Aa ~Dr. A. M. Hegazy & Co.
/A Crowe Dr. Khaled A. Hegazy
Accouniants &Cos ns
A Member of Crowe Global
6 Boulos Harinah SL, I' Floot
Dokki, 12311 Giza, Egypt
Tel. 37600319- 376003
Fax. 376006
www.crowecom
The Governing Body
Social Housing and Mortgage Finance Fund (SHMFF)
December 5th 2023
Dear Sirs,
This report represents the results of our financial audit of the World Bank Loan No.8498 -EG
and Additional Financing No.9033 EG to finance the implementation and to improve the
affordability of formal housing for low income households in the Arab Republic of Egypt and
to strengthen the SHMFF's capacity to design policies and coordinate programs in the social
housing sector for the year ended June 30th 2023.
Audit Objectives:
The objective of this engagement was to conduct a financial audit of the funds receipts and
expenditures and related Special Accounts of the World Bank Loan No. 8498 EG and Additional
Financing No.9033 EG for the year ended June 30th 2023. As required by internationally accepted
standards on auditing, we have made specific inquires of the management and others about the
representations embodied in the financial statement and the effectiveness of the internal control
over financial reporting. The results of our audit tests, the responses to our inquiries, and the
written representations of the management comprise the evidential matter upon which we
intend to rely to forming our opinion.
Our activities were confined to auditing the procedures of funds expenditures of the loan
project, at all levels and division, for the financial year ended June 30th 2023, according to the
Loan agreement and the guidelines of the World Bank.
An audit in accordance with International Standards on Auditing does not provide absolute
assurance about or guarantee the accuracy of the said statement. Because of the concept of
reasonable assurance and because we did not perform a detailed examination of all transactions,
there is an inherent risk that material crrors, fraud, or illegal acts, may exist and not be detected
by us.
In planning and performing our audit of the statement of funds receipts and expenditures of the
World Bank Loan No. 8498 EG and Additional Financing No.9033 EG for the year ended June
30th 2023, we considered its internal control to determine our auditing procedures for the
purpose of expressing our opinion on the said statement and not to provide absolute assurance
on the internal control. Our consideration of the internal control would not necessarily disclose
all matters in internal control that might be a weakness. A weakness is a condition in which the
design or operation of one or more of the internal control components dose not reduce to
relatively low level the risk that errors or fraud in amounts that would be material in relation to
/* Crowe
the statement being audited may occur and not be detected within a timely period by employees
in the normal course of performing their assigned functions.
Our responsibility, as prescribed by professional standards, is to plan and perform our audit to
obtain reasonable assurance about whether the special purpose financial statement of the
Sources and Uses of Funds Statement of the World Bank Loan No. 8498 EG and Additional
Financing No.9033 EG is free of material misstatement. Such criteria required us to search for
mistakes and irregularities which may seriously affect the usage lists. I lowever as our
examination relies on selective checking for accounting recci ds, there is no absolute guarantee
that all mistakes and irregularities will be discovered.
Additionally, auditing checking should not be relied on to uncover illegal conducts that affect
the usage lists, which are disclosed in our examination.
Professional standards require that we advise you of any matter relating to our audit and based
on the audited sample which represents 79,6%of the total amounts drawn during the year ended
June 301h 2023, we communicated our comments with the project management and agreed with
the feedback from the project management in addition such corments do not reveal internal
control weakness.
Please do not hesitate to contact us if you require any clarifications.
Sincerely
Dr. Khaled A. M. Hegazy
Fellow of the Egyptian Society for Accountants & Auditors No. 207
Accountants & Auditors Register "AAR" No. 10945
Financial Regulatory Authority Auditors Register "FRAAA" No. 72
Independent Professional Practice, Member of Crowe Global
Crowe
Dr. Khaled A Hegazy
Dr. A. IVL flegazY & CO
c&Gountants & Consuttants
Dr. A. M. Hegazy & Co.
