annual report 2015 empower - tamkeen · annual report 2015 tamkeenbahrain 1738 3333 empower tamkeen...

Annual Report 2015

TamkeenBahrainwww.tamkeen.bh1738 3333

Empower

Tamkeen from the view of those it empowers

• Journey towards customisation• Inspirational journeys • Evolving to meet customer needs

Tamkeen PO Box 18131Manama, Kingdom of Bahrain

+973 1738 3333

+973 1738 2352

[email protected]

His Royal HighnessPrince Salman Bin Hamad Al Khalifa

The Crown Prince, Deputy Supreme Commander, and

First Deputy Prime Minister of the Kingdom of Bahrain

His MajestyKing Hamad Bin Isa Al Khalifa

The King of the Kingdom of Bahrain

His Royal HighnessPrince Khalifa Bin Salman Al Khalifa

The Prime Minister of theKingdom of Bahrain

Our VisionEmpowering Bahrainis to prosper and contribute to the national economy.

Our MissionEmpowering Bahrainis according to market requirements and building enterprise capabilities to contribute to expanding the national economy.

06

08

10

14

12

15

16

18

20

21

22

24

26

27

28

30

32

34

37

Meet our Board of Directors

Tamkeen’s Message

Overview of Tamkeen’s Strategic Focus From 2014/15-2017 (Impact)

Journey Towards Customisation

Inspirational Journey – Training Program

Inspirational Journey – Enterprise Support

Enterprise Support – Evolving to match customer needs

Training – More choices for businesses and individuals

Inspirational Journey – Training and Wage Support

Inspirational Journey – Enterprise Support

The Business Plan – How to write one

Finance Scheme – Encouraging businesses achieve their aspirations

Inspirational Journey – Training and Wage Support

Inspirational Journey – Professional Certification Scheme

Segments and Sectors – Analysing the customer’s needs Enhancing Customer Touchpoints Elevating the Entrepreneurial Spirit – The Bahrain Award for Entrepreneurship

Providing Value to Bahrain’s Economy – The Bahrain Shopping Festival

Financials

Contents

In 2015, Tamkeen’s Board of Directors consisted of 8 members representing the organisations which play a vital role in the development of the private sector.

Representing the public sector on the Board were Shaikh Mohammed Bin Essa Al Khalifa (Chairman), Dr. Zakaria Ahmed Hejres, and Mr. Abdulellah Ebrahim Al-Qassimi.

Board members from the private sector were Mr. Khalid Ali Rashid Al-Amin (Vice-Chairman), Mr. Kadhem Isa Al-

Saeed, and Mr. Mohammed Adel Fakhro from the Bahrain Chamber of Commerce and Industry as representatives of businesses, Mr. Mohammed Abdulrahman Mohammed from the General Federation of Bahrain Trade Unions as representatives of the Bahraini workforce, and Mr. Hassan Ameen Jarar from the Bahrain Association of Banks as representative of the financial sector.

page 6

Meet our Board of Directors

Shaikh Mohammed Bin Essa Al-KhalifaChairman

Khalid Ali Rashid Al-AminVice Chairman

page 7

Dr. Zakaria Ahmed HejresBoard Member

Mohammed Adel FakhroBoard Member

Mohammed Abdulrahman MohammedBoard Member

Hassan Ameen JararBoard Member

Abdulellah Ebrahim Al-Qassimi Board Member

Kadhem Isa Al-Saeed Board Member

2015 has been a year of both new direction and consolidation for Tamkeen. At the start of the year, we embarked on our new 2015-2017 strategy to further help Bahrain’s economy to continue to develop and expand.

Tamkeen’s Message

page 8

We are pleased to report that we are making progress on our overall objective, which is to enable the private sector to become the key engine of economic growth, a goal which Tamkeen was tasked with achieving when it was established in 2006.

Since Tamkeen’s formation, Bahrain’s economy, reflecting global and regional shifts, has undergone a number of alterations which affected the dynamics of the market, as well as the nature of business operations in the Kingdom. As these changes have occurred, Tamkeen has also adapted to each new circumstance to stay focused on achieving its core objective. One of the primary examples is the role that technology played in improving our operations during this year; as businesses continued putting online technologies at the core of their operations, so have we. Consequently, we launched an interactive website that allows customers to apply online as well as we have switched methods of payment from physical means such as cheques, to adopting the global IBAN standard.

Since we have launched our 2015-2017 strategy, we stayed committed to achieving Tamkeen’s original purpose by enhancing the quality of our offerings, becoming more customer-centric as well as ensuring better results are achieved.

Rather than offering almost 200 standardized programs which required business and individuals to fit into specified categories, Tamkeen’s services are now concentrated around just three main support categories, the Enterprise Support Program, the Finance Scheme, and the Professional Certification program. These support services are highly customizable so that they can best fit the needs of each business or individual.

This customization element of the programs is essential for the achievement of our 2015-2017 strategic objectives and to ensure that our support matches the changing dynamics of the economy. At the end of 2014, and throughout 2015, we have been able to see the first indicators of the impact of such restructure as we continued moving forward through this customization route.

By the end of 2015, The Tamkeen Enterprise Support program has benefited over 1,000 businesses. In addition, through Tamkeen’s Professional Certification program, more than 250 individuals received different professional certificates representing various sectors. Through our Finance Scheme, in partnership with 7 local banks, more than 850 businesses have been able to fund new projects and ideas.

I would also like to congratulate the Tamkeen team, who worked hard to ensure that our objectives continue to be at the heart of everything we do. This results in Tamkeen receiving a number of awards during the year including the Regional Enterprise Agility Award for Supporting Entrepreneurial Ecosystem Development from Entrepreneur ME magazine and the Best Sponsor of Productive Families Award from the Supreme Council of Women.

During the first part of the year, Tamkeen also supported a number of new initiatives to help develop Bahrain’s economy. This included the Bahrain Award for Entrepreneurship, patronized by his Royal Highness, Prince Salman bin Hamad Al Khalifa, Crown Prince, First Deputy Prime Minister and Chairman of Bahrain Economic Development Board. The first edition of the Award concluded in March 2015 and the second edition opened its doors for nominations in November 2015.

In addition, Tamkeen also launched the first edition of Bahrain’s nationwide Shopping Festival, which ran from December 2014 to March 2015, with the second edition entitled ‘Shop Bahrain’ running between December 2015 and January 2016.

As we move ahead, we will keep implementing our 2015-2017 strategy after the inclusion of feedback provided by our customers during the last quarter of 2015. It is imperative that we continue to evolve in order to ensure the success of businesses and individuals in the private sector, and subsequently ensure the diversification and growth of the Kingdom’s economy.

Shaikh Mohammed Bin Essa Al-Khalifa

Chairman of Tamkeen

As per the 2015-2017 strategy, Tamkeen is more focused on enhancing the quality of its offerings, becoming more customer-centric as well as ensuring that better results are achieved.

3At the beginning of 2014, Tamkeen

began drafting its 2015-2017

strategy, which focused on three

main pillars with the aim to meet

the dynamic needs of Bahrainis

and private sector businesses:

• Customer centricity

• Improving quality

• Delivering better results

2 As Tamkeen moved towards its second strategic cycle, between 2011 and 2014, it continued introducing programs that catered to particular needs. During this cycle, Tamkeen focused on reaching out to the

public regarding its programs and what they can offer. By the end of 2014, “Tamkeen”

had become a householdname for Bahrainis.

1As part of the first cycle, which lasted

from 2007 to 2010, Tamkeen worked

diligently to study market conditions,

and formulated private sector focused

programs that were in-line with new

business and individual needs that came

up as a result of these conditions.

Overview of Tamkeen’s Strategic Focus

Throughout the years, Tamkeen has offered more than 200 programs, each with its own specific budget and plan. This came about as a result of regular feedback from the public for the inclusion of new initiatives that cover newer, more diverse and unique needs. The need for Tamkeen to update its strategy for the 2015-2017 timeframe arose with the requirement for a more comprehensive, actionable, impact driven approach in operations that would enable it to play its role in tackling the relevant labour market and private sector challenges, support the National Economic Strategy and fulfil its mandate.

page 10

3At the beginning of 2014, Tamkeen

began drafting its 2015-2017

strategy, which focused on three

main pillars with the aim to meet

the dynamic needs of Bahrainis

and private sector businesses:

• Customer centricity

• Improving quality

• Delivering better results

2 As Tamkeen moved towards its second strategic cycle, between 2011 and 2014, it continued introducing programs that catered to particular needs. During this cycle, Tamkeen focused on reaching out to the

public regarding its programs and what they can offer. By the end of 2014, “Tamkeen”

had become a householdname for Bahrainis.

1As part of the first cycle, which lasted

from 2007 to 2010, Tamkeen worked

diligently to study market conditions,

and formulated private sector focused

programs that were in-line with new

business and individual needs that came

up as a result of these conditions.

To achieve these objectives, Tamkeen initiated a restructuring exercise that began in March. Since then, Tamkeen went through a number of operational changes, with the overall result being the consolidation of Tamkeen’s programs to 2 main functions: ‘Grant-based Support’ and ‘Financial Support’. However, as Tamkeen recognized the different priorities of each business sector and the need to offer customized “best-fit” solutions to serve the growth and development of Bahrainis, an additional support - the ‘Guidance and Advisory Support’ - was added by the end of 2015.

During 2015, Tamkeen implemented a number of changes besides the consolidation of programs in order to achieve its strategy’s three objectives. For example, to provide a better experience for customers, in-line with its objective of achieving customer-centricity, Tamkeen implemented a new electronic interface that allows customers to directly apply for programs without the need to physically visit a customer service center.

One of the initiatives Tamkeen implemented for achieving better results was the addition of a new requirement as part of the Enterprise Support program - a business plan that contains KPIs, time plans and goals; this would ensure that the support provided achieves the maximum impact possible. The plan is automatically formulated as part of the online application process and this new requirement assists businesses (especially start-ups) to have a clearer outline of what they need to do moving forward. Based on the completion of the KPIs in the plan, Tamkeen increases the amount of its support to encourage businesses to achieve their goals.

An example for improving quality is Tamkeen’s implementation of a new IBAN payment process that reduces the payment time to customers and service providers.

By the last quarter of 2015, Tamkeen’s customization approach proved to be the best way forward for providing support to individuals and businesses as needs were found to be too varied.

page 11

2015 onwards

Key support through consolidated programmes available online

Launch of Tamkeen Advisory Services Guidance Support

Advisory Support

Networking & Communication

Building

Market Awareness Campaigns

Career Guidance Support

Enterprise Support

Grant-based Support Financial Support

Finance Scheme Professional Certification Scheme

for Individuals

1 2 3

Journey Towards Customisation

aspect for the provision of specialized work-place related training to Bahrainis. Since its launch, the program’s structure has always been highly customizable whereby Bahrainis applying for the program can request to receive support for certification covering a wide range of sectors. It allows them to receive training, locally or abroad, in certificates provided by professional business-related institutions including industry veterans and practitioners, such as CIPD (The Chartered Institute of Personnel and Development), ACCA (Association of Chartered Certified Accountants), CII (The Chartered Insurance Institute), and CIM (The Chartered Management Institutes) to name a few.

