NOTES TO THE FINANCIAL STATEMENTS 5. Cost of Sales 2023 2022 HK$M HK$M Direct rental outgoings in respect of investment properties that – generated rental income 2,984 2,798 – did not generate rental income 282 199 3,266 2,997 Property trading 119 621 Hotels 899 685 4,284 4,303 6. Other Net (Losses)/Gains 2023 2022 HK$M HK$M Gains arising from the acquisition of interests in joint venture companies 551 – (Losses)/Gains on disposal of investment properties (16) 31 Losses on disposal of property, plant and equipment (2) – (Losses)/Gains on disposal of assets classified as held for sale (44) 20 Change in fair value of assets classified as held for sale (442) 48 Net foreign exchange losses (240) (107) Government subsidies 8 31 Others 71 56 (114) 79 7. Expenses by Nature Expenses included in cost of sales, administrative and selling expenses, and other operating expenses are analysed as follows: 2023 2022 HK$M HK$M Impairment charged on trade receivables* 40 341 Depreciation of property, plant and equipment (note 15) 275 232 Depreciation of right-of-use assets – leasehold land held for own use 29 25 – property 49 39 Amortisation of – intangible assets (note 17) 66 53 – initial leasing costs in respect of investment properties 96 79 Staff costs 2,115 1,899 Other lease expenses** 31 32 Auditors’ remuneration – audit services 14 11 – tax services 2 3 – other services 4 3 * These impairments include expected credit losses on the operating lease receivables in relation to the forgiveness of lease payments, i.e. rent concessions granted to tenants during the year, under HKFRS 9 of HK$36 million (2022: HK$319 million). ** These expenses relate to short-term leases and leases of low-value assets. They are directly charged to the consolidated statement of profit or loss and are not included in the measurement of lease liabilities under HKFRS 16. 154