CDAC Audited Report FY 2020

Chinese Development Assistance Council (Limited by guarantee and not having a share capital) Registration Number: 199202625K

Audited Report Year ended 31 December 2020

KPMG LLP (Registration No. T08LL1267L), an accounting limited liability partnership registered in Singapore under the Limited Liability Partnership Act (Chapter 163A) and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

Chinese Development Assistance Council General information

Executive Director Pok Cheng Chong Registered Office 65 Tanjong Katong Road, Singapore 436957 Auditors KPMG LLP Bankers Hong Leong Finance Limited 16 Raffles Quay #01-05, Hong Leong Building Singapore 048581 Oversea-Chinese Banking Corporation Limited 65 Chulia Street #01-00, OCBC Centre Singapore 049513 Singapura Finance Ltd 150 Cecil Street #01-00, Singapore 069543 DBS Bank Ltd 12 Marina Boulevard, DBS Asia Central@ Marina Bay Financial Centre Tower 3 Singapore 018982 United Overseas Bank Limited 80 Raffles Place, UOB Plaza Singapore 048624 Lawyer Dentons Rodyk & Davidson LLP 80 Raffles Place #33-00, UOB Plaza 1 Singapore 048624 Investment advisors Lion Global Investors Limited 65 Chulia Street #18-01, OCBC Centre Singapore 049513 UOB Asset Management Ltd 80 Raffles Place #03-00, UOB Plaza 2 Singapore 048624

Chinese Development Assistance Council Directors’ statement Year ended 31 December 2020

Directors’ statement We, the undersigned directors, on behalf of all the directors of Chinese Development Assistance Council (the “Council”), submit this audited report to the members together with the audited financial statements of the Council for the financial year ended 31 December 2020.

We, being directors of Chinese Development Assistance Council, do hereby state that in our opinion: (a) the financial statements set out on pages FS1 to FS45 are drawn up so as to give a true and fair view of the financial position of the Council as at 31 December 2020 and the financial performance, changes in funds and cash flows of the Council for the year ended on that date in accordance with the provisions of the Singapore Companies Act, Chapter 50, the Singapore Charities Act (Chapter 37), and Singapore Financial Reporting Standards; and (b) at the date of this statement, there are reasonable grounds to believe that the Council will be able to pay its debts as and when they fall due.

The Board of Directors has, on the date of this statement, authorised these financial statements for issue.

Patron The Patron of the Council is the Prime Minister of Singapore, Mr Lee Hsien Loong.

Directorate The directors in office at the date of this statement are as follows: Ong Ye Kung Ang Kiam Meng Baey Yam Keng Chee Hong Tat Hong Poh Hin Koh Poh Koon Lim Sau Hoong Low Yen Ling Ng Bee Soon, Patrick Ng Poh Wah Ng Siew Quan Peh Nam Chuan, Adrian Sun Xueling Tan Bock Huat Tan Chye Hee, Gilbert Wan Shung Ming Yam Ziming, Alex

(Chairman)

(Appointed on 18 June 2020)

1

Chinese Development Assistance Council Directors’ statement Year ended 31 December 2020

Trustees The trustees in office at the date of this statement are as follows: Chua Thian Poh Cheng Wai Keung Chew Leong-Chee, Tony Ch’ng Jit Koon Gan Kim Yong Ho Nai Chuen, Charles Kuah Boon Wee Kwek Eik Tse, Sherman Lee Sze Leong Leong Sin Yuen, William Lew Chee Beng Lim Ming Yan Ng Chee Tat, Philip Ng San Tiong, Roland Ong Ye Kung Pang Lim Pek Lian Guan Phua Kiah Mai Quek Meng Tong, George Seow Choke Meng Tan Aik Hock Tan Cheng Gay Tan Kang Uei, Anthony Wu Hsioh Kwang

(Chairman)

(Appointed on 18 June 2020) (Appointed on 18 June 2020)

Directors’ interests The Council has no share capital and its liability is limited by guarantee.

Neither at the end of, nor at any time during the financial year, was the Council a party to any arrangement whose objects are, or one of whose objects is, to enable the directors of the Council to acquire benefits by means of the acquisition of shares in or debentures of the Council or any other body corporate.

Since the end of the last financial year, no director has received or become entitled to receive a benefit by reason of a contract made by the Council or a related corporation with the director or with a firm of which he is a member or with a company in which he has a substantial financial interest.

2

KPMG LLP 16 Raffles Quay #22-00 Hong Leong Building Singapore 048581

Telephone Fax Internet

+65 6213 3388 +65 6225 0984 www.kpmg.com.sg

Independent auditors’ report Members of the Council Chinese Development Assistance Council

Report on the audit of the financial statements Opinion We have audited the financial statements of Chinese Development Assistance Council (‘the Council’), which comprise the balance sheet as at 31 December 2020, statement of comprehensive income, statement of changes in funds and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, as set out on pages FS1 to FS45.

In our opinion, the accompanying financial statements are properly drawn up in accordance with the provisions of the Companies Act, Chapter 50 (‘the Companies Act’), the Charities Act, Chapter 37 and other relevant regulations (‘the Charities Act and Regulations’) and Financial Reporting Standards in Singapore (‘FRSs’) so as to give a true and fair view of the financial position of the Council as at 31 December 2020 and of the financial performance, changes in funds and cash flows of the Council for the year ended on that date.

Basis for opinion We conducted our audit in accordance with Singapore Standards on Auditing (‘SSAs’). Our responsibilities under those standards are further described in the ‘Auditors’ responsibilities for the audit of the financial statements’ section of our report. We are independent of the Council in accordance with the Accounting and Corporate Regulatory Authority Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities (‘ACRA Code’) together with the ethical requirements that are relevant to our audit of the financial statements in Singapore, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ACRA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other information Management is responsible for the other information contained in the audited report. Other information is defined as all information in the audited report other than the financial statements and our auditors’ report thereon.

We have obtained the Directors’ statement and general information, prior to the date of this auditors’ report.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

KPMG LLP (Registration No. T08LL1267L), an accounting limited liability partnership registered in Singapore under the Limited Liability Partnership Act (Chapter 163A) and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

4

Chinese Development Assistance Council Independent auditors’ report Year ended 31 December 2020

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed on the other information obtained prior to the date of this auditors’ report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the financial statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the provisions of the Companies Act, Charities Act and Regulations and FRSs, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair financial statements and to maintain accountability of assets.

In preparing the financial statements, management is responsible for assessing the Council’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Council or to cease operations, or has no realistic alternative but to do so.

Those charged with governance comprises the board of directors and trustees. Their responsibilities include overseeing the Council’s financial reporting process.

Auditors’ responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.

The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.

Obtain an understanding of internal controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Council’s internal controls.

5

Chinese Development Assistance Council Independent auditors’ report Year ended 31 December 2020

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Council’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Council to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal controls that we identify during our audit.

Report on other legal and regulatory requirements In our opinion, the accounting and other records required to be kept by the Council have been properly kept in accordance with the provisions of the Companies Act and the Charities Act and Regulations.

During the course of our audit, nothing has come to our attention that causes us to believe that during the year: (a) the Council has not used the donation moneys in accordance with its objectives as required under Regulation 11 of the Charities (Institutions of a Public Character) Regulations; and (b) the Council has not complied with the requirements of Regulation 15 of the Charities (Institutions of a Public Character) Regulations.

KPMG LLP Public Accountants and Chartered Accountants Singapore 31 May 2021

6

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Balance sheet As at 31 December 2020 2020 Operation Endowment Note Fund Fund $ $ Non-current assets Property, plant and equipment Direct investments Interest in associate

4 5 6

Current assets Curriculum materials Other receivables Derivative assets Investments Cash and cash equivalents

7 8 8 9

Total assets Reserves Accumulated Endowment Fund Accumulated Operation Fund Fair value reserve Total reserves

1,671,687 6,693,940 2,500,000 10,865,627 9,939 2,990,339 56,757 7,052,976 15,664,124 25,774,135 36,639,762

– – – –

Total $ 1,671,687 6,693,940 2,500,000 10,865,627

– 9,939 454,324 3,444,663 487,181 543,938 63,163,968 70,216,944 10,087,936 25,752,060 74,193,409 99,967,544 74,193,409 110,833,171

10

– 74,018,250 74,018,250

11 12

31,694,700 – 31,694,700 662,333 – 662,333 32,357,033 74,018,250 106,375,283

2019 Operation Endowment Fund Fund $ $ 2,644,175 36,250 1,940,687 4,621,112

– – – –

Total $ 2,644,175 36,250 1,940,687 4,621,112

17,478 – 17,478 2,958,177 519,363 3,477,540 57,558 341,944 399,502 5,799,809 61,797,480 67,597,289 21,800,306 7,554,612 29,354,918 30,633,328 70,213,399 100,846,727 35,254,440 70,213,399 105,467,839

–

70,153,256 70,153,256

30,155,803 – 30,155,803 (13,264) – (13,264) 30,142,539 70,153,256 100,295,795

Non-current liabilities Lease liabilities

13

459,274 459,274

– –

459,274 459,274

909,984 909,984

– –

909,984 909,984

Current liabilities Lease liabilities Other payables

13 14

478,565 3,344,890 3,823,455

– 175,159 175,159

478,565 3,520,049 3,998,614

455,862 3,746,055 4,201,917

– 60,143 60,143

455,862 3,806,198 4,262,060

4,282,729

175,159

4,457,888

5,111,901

60,143

5,172,044

36,639,762 74,193,409 110,833,171

35,254,440

Total liabilities Total reserves and liabilities

70,213,399 105,467,839

The accompanying notes form an integral part of these financial statements.