This also includes certification provided and approved by international businesses or entities that have extensive experience in their field; this comprises certificates from CISCO, the IATA (International Air Transport Association), IBM, Microsoft, BBC, and others.

The main change to the Professional Certification program, which was implemented prior to 2015 and continued to be implemented during this year, is the ability for individuals to request the inclusion of any approved professional certificate

While the type of support Tamkeen provided remained relatively the same as previous years', the way it is delivered has changed. Business support services, whereby Tamkeen provides direct support to various business functions, are now completely consolidated under the Enterprise Support program. Instead of applying for only specific functions, such as receiving marketing or equipment support, in 2015, businesses have been empowered to be able to request support for several functions at once.

Prior to 2015, some business functions were also put under separate programs. For example, Tamkeen’s Career Progression program, which allows businesses to request Training and Wage Subsidy support, used to be its standalone program. With Tamkeen’s move towards customizing its support, the program has been integrated into the Enterprise Support program, so businesses can include, if they wish, wage and training support for their employees as part of their application instead of applying for two different programs.Just as enterprises can include training as part of their Enterprise Support applications, individuals who would like to further their careers have their own stand-alone training program. Tamkeen’s Professional Certification program forms a core

page 12

2015 onwards

Key support through consolidated programmes available online

Launch of Tamkeen Advisory Services Guidance Support

Advisory Support

Networking & Communication

Building

Market Awareness Campaigns

Career Guidance Support

Enterprise Support

Grant-based Support Financial Support

Finance Scheme Professional Certification Scheme

for Individuals

1 2 3

In 2015, as Tamkeen moved forward towards customising its support to match the needs of each business and individual, Tamkeen’s support structure also had to evolve.

(if it is related to their field of work or prior academic qualifications), thus making the program even more customizable.

In terms of business loans and financial support, in 2015, Tamkeen’s Finance Scheme continued to be the main program for the provision of business funding, and has continued to function as per its previous support structure, which has always been highly customizable. Through the scheme, Tamkeen provides businesses with 50% of the interest required as part of a loan, and provides 50% guarantee to the lending bank. The reason the scheme has not gone through any major overhauls is due to the nature of funding provided by the scheme. Cash is the most flexible form of support, and allows businesses to invest as per their plans.

The major addition to Tamkeen’s support structure in 2015 is the inclusion of a new type of support to both businesses and individuals. While Tamkeen has been implementing changes to allow its programs to be molded as per different requirements and needs, it was found that businesses and individuals sometimes need assistance to be able to identify the exact requirements needed to achieve their goals and objectives.

In December 2015, Tamkeen announced the launch of a set of Advisory Services, a new platform which provides advisory and consultancy services to businesses, jobseekers and employees working in the private sector. Through this platform, and in collaboration with experts, Tamkeen provides eligible business owners and individuals with relevant guidance and advisory services at no cost.

In addition, this service platform is self-supported by the efforts of Tamkeen’s customer engagement team, which works diligently to engage with the public through various channels and means; this is done through Tamkeen’s Customer Service Centers, interacting with the public through community events, consultation sessions and other activities as well.

This support structure, which Tamkeen began implementing in 2015, serves as a basis for the provision of customized support for both individuals and businesses. The move towards customization allows Tamkeen to achieve its objective of empowering Bahrainis and making them the primary drivers for growth in the private sector and subsequently, forwarding the diversification and development of the Kingdom’s economy.

page 13

The program comprised two years of theoretical study and two years of technical study, and I was among the first batch of proud graduates to get their license as the first Aviation Engineer; at the age of 22, I also became the youngest graduate in the history of Gulf Air.

It was challenging at times in terms of finding support in the field. Being a male-dominated industry, the idea that I, as a female, wanting to continue on this path, was unfamiliar to many. People did not take the idea seriously, including family and friends; however my passion for pursing this career motivated me to complete the program successfully as the first female Aviation Engineer.

At the time, the aviation training field in Bahrain was relatively in its development stage. The pursuit of my career in a challenging field, and as the first female to do so in this industry, could not have been accomplished without Tamkeen’s support through its training programs. The organization has developed training further within the field and allowed for these opportunities to be continually offered. Additionally, the financial support package offered by Tamkeen provided full services to ease the training program for participants such as: payment of fees during both the theoretical and technical training years, providing the tool books needed as well as providing type rating certification.

While I will continue to be in the engineering field, and specifically on-the-line, for the next year or two, but eventually, I plan to branch out into the administrative

Hind Al Awadhi Aviation Engineer

My journey into the field of aviation started long before my career took off as an

Aviation Engineer. I always had a passion for the field since childhood, but initially

I just wanted to be a pilot or a crew member. When I graduated early, at the age of

sixteen, I got the time to research my options and look at my choices in the industry

and that’s when the engineering aspect of aviation started appealing to me. After

having achieved a high GPA in high school, I applied to the Tamkeen-Gulf Air Aviation

training program along with over 500 other applicants, and was among the 30

handpicked students who received a full scholarship from Tamkeen.

part of the field to be able to have a more well-rounded career experience.

To any individual pursuing their goals and career objectives, my advice is that you should choose something you love doing, otherwise you risk limiting your career. Be sure to do it for yourself and be self-motivated on your own journey. Also be ready to face challenges, as it can be hard especially to find support in an unfamiliar field. Finally, if you love what you do, it will always be worth it. Personally for me, it was about wanting to complete the journey I started and to make a difference.

Personal conviction"Don’t let others define your capabilities for you and never compare yourself to others or pursue your career just to prove others wrong. By graduating as the first female Aviation Engineer, I was able to make a difference and hopefully others will be motivated to follow suit."

Inspirational JourneyTraining Program

Since our start in 1970, we at Delmon Bakery have been considered among

Bahrain’s leading bakeries and confectionary facilities. With over 40 years of

continued quality product lines and services in the Kingdom, we have now

solidified our position as Bahrain’s largest bakery whose aim is customer

satisfaction and quality. Delmon Bakery has always strived to employ the most

innovative of methods to ensure maximum quality, including our use of the

latest state-of-the-art technologies. At the core of our business mission we

strive to satisfy our customers, who have trusted the brand for over 40 years.

When we received support from Tamkeen, it gave us that much needed opportunity to remain a major player in the market. With the low interest loans made available to us, we were able to purchase new machinery and raw materials and thus deliver on our promise of utilizing state-of-the-art equipment. The financial capital was further used to fund Delmon Bakery’s new marketing programs which helped us focus further on a vast market expansion.

Today, Delmon Bakery has many outlets throughout the Kingdom and operates an efficient delivery fleet ensuring a continuous and steady supply of all our products to Bahrain’s major supermarkets, catering companies, hotels and cold stores. We believe that the future of the bakery will remain prosperous and we will continue to thrive as our emphasis on satisfaction and quality remain at the forefront of our business.

Delmon Bakery’s market position as a major Bahraini bakery will be supported further as it complies with the ISO 22000 Food Management System standards thereby delivering on all parameters of food safety and security ensuring ample supply to the people of Bahrain at any given time.

Core Belief"We truly believe going above and beyond in accomplishing this by offering quality and hygienic foods at reasonable prices, offering in-demand products and exploring ways to keep costs low to ensure market preference."

Inspirational JourneyEnterprise Support

Osama Bin Mahmood Delmon Bakery, Bin Mahmood Holding

Tamkeen also implemented a number of changes to facilitate the application process to their various support programs. One of which is the launch of an online portal, where customers can complete their applications online and follow up on the status of their applications.

Given the importance of business planning for the success of any business, Tamkeen encourages the applicants to do more thorough planning in the re-launched version of the Program. Through

CustomizedApproach

Enterprise Support Approach

BusinessDevelopment

EmployeeDevelopment

Tamkeen Advisory Services

Grant Scheme> > >Finance SchemeTailor-made Choices:

• Machinery & Equipment • Quality • Marketing & Branding • Business Consulting • Exhibition Participation • ICT

Customized Support

Enterprise Support Evolving to Match Customer Needs

Tamkeen works continuously to ensure that its support programs achieve exponential benefit for the individuals and businesses that collectively form Bahrain’s economy. Since its launch in 2008, the Enterprise Support program, has proven to be highly effective in reducing the operational gaps. This Program focuses on two main areas:

• Business Development • Employee Development

Previously, the Enterprise Support program included specific aspects of operations (equipment, accounting, marketing, promotion, quality and advisory), and as part of its restructuring efforts, Tamkeen revisited the Enterprise Support program in March 2014 and made a number of changes to make it more flexible and customer-focused. The Program was re-launched in September 2014 enabling customers to choose their own set of customized business solutions that best address their business-specific operational needs.

The Employee Development Program now also allows individuals to be placed in international locations related to their industry for the purposes of gaining a wider working experience. In addition, businesses can now apply to the Training and Wage Subsidy support for their Bahraini employees.

Start-upsGrowingand Mature Organizations

Others

34.5%61.6%

3.9%

the online application, the system now automatically generates a business plan that contains goals, KPIs and a specific timeline, and assists businesses (especially start-ups) to have a clearer outline of their future plans. Based on the applicants’ capability to execute the business plan and set goals, they will receive a financial support of up to 50% of their estimated cost; companies that succeed to achieve KPIs set by Tamkeen will be rewarded by Tamkeen and will get up to 80% support instead.

In addition, Tamkeen launched a new electronic form of payment for faster processing. The system uses the International Bank Account Number (IBAN) system, which allows for swift electronic processing of payments to customers and suppliers.

In 2015, more than 1,000 enterprises benefited from the Business Development, 34.5% of which are considered start-up businesses and 61.6% growing and mature organization.

As part of its continuous efforts to support businesses and individuals across all stages of development, Tamkeen also launched its Advisory Services in December 2015 to provide advisory and consultancy services to businesses, jobseekers and employees

CustomizedApproach

Enterprise Support Approach

BusinessDevelopment

EmployeeDevelopment

Tamkeen Advisory Services

Grant Scheme> > >Finance SchemeTailor-made Choices:

• Machinery & Equipment • Quality • Marketing & Branding • Business Consulting • Exhibition Participation • ICT

Customized Support

working in the private sector. Through this new platform, Tamkeen, in collaboration with experts, offers eligible business owners and individuals with the relevant guidance and advisory services at no cost. For businesses, Tamkeen’s Advisory Services provides business mentoring to enterprises seeking direction and expert advice and enables them to improve and grow their businesses through long-term direct interaction with experienced mentors. Tamkeen also enables individuals to receive long-term career mentoring from industry veterans and professionals, as well as internship and volunteering opportunities across various sectors in Bahrain.

