NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 8 INVESTMENTS IN AND BALANCES WITH ASSOCIATES (CONT’D) The non-trade amounts owing by associates are unsecured and repayable on demand. In respect of interest-bearing amounts owing by associates, interest of 6.00% (2021: 6.00%) per annum was charged by the Group. The non-trade amount owing to an associate is unsecured and repayable on demand. Included in the Group’s investments in associates are investments in three associates (2021: two associates) which are listed on the Mainboard of Singapore Exchange Securities Trading Limited (SGX-ST). As at the reporting date, the aggregate carrying amount of these investments were $1,181.6 million (2021: $764.5 million) and the fair values based on the published price quotation (Level 1 in the fair value hierarchy) was $950.6 million (2021: $612.7 million). In respect of these associates, management had assessed the recoverable amounts of the investments and determined that as their net asset value based on the latest available audited financial statements of the associates are higher than the carrying amount as at the reporting date, no impairment loss for these investments is considered necessary. During 2021, the Group assessed the carrying amount of its investments in associates for indicators of impairment. Based on the assessment, the Group recognised an impairment loss of $12,125,000 on its investment in certain associates as a result of their weak financial performance. The recoverable amount was estimated taking into account the fair values of the underlying assets and the liabilities of the associates. The fair value measurement was categorised as a Level 3 in the fair value hierarchy as it is derived from unobservable inputs. The movements in impairment losses in respect of investments in associates and amounts owing by associates are as follows: Investments in associates Amounts owing by associates Lifetime ECL – not credit-impaired 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Group At 1 January 15,399 3,000 – – Impairment loss recognised – 12,125 339 – Impairment loss utilised (1,703) – – – Translation differences on consolidation (1,041) 274 (19) – At 31 December 12,655 15,399 320 – The impairment loss recognised was included in “Share of after-tax profit of associates” in the consolidated statement of profit or loss. Accounting for investment in CDLHT In May 2022, the Company distributed 144,191,823 units in CDLHT (“CDLHT units”) that it held to its ordinary shareholders, which resulted in CDLHT, which was a subsidiary in prior year, becoming an associate of the Group thereafter (notes 40, 44 and 45). The Group’s retained interest in CDLHT has been remeasured to fair value and accounted for as a business combination, which requires the purchase price to be allocated to the fair value of the identifiable assets acquired and liabilities assumed, including any contingent liabilities (purchase price allocation or “PPA”). A significant portion of the purchase price was allocated to CDLHT’s underlying property portfolio comprising property, plant and equipment and investment properties, based on the valuation amounts in the valuation reports undertaken by an internal valuer with appropriate recognised professional qualifications and experience in the location and category of the properties being valued. 7 INVESTMENTS IN AND BALANCES WITH SUBSIDIARIES (CONT’D) Impairment losses The movements in impairment losses in respect of investments in subsidiaries and amounts owing by subsidiaries during the year are as follows: Investments in subsidiaries Amounts owing by subsidiaries Lifetime ECL – not credit impaired 2022 2021 2022 2021 $’000 $’000 $’000 $’000 At 1 January 32,287 33,663 183,563 125,600 Impairment loss recognised 10,277 17,270 73,682 57,963 Impairment loss utilised (1,727) (18,646) – – At 31 December 40,837 32,287 257,245 183,563 The increase in loss allowance on amounts owing by subsidiaries was due to a decline in the financial positions of the subsidiaries. Further details regarding the Group’s subsidiaries are set out in note 44. 8 INVESTMENTS IN AND BALANCES WITH ASSOCIATES Group Company Note 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Investments in associates Investments in associates 1,276,368 832,378 – – Impairment loss (12,655) (15,399) – – 1,263,713 816,979 – – Balances with associates Amounts owing by associates receivable within 1 year: – trade 9,520 22 1,540 3 – non-trade, interest-bearing 1,188 1,120 – – – non-trade, interest free 528 – – – 11,236 1,142 1,540 3 Impairment losses (320) – – – 16 10,916 1,142 1,540 3 Amount owing to an associate payable within 1 year: – trade 4,790 – 6 – – non-trade, interest-free 2,605 2 – – 31 7,395 2 6 – CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2022 FINANCIALS 166 167
RkJQdWJsaXNoZXIy ODIwNTc=