1Issue 1 | September 2024

Applied Examples Example 6: The data below is for a bank licensed in the Kingdom of Saudi Arabia as of 31st December 2024G. Accordingly, it is required to calculate the Zakat. Statement of Financial Position As of 31st December 2024G (Amounts in SAR) Item 2024 (SAR) 2023 (SAR) Assets Cash and balances with the Saudi Central Bank Balances with banks and financial institutions Positive fair value of financial derivatives Investments - net Loans and advances - net Property and equipment, net Other assets Total Assets Liabilities and Equity Liabilities Balances due to banks and financial institutions Customer deposits Financial derivatives Other liabilities Total Liabilities Capital Statutory reserve General reserves Currency exchange reserve Other reserves Retained earnings Proposed dividends Treasury shares Total Shareholders’ Equity Total Liabilities and Shareholders’ Equity Taking into account the following information regarding assets, liabilities, and equity: Liabilities and Equity: 1. 20% of the balances due to banks and financial companies mature after one year or more. 2. 10% of customer deposits mature after one year or more. 3. All other liabilities have a maturity date of less than one year. 4. 50% of financial derivatives have a maturity date of one year or more. Assets: 1. The bank has a statutory deposit with the Saudi Central Bank amounting to 8,000,000 SAR. 2. 50% of derivatives have a maturity date of one year or more. 3. 50% of loans and advances have a maturity date after one year or more. 4. All other assets have a maturity date of less than one year. 5. 15% of investments consist of equity investments in the Kingdom of Saudi Arabia. 6. 50% of investments consist of investments in debt instruments (Sukuk issued locally by the Ministry of Finance in Saudi Riyals). Income Statement For the period from 1st January 2024G, to 31st December 2024G (Amounts in SAR) Item 2024 (SAR) Special commission income Special commission expenses Net special commission income Fee and commission income - net Foreign exchange gains - net Investment income at fair value through profit or loss Trading income - net Gains on debt securities at fair value through other comprehensive income Income from other operations Total operating income Salaries and employee-related costs Rents Other general and administrative expenses Allowance for credit losses Total operating expenses Net income for the year Zakat Base Calculation: A. Step One: Identification of Non-Zakat Assets Non-Zakat assets are identified as determined by the rules as follows: Group Item Clarifications Amount (SAR) Non-Zakat Assets Net fixed assets and their equivalents Net fixed assets are taken as at the end of the year Investments in establishments or ownership shares inside the Kingdom, in accordance with the regulation. 15% of the investment value is taken as it represents equity investments inside the Kingdom for which Zakat was previously paid Investments in entities or equity interests outside the Kingdom, provided that the Zakat payer settles their Zakat independently in accordance with the regulation. The bank has investments outside the Kingdom, but the legally mandated Zakat has not been paid for them; accordingly, they are not treated as non- Zakatable assets Debts due to the Zakat payer where the maturity date or part thereof is after one year or more, whether called short-term or long-term debts, as follows: a. All types of provided financing, whether through lending, Murabaha/cost-plus financing, finance lease, or other financing contracts. b. Zakat payer investments in debt instruments, such as Sukuk and bonds, regardless of their structure. 50% of loans and advances with a maturity date of one year or more are taken