Crowe Dr. Khaled A. Hegazy
Accountants & Consultants
A Member of Crowe Global
6 Boulos Hannah St., 5" Floor
Dokki, 12311 Giza, Egypt
Tel. 37600319 - 3760C320 - 37616310
Fax. 37600488
wwwocrowe.com
The Governing Body
Social Housing and Mortgage Finance Fund (SHMFF)
December 501 2023
Dear Sirs,
This report represents the results of our financial audit of the World Bank Loan No.8498 -EG
and Additional Financing No.9033 EG to finance the implementation and to improve the
affordability of formal housing for low income households in the Arab Republic of Egypt and
to strengthen the SHMFF's capacity to design policies and coordinate programs in the social
housing sector for the year ended June 30h 2023.
Audit Objectives:
The objective of this engagement was to conduct a financial audit of the funds receipts and
expenditures and related Special Accounts of the World Bank Loan No. 8498 EG and Additional
Financing No.9033 EG for the year ended June 30t 2023. As required by internationally accepted
standards on auditing, we have made specific inquires of the management and others about the
representations embodied in the financial statement and the effectiveness of the internal control
over financial reporting. The results of our audit tests, the responses to our inquiries, and the
written representations of the management comprise the evidential matter upon which we
intend to rely to forming our opinion.
Our activities were confined to auditing the procedures of funds expenditures of the loan
project, at all levels and division, for the financial year ended June 30t 2023, according to the
Loan agreement and the guidelines of the World Bank.
An audit in accordance with International Standards on Auditing does not provide absolute
assurance about or guarantee the accuracy of the said statement. Because of the concept of
reasonable assurance and because we did not perform a detailed examination of all transactions,
there is an inherent risk that material errors, fraud, or illegal acts, may exist and not be detected
by us.
In planning and performing our audit of the statement of funds receipts and expenditures of the
World Bank Loan No. 8498 EG and Additional Financing No.9033 EG for the year ended June
301h 2023, we considered its internal control to determine our auditing procedures for the
purpose of expressing our opinion on the said statement and not to provide absolute assurance
on the internal control. Our consideration of the internal control would not necessarily disclose
all matters in internal control that might be a weakness. A weakness is a condition in which the
design or operation of one or more of the internal control components dose not reduce to
relatively low level the risk that errors or fraud in amounts that would be material in relation to
Crowe
the statement being audited may occur and not be detected within a timely period by employees
in the normal course of performing their assigned functions.
Our responsibility, as prescribed by professional standards, is to plan and perform our audit to
obtain reasonable assurance about whether the special purpose financial statement of the
Sources and Uses of Funds Statement of the World Bank Loan No. 8498 EG and Additional
Financing No.9033 EG is free of material misstatement. Such criteria required us to search for
mistakes and irregularities which may seriously affect the usage lists. However as our
examination relies on selective checking for accounting recci ds, there is no absolute guarantee
that all mistakes and irregularities will be discovered.
Additionally, auditing checking should not be relied on to uncover illegal conducts that affect
the usage lists, which are disclosed in our examination.
Professional standards require that we advise you of any matter relating to our audit and based
on the audited sample which represents 79,6%of the total amounts drawn during the year ended
June 30th 2023, we communicated our comments with the project management and agreed with
the feedback from the project management in addition such comments do not reveal internal
control weakness.
Please do not hesitate to contact us if you require any clarifications.
Sincerely
Dr. Khaled A. M. Hegazy
Fellow of the Egyptian Society for Accountants & Auditors No. 207
Accountants & Auditors Register "AAR" No. 10945
Financial Regulatory Authority Auditors Register "FRAAA" No. 72
Independent Professional Practice, Member of Crowe Global
Crowe
Dr. Khaled A Hegazy
Dr. A. M. Ilegazy & Co
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Inclusive Housing Financing Program
Social Housing and Mortgage Finance Fund
Auditor's Report
Special Purpose Financial Statement
For the year ended
June 301h 2023
Contents
1- Auditor's Report
2- Special Purpose Financial Statement as at 301h June 2023.
3- Notes to the Special Purpose Financial Statement as at
30th June 2023.
