NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 13 DEVELOPMENT PROPERTIES Group Company 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Properties under development, for which revenue is to be recognised over time 1,519,313 1,649,627 – – Properties under development, for which revenue is to be recognised at a point in time 3,100,118 2,518,357 – – Completed units 1,465,230 1,739,574 166,106 175,792 6,084,661 5,907,558 166,106 175,792 Allowance for foreseeable losses (127,064) (68,087) – – Total development properties 5,957,597 5,839,471 166,106 175,792 (i) Allowance for foreseeable losses Movements in allowance for foreseeable losses are as follows: Group Company Note 2022 2021 2022 2021 $’000 $’000 $’000 $’000 At 1 January 68,087 62,097 – – Allowance made 33 61,766 5,641 – – Translation differences on consolidation (2,789) 349 – – At 31 December 127,064 68,087 – – The allowance for foreseeable losses is determined after taking into account estimated selling prices, estimated total construction costs and selling expenses. The estimated selling prices are based on recent selling prices for the development project or comparable projects and prevailing property market conditions. The estimated total construction costs are based on contracted amounts and, in respect of amounts not contracted for, management’s estimates of the amounts to be incurred taking into consideration historical trends of the amounts incurred. The allowance made for foreseeable losses is included in “cost of sales”. (ii) Development properties of the Group recognised as cost of sales, excluding allowance for foreseeable losses, amounted to $1,081,031,000 (2021: $961,314,000) for the year. (iii) Development properties of the Group with carrying amounts of $565,080,000 (2021: $1,661,321,000) are mortgaged to financial institutions to secure credit facilities (refer to note 23). 14 CONTRACT COSTS The amount relates to commission fees paid to property agents for securing sale contracts for the Group’s development properties. During the year, $43,664,000 (2021: $75,218,000) of commission fees paid were capitalised as contract costs. Capitalised commission fees are amortised when the related revenue is recognised. During the year, $51,316,000 (2021: $32,990,000) was amortised. There is no impairment loss in relation to such costs capitalised. 11 DERIVATIVE FINANCIAL ASSETS/(LIABILITIES) Group Company 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Derivative financial assets Cross currency swaps 43,696 8,788 43,696 4,026 Forward exchange contracts 49,636 17,485 49,636 17,485 Interest rate swaps 18,917 – 18,917 – 112,249 26,273 112,249 21,511 Non-current 40,449 4,762 40,449 – Current 71,800 21,511 71,800 21,511 112,249 26,273 112,249 21,511 Derivative financial liabilities Cross currency swaps (780) (14,936) (780) (14,928) Forward exchange contracts (780) – (780) – Interest rate swaps (645) (941) (645) – (2,205) (15,877) (2,205) (14,928) Non-current (645) (1,295) (645) (346) Current (1,560) (14,582) (1,560) (14,582) (2,205) (15,877) (2,205) (14,928) As at the reporting date, the Group has cross-currency swaps, forward exchange contracts and interest rate swaps with a total notional amount of $559,484,000 (2021: $536,104,000), $1,008,329,000 (2021: $1,308,617,000) and $840,952,000 (2021: $88,036,000) respectively. The Company has cross-currency swaps, forward exchange contracts and interest rate swaps with a total notional amount of $559,484,000 (2021: $378,777,000), $1,008,329,000 (2021: $1,308,617,000) and $840,952,000 (2021: $Nil) respectively. 12 OTHER NON-CURRENT ASSETS Group Company Note 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Amounts owing by subsidiaries 7 – – 6,428,732 6,205,239 Amount owing by joint ventures 9 274,332 – – – Deposits 11,946 3,395 – – Other receivables 6,682 13,307 – – Restricted bank deposits 18 6,494 89,630 – – 299,454 106,332 6,428,732 6,205,239 Prepayments 288 282 – – Intangible assets 1,714 1,879 – – Deferred tax assets 30 47,468 69,302 – – 348,924 177,795 6,428,732 6,205,239 CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2022 FINANCIALS 176 177
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