptions regarding the estimation of cash flows for groups of insurance contracts, the company must consider the following:

Inherent risks.
Level of aggregation.
Probability of natural disasters occurring.
Probability of contract termination before the end of the insurance coverage date, and other expected practices from the insured.
Factors that will affect estimates, and sources of information for these factors.

(6,5,2) Non-Financial Risk Adjustments
The company establishes a provision for uncertainty regarding the amount and timing of cash flows arising from non-financial risks based on actuarial assumptions and the company's experience in managing its portfolio of held insurance/reinsurance contracts (the method to be followed in evaluating non-financial risk adjustments, such as Value at Risk, or capital cost methods and appropriate confidence levels if any, shall be disclosed). The company must disclose calculation details and assumptions.

(7,5,2) Non-Insurance Components
The company discloses the following aspects:

Definition of insurance risk.
Definition of an insurance contract, and identification of insurance contracts underwritten based on that definition.
Statement of contracts issued by the company that do not conform to the definition of an insurance contract.
Mechanism for separating non-insurance components (investment component, service component, etc.) from the insurance contract, if any, along with the most specific standard to be applied to address those components.
Mechanism for determining the relative significance of insurance contract risks.

(8,5,2) Lawsuits Filed Against the Company A provision is established for lawsuits filed against the company based on a legal study prepared by the company’s lawyers, which determines potential future risks, and these studies are reviewed periodically.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

(9,5,2) Fair Value Levels
Fair value measurement hierarchy levels are disclosed, classifying fair value measurements fully. Fair value measurements are separated according to the levels defined in International Financial Reporting Standards. The difference between Level 2 and Level 3 fair value measurements represents an assessment of whether information or inputs can be observed and the significance of unobservable information requiring judgment and detailed analysis of inputs used to measure fair value, including consideration of all factors pertaining to assets or liabilities.

(6,2) Key Accounting Policies Followed
(1,6,2) Segment Information
Business segment represents a group of assets and operations that jointly provide products or services subject to risks and returns different from those related to other segments, measured according to financial reports used by the company. Geographic segment relates to providing products or services in a specific economic environment subject to risks and returns different from those related to segments operating in other economic environments.

(2,6,2) Goodwill
Goodwill is recorded at cost, representing the excess of the cost of acquiring or purchasing a subsidiary or companies owned jointly with other companies over the company’s share in the fair value of net identifiable assets and liabilities of that company at the acquisition date. Goodwill resulting from investment in subsidiaries is recorded in a separate line item as intangible assets.

Goodwill resulting from investment in associates appears as part of the investment account in the associate company, and goodwill is subsequently impaired by any decline in the value of the investment.

Goodwill is allocated to one or more cash-generating units for impairment testing purposes.

An impairment test for goodwill is performed at each financial reporting date, and goodwill is impaired if there is indication that its value has declined, specifically when the estimated recoverable amount of the cash-generating units to which goodwill belongs is less than the carrying amount of the unit(s). Impairment loss is recorded in the statement of profit or loss.

Impairment loss on goodwill is not reversed in subsequent periods. In case of sale of a subsidiary or jointly owned company, the goodwill value is taken into account when determining the profit or loss from the sale transaction.

(3,6,2) Definition of Insurance Contract
A contract under which an insurance company accepts significant insurance risk from the policyholder, agreeing to compensate the policyholder/beneficiary in the event of a specific uncertain future event (insured peril) that negatively affects the policyholder/beneficiary. An insurance contract is recognized based on the earliest of the following dates:

Start of the coverage period for the contract.
Due date of the first premium for the contract.
Date the insurance contract is considered a loss-making contract.
(Disclosure of the mechanism for recognizing a group of insurance contracts)

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

Regarding insurance contracts containing a direct participation feature and returns having economic characteristics similar to insurance contracts (long coverage period, recurring premiums, and amount/timing of return determined by the issuer), and linked to the same assets or participating in the performance of insurance contracts, contracts containing this feature at inception include the following:

Policyholders/beneficiaries sharing in a portion of the insurance contract portfolio.
Probability that the company will pay policyholders/beneficiaries a significant portion of the fair value returns of investments linked to the group of insurance contracts.
High probability of change in amounts paid to policyholders/beneficiaries due to changes in the fair value of investments linked to the group of insurance contracts.

