IdealRatings Newsletter Q4 2011

IDEALRATINGS NEWSLETTER

Q4 2011

T h e Is lam ic I nves tor IdealRatings homepage The Islamic Investor is published by IdealRatings and contains news, updates, and other useful links for everyone with an interest in Islamic Finance.

IN THIS ISSUE PREMIUM REPORTS ONLINE To date, we’ve published 10 premium reports that our team usually delivers exclusively to our clients on our web site. ISLAMIC INVESTOR IPHONE The only iPhone application that tells you if a stock is Shariah compliant or not, gives you a detailed report explaining why, and alerts you if it changes status. UPCOMING EVENTS See us at these upcoming events Q&A The top questions we’ve heard about Islamic fund management and their answers

CONTACT US To contact IdealRatings, or for feedback on this newsletter click here or send an email to: [email protected]

Publicly Available For the First Time

Premium research reports are online We’re publishing many reports that our team usually delivers exclusively to our clients on our web site, and they’re free of charge. We’re doing this to help i nve s t o r s u n d e r s t a n d t h e compliance status of some of the most popular companies that are also challenging to screen. The reports reveal the results of the analysis process that our team goes through to analyze companies' revenue streams, and the level of detail that is required to form a final opinion on the Shariah compliance status of a stock. The research reports for these companies are available Apple I n c. ( N A S DAQ A A P L ) , Microsoft (NASDAQ MSFT), LinkedIn Corporation (NYSE LNKD), Vodafone Group plc (London Stock Exchange (LON) VOD),Woolworths Limited (Australian Stock Exchange (Sydney) WOW), LVMH Moet Hennessy Louis Vuitton SA (Euronext Paris MC),Emirates Telecommunications Corporation (Abu Dhabi Stock ExchangeETISALAT), Kuwait Food CompanyAmericana KSC ( K u w a i t S t o c k E xc h a n g e FOOD), Saudi Basic Industries Corporation [SABIC] (Saudi Arabian Stock Exchange 2010), Plus Expressways Berhad (Bursa Malaysia PLUS).

COPYRIGHT © 2011 IDEALRATINGS, INC. ALL RIGHT RESERVED

We plan to publish new premium reports weekly, so let us know if you need a report for a specific company or sector. We've heard as a feedback from the market that some of these reports delivered surprises to a number of portfolio managers, certain companies ' compliance were opposite to their perceived status, and some of this year's best winners were mistakenly avoided. Apple Inc. Revenue Segmentation as per Q3 2011

The published reports are all screened according to the Shariah mandate as defined by the AAOIFI (Accounting and Auditing Org anization of Islamic Financial Institutions). IdealRatings clients can order any premium report according to their choice of mandates.

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IDEALRATINGS NEWSLETTER

Q4 2011

AppStore Customer Reviews for The Islamic Investor: Great Resource! July 13, 2011 "This app is such a great resource to check on Shariah compliant stocks. please keep the reports coming..."

Excellent App August 25, 2011 "I have been using this app for almost 3 weeks now. it's the best resource on Shariah compliant stocks. the reports are easy to read and the green/red color scheme is easy to follow iPhone/iPad/iPod Application

The Islamic Investor Until now Islamic finance services such as knowing which stocks are Shariah compliant or not are only available to institutions subscribing to specific data service providers such as IdealRatings or index providers for instance. These subscriptions might be feasible for institutions but for individual investors who are willing to invest in the stock market subscribing to such a service in order to fulfill their ethical and religious views is not feasible. IdealRatings as a strong believer in Islamic Finance and having the objective to make Islamic investment information available to all Muslim investors who are willing to invest according to their ethical and religious beliefs, decided to provide a retail product for individual investors and to offer it for free. IdealRatings Islamic Investor™ is the only iPhone

create and manage their Islamic,Shariah compliant products. Our data is available directly, or on Thomson Reuters and Bloomberg terminals. Features: - Find out, instantly, if a stock in your local market is Shariah compliant or not. - Learn why by reading a detailed report. - Explore Shariah compliant stocks from the Top Stocks and Featured sections. -Track the compliance of your favorite stocks. - Receive an alert if a stock changes compliance status. -Share your findings with your friends and colleagues.

application that tells you if a stock is Shariah compliant or not, gives you a detailed report explaining the reasoning of the compliance status, and alerts you if a company changes the compliance status. IdealRatings is the most trusted provider of accurate, and timely, Islamic Finance information. Most Islamic index providers, and financial institutions in 12 countries rely on IdealRatings to COPYRIGHT © 2011 IDEALRATINGS, INC. ALL RIGHT RESERVED

Upcoming Events

• IFN Issuers & Investors Asia Forum 17 - 19 October 2011, Kuala Lumpur, Malaysia. Entering its 6th year and recognized as the industry’s leading and largest annual event in Asia • WIBC - The 18th World Islamic Banking Conference 21 - 23 November 2011, Manama, Bahrain. The World’s Largest Annual Gathering of International Islamic Finance Industry Leaders.

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IDEALRATINGS NEWSLETTER

Q2 2011

Q&A Who wrote the compliance criteria (rulebook) that you use while screening stocks in your Islamic Investor iPhone application?

What are the criteria for Shariah compliance (rulebook) that you use while screening stocks in your Islamic Investor iPhone application?

What causes a stock to change compliance?

How do you determine that a stock is Shariah compliant in your Islamic Investor iPhone application?

Who uses your service?

AAOIFI (Accounting and Auditing Organization for Islamic Financial Institutions). These criteria represent what we've seen as the most commonly used rulebook globally, they were deduced by qualified scholars in Islam and finance to screen companies that they see fit for investment by observant Muslims. We do realize however that there is no single standard to determine what is Halal or Haram, but we determined that this should at least give an initial opinion for individual investors. Business To Avoid: Total non-permissible income not to exceed 5% of the total income generated by the company. Non Permissible Income is defined as income generated from: •Interest Income from operating or non operating activities •Adult Entertainment •Alcohol •Cinema •Conventional Banking Activities (Banking, Mortgage, Conventional Financial Services, Conventional Insurance) •Gambling •Defense & Weapons •Hotels •Pork •Tobacco Financial Screening: Cash & Interest Bearing investments should not exceed 30% of the Average Market Cap. during the previous 12 Months. Interest Bearing Debts not to exceed 30% of the Average Market Cap. during the previous 12 Months. Total Sum of the liquid Assets should not exceed 67% of the Average Market Cap. during the previous 12 Month. Companies change business activities by buying other companies, or entering into new businesses, they also change their financial's by borrowing more, or paying back loans that they owed. Because of these, and many other corporate actions, we constantly track and screen companies for compliance. Our analysts analyze every company to insure that its financial's and business activities are compliant with the criteria defined by AAOIFI. We also update the financial information like closing price, p/e, Exchange, Market capitalization, etc... on daily basis.

Global and regional financial institutions in more than 10 countries rely on our service to manage their Islamic products, for a sample list of our clients click here

Disclosures: This research is for our clients only. This research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The research reports are published at irregular intervals based on clients’ request or as appropriate in our analysts’ judgment. This research is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction especially where such an offer or solicitation would be illegal. It does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients. Clients should consider whether any advice or recommendation in this research is suitable for their particular circumstances and, if appropriate, seek professional advice, including tax advice. The price and value of investments referred to in this research and the income from them may fluctuate. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. Copyright © 2011 IdealRatings, Inc. No part of this material may be (i) copied, photocopied or duplicated in any form by any means or (ii) redistributed without the prior written consent of IdealRatings, Inc.

COPYRIGHT © 2011 IDEALRATINGS, INC. ALL RIGHT RESERVED

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