1,022 Enterprises benefited in 2015

8,778 Enterprises benefited till 2014

TrainingMore Choices for Businesses and Individuals

Training has been a critically important aspect of Tamkeen’s support. Overall, more than 101,000,000 BD was

spent on training programs since Tamkeen’s foundation, and more than 94,000 individuals have benefited from

these programs. Tamkeen has also had a big impact on the way institutes provide training in Bahrain. This trend

of investment in training has continued during 2015, as training and human capital development constituted

almost 45% of amounts spent by Tamkeen on its support programs. In addition, there were a number of key

changes and new updates to Tamkeen’s training offerings during the year.

page 18

Following Tamkeen’s Consultation Forum in November 2015, where representatives from 15 sectors presented their feedback and recommendations regarding Tamkeen’s support, a number of changes went into effect to ensure the smooth transition of responsibilities from the High Council for Vocational Training to Tamkeen.

One of the changes is the inclusion of Training & Wage subsidy as part of the Enterprise Support program. This allows businesses to provide their employees with specialized training, followed by wage subsidy for up to 2 years for the trained employees. Through this program, Tamkeen assesses particular skills gaps that exist within a business, then formulates a training plan and selects the appropriate training supplier to provide Bahrainis with the necessary certification and skills to bridge those gaps. The skills gaps that Tamkeen assesses belong to five different levels as per below:

With the transfer of responsibilities of the High Council for Vocational Training to Tamkeen, the inclusion of Training & Wage subsidy as part of Enterprise Support, not only allows businesses to receive training support, but also allows them to improve other business functions as well. In 2015, the Training & Wage subsidy, before and after its inclusion as part of the Enterprise Support Program, has benefited more than 2000 Bahrainis working in over 200 companies.

In addition to giving businesses the opportunity to impart their Bahraini employees with the necessary expertise and skills to close specific knowledge gaps in 2015, Tamkeen continued to provide individuals with unique avenues to specialize and grow in various professional fields. Tamkeen’s Professional Certification Program allows Bahrainis to receive training, locally or abroad, in certificates provided by professional business-related institutions and delivered by industry veterans and practitioners; this Program has proved to be very effective in the way it provides training that cover market gaps despite being highly demand driven.

Through the program, in general, Tamkeen provides 50% of the total fees required for the certification, with another 50% paid upon the completion of the certification program. This serves to encourage applicants to pursue success in attaining the certification as much as possible.

By allowing Bahrainis to receive training from professional individuals and institutions that have extensive operational expertise, throughout the decade that Tamkeen has been working in, the gap between academic knowledge and operational knowledge has been narrowed down considerably.

In 2015, Tamkeen continued allowing any professional certificate, related to the applicant’s field of work or study, to be covered as part of the Program. The change, implemented in 2014, comes as part of Tamkeen’s drive to make its programs more customizable and offer various options for better progress and development.

As part of Tamkeen’s customization efforts, 74 new certificates were approved during the year. The program continued to serve as a catalyst for providing a platform that allows Bahrainis to become more aligned with international standards and local business expectations.

“As the global market has seen tremendous growth in terms of size and specialization, professional certificates have become a key qualification requirement that matches benchmarks of international competency of human resources. Bahrain’s market is no exception to this equation of growth. Professional certificates have been closely identified with the expansion of knowledge and skills of the workforce, and hugely contribute to the level of productivity. It also provides both a proof of mastery and an international credibility that is instant and unequivocal. An ACCA qualification for example is the same in London, New York, Hong Kong and here in Bahrain, which allows for the portability of skills and instant credibility. This creates a workforce which is valuable not only in the domestic market, but one which is also portable, especially within the GCC given inherent language and cultural skills.

Functional Competency: includes specific competencies which are considered a core part of the job within a defined technical or functional area of work.

Fundamental Competency: includes competencies that cover a wide range of skills and tools. It’s not related to a specific job role, but is still needed within the wider context of the enterprise.

Cognitive Competency: focuses on skills related to finding innovative or creative solutions to business problems such as analytical and critical thinking.

Interpersonal Competency: includes skills that allow the individual to function better in a team as well as in dealing with people inside and outside the organisation.

Leadership Competency: concerns skills related to management and executive decision making.

50over

10,500over

spent on TrainingPrograms on Individuals

Till date: 94,512

Individuals Trained(until 2015)

During 2014 and 2015, through Tamkeen’s Training and Wage Subsidy Support, GARMCO successfully trained a total of 528 Bahraini employees who received a total of 23,257 hours of training. The training focused on nontechnical skills that employees needed, to better align their capabilities with the company’s overall objectives. The impact was significant, as it helped in building a healthy and positive culture, a culture that encourages learning and continuous development. As a result of the training conducted. The company was able to better assess the performance and capabilities of employees, and find the potential in them. Some employees were promoted to higher positions after successfully completing the training program. And some were even appointed in key managerial and supervisory roles, after proving their capability and competency throughout the training period.

Through the various schemes that Tamkeen has introduced to the market, benefiting both companies, as well as individuals. The Bahraini workforce has become more capable of positioning themselves into the market, and

Learning and development is considered one of the key functions at GARMCO.

It drives substantial improvements on a personal and organisational level, and

it significantly contributes to the success of the company’s journey towards

reaching to its overall goal and objectives. In 2014, the total learning hours

reached 87,915. And increased to 127,950 learning hours, in 2015.

progressing in their careers through continuous learning and development activities. While it is a successful initiative, there is still more potential for growth. In partnership with companies in specialized fields, Tamkeen can jointly work with them to develop and further prepare Bahraini employees to take on new roles. The training could also expand to on-job training and training abroad.

Learning activities are very critical to the success of any company. In GARMCO, learning takes place from the very first day a new employee joins and continues to the end of the employee’s work cycle. It ensures that employees are continuously expanding and gaining the necessary skills and knowledge that meet the standards of GARMCO. It also ensures that employees are up-to-date and have relevant market knowledge to enable GARMCO to compete effectively. We pride ourselves on being a huge contributor in preparing a professional and capable generation that will add to the advancement and success of the Kingdom of Bahrain.

Driving Philosophy"Learning and development is not just an admin function for GARMCO, it is a strategic element of our operations."

Nawaf Zainal Head of Learning & Talent Development(Gulf Aluminium Rolling Mill B.S.C)

Inspirational JourneyTraning and Wage Support

Since its foundation, we at Nine Senses Beauty Centre & Spa, have aimed

to assist women in reconnecting with their senses, and enjoy their

sense-ability. This comes as part of our objectives to provide the market

with an unparalleled sensory experience catering to spa and wellness needs.

Through continuous development and improvement, Nine Senses was able to

provide an unrivalled range of signature wellness treatments focusing on a variety

of services including: hair, health, beauty, nail care, rejuvenation, stress reduction

and recuperation using pure, natural and environmentally-friendly products.

When an opportunity arose to create a business around this need, we embraced it as it would allow us to make a difference in the industry and create an impact in the market. This was in part due to a major support obtained from Tamkeen in the form of a business loan granted by Bahrain Development Bank (BDB). This support allowed Nine Senses to move from the initial planning stages to implementation and becoming a real concept.

Following our establishment, Nine Senses managed to receive further support from Tamkeen through its Enterprise Support program which allowed for the development and implementation of effective marketing plans as well as acquiring key and necessary equipment.

Today, we are proud of reaching a state of local market recognition following careful and rigorous planning and execution. Currently, Nine Senses has expanded further as its facilities cover a vast amount of space in a popular Bahraini area easily accessed by the public.

In the future, we also want to bring our local Bahraini touch to more people, and possibly franchise in order to become a recognized beauty and spa brand across the region, which contributes to reflecting Bahrain’s talent, innovation and creativity.

Biggest Inspiration"After 12 years of experience in the same field of Beauty & Spa services, we found out that there is a need to build a unique Bahraini brand of beauty and spa services."

Inspirational JourneyEnterprise Support

Ali Al RayesNine Senses Beauty Center & Spa

Business Essentials: The Importance of a Business Plan for Venture Success

At any given stage of a business venture, whether in the planning phase or after establishment, a business plan is considered crucial documentation which serves as the guide to map out a venture’s past, present and future with research, forecasting, objectives, expectations, growth opportunities, targets, performance measures, marketing tactics, communication plans and more.

In the early stages of any planned venture, a business plan acts as a written description detailing the trajectory of a business supported by data insights and expectations as well as a plan of action and strategy to achieve objectives. The essential elements detailed in a business plan highlight allocation of capital, resources and ability to demonstrate

page 22

profitability and distinction in a given venture to potential investors, financiers, business support entities or partners.

A business plan’s structure is pillared by several components which aim to offer detailed insight into an entrepreneur’s venture with the following:

Executive Summary: A general outline summarising the venture and the objectives of the entrepreneur

Business Description: The industry description offering market insights as well as projections of the industry’s present and future developments

Market Strategies: Definition of target markets via market analysis to determine the venture’s positioning

page 23

Competitive Analysis: Identification of primary industry competitors including strengths and weaknesses

Design & Development Plan: Budget development and product design are showcased

Operations & Management Plan: Daily business functionality which includes logistics, organisational structure, expenses and day-to-day tasks

Milestones & KPIs: Clear operational goals and timelines that are employed to monitor the business’ performance in relation to the strategic goals and objectives

Financial Data: Financial capital, projections, forecasting and expenses

In its compliance and adherence to optimal business practices, Tamkeen’s requirement of thorough business plans submitted by potential business owners has in turn resulted in receiving higher quality applications showcasing long-term strategic planning and guidance. Providing business plans ensures business milestones are highlighted and key performance indicators (KPIs) are developed, planned and met.

With its updated processes, criteria and evaluation procedures implemented In Tamkeen’s Enterprise Support Program - a key flagship scheme aimed to support enterprise growth and development - business plans have become crucial to assisting budding enterprises determine their business needs. Additionally, by requiring business owners to submit comprehensive business plans, Tamkeen enables them to fully consider their potential business from all aspects and ascertain their needs.

SME grows and achieves sustainability

5

Clientdiscusses

requirementswith Bank

3

Bank approves loan

at reduced interests

4

SMEcustomer

approachesTamkeen

12

Tamkeen advices SME

on risk alleviation

SME contributes to

growth of economy

6

Finance SchemeEncouraging Businesses to Achieve their Aspirations

One of Tamkeen’s main objectives is making the private sector the engine of growth for Bahrain’s economy in achieveing sustainable economic development. One of the steps needed to achieve this is the creation of an environment that allows individuals with an entrepreneurial bent of mind to be able to bring their ideas to reality. This is a core element for the growth of any modern economy, as new ideas and concepts need to be injected into the market due to the continuously changing needs as well as the dynamic nature of the economy.

The creation of this environment requires both changes in culture as well as providing the physical means that will allow entrepreneurship to thrive. For example, one of the biggest

challenges facing entrepreneurs, start-ups and small businesses, is the provision of funding, as these types of businesses generally have high risk and banks may be reluctant in providing them with the necessary financing.

