Instructions on Mandatory Policies and Standards for Fair Value Re-evaluation and Disposal of Re-evaluation Surplus

Instructions on the mandatory policies and standards for re￾evaluation of fair value and for disposal of re-evaluation surplus for the year 2007 Issued pursuant to articles 8 and 12 of the Securities Law No. 76 for the year 2002 and by virtue of the JSC Board of Commissioners decision No. 27 of 16 December 2007 and amendment thereto as approved by the JSC Board of Commissioners decision No. 5 of 11 February 2008
Article 1: These instructions shall be cited as “instructions on the mandatory
policies and standards for re-evaluation of fair value and for disposal of re-evaluation surplus for the year 2007” and they shall come into force on 16th December 2007.
Article 2: All issuing companies that fall under the supervision of the Jordan
Securities Commission (JSC) shall implement the International Financial Reporting when preparing their financial (statements) for the year ending on 31 December 2007, and shall comply with the following rules and procedures:

First: It is forbidden to dispose of re-evaluation surplus of financial assets at fair value through profit or loss (for trading); such surplus shall be disclosed as “unrealized earnings” under the item “retained gains”. Second: Loss on financial assets available for sale, or held to maturity shall be recognized directly in the Income Statement if their market value drops by 20% or more of the investment cost at purchasing date, and if such drop lasts for 9 months or more. Third∗ :
A.When distributing dividends, the equivalent of the total negative fair values recorded for each investment under the item "Equity

∗
Explanation of Article 3: Paragraph A: If there is a drop (loss) in the market value of any shares of the assets available for sale less than 20% and this drop does not last more than 9 months, the loss of each of these shares shall be added together, and a sum equivalent to the total of the loss shall be reserved from distributable dividends regardless of any gains (rise) in the value of shares in this portfolio. Paragraph B: If the Board of Directors of the company decides, on its own responsibility, that despite a drop in the value of some shares in the portfolio of financial assets available for sale as indicated in Paragraph A above, that there are no risks related to this portfolio, profits would not be reduced by a sum equal to the total loss of each share in the portfolio; instead, the result of the assessment of the portfolio as a whole is examined; if the total drop in the market value of some shares in the portfolio is greater than the rise in the market value of the remaining shares in that portfolio, then the distributable dividends are reduced only by a sum equal to the negative balance of the change in the market value, not the negative change of each share in the portfolio.

(fair value accumulated adjustment)" of financial assets available for sale “shall be excluded from dividends for distribution. B.It is permissible, based on a decision of the company’s board of directors, taken on the basis of the board’s assessment of the risks of the portfolio of financial assets available for sale, to reduce the sum to be excluded from distributable dividends referred to in (A) above, provided that the sum excluded shall be no less than the negative balance (debit) of the " Equity (fair value adjustment) " of financial assets available for sale. Fourth: The cost model shall be adopted in applying International Accounting Standards Number 40 related to real estate investments. Disclosure of the fair value within notes to financial statements shall be made. Fifth: Companies that adopted Fair Value Model in past years are required to amend their financial performance in accordance with the cost model, with the assistance of their external auditors. Sixth: It is forbidden to dispose of re-evaluation surplus resulting from applying of International Accounting Standard 41 whether by distribution or capitalization or any other means; such surplus shall be disclosed and highlighted as unrealized gains under retained earnings. Seventh: The cost model when applying International Accounting Standard Number 16 related to Property, Plant and Equipment shall be applied. Eighth: Companies that adopted the re-evaluation model in past years shall amend their financial performance to be consistent with the cost model, in cooperation with their external auditors.