Dr. A. M. Hegazy & Co.
i Crowe Dr. Khaled A. Hegazy
Accountants & Consuftants
A Member of Crowe Global
6 Boulos Hannah St., 5' Floor
Dokki, 12311 Giza, Egypt
Tel. 37600319 - 37600320 - 37616310
Fax. 37600468
wwwcrowe.com
Auditor's Report
To Social Housing and Mortgage Finance Fund
Inclusive Housing Financing Program
We have audited the accompanying Special Purpose Financial Statement (SPFS) of Inclusive Housing
Financing Program represented in the Sources and Uses of Funds statement for the year ended 30th June
2023. The Program's management is responsible for ensuring that the Special purpose financial
statement is perpared. It is our responsibility is to form an independent opinion, based on our audit, on
this statement and to report our opioin to you.
We conducted our audit in accordance with Egyptian and International Auditing Standards and such
other specific procedures requested by the Program's management. An audit includes examination, on
a test basis, evidence supporting amounts and disclosures in the funds receipts and expenditures
statement. It also includes an assessment of the significant estimates and judgements made by the
Program's management in the preparation of the statement, and of whether the accounting policices are
appropriate to the project's circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanation which we
considered necessary in order to provide us with sufficient evidence to give reasonable assurance that
the statements is free from material misstatement, whether caused by fraud or other irregularity or error.
In forming our opinion we also evaluated the overall adequacy of the presentation of information in the
statements.
Opinion
In our opinion, the special purpose financial statements referred to above present fairly, in all material
respects, the Sources and Uses of Fund Statement for the year ended 30h June 2023 in conformity with
the accounting principles described in Note 2 to the special purpose financial statements. Expenditures
provided are properly supported and represent eligible expenditures under the Loan Agreement 8498
- EG And the Additional Financing Agreement by Loan No. 9033 - EG.
Dr. Khaled A. M. Hegazy
Fellow of the Egyptian Society for Accountants & Auditors No. 207
Accountants & Auditors Register "AAR" No. 10945
Financial Regulatory Authority Auditors Register "FRAAA" No. 72
Independent Professional Practice, Member of Crowe Global
Giza: 5 "' December 2023 Rh hlCd A Hegazy
Social Housing and Mortgage Finance Fund (SHMFF)
Inclusive Housing Finance Program
Financial Management Unit (FMU)
Partially Funded From World Bank Loan No 8498 EG and Additional Financing No. 9033 EG
Sources and Uses of Funds Statements
For Year ended June 30,2023
Amounts in US S
No Government For I July 2022 to 30 Cumulative to 30 June
Budget June 2023 2023
Cash Receipt
World Bank (WB) Third Line 79,222,148 519,096.675
Social Housing and Mortgage Finance Fund (SHMFF) Third Line 405,209 3.844.848
Total Financing 3 79,627,357 522,941,523
Less:
Uses of Funds
Demand Side Housing Subsidy Support 4 Forth Line 79,221,930 519,095,684
Improving Management Information System 5 Second Line 71347 1,674.914
79,293,277 520,770,598
Other Expenditure
Salaries & Wages 6 First Line 317,006 2,079,910
Others and Bank expenses and commissions 7 Second Line 17,074 9 101
334,080 2,170,925
Total Expenditures 79,627,357 522,941,523
Net Funds balances -
1)r Khaid A lirctn
Dr. A. 11. lVgazN & ( t
Acuntlant,, C on"'IFL1tant
Social Housing and Mortgage Finance Fund (SHMIFF)
Inclusive Housing Finance Pr-ogrami
Partially Funded from the WVorld Bank's Loan No 8498 EC' and Additional
Financin- No. 9033 LiG
Notes to the Special Purpose Financial Statement
From 1 July 2022 to 30 June 2023
Note I -Nature of Activities
The Arab Republic of Egypt and the International Bank for Reconstruction and
Development agreed that the latter shall provide finance to the Social Housing and
Mortgage Finance Fund on June 10th, 2015, through Loan No 8498 EG, The Bank
agrees to lend an amount of five hundred million United States Dollar (US$500
Million). In addition, on 5/7/2020, loan agreement No. 9033 - Egypt was signed for
the purpose of providing additional funding related to the main program, with an
amount of 500 million US dollars.
