NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 42 FINANCIAL INSTRUMENTS (CONT’D) (i) Credit risk (cont’d) Expected credit loss assessment on trade receivables The Group uses an allowance matrix to measure the ECLs of trade receivables from individual customers, which comprise a very large number of small balances. Loss rates are based on actual credit loss experience over the past 3 years (2021: 3 years). These rates are adjusted to reflect differences between economic conditions during the period over which the historic data has been collected, current conditions and the Group’s view of economic conditions over the expected lives of the receivables. The following table provides information about the exposure to credit risk and ECLs for trade receivables and accrued receivables as at reporting date: Group Company Gross carrying amount Impairment loss allowance Gross carrying amount Impairment loss allowance $’000 $’000 $’000 $’000 2022 Current (not past due) 183,109 27,278 2,789 – 1 – 30 days past due 43,263 76 8,576 13 31 – 60 days past due 16,601 281 114 3 61 – 90 days past due 16,008 2,497 11 1 More than 90 days past due 33,388 5,505 193 65 292,369 35,637 11,683 82 2021 Current (not past due) 171,194 15 2,404 11 1 – 30 days past due 32,540 557 628 44 31 – 60 days past due 5,108 95 118 10 61 – 90 days past due 3,448 30 21 3 More than 90 days past due 49,026 16,328 528 67 261,316 17,025 3,699 135 42 FINANCIAL INSTRUMENTS (CONT’D) (i) Credit risk (cont’d) Impairment losses on trade and other receivables, amounts owing by associates and debt investment recognised/ (reversed) in profit or loss were as follows: Group Note 2022 2021 $’000 $’000 Other receivables 62,673 6,104 Debt investment 10 18,015 – Amounts owing by associates 8 339 – Trade receivables and accrued receivables 22,389 (2,448) 103,416 3,656 Trade and other receivables and contract assets The Group has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount. The Group does not require collateral in respect of these financial assets. The Group limits its exposure to credit risk from trade receivables by collecting deposits as collateral, where possible. For trade receivables and contract assets relating to sale of development properties, if a purchaser defaults on payments, the Group may enforce payments via legal proceedings or if the purchaser is assessed to be insolvent, the Group may take possession of the units, retain a portion of the sales consideration, and resell the property. In monitoring customer credit risk, the Group considers the trade history of the customers with the Group, aging profile, maturity and existence of previous financial difficulties. Exposure to credit risk The maximum exposure to credit risk for trade and other receivables and contract assets at the reporting date by business segment is set out below: Group Company 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Restated* Property development 1,887,697 1,813,907 5,796,323 5,146,585 Hotel operations 212,276 179,976 2,176,094 1,635,335 Investment properties 130,205 138,570 1,436,920 1,734,717 Others 48,327 112,034 3,494,252 3,911,800 2,278,505 2,244,487 12,903,589 12,428,437 * Refer to Note 47 CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2022 FINANCIALS 218 219
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