FS1

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Statement of comprehensive income Year ended 31 December 2020 2020 Operation Endowment Note Fund Fund $ $ Income Voluntary income: Donations via Central Provident Fund (“CPF”) contributions to CDAC fund Other donations/ sponsorships 16 Income from charitable activities: Fee income from education programme (including CDAC Centres) Fee income from Fulfilling Ageing programme Grants and subsidies from government agencies 17 Other income

18

Total income Expenses Agency fees paid to CPF Board Charitable activities: Student & Parent Education programme Family & Worker Support programme Fulfilling Ageing programme Community Outreach & Engagement programme Volunteers Engagement & Development programme One-Stop Service CDAC-SFCCA Hardship Assistance and CDAC-SFCCA Bursary schemes CDAC Education Grant

Total $

2019 Operation Endowment Fund Fund $ $

26,133,559

–

26,133,559

25,694,358

279,644 26,413,203

1,031,959 1,031,959

1,311,603 27,445,162

556,476 26,250,834

644,366

–

644,366

1,276,620

–

1,276,620

945

–

945

12,833

–

12,833

6,838,650 7,483,961

– –

6,838,650 7,483,961

2,829,262 4,118,715

– –

2,829,262 4,118,715

174,408

57,964

232,372

252,356

78,598

330,954

34,071,572

1,089,923

35,161,495

30,621,905

(502,404)

(11,086,356)

–

(502,404)

–

Total $

25,694,358

644,337 1,200,813 644,337 26,895,171

722,935 31,344,840

(519,481)

–

(519,481)

– (11,086,356) (11,973,288)

– (11,973,288)

(6,993,485)

–

(6,993,485)

(4,930,101)

–

(4,930,101)

(694,274)

–

(694,274)

(994,654)

–

(994,654)

(2,980,642)

–

(2,980,642)

(3,480,006)

–

(3,480,006)

(656,464) (518,794)

– –

(656,464) (518,794)

(734,524) (534,819)

– –

(734,524) (534,819)

(3,289,528) (5,198,445) 19 (31,417,988)

Governance costs (190,679) Depreciation expense on Right of use asset (389,849) Administration and finance (1,028,587) Total expenses incurred 21 (33,529,507)

– (3,289,528) (2,016,730) – (5,198,445) – – (31,417,988) (24,664,122)

– (2,016,730) – – – (24,664,122)

–

–

(190,679)

(184,086)

– (389,849) (445,398) (114) (1,028,701) (975,377) (114) (33,529,621) (26,788,464)

(184,086)

– (445,398) (116) (975,493) (116) (26,788,580)

The accompanying notes form an integral part of these financial statements.

FS2

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Statement of comprehensive income (cont’d) Year ended 31 December 2020 2020 Operation Endowment Fund Fund Note $ $ Investment income/(loss): Fund management investment schemes Direct investments Gain on disposal of plant and equipment Investment-related expenditures: Fund management investment costs Share of loss of associate

Net surplus for the year Other comprehensive income Items that are or may be reclassified subsequently to profit or loss: Net change in fair value – Equity investment at FVOCI Other comprehensive income for the year, net of tax Total comprehensive income for the year

22 22

425,195 25,209 (1,271)

6

3,126,088 –

3,551,283 25,209

428,190 2,230

(1,271)

(1,463)

(350,903) – 2,775,185

(362,517) 559,313 3,772,017

(11,113) 318,980 736,824

1,538,897

3,864,994

5,403,891

675,597

–

675,597

2,214,494

(11,614) 559,313 996,832

–

Total $

2019 Operation Endowment Fund Fund $ $ 4,625,970 – –

Total $ 5,054,160 2,230 (1,463)

(239,642) – 4,386,328

(250,755) 318,980 5,123,152

4,570,265

5,109,147

9,679,412

675,597

2,250

–

2,250

–

675,597

2,250

–

2,250

3,864,994

6,079,488

4,572,515

5,109,147

9,681,662

The accompanying notes form an integral part of these financial statements.

FS3

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Statement of cash flows Year ended 31 December 2020 2020 Operation Endowment Note Fund Fund $ $ Cash flows from operating activities Cash receipts from: Donations via CPF contributions to CDAC fund Other donations Student fees including CDAC Centres programmes Fee income from Fulfilling Ageing programme Job Credits from government Grants from government agencies Cash paid to: Grants received for Skills Training Award scheme CPF Board for agency fees Suppliers and employees Net cash from operating activities Cash flows from investing activities Purchase of plant and equipment Government grant to fund capital expenditure Proceeds from disposal of plant and equipment Interest received Dividends received Purchase of direct investment Funds with investment managers: Purchase of financial assets Proceeds from disposal of financial assets Decrease/(increase) of cash and cash equivalents held with fund managers Net cash (used in)/from investing activities

26,106,490 306,107

Total $

– 26,106,490 1,029,229 1,335,336

2019 Operation Endowment Fund Fund $ $

25,651,327 555,828

Total $

– 25,651,327 649,617 1,205,445

574,225

–

574,225

1,146,607

–

1,146,607

196

–

196

12,833

–

12,833

1,504,810

–

1,504,810

52,808

–

52,808

5,333,840

–

5,333,840

2,776,454

–

2,776,454

– (502,404) (32,410,025) 913,239

– – 5,364 – (502,404) (519,481) (164) (32,410,189) (25,603,846) 1,029,065

1,942,304

4,077,894

– 5,364 – (519,481) (166) (25,604,012) 649,451

(435,384)

–

(435,384)

271,963

–

271,963

–

–

–

– 403,861 31,017

– 1,817,256 118,483

– 2,221,117 149,500

525 369,558 16,963

– 1,783,152 148,792

525 2,152,710 165,755

–

–

–

(5,982,093)

–

(5,982,093)

(657,317)

–

4,727,345

(657,317)

(3,965,620) (60,200,165) (64,165,785) (18,251,344) (60,624,043) (78,875,387) 2,970,835 59,768,685 62,739,520

826,410 (5,879,011)

(1,434,338) 69,921

18,288,816

53,579,793

71,868,609

4,996,613

(607,928)

(189,947)

5,186,560

(5,809,090)

(422,746)

74,254

(348,492)

The accompanying notes form an integral part of these financial statements.

FS4

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Statement of cash flows Year ended 31 December 2020 2020 Operation Endowment Note Fund Fund $ $ Cash flows from financing activities Payment of lease liabilities Interest paid Net cash used in financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

9

Total $

2019 Operation Endowment Fund Fund $ $

Total $

(320,515) (23,485)

– –

(320,515) (23,485)

(415,747) (29,537)

– –

(415,747) (29,537)

(344,000)

–

(344,000)

(445,284)

–

(445,284)

(5,309,772)

1,098,986

(4,210,786)

20,631,177

6,309,494 26,940,671

17,421,313

5,585,789 23,007,102

15,321,405

7,408,480 22,729,885

20,631,177

6,309,494 26,940,671

3,209,864

723,705

3,933,569

The accompanying notes form an integral part of these financial statements.

FS5

4,570,265 – – 4,570,265 30,155,803

Total comprehensive income for the year Net surplus for the year

Other comprehensive income Net change in fair value – Equity investment at FVOCI Total other comprehensive income Total comprehensive income for the year

At 31 December 2019

(13,264)

2,250 2,250 2,250

–

(15,514)

30,142,539

2,250 2,250 4,572,515

4,570,265

25,570,024

The accompanying notes form an integral part of these financial statements.

25,585,538

70,153,256

– – 5,109,147

5,109,147

65,044,109

Endowment ----------------- Operation Fund ---------------Fund Accumulated Fair value Accumulated Total fund reserve fund $ $ $ $

At 1 January 2019

Statement of changes in funds Year ended 31 December 2020

FS6

100,295,795

2,250 2,250 9,681,662

9,679,412

90,614,133

Total reserves $

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

31,694,700

At 31 December 2020

662,333

675,597 675,597 675,597

–

(13,264)

32,357,033

675,597 675,597 2,214,494

1,538,897

30,142,539

The accompanying notes form an integral part of these financial statements.

– – 1,538,897

1,538,897

Total comprehensive income for the year Net surplus for the year

Other comprehensive income Net change in fair value – Equity investment at FVOCI Total other comprehensive income Total comprehensive income for the year

30,155,803

74,018,250

– – 3,864,994

3,864,994

70,153,256

Endowment ----------------- Operation Fund ---------------Fund Accumulated Fair value Accumulated Total fund reserve fund $ $ $ $

At 1 January 2020

Statement of changes in funds (cont’d) Year ended 31 December 2020

FS7

106,375,283

675,597 675,597 6,079,488

5,403,891

100,295,795

Total reserves $

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Notes to the financial statements These notes form an integral part of the financial statements.