The objective of the Program is to improve the affordability of formal housing for low
income households in the Arab Republic of Egypt and to strengthen the SHMFF's
capacity to design policies and coordinate programs in the social housing sector.
The Program consist of the following parts:
The Program is a part of the Borrower's Social Housing Program and consists of the
following components:
Part A: Institutional Strengthening of SHMFF
1. Enhancing the capacity of SHMFF to improve the Borrower's housing sector
through, interalia: (a) coordination and consolidation of housing entities and
functions; (b) formulation of social housing policy, programs, regulations and
procedures; and (c) preparation and implementation of reforms to improve
the efficiency and equitability of the housing system.
2. Enhancing the effectiveness of SHMFF to provide oversight to the
implementation of the Program through, inter alia: (a) the establishment of an
improved management information system; (b) the establishment of a sound
fiduciary management and governance structure and (c) improving
monitoring and evaluation and fiduciary and environmental capacity.
Part B: Demand-side Housing Subsidy Support
1. Affordable Mortgage Program (AMP)
2. Public Rental Subsidy Program for Tenants
3. Private Rental Subsidy Programs for Investors
4. Private Rental Subsidy Programs for Tenants,
5. Rental Inventive Package.
6. PPP Guidelines ( Public-Private Partnership)
Notes to the special purpose financial statement
Social Housing and Mortgage Finance Fund (SHMFF)
Partially Funded FromThe World Bank Loan No. 8498 EG and Additional Financing No. 9033 EG
From I July 2022 to 30 June 2023 Page 4
Part C: Strengthening the Governance and Institutional Structure of the Housing
Sector:
1. Establishment and operation of an internal audit function within SHMFF
providing assurance service for the ownership and rental programs.
2. Supporting the interest rate to ensure the sustainability of social housing
3. Adopting the necessary legislation to regulate the profession of real estate
development and installment sale.
4. Activating the environment unit in the SHMFF.
5. Serve the beneficiaries efficiently.
Part D: Enhancing transparency and accountability in social housing programs:
1. Establishment and functioning of a housing monitoring and evaluation
system and an M&E unit within SHMFF, and the preparation of the Multi-
Year Plan and Annual Targets informed by the M&E system.
2. Effective response to citizens' complaints.
3. A mechanism for monitoring the occupancy of the units.
Part E: Improving access to affordable housing units:
1. The number of new housing units subsidized annually.
2. The number of subsidized rental units annually.
3. The number of housing units developed by the private sector.
Part F: Promotion of social housing in good locations:
1. Residential units that are 60 minutes away from the work center or less by car.
The Program Duration:
The Program closing date is Decmber 31, 2024
Terms of repayment and Grace period:
According to the loan agreement, Schedule 3, the Arab Republic shall repay the loan
on semi-annual installment due on January and July 15h each year, starting from July
15f 2020 and ending on January 15th 2050. Each installment amounts to (1,67%) of the
loan amount, except for the Installment dated January 15th 2050 which will amount to
(1.47%)
According to the additional loan agreement, Schedule 3 , the Arab Republic shall
repay the loan on semi-annual installment due on April and October 1st each year,
starting from April l5t 2025 and ending on October 1s 2054. Each installment amounts
to (1.67%) of the loan amount, except for the Installment dated October 1st 2054 which
will amount to (1.47%)
Note 2 - AccountinR Policies
The following are the significant applied accounting policies:
2/1 Method of Accounting
The Program maintain its accounts on the cash basis of accounting. On this basis
receipts are recognized when received by the Program and expenditures are
recognized when paid.
Notes to the special purpose financial statement
Social Housing and Mortgage Finance Fund (SHMFF)
Partially Funded FromThe World Bank Loan No. 8498 EG and Additional Financing No. 9033 EG
From I July 2022 to 30 June 2023 Page 5
2/2 Foreign currency translation:
The SHMFF maintains its accounts in Egyptian Pounds. Transactions in U$ dollar
currencies are recorded at the average exchange rates ruling at the end of the financial
year 30 June 2023.
