NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2023 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2023 32 PROFIT FOR THE YEAR (CONT’D) Group Note 2023 2022 $’000 $’000 Other expenses Allowance made for foreseeable losses on development properties (net) 13 49,663 61,766 (Reversal of impairment losses)/Impairment losses recognised on: – property, plant and equipment 4 (54,037) (28,113) – investment properties 5 43,749 35,728 – trade receivables and accrued receivables 41 7,142 22,389 - other receivables 743 – – amounts owing by associates 8 57 339 Loss on dilution of interest in an associate – 1,378 Property, plant and equipment and investment properties written off 7,608 15,987 Provisions (written back)/made 28 (3,587) 26,938 Finance income Interest income under the effective interest method: – amounts owing by associates at amortised cost 158 67 – amounts owing by joint ventures at amortised cost 24,466 19,523 – cash and cash equivalents 56,656 29,726 – others 1,164 3,465 Fair value gains on financial derivatives 1,291 29,433 Net change in fair value of cash flow hedges, reclassified from hedging reserve 14,235 614 Net exchange gain – 8,863 97,970 91,691 Less: Finance income capitalised in development properties – (137) Total finance income 97,970 91,554 Finance costs Amortisation of transaction costs capitalised 6,612 6,428 Interest expense: – term loans and bank loans 374,362 179,619 – bonds and notes 78,287 72,366 – amounts owing to fellow subsidiaries 802 2,947 – amounts owing to joint ventures 12 – – financial derivatives – 4,549 – lease liabilities 25,320 20,127 – others 7,049 11,821 Fair value losses on financial assets mandatorily measured at FVTPL (net) 36,389 38,323 Net exchange loss 4,472 – Unwinding of discount on non-current liabilities 1,133 251 Finance costs capitalised in: – development properties## (35,016) (30,863) – property, plant and equipment (128) (1,468) – investment properties (7,716) (19,420) Total finance costs 491,578 284,680 Net finance costs 393,608 193,126 * The comparative information for audit and non-audit fees has been re-presented to include fees paid to affiliated firms of KPMG International Limited under “auditors of the Company and other firms affiliated with KPMG International Limited” instead of “other auditors”, arising from revisions to disclosures on audit and non-audit fees under ACRA Code effective for periods beginning on or after 15 December 2022. ** Non-audit fees paid to auditors of the Company and other firms affiliated with KPMG International Limited include audit-related services of $30,172 (2022: $25,280). # Included grant income of $146,000 (2022: $404,000) deducted against depreciation of right-of-use assets. ^ Relates to wage grants received or receivable by the Group under the wage subsidy programmes introduced by various governments in the countries where the Group operates, in response to the COVID-19 pandemic. ^^ Mainly relates to pre-tax profit on the disposal of the Millennium Hilton Seoul and the collective sale of Tanglin Shopping Centre and Golden Mile Complex. ## Relates to development properties for which revenue is recognised at a point in time. Borrowing costs on development properties where revenue is recognised over time is charged to profit or loss, as incurred. 32 PROFIT FOR THE YEAR (CONT’D) Group 2023 2022 $’000 $’000 The above finance income and finance costs (including amounts capitalised) include the following interest income and expenses in respect of assets and liabilities not at FVTPL: – total interest income on financial assets 81,699 49,488 – total finance costs on financial liabilities 417,640 215,002 During the year, net finance costs of the Group have been capitalised at rates ranging from 0.35% to 8.00% (2022: 0.36% to 12.00%) per annum, 4.59% to 5.09% (2022: 1.32% to 4.86%) per annum, and 1.00% to 8.00% (2022: 1.00% to 12.00%) per annum for development properties, property, plant and equipment, and investment properties, respectively. 33 TAX EXPENSE Group Note 2023 2022 $’000 $’000 Current tax expense Current year 130,497 374,638 Over provision in respect of prior years (67,015) (56,315) 63,482 318,323 Deferred tax expense Movements in temporary differences 36,169 173,758 Effect of changes in tax rates and legislation – 1,425 (Over)/Under provision in respect of prior years (11,076) 25,348 29 25,093 200,531 Land appreciation tax 10,190 22,037 Withholding tax 24,997 1,677 Total tax expense 123,762 542,568 FINANCIALS FINANCIALS ANNUAL REPORT 2023 CITY DEVELOPMENTS LIMITED 201 200
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