The financial statements were authorised for issue by the Board of Directors on 31 May 2021.

1

Domicile and activities Chinese Development Assistance Council (the “Council”), a public company limited by guarantee and not having a share capital, is incorporated in Singapore. The registered address of the Council is at 65 Tanjong Katong Road, Singapore 436957.

The Patron of the Council is the Prime Minister of Singapore, Mr Lee Hsien Loong.

The Council’s priority is to help the less successful individuals of the Chinese community in Singapore maximise their potential and strive for social mobility through its various assistance schemes. To achieve this, the Council organises low fee education programmes and provides families with financial and employment support. In addition, the Council has set up CDAC Centres to provide enrichment programmes for students as well as other services for families.

The Council has an Operation Fund which is used to finance the Council’s operations and programmes, and an Endowment Fund which is used to provide funds which can only be used for the Council’s operations. Please refer to notes 10 and 11 for details of the Council’s Endowment Fund and Operation Fund, respectively.

The Council has been granted Institution of a Public Character (“IPC”) status since 22 May 1992.

The current tax exemption status will expire on 21 May 2022.

The Council is registered as a charity under the Charities Act, Chapter 37 since 23 July 1992.

2

Basis of preparation

2.1

Statement of compliance These financial statements have been prepared in accordance with the Singapore Financial Reporting Standards (“FRSs”).

The Council had obtained an exemption order from the Accounting & Corporate Regulatory Authority to prepare and present balance sheets, statements of comprehensive income, statements of cash flows and statements of changes in funds for its Operation Fund and Endowment Fund under Section 202(1) of the Singapore Companies Act, if such presentation results in a fair presentation of its financial position, financial performance, cash flows and changes in funds.

The directors are of the opinion that the preparation and presentation of separate balance sheets, statements of comprehensive income, statements of cash flows and statements of changes in funds for its Operation Fund and Endowment Fund and their aggregation results in a fair presentation of the financial position, financial performance, cash flows and changes in funds of the Council.

FS8

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

2.2

Basis of measurement The financial statements have been prepared on the historical cost basis except for certain financial assets and liabilities which are measured at fair value.

2.3

Functional and presentation currency The financial statements are presented in Singapore dollars, which is the Council’s functional currency. All financial information is presented in Singapore dollars, unless otherwise stated.

2.4

Use of estimates and judgements The preparation of financial statements in conformity with FRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

Information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements is included in the following notes: Note 6 – Classification and valuation of interest in associate; Note 25 – Financial risk management

2.5

Changes in accounting policies The Council has applied the following FRSs, amendments to and interpretations of FRS for the first time for the annual period beginning on 1 January 2020: Amendments to References to Conceptual Framework in FRS Standards Definition of a Business (Amendments to FRS 103) Definition of Material (Amendments to FRS 1 and FRS 8) Interest Rate Benchmark Reform (Amendments to FRS 109, FRS 39 and FRS 107) The application of these amendment to standards and interpretations did not have material effect on the Council’s financial statements.

FS9

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

3

Significant accounting policies The accounting policies set out below have been applied consistently to all periods presented in these financial statements.

3.1

Basis of consolidation Investment in associate Associates are those entities in which the Council has significant influence, but not control or joint control, over the financial and operating policies. Significant influence is presumed to exist when the Council holds between 20% or more of the voting power of another entity.

Investment in associate is accounted for using equity accounting.

Investment in associate is recognised initially at cost, which includes transaction costs.

Subsequent to initial recognition, the Council’s financial statements includes the Council’s share of losses of equity accounted investee, from the date that significant influence commences until the date that significant influence ceases.

When the Council’s share of losses exceeds its interest in an equity-accounted investee, the carrying amount of the investment, together with any long-term interests that form part thereof, is reduced to zero, and the recognition of further losses is discontinued.

Impairment of associates Investment in associate is assessed at the end of each reporting period to determine whether there is any objective evidence that it is impaired in accordance with note 3.6 (i). An impairment loss in respect of an associate is measured by comparing the recoverable amount of the investment with its carrying amount in accordance with note 3.6 (ii). An impairment loss is recognised in profit or loss. An impairment loss is reversed if there has been a favourable change in the estimates used to determine the recoverable amount.

3.2

Foreign currency Foreign currency transactions Transactions in foreign currencies are translated to the functional currency of the Council at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the exchange rate at that date. The foreign currency gain or loss on the monetary items is the difference between amortised cost in the functional currency at the beginning of the year, adjusted for effective interest and payments during the year, and the amortised cost in foreign currency translated at the exchange rate at the end of the year.

Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated to the functional currency at the exchange rate at the date that the fair value was determined. Non-monetary items in a foreign currency that are measured in terms of historical cost are translated using the exchange rate at the date of the transaction. Foreign currency differences arising on translation are recognised in profit or loss, except for differences arising on the retranslation of equity investment at Fair Value through Other Comprehensive Income (“FVOCI”) which are recognised in other comprehensive income.

FS10

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

3.3

Property, plant and equipment Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses.

Cost includes expenditure that is directly attributable to the acquisition of the asset. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

The gain or loss on disposal of an item of property, plant and equipment (calculated as the difference between the net proceeds from disposal and the carrying amount of the item) is recognised in profit or loss.

The cost of replacing a component of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Council and its cost can be measured reliably. The carrying amount of the replaced component is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.

Depreciation is recognised as an expense in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and equipment.

Depreciation is recognised from the date that the property, plant and equipment are installed and are ready for use, or in respect of internally constructed assets, from the date that the asset is completed and ready for use. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Council will obtain ownership by the end of the lease term.

The estimated useful lives for the current and comparative years are as follows: Building Office equipment Computer equipment Furniture and fittings Renovation

-

Remaining lease term of 3 (2019: 4) years 3 years 2 years 5 years 5 years

Depreciation methods, useful lives and residual values are reviewed at the end of each reporting period and adjusted if appropriate.

3.4

Funds Separate funds are maintained for amounts received for specific purposes. Interest income is allocated to the respective funds, where appropriate, on a specific identifiable basis.

FS11

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

3.5

Financial instruments

(i)

Recognition and initial measurement Non-derivative financial assets and financial liabilities Trade receivables and debt investments issued are initially recognised when they are originated.

All other financial assets and financial liabilities are initially recognised when the Council becomes a party to the contractual provisions of the instrument.

A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at fair value through profit or loss (“FVTPL”), transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.

(ii)

Classification and subsequent measurement Non-derivative financial assets On initial recognition, a financial asset is classified as measured at: amortised cost; FVOCI; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Council changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

Financial assets at amortised cost A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL: it is held within a business model whose objective is to hold assets to collect contractual cash flows; and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Equity investments at FVOCI On initial recognition of an equity investment that is not held-for-trading, the Council may irrevocably elect to present subsequent changes in the investment’s fair value in Other Comprehensive Income (“OCI”). This election is made on an investment-by-investment basis.

Financial assets at FVTPL All financial assets not classified as measured at amortised cost or FVOCI as described above are measured at FVTPL. On initial recognition, the Council may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

FS12

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Financial assets: Business model assessment The Council makes an assessment of the objective of the business model in which a financial asset is held at a portfolio level because this best reflects the way the business is managed and information is provided to management. The information considered includes: the stated policies and objectives for the portfolio and the operation of those policies in practice. These include whether management’s strategy focuses on earning contractual interest income, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected cash outflows or realising cash flows through the sale of the assets; how the performance of the portfolio is evaluated and reported to the Council’s management; the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; how managers of the business are compensated – e.g. whether compensation is based on the fair value of the assets managed or the contractual cash flows collected; and the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and expectations about future sales activity.

Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales for this purpose, consistent with the Council’s continuing recognition of the assets.

Non-derivative financial assets: Assessment whether contractual cash flows are solely payments of principal and interest For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a profit margin.

In assessing whether the contractual cash flows are solely payments of principal and interest, the Council considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making this assessment, the Council considers: contingent events that would change the amount or timing of cash flows; terms that may adjust the contractual coupon rate, including variable rate features; prepayment and extension features; and terms that limit the Council’s claim to cash flows from specified assets (e.g. non-recourse features).

FS13

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding, which may include reasonable additional compensation for early termination of the contract. Additionally, for a financial asset acquired at a significant discount or premium to its contractual par amount, a feature that permits or requires prepayment at an amount that substantially represents the contractual par amount plus accrued (but unpaid) contractual interest (which may also include reasonable additional compensation for early termination) is treated as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition.

Non-derivative financial assets: Subsequent measurement and gains and losses Financial assets at FVTPL These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognised in profit or loss.

Financial assets at amortised cost These assets are subsequently measured at amortised cost using the effective interest method. The amortised cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognised in profit or loss. Any gain or loss on derecognition is recognised in profit or loss.

Equity investments at FVOCI These assets are subsequently measured at fair value. Dividends are recognised as income in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment.