Note 3-Cash receipt (Financing) Analysis
Amounts in US S
For 1 July 2022 to Cumulative to 30
30 June 2023 June 2023
Cash Receipt
World Bank (WB) 79,222,148 519,096,675
Social Housing and Mortgage Finance Fund (SHMFF) 405,209 3,844,848
Total Financing 79,627,357 522,941,523
*As per the Issuance of Law 93 of 2018 Related to the Social Housing and Supporting Mortgage Finance Fund Law
on 11/6/2018 by Merging the Two Funds under the Name of the Social Housing and Mortgage Finance Fund,
Note 4 - Expenditure & Net Financing
Note 4/1 - World Bank Loan NO.8498 and Additional Financing No. 9033
Amounts in US $
For 1 July 2022 to Cumulative to 30
30 June 2023 June 2023
As at 30/6/2023
Cash Receipt* 94,979,415 636,356,622
Expenditure (79,222,148) (396,727,782)
Net Funds balance 15,757,267 239,628,840
*he total financing during the current period, amounting to $ 94,979,415, is the amount of financing added
from loan No.8498 and loan No.9033.
"The total expenditure during the current period,amounting to $79,222,148 is represented in the disbursed
amounts of financing from both loan No.8498 and additional loan No.9033
Note 4/2 - World Bank Loan NO.7747*
Amounts in US $
For 1 July 2022 to 30 Cumulative to 30
June 2023 June 2023
As at 30/6/2023
Cash Receipt 122,368,805
Expenditure (122,368,805)
Net Funds balance
Notes to the special purpose financial statement
Social Housing and Mortgage Finance Fund (SHMFF)
Partially Funded FromThe World Bank Loan No. 8498 EG and Additional Financing No. 9033 EG
From I July 2022 to 30 June 2023 Page 6
*It is surplus carried over from loan No. 7747, which has been used to finance some of the program's activities.
Note 5 - Improving Management Information System
Amounts in US $
For 1 July 2022 to 30 Cumulative to 30
June 2023 June 2023
As at 30/6/2023
Improving Management Information System* 71,347 1,674,914
Total 71,347 1,674,914
*The value of renewing IBM software licenses, maintenance services, technical support,
additions and modifications for each of the automated system used by the social housing fund,
mortgage finance fund and its electronic portal.
Note 6 - Wages and salaries
Wages & Salaries as at 30th June 2023 is represented as follows:
Amounts in US $
Salaries & Wages For 1 July 2022 Cumulative to
to 30 June 2023 30 June 2023
*Improving Management Information System 90,200 649,731
Improving Monitoring & Evaluation 57,507 432,478
Internal audit function 89,579 472,014
Mechanism for considering complaints and grievances 72,528 518,495
Operating the Fund's Environmental Department 7,192 7,192
Total Salaries & Wages 317,006 2,079,910
The value of renewal of IBM software licenses, maintenance services, technical
support, additions and modifications to both the automated system used in the Social
Housing and Mortgage Finance Fund and its electronic portal.
Note 7 - Other Expenditures and bank expenses
As at 30th June 2023 is represented as follows:
Amounts in US $
Others For 1 July 2022 to Cumulative to 30
30 June 2023 June 2023
Independent Verification Agent ( IVA ) Fees 16,856 90,024
bank charges & interest 218 991
Total Others 17,074 91,015
Notes to the special purpose financial statement
Social Housing and Mortgage Finance Fund (SIMFF)
Partially Funded FromThe World Bank Loan No. 8498 EG and Additional Financing No. 9033 EG
From I July 2022 to 30 June 2023 Page 7
Note 8 - Important events
* The slowdown of many economies of major countries in the past period led to a
combination of high world prices for commodities, supply chain disruptions and high
shipping costs, in addition to fluctuations in financial markets in emerging countries,
which led to inflationary pressures that affected the economies of many countries,
including the economy of the Arab Republic of Egypt. the war between Russia and
Ukraine led to a decrease in foreign exchange flows from tourism as well as from foreign
direct investment, which resulted in higher prices in general.