To help such businesses may acquire the funding they need, Tamkeen launched the Finance Scheme in 2007 whereby it supports 50% on the profit charged, approved by a bank to a business, in addition to providing a 50% of the principal as a guarantee to the financing bank. This way, Tamkeen alleviates the risk associated with new ventures and Small/Medium businesses, while only providing a fraction of the total financing.

page 24

SME grows and achieves sustainability

5

Clientdiscusses

requirementswith Bank

3

Bank approves loan

at reduced interests

4

SMEcustomer

approachesTamkeen

12

Tamkeen advices SME

on risk alleviation

SME contributes to

growth of economy

6

Tamkeen’s goal through the program is however not to fund; banks have always served this purpose. Through the program, Tamkeen seeks to give entrepreneurs and business-minded individuals with the opportunities to realize their aspirations and goals. Of the 6,250 enterprises that benefited from the scheme to date, 83% are classified as small businesses and 16% are classified as medium businesses. And while Tamkeen only spent around BD 22 million in profit and guarantee payments, the resulting provision of more than BD 350 million in funding through partner banks, and the availability of a BD 412.5 million portfolio, have been instrumental in the creation and sustainability of a significant number of businesses in Bahrain.

During 2007, the program’s launch year, only Fixed Asset funding was provided to benefiting enterprises. To expand the program, new forms of funding were introduced during later years. This included Working Capital financing, Working Capital + Fixed Assets financing, Trade financing in addition to a number of other financing that were provided outside of these categories.

In 2015, around 900 enterprises benefited across all these categories, which is a reflection of Tamkeen’s strategy to making the Finance Scheme more flexible so as to address a variety of needs and requirements.

Partnerships with banks however, is critical for the success of this program, as they are the prime facilitators and funds providers. Tamkeen works very closely with these banks in order to ensure that businesses are provided with the right amount and type of funding to help them achieve their goals and objectives.

In 2015, Tamkeen worked with a number of banks, including:

• Bahrain Development Bank • Bahrain Islamic Bank

• BMI/Al Salam Bank • Khaleeji Commercial Bank

• Kuwait Finance House • Al Baraka Bank

• Ithmaar Bank

Since the launch of Tamkeen’s Finance Scheme, there has been a shift in the provision of funding to start ups and SMEs, even without Tamkeen’s involvement. The program effectively created a much more encouraging environment for banks to provide funding to Bahraini businesses.

The below illustration showcases how Tamkeen’s Finance Scheme adds value to both enterprises and banks. This in turn increases the overall number of businesses and subsequently creates further growth and development opportunities.

page 25

As motivation plays a crucial role in employees’ satisfaction and eventually their retention, in 2008, BAS signed an agreement with Tamkeen to benefit from the Training & Wage support scheme which allowed BAS to offer its employees a salary increment. More than 500 of our employees enrolled in the various training programs offered by the scheme to further enhance their skills broaden their knowledge and expand their professional experience.

As a result, our employees were more motivated which reflected positively on their performance levels and loyalty to the company, and eventually on our overall productivity and quality of work.

Khalid Al-Bastaki Senior Manager - Training & Development

Bahrain Airport Services (BAS), one of Bahrain’s major private companies under a

government concession, is the sole provider of all aircraft support services at Bahrain

International Airport. Founded in August 1977, BAS has been professionally committed

to providing comprehensive ground support to more than 35 airlines operating

through Bahrain International Airport, including Bahrain’s national carrier- Gulf Air.

At BAS, one of the leading Ground Handling Agents (GHA) in the region, we believe

that Human Capital is our main asset.

Our focusIs on developing and enhancing our employees’ skills, knowledge and experience.

Inspirational JourneyTraining and Wage Support

Inspirational JourneyProfessional Certifications Scheme

Creo InnovationFounder, Creo InnovationNoora Al Haddad

The first project I undertook was pro-bono because I believed it would reap societal benefits, and insisting on such a project was essential in helping us realize the CSR visions of our brand. By organizing an art exhibition with proceeds going to children cancer patients, we opened the doors to collaborate with many other firms which eventually helped us establish CREO as a reputable firm. The return on the work I was doing proved to me how far your dreams can take you. It was also the starting point to a new chapter full of ambitions and achievements and I was more motivated than ever to dive into this journey.”

The work we do at Creo is very much client focused therefore understanding client needs is essential to success. A challenge I experienced was the inability to understand the specific industry-focused jargon used by my clients. In order to address the challenge, I found a solution through Tamkeen’s practical educational courses which offer services to help prepare participants and enlighten them about different sectors. The professional certificate not only helped me to understand the needs of my clients, but also gave me the confidence to handle the detailed and specific client work efficiently. Tamkeen’s support allowed me to better enhance the communication I had with my clients where I am able now to further understand their needs, anticipate demand and provide effective solutions.

In the future, I aim to continue working on beneficial projects that not only help our clients but the community as a whole where we try to engrain the culture of giving and contributing to maintain our social unity.”

“My journey with Creo started about 3 years ago, and it began with my interest

in delving into projects and ideas that could benefit people’s way of life, society is

one of the core motivators that push me to work tirelessly for the greater benefit

of the community. Having my brother, who was one my biggest supporters,

was immensely rewarding in my quest of achieving my ambitions. I faced many

who questioned my abilities and aspirations and tried to convince me against

pursuing my idea. The thought of leaving my previous successful position was

shocking to all; however my ambition pushed aside any doubt.

Creo Philosophy"The work we do at Creo is very much client focused therefore understand client needs is essential to success"

Customization of Tamkeen’s support requires the understanding of individual and business needs. To achieve this, a segmentation model has been put in place to understand common needs that are shared between individuals and businesses. This model takes into account the industry and the stage of development.

Tamkeen’s segmentation included grouping businesses into three different categories:

The segmentation was put in place to address correlating needs between the segments. For example, start-up businesses tend to require basic business function support more than growing or mature businesses. On the individual side, an example is the need for career progression amongst employees, which does not apply to jobseekers or students as it requires working in an established position.

In addition, individuals were also segmented into three different categories:

However, continuous efforts will be required from Tamkeen to understand needs even further. This is evident in the feedback collected from the public during the year, particularly during Tamkeen’s consultation session on the 3rd of November, which

included around 600 participants from all economic sectors and brought together professionals of different backgrounds including business owners, entrepreneurs, executives, jobseekers, students and other stakeholders. This also included feedback that was presented during specific sessions which were separately held with each economic sector.

As a result, Tamkeen organised and created nine Advisory Committees representing nine economic sectors comprised of professionals experienced in their respective industries. The Committees were formed to reinforce Tamkeen’s efforts to fully engage and actively work alongside the Private Sector to enhance Tamkeen’s offerings and build working relationships with sectors across the different facets of the economy.

The Committees, which officially started their involvement in 2016, will be tasked with providing feedback and recommendations to help develop and adjust Tamkeen’s

support programs according to sector-specific requirements and needs. They will also offer advice to help Tamkeen bridge the current gaps in specific industries and the private sector in general, as well as propose ways for possible cooperation with potential partners. The Committees will hold regular meetings every quarter to provide their feedback, and will highlight issues that require immediate attention.

The nine Advisory Committees represent the following sectors: Manufacturing & Oil/Gas, Real Estate & Construction, Accommodation & Food Services, Wholesale & Retail Trade, Health, Business & Support Service Activities, Information & Communication Technology, Education as well as Transportation & Logistics.

Segments and Sectors Analysing Tamkeen’s Customer Needs

Start-up Businesses

Students

Growing Businesses

Jobseekers

Maturing Businesses

Employees

Manufacturing, Oil and Gas

Wholesale and Retail Trade

Information and Communication

Technology

Education

Health

Transportation and Logistics

Accommodation and Food Services

Business and Support Service

Activities

Real Estate, Contstruction and Utilities

AdvisoryCommittees

Advisory Committees’ Responsibilities• Identify sector trends and challenges

• Identify vocational training and education needs within sectors

• Obtain feedback and review of Tamkeen’s: – Policies – Scope – Products – Impact of its efforts to the sector

• Identify opportunities for joint projects and collaboration with other entities

• Intervention mechanisms that are best suited for market needs

• Recommending policy and funding prioritiespage 29

33,000Customers Visitors

11,500Bahraini’s Reached

285Community Events

102

36

page 30

Enhancing Customer Touchpoints

One of the pillars for Tamkeen’s 2015-2017 strategy is customer centricity, which forms a core part of Tamkeen’s operations during the period. As such, Tamkeen launched new initiatives and continued enhancing previous offers in order to ensure that customer centricity remains at the heart of its support services.

Tamkeen’s customer engagement initiatives continued to be a catalyst for customer centricity. In 2015, the customer engagement unit held more than 280 community events that reached over 11,500 Bahrainis. These events formed a bridge that connects Tamkeen directly with the community. Almost all community events conducted by the customer engagement unit were exclusively on request basis, which allowed Tamkeen to engage directly with individuals and businesses that have the drive to further develop and evolve.

The team also handled more than 44,700 inbound calls, and 15,800 outbound calls. Overall, more than 33,000 customers visited Tamkeen’s customer services centers in Seef Mall, Bait Al Tijjar, Enma Mall, Sitra Mall and five representative offices. In addition, the team also handled more than 3,300 e-Mail enquiries.

Furthermore, in order to ensure that the quality of its programs is upheld to international standards and procedures, Tamkeen continued conducting various impact and assessment studies. In 2015, more than 78 studies were conducted covering different sectors such as Human Resources Development, Career Guidance & Progression, Aviation, Health Care, etc. to mention but a few.

Customer engagement at-a-glance

33,000Customers Visitors

11,500Bahraini’s Reached

285Community Events

102

36

page 31

Held under the kind patronage of His Royal Highness Prince Salman bin Hamad Al Khalifa, the Crown Prince, First Deputy Prime Minister and Chairman of Bahrain Economic Development Board, The Bahrain Award for Entrepreneurship was announced at the end of 2014 with the aim to spotlight innovative talent in a private sector-driven economy and recognise the efforts, contributions and initiatives established by Bahrain’s entrepreneurs. In line with the Kingdom’s national economic vision, this award celebrates the achievements of Bahrain’s entrepreneurs and their socio-economic role directly affecting Bahrain’s economy across various fields.

The award is a testament to the success of the different initiatives supporting entrepreneurship throughout the Kingdom, accomplishing the mission that Tamkeen and their award partners set out to achieve, namely the development of Bahrain’s private sector and positioning it as the key driver of economic growth. The recognition achieved by the award highlights the role that both creativity and innovation have played in developing the Kingdom’s economy, marking that entrepreneurship, a core driver of pivotal change, has contributed in the growth of Bahrain’s private sector. The success of this award further cemented Bahrain’s position as a regional hub for entrepreneurship.

This national initiative, the first of its kind in Bahrain, is at its core a celebration of Bahrain’s thriving entrepreneurial sector and the impact these ventures have on both the local and the regional economy. The regional competitive scale meant enlisting a dynamic prize package for selected winners, offering them sustainable opportunities for development. The prizes included: enrolment in development programs, seed funding capital, business coaching, incubator space, growth plan development, certification and training as well as the opportunity to connect to a vast network of local, regional and international business leaders.