Other net gains and losses are recognised in OCI and are never reclassified to profit or loss.

Non-derivative financial liabilities: Classification, subsequent measurement and gains and losses Financial liabilities are classified as measured at amortised cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognised in profit or loss. Directly attributable transaction costs are recognised in profit or loss as incurred.

Other financial liabilities are initially measured at fair value less directly attributable transaction costs. They are subsequently measured at amortised cost using the effective interest method.

Interest expense and foreign exchange gains and losses are recognised in profit or loss. These financial liabilities comprised loans and borrowings, bank overdrafts, and trade and other payables.

FS14

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

(iii)

Derecognition Financial assets The Council derecognises a financial asset when: the contractual rights to the cash flows from the financial asset expire; or it transfers the rights to receive the contractual cash flows in a transaction in which either: - substantially all of the risks and rewards of ownership of the financial asset are transferred; or - the Council neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

Transferred assets are not derecognised when the Council enters into transactions whereby it transfers assets recognised in its balance sheet, but retains either all or substantially all of the risks and rewards of the transferred assets.

Financial liabilities The Council derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire. The Council also derecognises a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognised at fair value.

On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in profit or loss.

(iv)

Offsetting Financial assets and financial liabilities are offset and the net amount presented in the balance sheet when, and only when, the Council currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously.

(v)

Cash and cash equivalents Cash and cash equivalents comprise cash balances and short-term deposits with maturities of three months or less from the date of acquisition that are subject to an insignificant risk of changes in their fair value, and are used by the Council in the management of its short-term commitments.

3.6

Impairment

(i)

Non-derivative financial assets The Council recognises loss allowances for Expected Credit Loss (“ECLs”) on financial assets measured at amortised costs.

FS15

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Loss allowances of the Council are measured on either of the following bases: 12-month ECLs: these are ECLs that result from default events that are possible within the 12 months after the reporting date (or for a shorter period if the expected life of the instrument is less than 12 months); or Lifetime ECLs: these are ECLs that result from all possible default events over the expected life of a financial instrument or contract asset.

Simplified approach The Council applies the simplified approach to provide for ECLs for all student fees receivables.

The simplified approach requires the loss allowance to be measured at an amount equal to lifetime ECLs. General approach The Council applies the general approach to provide for ECLs on all other financial instruments.

Under the general approach, the loss allowance is measured at an amount equal to 12-month ECLs at initial recognition.

At each reporting date, the Council assesses whether the credit risk of a financial instrument has increased significantly since initial recognition. When credit risk has increased significantly since initial recognition, loss allowance is measured at an amount equal to lifetime ECLs. When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECLs, the Council considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Council’s historical experience and informed credit assessment and includes forward-looking information.

If credit risk has not increased significantly since initial recognition or if the credit quality of the financial instruments improves such that there is no longer a significant increase in credit risk since initial recognition, loss allowance is measured at an amount equal to 12-month ECLs. The Council considers a financial asset to be in default when the borrower is unlikely to pay its credit obligations to the Council in full, without recourse by the Council to actions such as realising security (if any is held).

The maximum period considered when estimating ECLs is the maximum contractual period over which the Council is exposed to credit risk.

Measurement of ECLs ECLs are probability-weighted estimates of credit losses. Credit losses are measured at the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Council expects to receive). ECLs are discounted at the effective interest rate of the financial asset.

FS16

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Credit-impaired financial assets At each reporting date, the Council assesses whether financial assets carried at amortised cost are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Evidence that a financial asset is credit-impaired includes the following observable data: significant financial difficulty of the borrower or issuer; a breach of contract such as a default or being more than 90 days past due; the restructuring of a loan or advance by the Council on terms that the Council would not consider otherwise; it is probable that the borrower will enter bankruptcy or other financial reorganisation; or the disappearance of an active market for a security because of financial difficulties.

Presentation of allowance for ECLs in the balance sheet Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of these assets.

Write-off The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Council determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Council’s procedures for recovery of amounts due. (ii)

Non-financial assets The carrying amounts of the Council’s non-financial assets, other than curriculum materials, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. An impairment loss is recognised if the carrying amount of an asset or its related cash-generating unit (CGU) exceeds its estimated recoverable amount.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs of disposal. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGUs. The Council’s corporate assets do not generate separate cash inflows and are utilised by more than one CGU. Corporate assets are allocated to CGUs on a reasonable and consistent basis and tested for impairment as part of the testing of the CGU to which the corporate asset is allocated.

FS17

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the CGU (group of CGUs), and then to reduce the carrying amounts of the other assets in the CGU (group of CGUs) on a pro rata basis.

An impairment loss in respect of assets recognised in prior periods is assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount.

An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had been recognised.

3.7

Curriculum materials Curriculum materials are stated at the lower of cost and net realisable value.

3.8

Provisions A provision is recognised if, as a result of a past event, the Council has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

3.9

Income recognition Donations Donations are recognised on an accrual basis.

Government grants Government grants related to assets are initially recognised as deferred income at fair value when there is reasonable assurance that they will be received and the Council will comply with the conditions associated with the grant. These grants are then recognised in profit or loss on a systematic basis over the useful life of the asset. Grants that compensate the Company for expenses incurred are recognised in profit or loss on a systematic basis in the same periods in which the expenses are recognised, unless the conditions for receiving the grant are met after the related expenses have been recognised. In this case, the grant is recognised when it becomes receivable.

Contributions from the CPF scheme Contributions from the CPF scheme are recognised when the right to receive payment has been established.

Student fees income Student fees income is recognised when the Council satisfies the performance obligation (“PO”) by transferring control of a service to the students. The amount of student fees income recognised is the amount of the fees allocated to the satisfied PO.

FS18

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

The fees is allocated to each PO in the contract on the basis of the relative stand-alone fees of the promised services. A discount or waiver is allocated to the PO if it relates specifically to that PO. The fees income is recognised over time following the progress towards complete satisfaction of that PO. Interest and dividend income Interest income is recognised as it accrues in profit or loss, using the effective interest method.

Dividend income is recognised in profit or loss on the date that the Council’s right to receive payment is established, which in the case of quoted securities is the ex-dividend date.

3.10

Leases At inception of a contract, the Council assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

As a lessee At commencement or on modification of a contract that contains a lease component, the Council allocates the consideration in the contract to each lease component on the basis of its relative stand-alone prices. However, for the leases of property the Council has elected not to separate non-lease components and account for the lease and non-lease components as a single lease component.

The Council recognises a right-of-use asset and a lease liability at the lease commencement date.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Council by the end of the lease term or the cost of the right-of-use asset reflects that the Council will exercise a purchase option. In that case the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The right-of-use asset is subsequently stated at cost less accumulated depreciation and impairment losses.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Council’s incremental borrowing rate. Generally, the Council uses its incremental borrowing rate as the discount rate.

The Council determines its incremental borrowing rate by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.

FS19

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Lease payments included in the measurement of the lease liability comprise the following: fixed payments, including in-substance fixed payments; variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date; amounts expected to be payable under a residual value guarantee; and the exercise price under a purchase option that the Council is reasonably certain to exercise, lease payments in an optional renewal period if the Council is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Council is reasonably certain not to terminate early.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Council’s estimate of the amount expected to be payable under a residual value guarantee, if the Council changes its assessment of whether it will exercise a purchase, extension or termination option or if there is a revised in-substance fixed lease payment.

When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The Council presents right-of-use assets in ‘property, plant and equipment’, and lease liabilities as separate items in the balance sheet.

Short-term leases and leases of low-value assets The Council has elected not to recognise right-of-use assets and lease liabilities for leases of lowvalue assets and short-term leases, including IT equipment. The Council recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

3.11

Employee benefits Defined contribution plans A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an employee benefit expense in profit or loss in the periods during which related services are rendered by employees.

Short-term employee benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under the short-term cash bonus if the Council has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.

FS20

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

3.12

New standards and interpretations not adopted A number of new standards, interpretations and amendments to standards are effective for annual periods beginning after 1 January 2020 and earlier application is permitted; however, the Council has not early adopted the new or amended standards and interpretations in preparing these financial statements.

The following new FRSs, interpretations and amendments to FRSs are not expected to have a significant impact on the Council’s financial statements.

FRS 117 Insurance Contracts Classification of Liabilities as Current or Non-current (Amendments to FRS 1) Covid-19-Related Rent Concessions (Amendment to FRS 116) Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (Amendments to FRS 110 and FRS 28) Reference to the Conceptual Framework (Amendments to FRS 103) Property, Plant and Equipment – Proceeds before Intended Use (Amendments to FRS 16) Onerous Contracts – Costs of Fulfilling a Contract (Amendments to FRS 37) Annual Improvements to FRS(I)s 2018 – 2020

FS21

4

34,757 69,412 39,574

158,639 249,021 126,713

812,833 44,288 (27,120) 830,001 65,830 (21,987) 873,844

– (226,636) 1,000,557

971,472 134,670 (27,120) 1,079,022 170,158 (21,987)

–

971,472

Computer equipment $

26,290 18,162 10,388

195,366 8,984 (878) 203,472 7,774 (4,630) 206,616

– – 217,004

221,656 856 (878) 221,634 – (4,630)

–

221,656

148,004 281,386 207,479

1,315,326 52,920 (9,525) 1,358,721 76,689 (6,100) 1,429,310

– – 1,636,789

1,463,330 186,302 (9,525) 1,640,107 2,782 (6,100)

–

1,463,330

Furniture and fittings Renovation $ $

* Remeasurement of right-of-use assets includes rent concession from its landlord.