(Disclosure of insurance contracts containing a direct participation feature, if any)

Contracts not classified as insurance contracts include, for example:

Investment contracts having a legal form similar to an insurance contract but not transferring significant insurance risk to the insurance company, and involving financial risks such as embedded derivatives, changes in fair value of a financial instrument, changes in interest rates, changes in exchange rates, or credit classification; these are classified as investment contracts according to International Financial Reporting Standard No. (9).
Investment contracts containing an optional participation feature; these are investment contracts with a legal form similar to an insurance contract but not transferring significant insurance risk to the issuer and not meeting the definition of an insurance contract, yet classified according to International Financial Reporting Standard No. (17).
Self-insurance (i.e., retaining risks that could have been covered by an insurance contract in the name of the company, a subsidiary, or an affiliate); these are classified according to International Financial Reporting Standard No. (15).

(4,6,2) Held Reinsurance Contracts
These are contracts concluded with reinsurers to compensate the insurance company for claims arising from insurance contracts issued by it.
Held reinsurance contracts are recognized:

At the beginning of the coverage period of the reinsurance contract or upon initial recognition of the insurance contract issued by the company if the reinsurance contract is proportionate to a group of insurance contracts.
From the beginning of the coverage period for groups of held reinsurance contracts.

(5,6,2) Liability for Remaining Coverage
The amount the company must establish upon recognition of insurance contracts relating to future financial periods resulting from active insurance contracts.

(6,6,2) Liability for Incurred Claims
The total value of expected and incurred costs to the company resulting from perils covered by insurance contracts that occurred before the end of the financial period, including reported and unreported claims, plus related expenses.

(7,6,2) Contractual Service Margin
The unearned profit from remaining coverage expected to be profitable, which is recognized concurrently with the provision of insurance contract services.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

(8,6,2) Initial Recognition of Insurance Contracts / General Measurement Model / Variable Fee Approach A group of insurance contracts is measured at initial recognition as follows:

Cash flows to fulfill obligations arising from contracts, including:
- Estimates of future cash flows.
- Time value of money and financial risk adjustments related to future cash flows, without including those financial risks in estimates of future cash flows.
- Non-financial risk adjustments.
Contractual service margin.

(9,6,2) Subsequent Measurement of Insurance Contracts / General Measurement Model / Variable Fee Approach The company recognizes the carrying amount of any group of insurance contracts at the end of each period, consisting of the sum of the following:

Liability for remaining coverage, calculated as the net present value of incoming and outgoing cash flows (after applying discount rate) added to non-financial risk adjustments and contractual service margin.
Liability for incurred claims, calculated based on the best estimate of future cash flows to settle claims, added to non-financial risk adjustments, considering application of discount rate to claims expected to be settled after more than one year.

(10,6,2) Initial Recognition of Insurance Contracts / Premium Allocation Approach A group of insurance contracts is measured at initial recognition as follows:

Insurance premiums received at initial recognition.
Less any acquisition costs for insurance contracts at that date.
Plus or minus any amounts arising from cash flows specific to insurance contract acquisition costs.

(11,6,2) Subsequent Measurement / Premium Allocation Approach

The company at the end of each subsequent period recognizes the carrying amount of the liability, considering the following adjustments to the liability balance:
- Add insurance premiums received for the period.
- Deduct cash flows for insurance contract acquisition.
- Add any amounts related to amortization of cash flows for insurance contract acquisition recognized as expense.
- Add adjustments arising to the financing component.
- Deduct amount recognized as insurance revenue for coverage provided in that period.
- Deduct any investment component paid or transferred to liabilities related to incurred claims.
  (Disclosure of the test for applicability of the premium allocation approach according to premiums based on relative significance in cases where the coverage period is more than one year, specifying the level of relative significance used).
Liability for incurred claims, calculated based on the best estimate of future cash flows to settle claims, added to non-financial risk adjustments, considering application of discount rate to claims.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

(12,6,2) Modification of Insurance Contracts The company modifies insurance contracts by processing expected changes in future cash flows resulting from changes in estimates of cash flows to fulfill contracts, unless conditions for derecognition of insurance contracts apply.