Elevating the Entrepreneurial Spirit The Bahrain Award for Entrepreneurship

100+

20

31

7

Applications received

Semi-finalists Winners

Shortlisted

page 32

Besides meeting the set eligibility criteria, the six pillars that the applicants had to demonstrate were: enterprise growth, impact on Bahrain’s economy, optimisation and development of talent, leadership and innovation, entrepreneurial spirit and business responsibility.

The Bahrain Award for Entrepreneurship saw enormous collaboration as demonstrated with its Award Partners, Knowledge Advisors as well as a panel of esteemed judges comprising some of the region’s most renowned and high-profile entrepreneurs and business figures. Award partners included the Bahrain Economic Development Board (EDB), the Bahrain Development Bank, whereas the Knowledge Advisors were BCCI, EY Bahrain and the United Nations Industrial Development Organisation -Arab Regional Centre for Entrepreneurship & Investment Training and the Ministry of Industry, Commerce & Tourism.

The award in essence is a proof of Bahrain’s commitment to further encourage the growth of the entrepreneurial sector on the basis of competitiveness, sustainability and creativity while recognising Bahrain’s entrepreneurs, their initiatives and contribution to Bahrain’s economy. The award also contributed to advancing innovation, a key element to the ongoing development of the Kingdom’s economy.

Due to the success of the first edition and the economic and regional impact it has achieved, the second edition of the award has seen a high demand for additional categories, thus leading to the Female Entrepreneur of the Year Award as well as the Enterprise of the Year with international footprint. As a result

of popular demand, the nomination and application periods were extended further in the second edition to allow more entrepreneurs across many sectors to submit their ventures for consideration.

Entrepreneurial nominees were given the chance of recognition, via application or nomination, on a national scale with the five award categories:

• Micro-enterprise of the Year

• Start-up of the Year

• Enterprise of the Year (SMEs)

• Enterprise of the Year (Large enterprise)

• Sustainable Business Award (SME and large enterprise categories)

Two categories were also included, outside of the application process:

• Lifetime Achievement Award

• People’s Choice Award

Tamkeen’s creation and continuation of The Bahrain Award for Entrepreneurship and its growing regional success had in turn inspired business ventures to flourish in the Kingdom. With the celebratory aspect of the award, entrepreneurial motivation has increased within the country’s economy and has seen steady growth in various sectors, resulting in further diversification of Bahrain’s economic development.

The Bahrain Shopping Festival

20

The Bahrain Shopping Festival, entitled Bahrain Noor El Ain in its inaugural year (2014), was articulated to continually add value to Bahrain’s economy by redefining Bahrain’s shopping experience and attracting a high volume of tourist traffic during the Kingdom’s most active festive season.

The festival, the first of its kind in Bahrain, saw the inclusion of malls, retailers and shoppers participating in deals, promotions, and activities aimed to attract and engage locals and visitors. The dynamic shopping festival saw the participation of over 20 of Bahrain’s malls which encompassed the registration of over 1,500 retailers.

Bahrain Shopping Festival, launched as the Kingdom’s first large-scale shopping carnival during the National Day celebrations, was designed to bring substantial economic benefits to the Kingdom’s retail and tourism sectors as well as the general economy while showcasing Bahrain’s premier offerings to entice local and regional visitors. The Festival utilised localised bazaars set in each governorate of the Kingdom to promote Bahraini and Bahrain-based vendors, local talents and products on display at rotating markets. Additionally, the Festival hosted specialised activities promoting Bahrain’s cultural heritage such as the Souk Explorer Challenge at Bab Al Bahrain’s Manama Souk, family-themed weekly carnivals at businesswomen’s incubator Riyadat Mall and a Farmers’ Collaborative networking event at the popular Budaiya Farmer’s Market, were included so as to promote Bahrain’s tourist activity hubs during the festival.

As the festival capitalised on the influx of visitors to the Kingdom, driving them to engage in the weekly bazaars, it also promoted a thriving range of activities intrinsic to Bahrain. Continually stimulating the tourism sector with initiatives such as Market 338 set in Bahrain’s restaurant hub in Adliya, the outdoor botanical food market in the Budaiya Farmers Market, Al Basta Entertainment Bazaar featuring traditional local musicians and artists at the iconic Bahrain International

Providing Value to Bahrain’s Economy Bahrain Shopping Festival

The Bahrain Shopping Festival

20Circuit and the grand finale event at the Amwaj Lagoon which saw an influx of visitors both local and regional joining in this nationwide event.

Bahrain Shopping Festival proved to be a popular platform capturing Bahrain’s unique spirit and rich cultural identity through the nation-wide events aiming to stimulate the retail sector and boost the tourism sector. Throughout its duration, the national initiative saw a higher than usual inflow of visitors entering the Kingdom from neighboring GCC countries as well as further Arab countries on a weekly basis.

An integral part of the festival had shoppers redeem their purchases at participating retailers, malls and outlets with raffle vouchers, for a chance to win a variety of weekly mega prizes ranging from smartphones, tablets, television sets, airline tickets, furniture and cars. As a result of this never-before-seen selection of raffle prizes, shoppers’ participation saw an unparalleled surge with thousands from a wide range of nationalities submitting their raffle tickets.

Over 1,500 retailers also reaped the benefits of participating in the Shopping Festival’s ‘Shop and Win’ promotion, as total sales in participating outlets reached more than BD 18 million during the festival duration.

The success of the national initiative led to the launch of the second edition in the year 2015, under the moniker of ‘Shop Bahrain’. The second edition launched on December 24th 2015, and featured even more participation from retailers, shopping malls, vendors and the general public with visitation numbers climbing with each passing week of the festival.

With Tamkeen launching the Bahrain Shopping Festival in 2014 and subsequently continuing the celebratory event in 2015, the Kingdom has witnessed a steady increase in tourist numbers from neighbouring Gulf and international countries, which offered significant economic benefit to Bahrain.

Empower / Tamkeen Annual Report 2015[page 37]

Contents

Board of Directors' Report 38

Independent Auditor's Report 39-40

Statement of Financial Position 41

Statement of Activities 42

Statement of Changes in Fund Balance 43

Statement of Cash Flows 44

Notes to the Financial Statements 45-60

Financial Statements withIndependent Auditor’s ReportFor the year ended December 31, 2015

Empower / Tamkeen Annual Report 2015 [page 38]

The Directors present their annual report and audited financial statements of Labor fund (“the Fund”) for the year ended December 31, 2015.

PRINCIPAL ACTIVITYThe Labor Fund aims to increase the efficiency and productivity of Bahraini Labor, strengthening the national economy, developing the private sector and creating new suitable job opportunities for Bahrainis in the Kingdom of Bahrain.

REVIEW OF BUSINESSThe results for the year are set out on page 42 of these financial statements.

CHANGES IN DIRECTORSDr. Ebrahim Janahi has been appointed as Chief Executive Officer effective December 30, 2015.

On behalf of the Board

Mohammed Bin Essa Al KhalifaChairmanJuly 31, 2016

Board ofDirectors’ Report


The Board of DirectorsLabor The Fund Manama - Kingdom of Bahrain

Report on the Financial Statements We have audited the accompanying financial statements of Labor Fund, (the “Fund”) which comprise the statement of financial position as at December 31, 2015, and the statement of activities, statement of changes in fund balance and the statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

IndependentAuditor's Report


IndependentAuditor's Report continued

OpinionIn our opinion, the financial statements present fairly, in all material respects, the financial position of Labor Fund as at December 31, 2015, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

Report on Other Legal and Regulatory RequirementsAs required by Law number 57 issued on August 12, 2006 to establish the Fund, we report that:(1) we have obtained all the information we considered necessary for the purpose of our audit; (2) the Fund has maintained proper books of account and the financial statements are in agreement therewith; and(3) the financial information included in the Directors’ report is consistent with the books of account of the Fund.

In addition, we report that, based on the information and explanations given to us, we are not aware of significant violations of the Law number 57 issued on August 12, 2006 in connection with the establishment of the Fund, having occurred during the year ended December 31, 2015 that might have had a material effect on the activities of the Fund or on its financial position.

Deloitte & Touche – Middle EastPartner Registration No. 135

July 31, 2016Manama - Kingdom of Bahrain


Notes 2015 2014

ASSETS

Non-current asset:

Furniture and equipment 5 903,475 670,132

-------------- --------------

Current assets:

Due from related parties 6 (a) 7,200,000 6,676,388

Other receivables 7 2,209,154 3,409,514

Cash and cash equivalents 8 34,234,471 14,686,279

Total current assets 43,643,625 24,772,181

Total assets 44,547,100 25,442,313

FUND BALANCE AND LIABILITIES

Fund balance:

General reserve 9 12,258,314 10,552,274

Projects’ fund balance 23,035,989 7,681,623

Available funds 35,294,303 18,233,897

--------------

Liabilities:

Current liabilities:

Due to related parties 6 (b) 2,094,346 1,886,241

Accounts payable and accruals 10 7,158,451 5,322,175

Total current liabilities 9,252,797 7,208,416

Total fund balance and liabilities 44,547,100 25,442,313

These financial statements were approved by the Directors and authorised for issue on July 31, 2016 and signed on their behalf by:

Mohammed Bin Essa Al KhalifaChairman

Dr. Ebrahim JanahiChief Executive

The accompanying notes 1 to 19 form an integral part of these financial statements.

