China XLX Fertiliser Ltd

NOTES TO THE FINANCIAL STATEMENTS31 December 20085. Other income and expense(a)Other incomeGroup2008 2007Rmb’000 Rmb’000Sale of by-products 5,564 3,717Management fees from related parties 941 962Service fee income from related parties – 1Other service fee income – 11Net fair value gain on derivatives 1,763 –Realised exchange gain – 7,487Unrealised exchange gain – 11,116Gain on disposal of property, plant and equipment – 23Write-back of provision for PRC statutory welfare fund* 6,595 –Others 1,169 44716,032 23,764* Prior to FY2007, PRC statutory welfare fund is accrued based on 14% of the total monthly salary payable.Upon the incorporation of the Company in Singapore on 17 July 2006, its PRC subsidiary is considered as aForeign Owned Enterprise and is no longer required to contribute to PRC statutory welfare fund. Hence thesubsidiary has reversed all provisions made in prior years, amounting to Rmb 6,595,080, in the financial yearended 31 December 2008.(b)Other expenseDonations 1,445 –Realised exchange loss 1,667 –Unrealised exchange loss 1,436 –Inventory written down 6,000 –Loss on disposal of property, plant and equipment 1,648 –Write-off of property, plant and equipment 694 –Others 73 –12,963 –Annual Report 200862