* This increase in international prices put additional pressure on the local currency
(Egyptian pound), which necessitated the intervention of the Central Bank of Egypt to
raise the interest rate on the Egyptian pound and move the exchange rate during March
2022.this move resulted in the decline in the value of the Egyptian pound against the US
dollar during that period by more than (18%), which resulted in the impact of companies
that have large balances of foreign currency obligations, whether short-term or long-
term, with large losses as a result of the re-translation of these balances according to the
exchange rate after the move.
* These losses were reflected significantly on the results of the work of those companies
in the income statement (profit or loss list), and affected the financial performance of
those companies.
* All this led to the need to issue this appendix to the Egyptian accounting standard No.
13 "effects of changes in foreign exchange rates", in order to develop an optional special
accounting treatment through which to deal with the effects of moving the foreign
exchange rate on the financial statements of the entity whose currency is the Egyptian
pound. This optional special accounting treatment issued in this appendix shall not be
considered an amendment to the amended Egyptian accounting standards currently in
force, beyond the time period for the entry into force of this appendix.
New versions and amendments made to the Egyptian Accounting Standards
On 03/6/2023, Prime Minister Decision No. 883 of 2023 was issued to amend some of
the Egyptian accounting standards, which include some new accounting standards and
amendments to some existing standards. The management is currently studying the
impact of these amendments on the financial statements.
Notes to the special purpose financial statement
Social Housing and Mortgage Finance Fund (SHMFF)
Partially Funded FromThe World Bank Loan No. 8498 EG and Additional Financing No. 9033 EG
From I July 2022 to 30 June 2023 Page 8
The following are the most important amendments:
New or amended Summary of the most important Potential impact on Application date
standards modifications financial statements
New Egyptian 1- The new Egyptian Accounting Standard No. (50)
Accounting Standard No. (50) "Insurance Contracts" applies to financial
Standard No. (50) replaces the corresponding topics in periods beginning
insurance contracts Egyptian Accounting Standard No. (37) on July 1, 2024
"Insurance Contracts: Recognition,
Measurement and Disclosure,"
2- The objective of the standard is to Management is
ensure that the entity provides currently assessing
appropriate information that faithfully the potential impact
reflects those contracts, and the on the financial
information provides users of the statements when
financial statements with the necessary applying the standard
basis for evaluating the impact of those
insurance contracts on the entity's
financial position, financial performance
and cash flows.
All entities were allowed, upon subsequent Management is Amended Standard
Amended measurement of fixed assets, to use either currently assessing No. (10) applies to
Egyptian the cost model option or the revaluation the potential impact financial periods
Accounting model option on the financial beginning on
Standard No. (10) Based on this amendment, the following statements when January 2023
"Fixed Assets" have been amended: applying the revised
1- Egyptian Accounting Standard No. (1) standard
"Presentation of Financial Statements:
Adding Paragraph (A) to the definition of
other comprehensive income in Paragraph
No. (7)
(A) Changes in the revaluation surplus / fair
value (review the Egyptian Accounting
Standard No. (10) "Fixed Assets" and
Standard No. 23 "Intangible Assets" and
Standard (34) Investment property
Amending Paragraph No. (96) to read as
follows:
(96) "Reclassification adjustments" do not
arise from changes in the revaluation surplus
recognized in accordance with Egyptian
Accounting Standard No. (10) and Egyptian
Accounting Standard No. (23) or
remeasurement of the defined benefit system
that was recognized in accordance with
Egyptian Accounting Standard No. (38).