– 1,336,195 779,699

– – 268,462

(166,647) – 1,614,946

Carrying amounts At 1 January 2019 At 31 December 2019 At 31 December 2020

280,038 62,181 (60,003) 282,216 2,996 (16,750)

1,781,593 – – 1,781,593 –

245,281 27,526 (60,003) 212,804 32,834 (16,750) 228,888

–

1,781,593

– 445,398 – 445,398 389,849 – 835,247

280,038

Office equipment $

–

Accumulated depreciation At 1 January 2019 Depreciation Disposals At 31 December 2019 Depreciation Disposals At 31 December 2020

Cost At 1 January 2019 Recognition of right-ofuse assets on initial application of FRS 116 Adjusted balance at 1 January 2019 Additions Disposals At 31 December 2019 Additions Disposals Remeasurement of rightof-use asset* Government grant At 31 December 2020

Land and buildings $

Property, plant and equipment

– – 21,794

– – – – 37,361 – 37,361

– – 59,155

– – – – 59,155 –

–

–

37,915 25,300 11,789

201,572 27,104 (9,629) 219,047 18,900 (34,767) 203,180

– – 214,969

239,487 14,489 (9,629) 244,347 5,389 (34,767)

–

239,487

86,478 80,828 37,361

461,407 52,789 (17,877) 496,319 37,162 (20,291) 513,190

– (45,327) 550,551

547,885 47,139 (17,877) 577,147 39,022 (20,291)

–

547,885

25,186 17,827 10,543

72,709 7,359 (570) 79,498 7,284 – 86,782

– – 97,325

97,895 – (570) 97,325 – –

–

97,895

181,810 566,044 426,347

2,013,518 81,959 (171,968) 1,923,509 143,098 (1,009) 2,065,598

– – 2,491,945

2,195,328 468,181 (173,956) 2,489,553 4,672 (2,280)

–

2,195,328

------------------------ CDAC Centres ----------------------Land and Office Computer Furniture buildings equipment equipment and fittings Renovation $ $ $ $ $

FS22

699,079 2,644,175 1,671,687

5,318,012 748,327 (297,570) 5,768,769 816,781 (105,534) 6,480,016

(166,647) (271,963) 8,151,703

7,798,684 913,818 (299,558) 8,412,944 284,174 (106,805)

1,781,593

6,017,091

Total $

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

5

Direct investments 2020 $ Non-current investments Equity investments – at FVOCI

6,693,940

2019 $ 36,250

The Council designated the investments shown above as equity investments as at FVOCI because these equity investments represent investments that the Council intends to hold for the long-term for strategic purposes.

Dividend income Fair value as recognised at 31 Dec 2020 during 2020 $ $ Equity investments Financial sector Others

4,995,300 1,698,640 6,693,940

19,700 5,509 25,209

Dividend income Fair value as recognised at 31 Dec 2019 during 2019 $ $ Equity investments Others

36,250

2,230

No strategic investments were disposed of during 2020, and there were no transfers of any cumulative gain or loss within equity relating to these investments.

6

Interest in associate In October 2015, the Council entered into a Memorandum of Understanding (“MOU”), together with Singapore Indian Development Association, Yayasan MENDAKI, and the Eurasian Association (together “Self-Help Groups (SHGs)”), to incorporate Self Help Groups Student Care Limited (“SHGSCL”).

Incorporation of SHGSCL is in line with the mandate of the SHGs to provide educational and family related support services to students from low income families. Programmes to be conducted by SHGSCL will be inclusive and multi-racial.

SHGSCL was incorporated in November 2015 and is a public company limited by guarantee.

The Council has appointed Low Yen Ling and Pok Cheng Chong to the Board of Directors of SHGSCL. The Council is entitled to 25% of total voting rights at the Board of Directors meetings.

Management has exercised judgement in determining the extent of its significant influence over SHGSCL, and concluded that the Council has significant influence over SHGSCL. Therefore, the Council recognised SHGSCL as an associate in the balance sheet.

FS23

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Details of the associate are as follows: Name

SHGSCL

Principal activities

Operate school-based student care centres in Singapore

Place of incorporation

Singapore

Voting rights 2020 2019 % % 25

25

The summarised financial information of the associate which is prepared in accordance with FRS is as follows: 2020 $

2019 $

Statement of comprehensive income Revenue Profit and total comprehensive income for the year

10,516,627 2,430,847

10,090,010 637,960

Balance sheet Non-current assets Current assets Non-current liabilities Current liabilities Net assets/deficit

769,594 9,399,319 (5,171,461) (3,685,231) 1,312,221

700,860 6,025,067 (5,000,000) (2,844,552) (1,118,625)

(559,313) 559,313

(878,293) 318,980 (559,313) 2,500,000 1,940,687

Interest in net assets of investee at beginning of the year Share of total comprehensive income Interest in net assets of investee at end of the year Loan to associate

–

2,500,000 2,500,000

The objective of setting up the associate is for the SHGs to jointly operate student care centres in schools that serve students from all races. The investment in the associate, in substance, is not meant to be a commercially-driven transaction with the purpose of profit takings. The Memorandum of Association of SHGSCL prohibits the Council, together with other SHGs, from obtaining any variable returns in the form of profits, dividends, or residual interest in net assets in the event of liquidation or winding-down.

The Council’s financial statements include the Council’s share of losses of the associate at 50%, based on the Council’s proportionate share of loan commitment to the associate as set out in the MOU. The Council’s exposure to losses is limited to the carrying amount of the investment, together with any long-term interests.

Loan to associate represents the Council’s commitment to the associate which is made in the form of an unsecured and interest free loan. As the associate has plans to scale up its operation, the settlement of the loan is not expected to occur in the foreseeable future. The loan is classified as non-current and at amortised cost less impairment.

FS24

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

The SHGs also agree to continue providing funding support to the associate while it scales up its operation. As at 31 December 2020, the Council has provided funding support of $2,500,000 (2019: $2,500,000).

Key source of estimation uncertainty The Council evaluates, amongst other factors, the financial health of and operational cash flow projections, to assess the recoverable amounts of its interest in SHGSCL. Differences between the actual performance and management’s annual impairment review will affect the results of the period in which such differences are determined. An increase in impairment losses will increase expenses and decrease non-current assets.

7

Other receivables 2020 Operation Endowment Note Fund Fund $ $ Student fees receivables Allowance for doubtful receivables Contributions receivable through the CPF scheme Deposits Interest receivable– held under fund management investment schemes Others

8

Prepayments

Total $

2019 Operation Endowment Fund Fund $ $

Total $

286,543

–

286,543

259,826

–

259,826

(30,767) 255,776

– –

(30,767) 255,776

(32,325) 227,501

– –

(32,325) 227,501

2,193,451 177,046

– –

2,193,451 177,046

2,166,382 158,116

– –

2,166,382 158,116

33,838 252,868 2,912,979 77,360 2,990,339

443,873 10,451 454,324 – 454,324

477,711 263,319 3,367,303 77,360 3,444,663

46,083 308,568 2,906,650 51,527 2,958,177

499,735 19,628 519,363 – 519,363

545,818 328,196 3,426,013 51,527 3,477,540

The movement in the allowance for impairment in respect of student fees receivable during the year is as follows: 2020 2019 $ $ At 1 January Impairment loss recognised Impairment loss utilised At 31 December

32,325 3,682 (5,240) 30,767

7,143 32,325 (7,143) 32,325

Contributions receivable through the CPF scheme relates to the December contributions made by individuals of the Chinese community.

FS25

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

8

Fund management investment schemes 2020 Operation Endowment Note Fund Fund $ $ Current investments Equity investments – designated at FVTPL Debt investments at FVTPL Derivative assets Interest receivable Cash and cash equivalents

7 9

2,348,727 4,704,249 7,052,976 56,757 7,109,733 33,838 342,719 7,486,290

16,212,928 46,951,040 63,163,968 487,181 63,651,149 443,873 2,679,456 66,774,478

2019 Operation Endowment Fund Fund $ $

Total $ 18,561,655 51,655,289 70,216,944 543,938 70,760,882 477,711 3,022,175 74,260,768

694,552 5,105,257 5,799,809 57,558 5,857,367 46,083 1,169,129 7,072,579

9,837,634 51,959,846 61,797,480 341,944 62,139,424 499,735 1,245,118 63,884,277

Total $ 10,532,186 57,065,103 67,597,289 399,502 67,996,791 545,818 2,414,247 70,956,856

The above represents funds placed with financial institutions that manage the funds for a period of at least 3 years. Although the book value of the investments fluctuates during the fund management period, the investment managers have provided guarantee of the return of the principal sum of $32.87 million (2019: $32.87 million) to the Council at the end of the relevant fund management periods on one portfolio (2019: one portfolio). The funds are invested in investments that are in compliance with the provisions of the Trustees Act. Forward foreign exchange contracts are held as economic hedges of debt securities and cash and cash equivalents denominated in foreign currencies.