(13,6,2) Derecognition of Insurance Contracts The company derecognizes insurance contracts in the following cases:

Expiration of the contract (expiration of the obligation specified in the insurance contract, fulfillment, or cancellation).
In case of modification of an insurance contract that does not meet modification conditions according to standard requirements, the company derecognizes a new contract.

(14,6,2) Loss-Making Insurance Contracts
The company recognizes insurance contracts as loss-making if the contract is expected to be loss-making at the initial recognition date, and the loss component is measured by comparing expected cash flows to fulfill contract liabilities or group of contracts with cash flows collected from this contract or group of contracts. The company must disclose the loss component if the contractual service margin value equals zero (applicable only to the general measurement model and variable fee approach).

(15,6,2) Summary of Measurement Approaches (1) The insurance company classifies insurance contracts as follows:

Portfolio	Contract Classification	Measurement Approach*

Portfolios of insurance contracts underwritten by the company shall be stated.
Contract classification shall be stated in case of non-insurance components (investment or service component); if no such components exist and separation is not required, they are classified solely as insurance contracts.
Portfolios of insurance contracts are classified according to the appropriate measurement approach; in case of non-insurance components, the most specific accounting standard is clarified.

(2) The insurance company classifies held reinsurance contracts as follows:

Portfolio*	Measurement Approach

Portfolios of held reinsurance contracts held by the company shall be stated.
Portfolios of held reinsurance contracts held by the company are classified according to the appropriate measurement approach, considering disclosure of minimum portfolios according to prevailing legislation.

(16,6,2) Aggregation Level
Portfolios of insurance contracts are detailed into groups by underwriting year so that portfolios of insurance contracts with similar risks managed together are aggregated. Including two types of insurance business in the same portfolio is prohibited, complying with minimum requirements for insurance and reinsurance contract portfolios according to prevailing legislation.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

(17,6,2) Profitability Level
Contract groups referred to in the previous level are classified into the categories listed below, based on expected net cash flows from the contract and the accounting method followed in processing contract groups:

Contracts with no probability of becoming loss-making at initial recognition.
Loss-making contracts.
Other contracts - if any.

(18,6,2) Financial Assets
Financial assets are classified at initial recognition into one of the following categories:

Amortized cost.
Fair value through profit or loss.
Fair value through other comprehensive income.
Financial Assets at Amortized Cost
The company classifies financial assets at amortized cost based on the company’s business model for managing financial assets and contractual cash flow characteristics of financial assets, when both of the following conditions are met:

The purpose of holding these assets is within a business model whose objective is to collect contractual cash flows.
Cash flows pursuant to the contractual terms of these assets arise on specified dates and represent only payments of principal amount of the asset and interest accrued on that principal amount.

Financial assets at amortized cost are recorded at cost upon purchase plus acquisition costs. Premiums/discounts (if any) are amortized using the effective interest method as interest or for calculation, and any provisions resulting from impairment leading to recoverability of this investment or part thereof are deducted. Any impairment in their value is recorded in the profit or loss statement.

The impairment amount of financial assets at amortized cost is the difference between the carrying amount and the present value of expected cash flows discounted at the original effective interest rate.

The standard allows in rare cases to measure these assets at fair value through profit or loss if it eliminates or significantly reduces measurement inconsistency (sometimes called accounting mismatch) arising from measuring assets or liabilities or recognizing results arising from them on different bases.

Financial assets at amortized cost are reduced by impairment losses, where interest income, foreign exchange gains/losses, and impairment are recognized in the statement of profit or loss, and gains or losses resulting from derecognition of financial assets appear in the statement of profit or loss.

