Title: Announcement regarding issuance of Disciplinary Board Resolution No. (14/2025 Disciplinary Board) (1 and 2/2025 Authority) and imposition of a fine against: 1- IFA Hotels & Resorts Company, 2- Grant Thornton Office (Al-Qatami and Al-Aiban) in its capacity as the External Auditor, for violating the Listing Rules and the Rules of Securities Activities and Registered Persons

Announcement regarding issuance of Disciplinary Board Resolution No. (14/2025 Disciplinary Board) (1 and 2/2025 Authority) and imposition of a fine against: 1- IFA Hotels & Resorts Company, 2- Grant Thornton Office (Al-Qatami and Al-Aiban) in its capacity as the External Auditor, for violating the Listing Rules and the Rules of Securities Activities and Registered Persons.

For the following reasons:
First: IFA Hotels & Resorts Company violated the provision of Article (1-14) of Module Twelve) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

It was proven to the CMA through studying the financial statements of IFA Hotels & Resorts Company for the year that ended on 31/12/2023 that the Company did not comply with Paragraph (38) of the International Accounting Standard (28) “Investments in Associates and Joint Ventures”, as the Company has maximized its investment in (associate company) by including the item of “Other amendments” in the value of KWD 2,266,962 (two million, two hundred and sixty-six thousand, nine hundred and sixty-two Kuwaiti Dinars only) to address the negative investment value that resulted from implementing the methodology of ownership rights without considering having balance in the loans granted to the same company, while the Company was required to load the losses resulting from the implementation of the ownership of rights methodology to the loan granted to the same company in accordance with the requirements of Paragraph 38 of the mentioned standard.

Second: Grant Thornton Office in its capacity as the auditor of IFA Hotels & Resorts Company violated the following:
1. The provision of Item (7) of Article (3-4-4) of Module Five (Securities Activities and Registered Persons) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
2. The provision of Article (3-4-5) of Module Five (Securities Activities and Registered Persons) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

It was proven to the CMA that the Office, in its capacity as the auditor of IFA Hotels & Resorts Company, did not provide any comments on the report issued on the financial statements for the year that ended on 31/12/2023 of IFA Hotels & Resorts Company with regard to the Company’s non-compliance with Paragraph (38) of the International Accounting Standard (28) “Investments in Associates and Joint Ventures”, as the Company has maximized its investment in (associate company) by including the item of “Other amendments” in the value of KWD 2,266,962 (two million, two hundred and sixty-six thousand, nine hundred and sixty-two Kuwaiti Dinars only) to address the negative investment value that resulted from implementing the methodology of ownership rights without considering having balance in the loans granted to the same company, while the Company was required to load the losses resulting from the implementation of the ownership of rights methodology to the loan granted to the same company in accordance with the requirements of Paragraph (38) of the mentioned standard.

The Resolution included the infliction of the following penalty: -
“First: Levying a fine on IFA Hotels & Resorts Company in the amount of KWD 20,000 (twenty thousand Dinars) for the attributed violation.

Second: Levying a fine on Grant Thornton Office (Al-Qatami, Al-Aiban and Partners) in its capacity as the auditor of IFA Hotels & Resorts Company in the amount of KWD 5,000 (five thousand Dinars) 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.