The weighted average effective interest rates per annum and repricing periods of the interestearning financial assets managed under these portfolios are as follows: Effective interest rate %

Total $

Within 1 year $

1 to 5 years $

2020 Debt securities and deposits

2.68

5,046,968

2,648,219

2,398,749

–

2019 Debt securities and deposits

2.73

6,274,386

1,438,433

4,835,953

–

2020 Debt securities and deposits

3.33

49,630,496

4,621,471

36,400,586

8,608,439

2019 Debt securities and deposits

3.30

53,204,964

6,603,493

38,735,469

7,866,002

Operation Fund

After 5 years $

Endowment Fund

The Council’s exposure to credit, currency and interest rate risks is disclosed in note 25.

FS26

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

9

Cash and cash equivalents 2020 Operation Endowment Note Fund Fund $ $ Cash in hand Cash at bank Deposits with financial institutions

3,900 1,652,392 13,665,113 15,321,405

Held under fund management investment schemes: Cash at bank Deposits with financial institutions 8

– 1,962,822

Total $

2019 Operation Endowment Fund Fund $ $

3,900 3,615,214

3,900 1,267,082

5,445,658 19,110,771 7,408,480 22,729,885

19,360,195 20,631,177

– 818,291

Total $ 3,900 2,085,373

5,491,203 24,851,398 6,309,494 26,940,671

342,719

2,679,456

3,022,175

167,533

1,245,118

1,412,651

– 342,719

– 2,679,456

– 3,022,175

1,001,596 1,169,129

– 1,245,118

1,001,596 2,414,247

15,664,124 10,087,936 25,752,060

21,800,306

7,554,612 29,354,918

The weighted average effective interest rates per annum of the interest-earning deposits at the reporting date are as follows:

Cash at bank Deposits with financial institutions

Operation Fund 2020 2019 % %

Endowment Fund 2020 2019 % %

0.00

0.01

0.05

0.07

0.33

1.72

0.30

1.54

Interest rates reprice at intervals of one, three, six, nine or twelve months.

10

Endowment Fund The Endowment Fund is established to receive donations from the public and government grants.

The Board of Trustees is entrusted with the duty of managing and building up the Endowment Fund. Such endowment funds can be used for the Council's operations only, with the approval of the Board of Trustees. Income generated by the Endowment Fund accrues to the Endowment Fund.

11

Operation Fund The Operation Fund is a general fund of the Council to be applied for the general purposes of the Council in support of its objectives. The Operation Fund comprises mainly the monthly contributions made by individuals of the Chinese community through the CPF scheme as stipulated in The Central Provident Fund (Contributions to Community Fund (CDAC)) Rules 1992 which commences from September 1992 and the income (net) generated thereon.

Excluding share of results of associate, the carrying amount of the Operation Fund as at 31 December 2020 amounts to $31,694,700 (2019: $30,715,116).

FS27

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

12

Fair value reserve The fair value reserve comprises the cumulative net change in the fair value of equity investments designated as at FVOCI held until the investment is derecognised.

13

Lease liabilities 2020 $ Non-current Current Total

459,274 478,565 937,839

2019 $ 909,984 455,862 1,365,846

Terms and conditions of outstanding lease liabilities are as follows: Effective interest rate

Year of maturity

31 December 2020 Lease liabilities

1.56% - 1.90%

2021 - 2022

964,000

937,839

31 December 2019 Lease liabilities

1.90%

2020 - 2022

1,404,000

1,365,846

Face value $

Carrying amount $

Reconciliation of movements of liabilities to cash flows arising from financing activities Lease liabilities 2020 2019 $ $ Balance as at 1 January Adjustment on initial application of FRS 116 Adjusted balance as at 1 January

1,365,846 – 1,365,846

Changes from financing cash flows Payment of lease liabilities Interest paid Total changes from financing cash flows

(320,515) (23,485) (344,000)

Other changes New lease Interest expense Remeasurement of lease liabilities Total liability-related other changes Balance as at 31 December

59,155 23,485 (166,647) (84,007) 937,839

– 1,781,593 1,781,593 (415,747) (29,537) (445,284) – 29,537 – 29,537 1,365,846

FS28

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

14

Other payables 2020 Operation Endowment Note Fund Fund $ $ Accrued operating expenses Other creditors Deferred grant income

15

15

3,124,717 46,136 174,037 3,344,890

175,159 – – 175,159

3,299,876 46,136 174,037 3,520,049

3,489,554 256,501 – 3,746,055

60,143 – – 60,143

Total $ 3,549,697 256,501 – 3,806,198

Accrued operating expenses 2020 Operation Endowment Fund Fund $ $ Auditors’ remuneration: - audit fees - non-audit fees Fund management performance fee Staff CPF contribution for December Ready for School project CDAC programmes and other administrative costs Provision for unutilised leave

16

Total $

2019 Operation Endowment Fund Fund $ $

Total $

2019 Operation Endowment Fund Fund $ $

Total $

118,000 5,000

– –

118,000 5,000

118,000 –

– –

118,000 –

2,984

175,159

178,143

2,853

60,143

62,996

373,450 1,290,558

– –

373,450 1,290,558

396,846 1,018,913

– –

396,846 1,018,913

964,608 370,117 3,124,717

– – 175,159

964,608 370,117 3,299,876

1,658,555 294,387 3,489,554

– – 60,143

1,658,555 294,387 3,549,697

Donation income Tax deductible donations during the year amounts to $27,058,224 (2019: $26,521,798).

17

Grants and subsidies from government agencies 2020 $ Grants from the government: - additional Top-Up Grant & Government Matching Grant - defrayment of operating lease expense for CDAC headquarters/Temporary Occupation Licence fee - wage support Other grants and subsidies from other government related agencies to fund programmes and activities

2019 $

5,000,000

2,000,000

333,840 1,364,054

476,454 52,808

140,756 6,838,650

300,000 2,829,262

CDAC occupies a government land at 65 Tanjong Katong Road, Singapore 436957 and pays an operating lease expense for CDAC headquarters/Temporary Occupation Licence (“TOL”) fee yearly to the Singapore Land Authority. The Ministry of Culture, Community & Youth provides a yearly grant to defray the lease rental/TOL fee incurred by the Council.

FS29

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Government grants recognised in 2020 includes:

18

a)

Additional Top-up Grant and Government Matching Grant to support the Council’s students’ programmes and provide assistance schemes for students and family that impacted by Covid-19 pandemic.

b)

Wage support from government to support businesses during the period of economic uncertainty due to the Covid-19 pandemic.

Other income 2020 Operation Endowment Fund Fund $ $ Interest income - deposits and bank balances Others

19

167,556 6,852 174,408

57,964 – 57,964

Total $ 225,520 6,852 232,372

2019 Operation Endowment Fund Fund $ $

Total $

251,838 518 252,356

78,598 – 78,598

330,436 518 330,954

Costs undertaken directly $

2019 Support costs (note 20) $

Total $

11,595,316 4,751,544 867,367

377,972 178,557 127,287

11,973,288 4,930,101 994,654

Resources expended on charitable activities

Programme or initiative

Costs undertaken directly $

Student & Parent Education 10,549,461 Family & Worker Support 6,715,386 Fulfilling Ageing 488,421 Community Outreach & Engagement 2,462,812 Volunteers Engagement & Development 552,564 One-Stop Service 410,065 CDAC-SFCCA Hardship Assistance and CDAC-SFCCA Bursary schemes 3,289,528 CDAC Education Grant 5,198,445 29,666,682

2020 Support costs (note 20) $

Total $

536,895 11,086,356 278,099 6,993,485 205,853 694,274 517,830

2,980,642

3,144,128

335,878

3,480,006

103,900 108,729

656,464 518,794

663,669 465,617

70,855 69,202

734,524 534,819

– 3,289,528 – 5,198,445 1,751,306 31,417,988

2,016,730 – 23,504,371

– 2,016,730 – – 1,159,751 24,664,122

FS30

20

45,593

187,482 74,055 536,895

Depreciation expenses Total for 2020

45,180

190,458 34,768 377,972

Depreciation expenses Total for 2019

10,248 127,287

18,431

98,608

6,722 205,853

17,920

181,211

Fulfilling Ageing programme $

169,212 335,878

50,988

115,678

243,805 517,830

49,791

224,234

19,991 70,855

13,818

37,046

20,024 103,900

13,353

70,523

Volunteers Community Engagement Outreach & & Engagement Development programme programme $ $

6,079 69,202

19,484

43,639

7,360 108,729

19,143

82,226

One-Stop Service $

Usage in terms of time spent Floor area in terms of floor area occupied and usage Usage in terms of assets acquired

Usage in terms of time spent Floor area in terms of floor area occupied and usage Usage in terms of assets acquired

Basis of allocation

FS31

Allocated staff costs include manpower cost of management staffs, administration and Information Technology staff but exclude staff who directly handle the programmes. Depreciation expenses incurred for CDAC Centres programme include depreciation expenses of renovation cost of CDAC Centres and assets acquired such as computers and office equipment to operate the Centres.

