NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 27 LEASE LIABILITIES Group Company 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Lease liabilities 697,439 265,327 32,522 15,922 Non-current 672,633 246,003 26,642 9,600 Current 24,806 19,324 5,880 6,322 697,439 265,327 32,522 15,922 The incremental borrowing rates of the Group’s and the Company’s lease liabilities range from 0.9% to 14.6% (2021: 0.9% to 14.6%) and 2.7% to 3.1% (2021: 2.2% to 2.8%) per annum respectively, as at 31 December 2022. Information about the Group’s and the Company’s exposure to foreign currency and liquidity risk is included in note 42. 28 OTHER LIABILITIES Group Company Note 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Restated* Deferred income 47,874 122,124 – – Rental deposits 52,928 53,609 9,564 8,041 Amounts owing to a subsidiary 7 – – 750,144 – Non-current retention sums payable 15,560 26,625 – – Miscellaneous (principally deposits received and payables) 19,781 18,213 – – 136,143 220,571 759,708 8,041 * Refer to Note 47 Included in deferred income are the following: (i) $7,030,000 (2021: $7,030,000) relating to the deferred gain on the sale of cash flows as disclosed in footnote (a) of note 45. (ii) $37,970,000 (2021: $105,406,000) relating to the deferred gain arising from the sale of Novotel Singapore Clarke Quay previously owned by CDLHT, to a joint venture. During the current financial year, $62.0 million deferred gain was realised and recognised as part of the gain on disposal of CDLHT under “Other income” in the consolidated statement of profit or loss. In addition, as at 31 December 2021, deferred income included $6,635,000 relating to the deferred gain arising from the Group’s exit of its entire interest in Summervale, an indirect wholly-owned subsidiary of the Group in October 2016. Although the Group lost control in Summervale, the Group assessed that it maintained some continuing involvement through its investment in secured fixed rate notes issued by Summervale (note 10). Accordingly, a portion of the gain on disposal of Summervale by reference to the extent of the amount of continuing involvement retained in Summervale is deferred. During the current financial year, the note issued by Summervale was fully redeemed and the deferred income was recognised as a gain under “Other income” in the consolidated statement of profit or loss (note 33). 26 EMPLOYEE BENEFITS (CONT’D) South Korea During 2021, the Group made contributions to a defined benefit pension plan for its employees in South Korea. The contributions required were determined by an external qualified actuary using the projected unit credit method. The most recent valuation was carried out on 31 December 2021. The assumptions which had the most significant effect on the results of the valuations were those relating to the discount rate and the rate of increase in salaries. The assets of each scheme have been taken at market value and the liabilities have been calculated using the following principal assumptions: 2022 2022 2021 2021 2021 UK Taiwan UK South Korea Taiwan Inflation rate 3.3% – 3.5% – – Discount rate 4.9% 1.5% 1.7% 2.8% 0.5% Rate of salary increase 3.8% 3.0% 4.0% – 3.0% Rate of pension increases 3.1% – 3.3% – – Rate of revaluation 2.8% – 3.0% – – The methodology for computing the discount rate is the yield range method. The assumptions used by the actuaries are the best estimates chosen from a range of possible actuarial assumptions, which due to the timescale covered, may not necessarily be borne out in practice. The present values of the schemes’ liabilities are derived from cash flow projections over long periods and are inherently uncertain. Sensitivity analysis The calculation of the defined benefit obligation is sensitive to the assumptions set out above. The following table summarises how the impact on the defined benefit obligation at the end of the reporting period would have increased/ (decreased) as a result of a change in one of the relevant actuarial assumptions by one percent, holding other assumptions consistent. Defined benefit obligation 1 percent increase 1 percent decrease $’000 $’000 Group 2022 Discount rate (9,329) 11,781 Rate of salary increase 912 (683) 2021 Discount rate (21,686) 27,650 Rate of salary increase 1,389 (1,272) CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2022 FINANCIALS 190 191
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