2012 Annual Report - ZTE

ANNUAL REPORT 2012Notes to Financial Statements(Prepared under Hong Kong Financial Reporting Standards)31 December 201238. OTHER LONG-TERM PAYABLESGroup2012 2011RMB’000 RMB’000Factoring costs payable 341,719 377,059Deferred income for staff housing scheme 182,086 192,833523,805 569,89239. PROVISION FOR WARRANTIESGroupCompany2012 2011 2012 2011RMB’000 RMB’000 RMB’000 RMB’000At beginning of year 347,610 215,076 209,246 77,606Additional provision 303,007 516,152 208,253 437,517Amounts utilised during the year (403,925) (383,618) (289,694) (305,877)At end of year 246,692 347,610 127,805 209,246In respect of handsets, the Group and the Company generally provide a one-year warranty to their customersunder which faulty products will be repaired or replaced. The amount of provision for warranties is estimatedbased on sales volume and past experience of the level of repairs and returns. The estimation basis isreviewed on an ongoing basis and revised where appropriate.401