11,862 178,557

121,515

152,746

2019 Staff costs (include management) Maintenance and administrative expenses

11,934 278,099

220,572

Family & Worker Support programme $

275,358

Student & Parent Education programme $

2020 Staff costs (include management) Maintenance and administrative expenses

Support costs

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

21

Expenses incurred The following items have been included in arriving at total expenses incurred: Note Allowance for doubtful receivables Depreciation expenses, net of government grant Staff costs: - key management personnel - others Contributions to defined contribution plans included in staff costs Waiver of student fees, offset against fee income from education programme

2020 $

2019 $

7 4

3,682 816,781

32,325 748,327

28

585,657 6,933,195

599,370 6,810,942

977,611

974,240

2,798,400

4,261,034

Effective from January 2019, the Tuition Programme and Enrichment Programme were revamped and merged as a single programme with enhanced content and pedagogy. Subsequent to the merger of the programme, CDAC introduced a new billing structure to reflect the published programme fees and applied a standard subsidy rate across all tuition centres and CDAC Centres.

With priority given to students from the lower income families, a higher fee waiver was granted to the needy students.

22

Investment income/(loss) 2020 Operation Endowment Fund Fund $ $ Investment income/(loss) from fund management investment schemes: Realised gain/(loss) on sale of investments Exchange gain/(loss) Investment income/(expenses) Net change in fair value of financial assets Interest income Dividend income

Investment income from direct investments: Dividend income

114,389 26,191 (1,991)

601,579 110,254 (23,164)

Total $

715,968 136,445 (25,155)

2019 Operation Endowment Fund Fund $ $

Total $

55,265 17,666 3,226

471,338 31,151 16,658

526,603 48,817 19,884

130,475 269,064 150,323 5,808 425,195

627,413 1,316,082 1,691,523 118,483 3,126,088

757,888 1,585,146 1,841,846 124,291 3,551,283

182,865 259,022 154,436 14,732 428,190

2,176,399 2,695,546 1,781,632 148,792 4,625,970

2,359,264 2,954,568 1,936,068 163,524 5,054,160

25,209

–

25,209

2,230

–

2,230

FS32

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

23

Taxation The Council is an approved charity organisation under the Charities Act, Chapter 37 and an institution of a public character under the Income Tax Act, Chapter 134. No provision for taxation has been made in the financial statements as the Council is a registered charity with income tax exemption.

24

Leases

(i)

Right-of-use assets The Council leases the government land at 65 Tanjong Katong Road, Singapore 436957 from the Singapore Land Authority. Refer to Note 4 for right-of-use assets relating to the leased assets.

(ii)

Amounts recognised in profit or loss 2020 $ Interest on lease liabilities Expenses relating to short-term leases

(iii)

23,845 62,924

29,537 140,030

Amounts recognised in statement of cash flows

Total cash outflow for leases (iv)

2019 $

2020 $

2019 $

344,000

445,284

2020 $

2019 $

Maturity analysis on lease liabilities (refer to Note 13 for lease liabilities recognised as at reporting date)

Maturity analysis – contractual undiscounted cash flows Less than one year One to two years Two to three years Total undiscounted lease liabilities at 31 December

496,000 468,000 –

964,000

468,000 468,000 468,000 1,404,000

FS33

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

25

Financial risk management Overview The Council has exposure to the following risks from its use of financial instruments: credit risk liquidity risk market risk This note presents information about the Council’s exposure to each of the above risks, the Council’s objectives, policies and processes for measuring and managing risk.

Risk management framework Risk management is integral to the operations of the Council. Management has established a system of controls in place to create an acceptable balance between the cost of risks occurring and the cost of managing the risks.

Credit risk Credit risk is the risk of financial loss to the Council if a counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Council’s receivables from counterparties and investment securities.

The carrying amount of financial assets in the balance sheet represents the Council’s respective maximum exposure to credit risk. The Council does not hold any collateral in respect of its financial assets.

The maximum exposure to credit risk for other receivables at the reporting date by type of counterparty are as follows: 2020 Operation Endowment Fund Fund $ $ Government agencies Student fees receivable (including Self-Help Groups) Others

Total $

2019 Operation Endowment Fund Fund $ $

Total $

2,207,024

–

2,207,024

2,185,873

–

2,185,873

255,776 450,179 2,912,979

– 454,324 454,324

255,776 904,503 3,367,303

227,501 493,276 2,906,650

– 519,363 519,363

227,501 1,012,639 3,426,013

The Council does not require collateral in respect of other receivables.

Expected credit loss assessment The Council uses an allowance matrix to measure the ECLs of receivables. The allowance matrix is based on actual credit loss experience over the past three years. The ECL computed is purely derived from historical data which management is of the view that the historical conditions are representative of the conditions prevailing at the reporting date. The amount of the allowance for credit impaired receivables is insignificant.

FS34

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

A summary of the Council’s exposures to credit risk for other receivables is as follows: Gross carrying amount $ 31 December 2020 Not past due Past due 31 – 60 days 31 December 2019 Not past due Past due 31 – 60 days

Impairment loss allowance $

Net $

3,367,303 30,767 3,398,070

– (30,767) (30,767)

3,367,303 – 3,367,303

3,415,917 42,421 3,458,338

– (32,325) (32,325)

3,415,917 10,096 3,426,013

Based on historical default rates, the Council believes that no impairment is necessary in respect of other receivables not past due or past due up to 60 days except for specifically identified amounts. These receivables are mainly arising from government agencies, Self-Help Groups and student fees.

Debt investments Exposure to credit risk An Investment Committee, established to advise, review and approve investment proposals and appointment of investment managers, monitors the Council’s investments on an ongoing basis.

Most of the Council’s funds are placed with regulated financial institutions that manage the funds on a full discretionary basis.

In order to limit the Council’s exposure to credit risk, stringent criteria are adopted by the Investment Committee in the selection of professional fund managers for investments in fund management investment schemes.

These professional investment managers adopt stringent quantitative and qualitative criteria in their investment process which cover research and fundamental analysis; strategy and asset allocation including portfolio construction, risk management and performance analysis.

Fixed income investments are assessed using stringent investment criterion and this includes, but is not limited to, a thorough analysis of each debt security’s terms and conditions, the availability and quality of the guarantor, as well as financial strength of the issuer.

FS35

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

The table below summarises the type of debt securities held by the Council and the credit ratings which are based on reputable credit rating agencies such as Standard and Poor, Moody and Fitch’s financial strength rating and its equivalent.

Financial strength ratings A to AA A- to BBBOthers* $ $ $

Total $

Operation Fund 2020 Debt securities: - Corporate bonds

1,794,007

2,140,831

769,411

4,704,249

2019 Debt securities: - Corporate bonds

2,343,266

1,989,689

772,302

5,105,257

2020 Debt securities: - Corporate bonds

17,629,898

18,166,477

11,154,665

46,951,040

2019 Debt securities: - Corporate bonds

18,884,250

18,321,924

14,753,672

51,959,846

Endowment Fund

*Others refer to credit ratings given by the fund managers.

Cash and cash equivalents The Council held cash and cash equivalents of $25,752,060 (2019: $29,354,918). The cash and cash equivalents are held with banks and financial institution counterparties which are regulated.

Impairment on cash and cash equivalents has been measured on the 12-month expected loss basis and reflects the short maturities of the exposures. The Council considers that its cash and cash equivalents have low credit risk based on the external credit ratings of the counterparties. The amount of the allowance on cash and cash equivalents is negligible.

Liquidity risk Liquidity risk is the risk that the Council will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset.

The Council monitors its liquidity risk and maintains a level of cash and cash equivalents deemed adequate by management to finance the Council’s operations and to mitigate the effects of fluctuations in cash flows.

FS36

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Carrying amount $ Operation Fund 2020 Other payables Lease liabilities 2019 Other payables Lease liabilities Endowment Fund 2020 Other payables 2019 Other payables

Contractual cash flows $

Cash flows Less than Between 1 1 year and 5 years $ $

3,344,890 937,839 4,282,729

(3,344,890) (964,000) (4,308,890)

(3,344,890) (496,000) (3,840,890)

– (468,000) (468,000)

3,746,055 1,365,846 5,111,901

(3,746,055) (1,404,000) (5,150,055)

(3,746,055) (468,000) (4,214,055)

– (936,000) (936,000)

175,159

(175,159)

(175,159)

–

60,143

(60,143)

(60,143)

–

Market risk Market risk is the risk that changes in market prices, such as interest rates, foreign exchange rates and equity prices will affect the Council’s income or value of its holding of financial instruments.

The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

Currency risk Currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

The Council is exposed to the effects of foreign currency exchange rate fluctuations, principally in Euro (“EUR”), Hong Kong dollar (“HKD”), United States dollar (“USD”), Korean Won (“KRW”) and New Taiwan dollar (“TWD”).

