Annual Report 2022

NOTESTOTHE CONSOLIDATED FINANCIAL STATEMENTS For the year ended 31 December 2022 94 The United Laboratories International Holdings Limited Annual Report 2022 7. OTHER GAINS AND LOSSES, NET/OTHER EXPENSES 2022 2021 RMB’000 RMB’000 (a) Other gains and losses, net Net gain on fair value changes of derivative financial instruments (Note) (37,730) (8,120) Gain on disposal of financial assets at fair value through profit or loss (17,973) – Write-down of deposits for property, plant and equipment 2,168 3,165 Net loss on disposal of property, plant and equipment 4,390 3,301 Written off of property, plant and equipment 78,176 16,080 Net foreign exchange loss (gain) 59,412 (34,550) Others 128 868 88,571 (19,256) (b) Other expenses Research and development expenditures 593,598 465,243 Tax penalty 781 223 Land penalty – 1,739 Others 9,236 27,749 603,615 494,954 Note: During the years ended 31 December 2022 and 2021, the Group had entered into a cross currency interest rate swap contract and several foreign currency forward contracts with banks and financial institutions to reduce its exposure to foreign currency risks. These derivatives were not accounted for under hedge accounting. There were three (2021: one) outstanding derivative financial instruments held by the Group as at 31 December 2022.