Financial Assets at Fair Value Through Profit or Loss
Remaining financial assets not meeting conditions for financial assets at amortized cost are measured at fair value.
Financial assets at fair value through profit or loss represent assets held for trading, and the purpose of holding them is to generate profits from short-term market price fluctuations or trading margins.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

Financial assets at fair value through profit or loss are recorded at fair value upon purchase (acquisition costs charged to profit or loss) and revalued at the financial statement date at fair value. Subsequent changes in fair value are recorded in the unified statement of profit or loss in the same period the change occurs, including changes in fair value resulting from translation differences of non-monetary items in foreign currencies. Distributed dividends or returns are recorded in the profit or loss statement when realized (approved by the General Assembly of Shareholders).

Reclassification
Reclassification from amortized cost to financial assets at fair value through profit or loss is permitted only when the entity changes the business model on which it classified those assets as mentioned above, taking into account the following:

No previously recognized gains, losses, or interest may be recovered.
When reclassifying financial assets so they are measured at fair value, their fair value is determined at the reclassification date, and any gains or losses resulting from differences between previously recorded value and fair value are charged to profit or loss.
When reclassifying financial assets so they are measured at amortized cost, they are recorded at their fair value as of the reclassification date.

Financial Assets at Fair Value Through Other Comprehensive Income
At initial recognition, investments in equity instruments not held for trading are allowed to adopt an irrevocable option to present all changes in fair value from these investments on an individual basis (each share separately) within other comprehensive income items. Under no circumstances may amounts of these changes recognized within other comprehensive income be subsequently reclassified to profit or loss, although these investments are recognized within net investment revenues, unless these distributions clearly represent partial recovery of the entire investment. In case of sale of these assets or part thereof, gains or losses resulting from the sale are transferred from the valuation reserve balance through other comprehensive income to retained earnings, not through the unified statement of profit or loss.

(19,6,2) Investment Properties
Investment properties appear at cost less accumulated depreciation (excluding land). These investments are depreciated over their productive life at a rate ranging between ...% to ...%. Revenue or operating expenses for these investments are charged to the profit or loss statement. An impairment provision is established at fair value, and fair value is disclosed in note (Investment Properties). (Investment properties are evaluated in accordance with prevailing legislation, and fair value is disclosed in the Investment Properties note).

(20,6,2) Investments in Associates
Associates are companies in which the company exercises significant influence over decisions related to financial and operational policies (but does not control them), owning a percentage ranging between (20%-50%) of voting rights. Investments in associates appear under the equity method. Revenue and expenses resulting from transactions between the company and associates are eliminated according to the company’s contribution percentage in these companies.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

(21,6,2) Property and Equipment
Property and equipment appear at cost less accumulated depreciation and any accumulated impairment losses. Property and equipment (excluding land) are depreciated when ready for use using the straight-line method over their expected productive life using the following annual percentages, and depreciation expense is charged to the profit or loss statement.

Depreciation %
	Buildings
	Equipment, machinery, and furniture
	Transport media
	Decorations

Depreciation of property and equipment is calculated when these assets are ready for use for intended purposes. (Full value of depreciation expense for the period is shown in the dedicated line item in the profit or loss statement). When the recoverable amount of any property or equipment falls below its net book value, its value is written down to the recoverable amount, and impairment value is recorded in the profit or loss statement.

Construction-in-progress property and equipment for company use appear after deducting any impairment losses.

The productive life of property and equipment is reviewed at the end of each year. If expectations of productive life differ from previous estimates, the change in estimate is recorded for subsequent years as a change in estimates.

Gains or losses resulting from disposal or scrapping of any property or equipment, representing the difference between proceeds from sale and carrying amount of the asset, appear in the profit or loss statement.

Property and equipment are derecognized when disposed of or when no future benefits are expected from their use or disposal.