FS37

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

The Council’s foreign currency exposures are as follows: GBP $

AUD $

JPY $

HKD $

USD $

Other currencies $

TWD $

Operation Fund 2020 Investments Cash and cash equivalents

2019 Investments Cash and cash equivalents

GBP $

–

–

–

12,928

–

–

–

– –

– –

– –

3,988 16,916

– –

– –

73,408

31,021

106,020

16,955

424,930

19,602

103,417

73,408

– 31,021

– 106,020

– 16,955

374 425,304

– 19,602

– 103,417

EUR $

HKD $

USD $

KRW $

TWD $

AUD $

Other currencies $

Endowment Fund 2020 Investments Cash and cash equivalents

–

–

109,842

944,947 1,650,036

711,490

415,971

159,467

– –

– –

– 109,842

– 591,212 944,947 2,241,248

– 711,490

99,409 515,380

5,738 165,205

601,332

–

285,154 5,119,157

–

238,580 1,885,413

9,818 611,150

– –

716 293,702 285,870 5,412,859

– –

63,180 4,633 301,760 1,890,046

2019 Investments 792,413 Cash and cash equivalents – 792,413

FS38

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Sensitivity analysis A 10% strengthening of the Singapore dollar, against the following currencies at the reporting date would have decreased profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Council considered to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, remain constant.

Profit or loss Operation Endowment Fund Fund $ $ 31 December 2020 EUR HKD USD KRW TWD

31 December 2019 GBP AUD HKD JPY USD TWD

– –

10,984 94,495 224,125 71,149 51,538

7,341 3,102 1,696 10,602 42,530 1,960

79,241 61,115 28,587 – 541,286 30,176

– –

1,692

A 10% weakening of the Singapore dollar against the above currencies would have had the equal but opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.

Interest rate risk The Council’s exposure to market risk for changes in interest rates relates to the interest-bearing cash and cash equivalents and debt securities. The weighted average effective rates at balance sheet date and the periods in which they reprice or mature are disclosed in notes 8 and 9.

The Council has fixed deposits of $19,110,771 (2019: $24,851,398) with fixed interest rates according to market rates in regulated banks.

For the financial instruments held with fund managers, the Council relies on professional fund managers to monitor and mitigate the adverse effects of interest rate changes on its investment portfolios.

FS39

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Sensitivity analysis An increase of 100 basis points in interest rates at the reporting date would have increased net income for the year by $191,108 (2019: $248,514). This analysis assumes that all other variables remain constant.

A decrease of 100 basis point in interest rates at the reporting date would have had the equal but opposite effect on the amounts shown above, on the basis that all other variables remain constant.

The analysis is performed on the same basis for 2019.

Price risk Price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market.

Sensitivity analysis The Council’s investments are recognised at fair value through profit or loss. A 10% increase or decrease in the underlying market prices at the reporting date, with all variables held constant would increase or decrease profit or loss by $7,076,088 (2019: $6,799,679).

Estimation of fair value The following summarises the significant methods and assumptions used in estimating the fair values of financial instruments of the Council.

Investments in equity and debt securities The fair value of quoted financial assets at FVTPL and FVOCI is determined by reference to their quoted bid prices at the reporting date.

The fair value of unquoted debt securities is provided by investment fund managers as obtained from recognised market makers.

Derivatives The fair value of forward exchange contracts is based on their listed market price, if available. If a listed market price is not available, fair value is estimated by discounting the difference between the contractual forward price and the current forward price for the residual period to maturity of the contract using a risk-free interest rate (based on government bonds).

FS40

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Fair value hierarchy The different levels have been defined as follows: Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices).

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Other financial assets and liabilities The carrying amounts of financial assets and liabilities with a maturity of less than one year (including other receivables, cash and cash equivalents and other payables) are assumed to approximate their fair values because of the short period to maturity.

FS41

13 14

8 8 7 8 9

14

Lease liabilities Other payables

Endowment Fund Equity investments – at FVTPL Debt investments – at FVTPL Other receivables* Derivative assets Cash and cash equivalents

Other payables

*Excludes prepayments

5 8 8 7 8 9

2020 Operation Fund Equity investment – at FVOCI Equity investments – at FVTPL Debt investments – at FVTPL Other receivables* Derivative assets Cash and cash equivalents

–

16,212,928 46,951,040 – 487,181 – 63,651,149

– – –

– 2,348,727 4,704,249 – 56,757 – 7,109,733

Mandatorily at FVTPL Note others $

–

– – 454,324 – 10,087,936 10,542,260

– – –

– – – 2,912,979 – 15,664,124 18,577,103

Financial assets at amortised cost $

–

– – – – – –

– – –

6,693,940 – – – – – 6,693,940

FVOCI – equity instruments $

Carrying amount

(175,159)

– – – – – –

(937,839) (3,344,890) (4,282,729)

– – – – – – –

Other financial liabilities $

(175,159)

16,212,928 46,951,040 454,324 487,181 10,087,936 74,193,409

(937,839) (3,344,890) (4,282,729)

6,693,940 2,348,727 4,704,249 2,912,979 56,757 15,664,124 32,380,776

Total $

16,212,928 – – – –

6,693,940 2,348,727 – – – –

Level 1 $

– 46,951,040 – 487,181 –

– – 4,704,249 – 56,757 –

Level 2 $

Fair value

– – – – –

– – – – – –

FS42

Level 3 $

The carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy are as follows. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.

Accounting classifications and fair values

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

13 14

8 8 7 8 9

14

Lease liabilities Other payables

Endowment Fund Equity investments – at FVTPL Debt investments – at FVTPL Other receivables* Derivative assets Cash and cash equivalents

Other payables

*Excludes prepayments

5 8 8 7 8 9

2019 Operation Fund Equity investment – at FVOCI Equity investments – at FVTPL Debt investments – at FVTPL Other receivables* Derivative assets Cash and cash equivalents

–

9,837,634 51,959,846 – 341,944 – 62,139,424

– – –

– 694,552 5,105,257 – 57,558 – 5,857,367

Mandatorily at FVTPL Note others $

–

– – 519,363 – 7,554,612 8,073,975

– – –

– – – 2,906,650 – 21,800,306 24,706,956

Financial assets at amortised cost $

–

– – – – – –

– – –

36,250 – – – – – 36,250

FVOCI – equity instruments $

Carrying amount

(60,143)

– – – – – –

(1,365,846) (3,746,055) (5,111,901)

– – – – – – –

Other financial liabilities $

(60,143)

9,837,634 51,959,846 519,363 341,944 7,554,612 70,213,399

(1,365,846) (3,746,055) (5,111,901)

36,250 694,552 5,105,257 2,906,650 57,558 21,800,306 30,600,573

Total $

9,837,634 3,498,585 – – –

36,250 694,552 – – – –

Level 1 $

– 48,461,261 – 341,944 –

– – 5,105,257 – 57,558 –

Level 2 $

Fair value

– – – – –

– – – – – –

FS43

Level 3 $

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

26

Capital management and reserve policy The Council is a company limited by guarantee with no issued capital. The Council builds up its capital from donations received and also through prudent management of its financial resources.

The capital of the Council includes reserve fund in its Endowment Fund and accumulated surplus fund in its Operation Fund.

The Council’s capital is closely monitored to ensure that there are sufficient capital and reserve to support its programmes and activities on an on-going basis. The Council constantly assesses its capital and reserve adequacy and explores ways to maximise existing resources within the community as it conducts its budget planning and review.

The Council has an Investment Committee to review and manage the capital fund. Most of the Council’s capital funds are invested with regulated financial institutions based on stringent criteria in the selection of professional fund managers.

The Council has set guidelines on its investment to safeguard the capital. Of the funds invested with professional fund managers, one out of the four portfolios managed by fund managers are with guarantee of the return of principal sum. The funds are invested in investments which are in compliance with the provisions of the Trustees Act. There were no changes in the Council’s approach to capital management during the year. The Council is not subject to externally imposed capital requirements.

27

Employees remuneration The number of employees whose remuneration amounted to over $100,000 during the year are as follows: 2020 $100,000 to $200,000 $200,001 to $300,000

2019 14 1

14 1

The number of staffs employed by the Council as at 31 December 2020 was 97 (2019: 97).

28

Related parties Compensation of key management personnel Key management personnel of the Council are those having the authority and responsibility for planning, directing and controlling the activities of the Council. The Board of Directors, members of the Investment Committee and the Executive Director of the Council are considered as key management personnel of the Council. The Board of Directors and members of the Investment Committee did not receive any form of remuneration during the year.

FS44

Chinese Development Assistance Council Financial statements Year ended 31 December 2020

Key management personnel compensation comprised of the three highest paid staff:

Short-term employee benefits Contributions to defined contribution plans

2020 $

2019 $

545,148 40,509 585,657

556,295 43,075 599,370

There is no paid staff who are close members of the family of the Executive Director or Board Member, who receives more than $50,000 during the year.

29

Capital commitments Capital expenditures relating to property, plant and equipment that are contracted for at the balance sheet date but not recognised in the financial statements amounted to $6,900,000 (2019: $nil).

FS45