Statement ofFinancial Position as at December 31, 2015

BAHRAINI DINAR


Statement ofActivities

Notes 2015 2014

Revenues:

Fee income 11 77,792,554 75,652,644

Other income 12 293,109 209,900

Total revenue 78,085,663 75,862,544

Expenditures:

Projects costs 13 33,114,376 54,376,015

Unemployment insurance subscriptions 14 17,840,821 16,574,425

Salaries, benefits and other remunerations 15 5,877,281 4,426,974

General and administrative expenses 16 3,054,287 2,706,266

Advertising and marketing cost 851,070 563,069

Depreciation expense 5 233,790 174,602

Training expense 53,632 166,517

Finance cost 18 - 147,145

Total expenditures 61,025,257 79,135,013

Excess of revenues over expenditures / (expenditures over revenues) during the year

17,060,406 (3,272,469)

Mohammed Bin Essa Al KhalifaChairman

Dr. Ebrahim JanahiChief Executive


for the year ended December 31, 2015 BAHRAINI DINAR

Empower / Tamkeen Annual Report 2015[page 43] Empower / Tamkeen Annual Report 2014

General reserveFunds available

for projects Total

Balance as at December 31, 2013 10,552,274 10,954,092 21,506,366

Deficit of income over expenditures for the year - (3,272,469) (3,272,469)


Excess of income over expenditures for the year - 17,060,406 17,060,406

Transfer to general reserve 1,706,040 (1,706,040) -



Statement ofChanges in Funds Balance for the year ended December 31, 2015

BAHRAINI DINAR


Statement ofCash Flows

2015 2014

Cash flows from operating activities:

Surplus / (deficit) of income over expenditures for the year 17,060,406 (3,272,469)

Adjustments for:

Depreciation expense 233,790 174,602

Profit income (288,259) (203,885)

Gain on disposal of furniture and equipment (505) (405)

17,005,432 (3,302,157)

Changes in operating assets and liabilities:

Decrease / (increase) in other receivables 1,218,669 (51(51,877)

(Increase) / decrease in due from related parties (523,612) 873,241

Increase in due to related parties 208,105 2,975,788

Increase / (decrease) in accounts payable and accruals 1,836,276 (96,807)

Net cash from operating activities 19,744,870 398,188

Cash flows from investing activities:

Purchase of furniture and equipment (467,133) (396(396,538)

Proceeds from sale of furniture and equipment 505 405

Profit income received 269,950 200,621

Net cash used in investing activities (196,678) (195,512)

Net increase in cash and cash equivalents 19,548,192 202,676

Cash and cash equivalents at the beginning of the year 14,686,279 14,483,603

Cash and cash equivalents at the end of the year (Note 8) 34,234,471 14,686,279

Cash and cash equivalents consist of:

Cash in hand 500 500

Bank balances 34,233,971 14,685,779

34,234,471 14,686,279




1 GENERAL INFORMATION: The Labor The Fund (“The Fund”) was established, in accordance with law number 57 (2006) issued on August 12, 2006,

as a judicial entity having an independent financial and administrative support and entitled to all the privileges given to other ministries, government entities and public institutions in the Kingdom of Bahrain.

The operations of the Labor Fund was wholly managed by the Economic Development Board (“EDB”) until December 31, 2006. All the costs were being incurred by the EDB on behalf of the Fund from the budget allocated to the Fund until this date. With effect from January 1, 2007, the Fund operationally separated from the EDB and commenced its operations independently.

The Fund aims to increase the efficiency and productivity of Bahraini Labor, strengthening the national economy, developing the private sector and creating new suitable job opportunities for Bahrainis in the Kingdom of Bahrain.

On October 7, 2015, Royal Decree No. 33 for 2015 was issued to discontinue the High Council for Vocational Training and transfer its assets, liabilities and activities to the Fund. As at December 31, 2015, this transfer was not yet effected and management expects completion by March 31, 2016.

2. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRSs): 2.1 Standards and Interpretations effective for the current period

• The following new and revised IFRSs, which became effective for annual periods beginning on or after 1 January 2015, have been adopted in these financial statements. The application of these revised IFRSs has not had any material impact on the amounts reported for the current and prior years but may affect the accounting for future transactions or arrangements.

• Annual Improvements to IFRSs 2010 - 2012 Cycle that includes amendments to IFRS 2, IFRS 3, IFRS 8, IFRS 13, IAS 16, IAS 24 and IAS 38.

• Annual Improvements to IFRSs 2011 - 2013 Cycle that includes amendments to IFRS 1, IFRS 3, IFRS 13 and IAS 40.• Amendments to IAS 19 Employee Benefits to clarify the requirements that relate to how contributions from employees

or third parties that are linked to service should be attributed to periods of service.

2.2 New and revised IFRS in issue but not yet effective The Fund has not yet applied the following new and revised IFRSs that have been issued but are not yet effective:

New and revised IFRSs

Effective for annual periods beginning on or after

IFRS 14 Regulatory Deferral Accounts. January 1, 2016

Amendments to IAS 1 Presentation of Financial Statements relating to Disclosure initiative. January 1, 2016

Amendments to IFRS 11 Joint arrangements relating to accounting for acquisitions of interests in joint operations.

January 1, 2016

Amendments to IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets relating to clarification of acceptable methods of depreciation and amortization.

January 1, 2016

Amendments to IAS 16 Property, Plant and Equipment and IAS 41 Agriculture relating to bearer plants.

January 1, 2016

Amendments to IAS 27 Separate Financial Statements relating to accounting investments in subsidiaries, joint ventures and associates to be optionally accounted for using the equity method in separate financial statements.

January 1, 2016

Amendments to IFRS 10 Consolidated Financial Statements, IFRS 12 Disclosure of Interests in Other Entities and IAS 28 Investment in Associates and Joint Ventures relating to applying the consolidation exception for investment entities.

January 1, 2016

Annual Improvements to IFRSs 2012 - 2014 Cycle covering amendments to IFRS 5, IFRS 7, IAS 19 and IAS 34.

January 1, 2016

Notes to theFinancial Statements for the year ended December 31, 2015

BAHRAINI DINAR


2. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRSs): (CONTINUED)

2.2 New and revised IFRS in issue but not yet effective

Effective for annual periods beginning on or after

IFRS 9 Financial Instruments

A finalized version of IFRS 9 was issued in July 2014 and contains accounting requirements for financial instruments, replacing IAS 39 Financial Instruments: Recognition and Measurement. The standard contains requirements in the following areas:

• Classification and measurement: Financial assets are classified by reference to the business model within which they are held and their contractual cash flow characteristics. The 2014 version of IFRS 9 introduces a ‘fair value through other comprehensive income’ category for certain debt instruments. Financial liabilities are classified in a similar manner to under IAS 39, however there are differences in the requirements applying to the measurement of an entity’s own credit risk.

• Impairment: The 2014 version of IFRS 9 introduces an ‘expected credit loss’ model for the measurement of the impairment of financial assets, so it is no longer necessary for a credit event to have occurred before a credit loss is recognized.

• Hedge accounting: Introduces a new hedge accounting model that is designed to be more closely aligned with how entities undertake risk management activities when hedging financial and non-financial risk exposures.

• Derecognition: The requirements for the derecognition of financial assets and liabilities are carried forward from IAS 39.

January 1, 2018

Amendments to IFRS 7 Financial Instruments: Disclosures relating to disclosures about the initial application of IFRS 9.

When IFRS 9 is first applied

IFRS 7 Financial Instruments: Disclosures relating to the additional hedge accounting disclosures (and consequential amendments) resulting from the introduction of the hedge accounting chapter in IFRS 9.

When IFRS 9 is first applied

IFRS 15 Revenue from Contracts with Customer

In May 2014, IFRS 15 was issued which established a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. IFRS 15 will supersede the current revenue recognition guidance including IAS 18 Revenue, IAS 11 Construction Contracts and the related interpretations when it becomes effective.

The core principle of IFRS 15 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Specifically, the standard introduces a 5-step approach to revenue recognition.

January 1, 2018


Notes to theFinancial Statements continued


2. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRSs) (CONTINUED):

2.2 New and revised IFRS in issue but not yet effective Effective for annual periods beginning on or after

IFRS 16 Leases January 1, 2019 (or when IFRS 15 is adopted)

IFRS 16 specifies how an IFRS reporter will recognize, measure, present and disclose leases. The standard provides a single lessee accounting model, requiring lessees to recognize assets and liabilities for all leases unless the lease term is 12 months or less or the underlying asset has a low value. Lessors continue to classify leases as operating or finance, with IFRS 16’s approach to lessor accounting substantially unchanged from its predecessor, IAS 17.

Amendments to IAS 7 Statement of Cash Flows requiring disclosure of changes in liabilities arising from financing activities.

January 1, 2017

Amendments to IAS 12 Income Taxes regarding recognition of deferred tax assets for unrealized losses.

January 1, 2017

The management anticipates that all of the above Standards and Interpretations, as applicable, will be adopted in the Fund’s financial statements in future periods and that the adoption of those Standards and Interpretations will have no material impact on the financial statements of the Fund in the period of initial application, except for the requirements in relation to IFRS 9. The Fund’s management has not yet performed a detailed review to quantify the effect of the application of this standard and therefore it is not practicable at present to provide a reasonable estimate of its effect.

3. SIGNIFICANT ACCOUNTING POLICIES:Statement of ComplianceThe financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) and law number 57 issued on August 12, 2006.

Basis of PreparationThe financial statements are prepared under the historical cost convention. These policies have been consistently applied to all the years presented, unless otherwise stated.

The financial statements have been presented in Bahraini Dinars (“BD”), being the functional currency of the Fund.

The significant accounting policies are set out below.

3.1 Furniture and EquipmentFurniture and equipment are stated at cost less accumulated depreciation and any impairment losses. The cost of furniture and equipment is depreciated by equal annual installments over the estimated useful lives of the assets. The estimated useful lives of the assets for the calculation of depreciation are as follows:

Furniture & Fixtures 5 yearsComputers 3 years

The gain or losses arising on the disposal or retirement of an item of furniture and equipment is determined as the difference between the sale proceeds and the carrying amount of the asset and is recognized in profit or loss.

Capital work-in-progress is not depreciated until the asset under construction is complete and transferred to its relevant category in the furniture and equipment.




3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

3.2 Impairment of Tangible AssetsAt each reporting date, the Fund reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss.

Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss previously been recognized. The reversal of the loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

3.3 Financial AssetsFinancial assets are classified based on the nature and purpose of the financial assets and determined at the time of initial recognition.

3.3.1 ReceivablesReceivables are initially recognized at fair value and subsequently measured at amortized cost, less any impairment.

3.3.2 Impairment of financial assetsFinancial assets are assessed for indicators of impairment at the end of each reporting period. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the financial asset have been affected.

For all the financial assets, objective evidence of impairment could include:• significant financial difficulty of the issuer or counterparty; or• default or delinquency in payments; or• it becoming probable that the borrower will enter bankruptcy or financial re - organization.

3.3.3 Derecognition of financial assetsThe Fund derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire; or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Fund neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Fund recognizes its retained interest in the asset and an associated liability for amounts it may have to pay. If the Fund retains substantially all the risks and rewards of ownership of a transferred financial asset, the Fund continues to recognize the financial asset and also recognizes a collateralised borrowing for the proceeds received.

The difference between the carrying amount of the financial asset derecognized and the sum of the consideration received and receivable is recognized in profit or loss.





3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

3.4 Financial Liabilities Financial liabilities are initially measured at fair value, net of transaction costs. Financial liabilities are subsequently measured at amortised cost.

The Fund derecognizes financial liabilities when, and only when, the Fund’s obligations are discharged, cancelled or they expire.

The difference between the carrying amount of the financial liability derecognized and the sum of the consideration paid and payable is recognized in profit or loss.

3.5 ProvisionsProvisions are recognized when the Fund has a present obligation (legal or constructive) arising from a past event and the costs to settle the obligation are both probable and able to be reliably measured.

3.6 Employees’ BenefitsFor Bahraini employees, the Fund makes contributions to the Social Insurance Organisation calculated as a percentage of the employees’ salaries. The Fund’s obligations are limited to these contributions, which are expensed when due.

The entitlement to leave pay is based upon the terms of employment contracts with the employees and length of service. The expected costs of these benefits are accrued at the end of each reporting date period and carried forward until they are utilised.

