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NOTES TO THE ACCOUNTS<br />
31. Expenses by nature<br />
Operating profit is stated after crediting and charging the following:<br />
Depreciation<br />
98 <strong>Johnson</strong> <strong>Electric</strong> Holdings Limited<br />
2006 2005<br />
US$’000 US$’000<br />
Depreciation on properties, plant and equipment 55,650 44,367<br />
Less: amounts capitalised on assets under construction (1,256) (1,012)<br />
54,394 43,355<br />
Staff costs 229,221 159,569<br />
Less: amounts capitalised on assets under construction (1,640) (2,029)<br />
227,581 157,540<br />
Cost of goods sold 1,149,235 795,625<br />
Auditors’ remuneration 1,879 769<br />
Amortisation on leasehold land and land use rights (note 8) 318 718<br />
Amortisation of intangibles (note 9) 7,828 3,313<br />
Impairment of assets (note 6) 4,404 –<br />
Loss on disposal of properties, plant and equipment 2,667 3,003<br />
Net exchange loss (note 35) 1,151 1,028<br />
Provision for bad debt 455 –<br />
Reversal of provision for bad debt – (880)<br />
32. Employee benefit expense<br />
2006 2005<br />
US$’000 US$’000<br />
Wages and salaries 206,946 150,725<br />
Social security costs 15,078 3,370<br />
Pension costs – defined contribution plans 3,178 2,523<br />
Pension costs – defined benefit plans 4,019 2,951<br />
229,221 159,569