These items are recognized in "Other
Comprehensive Income" and are not
reclassified to profits or losses (income
statement) in subsequent periods,
reclassification adjustments do not arise
Notes to the special purpose financial statement
Social Housing and Mortgage Finance Fund (SHMFF)
Partially Funded FromThe World Bank Loan No. 8498 EG and Additional Financing No. 9033 EG
From I July 2022 to 30 June 2023 Page 9
New or amended Summary of the most important Potential impact on Application date
standards modifications financial statements
when cash flow hedges or accounting for the
time value of an option contract (or the
forward component of a forward contract) or
basis points for foreign currency differences
result in amounts being removed from the
cash flow hedge reserve or a separate
component of equity, On the arrangement
and joining these amounts directly to the
assets or liabilities
-Egyptian Accounting Standard No. (5)
"Accounting policies, changes in accounting
estimates and errors."
Egyptian Accounting Standard No. (13)
effects of changes in foreign exchange
currency.
- Egyptian Accounting Standard No. (24)
"Income Taxes"
- Egyptian Accounting Standard No. (30)
"Periodic Financial Statements"
- Egyptian Accounting Standard No. (49)
"Lease Contracts"
Egyptian Accounting Standard No. (31)
"Impairment of Assets"
Amended - All entities were allowed, upon subsequent Management is Amended Standard
Egyptian measurement of intangible assets, to use currently assessing No. (23) applies to
Accounting either the cost model option or the the potential impact financial periods
Standard No. (23) revaluation model option on the financial beginning on 1
"Intangible statements when January, 2023.
Assets" applying the adjusted
standard
Amended 1. Introducing some amendments to Management is The amendments
Egyptian Standard No. (49) issued during 2019 as currently assessing to the amended
Accounting a result of amending and re-issuing the potential impact Standard No. (49)
Standard (49) Egyptian Accounting Standard No. (10) on the financial shall apply to the
"Lease Contracts" "Fixed Assets" amended in 2023 statements when financial periods
2. Adding Paragraph No. (35) to applying the revised beginning on
Standard No. 49 as follows: standard after the January 1, 2023
- If the right of use asset is related to a amendment. when applying the
category of fixed assets in which the amended Standard
lessee applies the revaluation model (10)
contained in Egyptian Accounting
Standard No. (10) "Fixed Assets", then
the lessee can choose to apply the
revaluation model to all right of use
assets related to that category of Fixed
assets.
3. Add Paragraph No. (57) to standard
(49) as follows:
If the lessee measures the right of use
assets at amounts revalued in accordance
Notes to the special purpose financial statement
Social Housing and Mortgage Finance Fund (SHMFF)
Partially Funded FromThe World Bank Loan No. 8498 EG and Additional Financing No. 9033 EG
From I July 2022 to 30 June 2023 Page
10
New or amended Summary of the most important Potential impact on
Application datei
standards modifications financial statements
with Egyptian accounting standard (10),
the lessee must disclose the information
required by paragraph 77 of Egyptian
accounting standard (10) on those right
of use assets.
4. Amending Paragraph No. (56) of
Standard (49) to read:
- If the those right of use assets meet the
definition of real estate investment, the
lessee must apply the disclosure
requirements contained in Egyptian
Standard No. (34) "investment
properties". In this case, the lessee is not
required to provide the disclosures
contained in paragraphs 53 (a), (b) or (c)
or (d) of those right of use assets.
Amended - All entities were allowed, upon the Management is This amendment
Egyptian subsequent measurement of their investment currently assessing the applies to fiscal
Accounting property, to use either the option of the cost potential impact on the periods beginning
Standard No. (34) model or the option of the fair value model, financial statements on or after January
Real Estate while obligating real estate investment funds when applying the 1, 2019.
Investment" only to use the fair value model upon the revised standard after
subsequent measurement of all their real the amendment.
estate assets.
- With the recognition of the increase in the
fair value upon the subsequent measurement
of the investment property within the items
of other comprehensive income instead of
profits or losses and accumulating it within
equity in an account called "investment
property valuation surplus at fair value"
(review paragraphs 35 and 35 (a) of the
Egyptian Accounting Standard No. 34)
Based on this amendment, the following
have been amended:
- Egyptian Accounting Standard No. (32)
"non-current assets held for the purpose of
sale and discontinued operations"
- Egyptian Accounting Standard No. (3 1)
"impairment of assets"