3.7 Revenue RecognitionRevenue is measured at the fair value of the consideration received or receivable.

Fees and other incomeFees and other income are recognized when the Fund’s right to receive such income is established.

Profit incomeProfit income is accrued on a time basis, by reference to the principal outstanding and at the effective profit rate applicable.

3.8 Contingent Liabilities and AssetsContingent liabilities are not recognized in the financial statements. They are disclosed unless the possibility of an outflow of resources embodying economic benefits is remote. A contingent asset is not recognized in the financial statements but disclosed when an inflow of economic benefits is probable.

3.9 Foreign Currencies The functional currency of the Fund is the Bahraini Dinar. Transactions in foreign currencies are recognized in functional currencies at the rate ruling at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the reporting date. All differences are taken to profit or loss. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

3.10 LeasesThe Fund as a lesseeLeases where the lessor retains substantially all the risks and rewards of ownership of the asset are classified as operating leases. Operating lease payments are recognized as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognized as an expense in the period in which they are incurred.





4. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY:In the application of the Fund’s accounting policies, which are described in Note 3, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

4.1 Critical judgements in applying the Fund’s accounting policiesIn the process of applying the Fund’s accounting policies, which are described in Note 3, management has not made any judgement that may have significant effect on the amounts recognized in the financial statements.

4.2 Key sources of estimation uncertainty The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

4.2.1 Useful lives of tangible assetsThe Fund’s management determines the useful lives of tangible assets and the related depreciation charge. The depreciation charge for the year will change significantly if the actual life is different from the estimated useful life of the asset.

The review carried out by the management in the current year did not indicate any necessity for changes in the useful lives of the tangible assets.


5. FURNITURE AND EQUIPMENT:

Furniture and

fixtures Computers

Capital work-

in-progress Total

Cost:

Balance as at December 31, 2013 777,747 558,283 4,429 1,340,459

Additions 17,013 120,689 258,836 396,538

Transfers 263,265 - (263,265) -

Disposals - (11,954) - (11,954)

Balance as at December 31, 2014 1,058,025 667,018 - 1,725,043

Additions 111,126 130,938 225,069 467,133

Transfers 40,777 3,675 (44,452) -

Disposals - (14,679) - (14,679)

Balance as at December 31, 2015 1,209,928 786,952 180,617 2,177,497

Accumulated Depreciation:

Balance as at December 31, 2013 453,571 438,692 - 892,263

Depreciation expense 112,611 61,991 - 174,602

Eliminated on disposal - (11,954) - (11,954)

Balance as at December 31, 2014 566,182 488,729 - 1,054,911

Depreciation expense 147,206 86,584 - 233,790

Eliminated on disposal - (14,679) - (14,679)

Balance as at December 31, 2015 713,388 560,634 - 1,274,022

Carrying Amounts:

Balance as at December 31, 2015 496,540 226,318 180,617 903,475

Balance as at December 31, 2014 491,843 178,289 - 670,132

6. RELATED PARTIES: Government related entities are disclosed under related parties because the same government has control or joint control of,

or significant influence over, both the Fund and the other entity.

(a) Balances due from related parties consist of:

2015 2014

Ministry of Finance 831,000 831,000

Ministry of Labor 600,700 600,700

1,431,700 1,431,700

Allowance for doubtful receivables (1,431,700) (1,431,700)

Labor Market Regulatory Authority (LMRA) 7,200,000 6,676,388

7,200,000 6,676,388

Due from LMRA represents the outstanding balance of fee income receivable (Note 6c).




6. RELATED PARTIES: (CONTINUED)(b) Balances due to related parties consist of:

2015 2014

Social Insurance Organisation (Note 14) 1,501,040 1,413,373

Labor Market Regulatory Authority (LMRA) 554,214 -

Information Affairs Authority 30,020 -

Ministry of Municipalities Affairs and Urban Planning 5,438 75,000

Bahrain Telecommunications Company (Batelco) 3,335 -

Electricity and Water Authority 299 1,820

Bahrain Development Bank - 196,305

Quality Assurance Authority for Education - 175,843

Gulf Air - 22,400

University of Bahrain - 1,500

2,094,346 1,886,241

(c) The Fund had the following major transactions with related parties:

2015 2014 Nature of transaction

LMRA 77,792,554 75,652,644 Share of fee income

Social Insurance Organization (Note 14)

(17,840,821) (16,574,425) Payment of unemployment insurance on behalf of the private sector

Bahrain Development Bank (3,014,425) (2,424,408) Project cost (SME Financing Scheme)

Quality Assurance Authority for Education

(1,673) (1,072,926) Project cost (National Skills Standard Program)

Ministry of Municipalities Affairs and Urban Planning

- (250,000) Project cost (Farmer’s Market at Hawret Aali)

King Hamad University Hospital

(909,885) (167,292) Project cost (Healthcare Professions & Healthcare Assistants)

Bahrain Polytechnic (52,433) (382,833) Project cost (Bahrain Polytechnic)

LMRA (1,088,138) (903,469) LMRA credit card and online collection fee

(d) Salaries and allowances to management personnel during the year are as follows:

2015 2014

Salaries 158,253 307,923

Allowances for attendance of board and committee meetings 74,000 76,000

232,253 383,923

7. OTHER RECEIVABLES:

2015 2014

Prepayments 83,071 56,565

Accrued profit income 30,215 11,906

Deposits with the projects implementers 2,089,536 3,331,136

Other receivables 6,332 9,907

2,209,154 3,409,514

Deposits with projects implementers represent amounts given to Projects implementers (KPMG, BDO, Ebdaa Bank and Bahrain Development Bank) for the payment of some project outsourced to them.





8. CASH AND CASH EQUIVALENTS:

2015 2014

Cash on hand 500 500

Current accounts with banks 1,869,607 553,979

Call accounts with banks 13,661,084 8,523,837

Murabaha and Wakala contracts 18,703,280 5,607,963

Cash and bank balances 34,234,471 14,686,279

Call accounts with banks earn profit at market rate of 1.45% (2014: 1.45%) per annum. Murabaha and Wakala contracts are placed with local Islamic banks, have original maturity periods of up to three months and

earn profit at market rate of 1.69% (2014: 1.65%) per annum.

9. GENERAL RESERVE:

The Directors decided to transfer 10% of the excess of revenues over expenditures for each year to a general reserve. There are no restrictions over the utilization of the general reserve.

10. ACCOUNTS PAYABLE AND ACCRUALS:

2015 2014

Accounts payable 705,477 3,239,604

Accrued expenses 5,524,726 1,282,474

Accruals for employee benefits 854,248 724,097Accruals for Board of Directors’ remuneration and Committee meetings (Note 6-d) 74,000 76,000

7,158,451 5,322,175

Accounts payable represents amounts payable for various projects in progress as at the reporting date.

11. FEE INCOME:

Fee income represents the Fund’s eligibility to an 80% (2014: 80%) share of fees collected by LMRA for the following:• From private sector employers for the issue of work permits and their renewal;• Agencies and recruitment offices permits; • Monthly fees of BD 10 for each foreign employee working in the Kingdom of Bahrain. In 2013, the monthly fee income

changed by Law to reflect BD 5 for the first five employees and BD 10 for each additional employee.

12. OTHER INCOME:

2015 2014

Profit income 288,259 203,885

Revenue from tender documents 4,345 5,610

Gain on disposal of furniture and equipment 505 405

293,109 209,900

*Profit income related to call accounts with banks and Murabaha and Wakala contracts.





13. PROJECT COSTS:

2015 2014

Enterprise Support Program 4,763,820 -

Enterprise Support Fund Program 18,256 435,770

Enterprise Growth Management 5,466,227 29,975,568

Bahrain Noor El Ain 2,454,553 1,271,150

National Skills Standardization Program 1,673 1,072,926

Finance and Accounting Program 82,556 46,008

Finance Support Scheme 5,731,713 5,590,320

Mohasaba Scheme 536,150 823,700

Accounting & Finance Professional – E&Y - 355,790

Professional Certification Scheme 3,276,209 3,080,140

Marketing Professionals CIM – BIBF - 12,305

Human Resource Certification Program - (21,000)

Warehouse Management Certificates 29,081 101,477

Training in Islamic Finance (CIMA) 8,880 -

Training and Education Performance Support - 182,254

Basic Skills Training 17,664 42,200

Alosra Retail Professionals Employment & Training - 1,580

Retail Training Program - 18,408

Alba Training Program 59,222 255,470

Asry Employment & Training Program 71,465 116,407

Tatweer Petroleum Training & Employment Program (46,582) 453,198

Silah – Call Centre Training – Employment Program 111,677 72,806

Bahrain Centre for Excellence Training Program - 75,800

Red Tag Retail Professionals Training & Employment - 30,200

Yokogawa Bahrain Graduates Engineers Training Program 21,760 57,800

Batelco Internship Program 23,192 16,400

Career Progression Schemes 2,171,841 1,722,176

Employment Support Scheme 297,643 144,995

Online Job Vacancy Postings Subsidy Scheme - 55,550

Career Publications 11,450 -

Apprenticeship Scheme in Retailing BIRD - 189,283

Medical Financing Scheme 873,136 -

Occupational Health & Safety 54,124 -

Health Care Training Program 1,202,000 -

King Hamad University Hospital Healthcare Training 921,585 132,192

King Hamad University Hospital - Healthcare Assistants (11,700) 35,100

Undergraduate Nursing Education – RCS12 115,999 743,995

BSc General Nursing Program with BDF 44,000 -

Pilot Financing Scheme – BDB/GAA - 353,711

AB-Initio Training Program – GAA 127,500 1,690



13. PROJECT COSTS: (CONTINUED)

2015 2014

Type Rating Program for 65 Pilots with GAA 65,975 229,970

Special Type Rating with GAA - 227,708

Special Type Rating Training with Air Arabia 13,620 428,597

Training and Employment of Aircraft Maintenance Engineers 398,983 467,750

Line Training Program with Gulf Air 1,022,089 356,442

Graduate Training Prog. with Bahrain Airport Co. 73,968 -

Bahrain Polytechnic 52,433 382,833

HR Workshops Scheme - 97,367

HR Management Certificate Program 81,900 135,548

Leadership Workshops Scheme - 129,821

Leadership Certification Program 11,700 79,875

Public Relations Professionals - 41,172

Graphic Design Professionals 242,736 244,567

Quantity Surveyors (BTI) 120,458 (74,113)

IT Administrator (BTI) / IT security and IT webgae (BTI) 11,365 (26,770)

Grooming Bahraini Hospitality Talent – Kempinski 12,685 108,870

Grooming Bahraini Hospitality Talent – The Western & Le Meridian 95,137 -

Grooming Bahraini Hospitality Talent – Sofitel 81,973 -

Travel & Tourism 11,684 (11,176)

