Title: Announcement regarding issuance of Disciplinary Board Resolution No. (74/2024 Disciplinary Board) (85/2024 Authority) and imposition of a fine against: 1- Sultan Center Food Company, 2- Chairman of the Board of Directors, 3- Vice Chairman of the Board of Directors, 4- Members of the Board of Directors, 5- Chief Executive Officer, 6- The Financial Manager., for Violating the Listing Rules and Corporate Governance.

Announcement regarding issuance of Disciplinary Board Resolution No. (74/2024 Disciplinary Board) (85/2024 Authority) and imposition of a fine against: 1- Sultan Center Food Company, 2- Chairman of the Board of Directors, 3- Vice Chairman of the Board of Directors, 4- Members of the Board of Directors, 5- Chief Executive Officer, 6- The Financial Manager., for Violating the Listing Rules and Corporate Governance.

For the following reasons:
First: Sultan Center Food Company violated the provision of Article (1-14) of Module Twelve (Listing Rules) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

It was proven to the CMA through reviewing the financial statements of Sultan Center Food Company for the year ending on 31/12/2023 and the Company’s disclosures on 16/5/2024, 15/8/2024 for the periodical financial statements for the period ending on 31/3/2024, and ending on 30/6/2024 that the Company failed to comply with the International Accounting Standard “IAS 28 Investments in Associates and Joint Ventures”, as it did not conduct a test to analyze the value of its investments, when the Company reached the fair value of its investment in the associate company in its financial statements (31/12/2023, 31/3/2024, 30/6/2024), which is consistent with the external auditor’s reservation.

Second: The Board of Sultan Center Food Company:
1. Chairman of the Board of Directors.
2. Vice Chairman of the Board of Directors.
3. Member of the Board of Directors.
4. Member of the Board of Directors.
5. Member of the Board of Directors.

Due to their violation of the provision of Item (5) of Article (3-7) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

They failed to ensure accuracy and validity of the data and information to be disclosed as they did not conduct a test to analyze the value of its investments, when the Company reached the fair value of its investment in the associate company in its financial statements (31/12/2023, 31/3/2024, 30/6/2024) which lead to Sultan Center Food Company’s failure to comply with the International Accounting Standard “IAS 28 Investments in Associates and Joint Ventures”.

Third: The Executive management of Sultan Center Food Company:
1. Chief Executive Officer of Sultan Center Food Company
2. Chief Financial Officer for Financial Affairs

It was proven that they violated the provision of Item (4) of Article (3-10) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
They failed to fulfill their duties regarding meeting the minimum requirements in the financial documents and evaluation reports regarding the investment in the associate company, they did not conduct a test to analyze the decline in the value of the investment in the aforementioned associate company.

The Resolution included the infliction of the following penalty: -
“First: Levying a fine on Sultan Center Food Company in an amount of KWD 5,000 (five thousand Dinars) for the attributed violation.

Second: Levying a fine on each of the following:

1. Chairman of the Board of Directors of Sultan Center Food Company.
2. Vice Chairman of the Board of Directors of Sultan Center Food Company.
3. Member of the Board of Directors of Sultan Center Food Company.
4. Member of the Board of Directors of Sultan Center Food Company.
5. Member of the Board of Directors of Sultan Center Food Company.

in an amount of KWD 2,000 (two thousand Dinars) on each one of them for the attributed violation.

Third: Levying a fine on each of:

1. Chief Executive Officer of Sultan Center Food Company
2. Chief Financial Officer for Financial Affairs of Sultan Center Food Company

in an amount of KWD 3,000 (three thousand Dinars) on each one of them for the attributed violation.”

In this regard, the CMA emphasizes the implementation of CMA Law and its Executive Bylaws on all persons dealing in securities activities, and urges them to comply with these Laws in order to promote investors' confidence, create a sound investment environment, and implement the Law according to the principles of fairness, transparency, and integrity in line with the best international practice.