(22,6,2) Intangible Assets

Intangible assets obtained through merger are recorded at fair value at the date of acquisition. Intangible assets obtained through merger method are recorded at cost.
Other intangible assets are classified based on estimated useful life as finite or indefinite. Finite-life intangible assets are amortized during this life, and amortization is charged to the profit or loss statement. Indefinite-life intangible assets are reviewed for impairment at the consolidated financial statement date, and any impairment in their value is charged to the profit or loss statement.
Internally generated intangible assets in the company are not capitalized and are charged to the profit or loss statement in the current year.
Any indicators of impairment in intangible assets are reviewed at the consolidated financial statement date. Also, estimated useful life of those assets is reviewed, and any adjustments are made for subsequent periods.
The following are accounting policies for each line item of intangible assets in the company (company-specific policy, useful life, and amortization mechanism for each line item shall be stated).

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

(23,6,2) Right-of-Use Assets
The company recognizes right-of-use assets on the date the asset becomes available for use. Right-of-use assets are recognized at cost less accumulated depreciation and impairment losses, and value is adjusted upon revaluation.

(24,6,2) Cash and Cash Equivalents
Cash and cash equivalents represent cash in hand, bank balances, and bank deposits with maturities not exceeding three months, after deducting bank overdraft accounts and restricted withdrawal balances.

(25,6,2) Offset
Offsetting between financial assets and financial liabilities and showing the net amount in the statement of financial position is performed only when legally binding rights exist and when they are settled on a net basis or realization of assets and settlement of liabilities occur simultaneously.

(26,6,2) Recognition Date of Financial Assets Purchase and sale of financial assets are recognized on the trade date (date the company commits to selling or buying the financial assets).

(27,6,2) Fair Value
Closing prices (buying assets/selling liabilities) on the financial statement date in active markets represent fair value of financial instruments having market prices.
In case of lack of published prices or lack of active trading for some financial instruments or inactive market, fair value is estimated by several methods, including:

Comparing with current market value of a highly similar financial instrument.
Analyzing future cash flows and discounting expected cash flows at a rate used in a similar financial instrument.
Option pricing models.
Valuation methods aim to obtain a fair value reflecting market expectations and considering market factors and any expected risks or benefits when estimating value of financial instruments. In case of financial instruments whose fair value cannot be reliably measured, they are shown at cost less any impairment in their value.

(28,6,2) Financial Liabilities
The company classifies financial liabilities based on the purpose of creation of this obligation. The company initially recognizes bank overdraft items at net fair value less costs associated with obtaining facilities. Such liabilities bearing interest are subsequently amortized at amortized cost using the effective interest rate method. Financing cost includes initial costs, premium paid upon settlement, plus interest accruing during the life of the obligation.

(29,6,2) Insurance Contract Liabilities
Insurance contract liabilities are recognized when the company has obligations on the financial statement date arising from past events related to insurance contracts, and settlement of obligations is probable and their value can be reliably measured. Amounts recognized as insurance contract liabilities represent the best estimate of amounts required to settle the obligation as of the financial statement date, considering risks and uncertainties associated with insurance contract liabilities. When liability value is determined based on estimated cash flows to settle the current obligation, its carrying amount represents the present value of these cash flows.

Form (09/01/1/1)

CENTRAL BANK OF JORDAN
البنك المركزي الأردني

Company ....................................
(Joint Stock Limited)
Amman - Hashemite Kingdom of Jordan

When it is expected that some or all of the required economic benefits from other parties will be recovered to settle liabilities, the debtor’s claim is recognized within assets if receipt of compensation is virtually certain and its value can be reliably measured.

(30,6,2) End-of-Service Benefit Provision
End-of-service benefit provision for employees is calculated according to the company’s policy consistent with Jordanian Labor Law.
Annual compensation incurred for employees leaving service is recorded to the end-of-service benefit provision account upon payment. A provision for liabilities incurred by the company for employee end-of-service compensation is taken in the profit or loss statement.

(31.6.2) Foreign Currencies

Transactions conducted in foreign currencies during the current year are recorded using the exchange rates prevailing on the date the transactions were carried out.
Balances of financial assets and financial liabilities denominated in foreign currencies are converted using the average foreign currency exchange rates prevailing on the date of the financial position statement and announced by the Central Bank of Jordan.
Non-financial assets and non-financial liabilities appearing at fair value are converted...