Fishermen Support Program - 357,470

Farmers Support Program 151,955 38,487

Farmer’s Market @ Hawrat A’li - 250,000

Al Basta Market 50,000 90,000

Mantoojati for Productive Families 8,250 16,890

GOYS Youth City IV 2030 (2013) - 9,271

GOYS Youth City 2030 (2015) 300,000 -

MOI Summer Program – Police Academy 2013 - 54,362

MOI Summer Program – Police Academy 2014 - 283,910

MOI Summer Program – Police Academy 2015 193,934 -

Business Plan Competition for Youth (Mashroo3i 2&3) 44,482 64,616

Company Program – Injaz - 138,694

Injaz Program - 20,066

AIESEC Training Support 46,200 60,000

Information and Communication Technology Program 12,082 55,095

Bahrain Legal Internship Program for Lawyers 69,023 41,546Multi–Track Technicians Program (National Institute for Industrial Training)

18,014 -

Invita Customer Service Program 43,750 25,750

A9eel in School2 – Work Attitude Development Program 33,211 95,786





13. PROJECT COSTS: (CONTINUED)2015 2014

Supply Chain Management Program - 51,700

Azadea Group Retail Program 26,550 26,550

NIIT Automotive Industry – Company Specific Diploma 114,218 156,326

Business Incubator 213,544 294,535

Supporting BCCI Roadshow & Int’l Exhibitions - 89,497

Exhibition Management Workshops - 61,745

Next Door Entrepreneurs - 92,996

Entrepreneur Workshops - 10,231

Las Vegas Jewelry Exhibition - 48,490

Plus 973 / Al Tajer Al Mubde 3 79,000 164,560

Supporting Conferences Attendance - 414,744

Marketing for Business Women Society - 76,600

Intelaaq Student Business Consultancy 21,556 29,784

Mega Enterprise Support – Nass Corporation 235,492 764,535

Provide Funding and Advice - eMarket Place - 512

Al Mohemah 2 - 203,800

Tamkeen Support for Bahrain Pavilion 233,941 -

Labor Law for Trade Unions 82,500 -

Aeronautics 253,674 1,053

Bell Racing Helmets International 101,652 -

Citibank Employment Support 44,547 -

Other projects 5,000 22,584

33,114,376 54,376,015

Commitments on projects are disclosed in Note 17.



14. UNEMPLOYMENT INSURANCE SUBSCRIPTIONS:

2015 2014

Unemployment insurance subscriptions 17,840,821 16,574,425

As stipulated in the Unemployment Law promulgated in Decree 87 of 2006, the Fund should contribute 1% unemployment subscriptions to the Social Insurance Organization on behalf of the private sectors employers. The amount payable as at December 31, 2015 of BD 1,501,040 (2014: BD 1,413,373) represents the subscription amount due for the month of December 2015 (2014: amount due for the month of December 2014) (Note 6 - b).

15. SALARIES, BENEFITS AND OTHER REMUNERATIONS:

2015 2014

Salaries 3,617,032 2,600,769

Staff allowances 581,845 585,496

Social insurance contributions 687,813 502,502

Transport allowances 234,374 151,672

Social allowances 203,715 134,625

Life and medical insurance 328,440 244,603

Telephone and communications 111,879 74,334

Interest on employees’ loans 38,183 56,973Board of Directors’ remuneration and Committee meetings (Note 6-d)

74,000 76,000

5,877,281 4,426,974

16. GENERAL AND ADMINISTRATIVE EXPENSES:

2015 2014

Business consulting, legal and professional fees 409,282 446,065

Communication expenses 192,940 257,228

Feasibility studies and research - P&D 112,128 154,337

IT System 105,550 -

LMRA credit cards collection fees (Note 6 - c) 1,088,138 903,469

Rentals and utilities 628,190 517,892

Training partner monitoring agency 44,774 111,698

Miscellaneous 473,285 315,577

3,054,287 2,706,266





17. COMMITMENTS AND CONTINGENT LIABILITY:

17.1 Commitment for expenditures:

2015 2014

Human capital development projects 10,297,498 30,907,215

Private sector support projects 34,080,239 48,693,464

44,377,737 79,600,679

The above commitments are due as follows:

Within one year 28,180,114 36,532,353

From one to 5 years 16,197,623 43,068,326

44,377,737 79,600,679

The above commitments were calculated based on the management’s best estimates, considering the expected expenditures on various projects.

17.2 Contingent liability:

2015 2014

Financing guarantees 210,000,000 165,000,000

Pursuant to the memorandum of understanding dated July 18, 2007, Ithmaar Bank of Bahrain B.S.C. agreed to grant financing facilities to the companies supported by the Fund to the extent of BD 12.5 million, of which the Fund agreed to guarantee up to 80% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 10 million and will automatically be reduced by any amount paid under this guarantee.

According to the agreement dated July 28, 2015, the Ithmaar Bank of Bahrain B.S.C agreed to grant financing facilities to the companies supported by the Fund to the extent of up to BD 10 million, of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 5 million and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.

According to the agreement dated May 28, 2008 and subsequent amendment on December 1, 2015, the Bahrain Development Bank B.S.C. agreed to grant financing facilities to the small and medium sized companies supported by the Fund to the extent of BD 202 million (December 31, 2014: BD 150 million), of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 101 million (December 31, 2014: BD 75 million) and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.

According to the agreement dated January 19, 2010 and subsequent amendment on July 15, 2015 the Bahrain Islamic Bank B.S.C. agreed to grant financing facilities to the companies supported by the Fund to the extent of BD 60 million (December 31, 2014: BD 50 million), of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 30 million (December 31, 2014: BD 25 million) and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.

According to the agreement dated July 4, 2010 and subsequent amendment on June 19, 2014, the Bank Muscat International B.S.C. agreed to grant financing facilities to the companies supported by the Fund to the extent of BD 40 million (December 31, 2014: BD 40 million), of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 20 million (December 31, 2014: BD 20 million) and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.



17. COMMITMENTS AND CONTINGENT LIABILITY: (CONTINUED)17.2 Contingent liability: (Continued)According to the agreement dated November 28, 2011, the Standard Chartered Bank B.S.C. agreed to grant financing facilities to the companies supported by the Fund to the extent of up to BD 15 million, of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 7.5 million and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.

According to the agreement dated October 18, 2011, and the subsequent amendment on March 1, 2015, the Khaleeji Commercial Bank B.S.C agreed to grant financing facilities to the companies supported by the Fund to the extent of BD 35 million (December 31, 2014: BD 25 million), out of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 17.5 million (December 31, 2014: BD 12.5 million) and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.

According to the agreement dated July 13, 2011, and subsequent amendment on November 11, 2015 the Al Salam Bank B.S.C agreed to grant financing facilities to the companies supported by the Fund for to the extent of BD 8 million (December 31, 2014: BD 20 million) of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 4 million (December 31, 2014: BD 10 million) and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.

According to the agreement dated August 28, 2011, the Kuwait Finance House B.S.C agreed to grant financing facilities to the companies supported by the Fund to the extent of BD 10 million, of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 5 million and will be reduced by 50% of any amounts paid by the beneficiary in accordance with this guarantee.

According to the agreement dated February 9, 2015, and subsequent amendment on December 27, 2015, Al Barka Islamic Bank agreed to grant financing facilities, to the companies supported by the Fund to the extent of BD 20 million, of which the Fund agreed to guarantee up to 50% of the value of all outstanding amounts due to the Bank under the above facilities. The Fund’s liability under this guarantee is limited to BD 10 million and will be reduced by 50% of any amount paid by the beneficiary in accordance with this guarantee.

18. FINANCE COST: The Fund has an Islamic facility from a local Islamic bank at a limit of BD 15 Million. The average finance cost on the Islamic facility is 3.75% per annum. During 2014, the Fund has settled this facility.

19. FINANCIAL INSTRUMENTS: 19.1 Capital risk managementThe Fund’s objectives when managing capital are to safeguard the Fund’s ability to continue as a going concern in order to provide benefits for stakeholders.

The capital structure of the Fund consists of available funds. The Fund is debt free at the reporting date.

19.2 Significant accounting policiesSignificant accounting policies and methods adopted, including the criteria for recognition, basis of measurement, and the basis on which income and expenses are recognized in respect of each class of financial assets and financial liabilities are set out in Note 3.

19.3 Categories of financial instrumentsFinancial instruments consist of financial assets and financial liabilities.Financial assets of the Fund include cash, bank balances, other receivables and due from related parties.Financial liabilities of the Fund include payables and accrued liabilities and due to related parties.





19. FINANCIAL INSTRUMENTS: (CONTINUED)2015 2014

Financial assets:

Receivables at amortized cost (including cash and bank balances) 41,471,018 21,384,480

Financial liabilities:

Amortized cost 9,252,797 7,208,416

19.4 Financial risk management objectives The Fund’s expose to market risk, credit risk and liquidity risk are described below:

19.5 Market riskMarket risk is the risk that the fair value or future cash flows of financial instruments will fluctuate due to changes in market prices. Market risks arise from open positions in foreign currency, profit margin rate and equity products, all of which are exposed to general and specific market movements and changes in the level of volatility of market rates or prices such as foreign exchange rates, and profit margin rates and equity prices.

19.5.1 Currency riskCurrency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in foreign exchange rates.

The Fund’s financial assets and financial liabilities are denominated in Bahraini Dinars and United States Dollars. As the Bahraini Dinar is pegged to the United States Dollar, balances in the US Dollar are not considered to represent a significant currency risk.

19.5.2 Profit margin rate risk Profit margin risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market profit share rates.

The Fund’s Murabaha and Wakala contracts carry fixed profit margin rates and mature within three months.

The Fund’s exposure to profit margin rates on financial assets is detailed in Note 8.

19.6 Credit risk managementCredit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss.

The concentration of credit risk is disclosed in Note 6.

In addition, the fund is exposed to credit risk in relation to financial guarantees to financial institutions participating in the Finance scheme. The fund’s maximum exposure in this respect is the maximum amount the fund could have to pay if the guarantee is called on (see note 17).

The credit risk on liquid funds is limited because the counterparties are banks with good credit-ratings assigned by international rating agencies. The carrying values of financial assets at the reporting date represent the Fund’s maximum exposure to credit risk.

19.7 Liquidity riskLiquidity risk, also referred to as funding risk, is the risk that an enterprise will encounter difficulty in raising funds to meet commitments associated with financial liabilities.

The Fund’s remaining contractual maturity for its non-profit bearing financial liabilities at amortized cost as at December 31, 2015 amounting to BD 9,252,797 (2014: BD 7,208,416).

The Fund’s expected maturity for its non-profit earning financial assets and profit earning financial assets as at December 31, 2015 amounting to BD 9,106,654 and BD 32,437,433 respectively (2014: BD 7,252,680 and BD 14,150,634 respectively).

19.8 Fair value of financial instrumentsThe Directors consider that the carrying amounts of financial assets and financial liabilities approximate their fair values at the reporting dates.

annual report 2015 empower - tamkeen · annual report 2015 tamkeenbahrain 1738 3333 empower tamkeen...

Documents