Chinese Development Assistance Council (Limited by guarantee and not having a share capital)
Registration Number: 199202625K
Audited Report
Year ended 31 December 2023
Executive Director
Tan Yap Kin
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
General information
Year ended 31 December 2023
Chinese Development Assistance Council
Directors’ statement
Year ended 31 December 2023
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 2023.
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 FS42 are drawn up so as to give a true and fair view of the financial position of the Council as at 31 December 2023 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 Companies Act 1967, the Singapore Charities Act 1994, and Financial Reporting Standards in Singapore; 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 Senior Minister of Singapore, Mr Lee Hsien Loong.
Directorate
The directors in office at the date of this statement are as follows:
Ong Ye Kung (Chairman)
Ang Kiam Meng
Baey Yam Keng
Chee Hong Tat
Chia Kim Huat
Hong Poh Hin
Koh Poh Koon
Chris Leong Sin Kuen
Lim Sau Hoong
Caryn Lim Tze Ching
Low Yen Ling
Patrick Ng Bee Soon
Ng Poh Wah
Png Yiow Beng
Sun Xueling
Woo Chee Chay
Alex Yam Ziming
statement
Year ended 31 December 2023
Trustees
The trustees in office at the date of this statement are as follows:
Ng San Tiong (Chairman)
Chan Kian Kuan
Cheng Wai Keung
Tony Chew Leong-Chee
Thomas Chua Kee Seng
Kho Choon Keng
Sherman Kwek Eik Tse
Lee Huay Leng
Lee Sze Leong
Lee Yi Shyan
William Leong Sin Yuen
Lew Chee Beng
Lim Hock Chee
Lim Ming Yan
Philip Ng Chee Tat
Ng Siew Quan
Ong Ye Kung
Pang Lim
Francis Phua Kiah Mai
Seow Choke Meng
Tan Cheng Gay
Anthony Tan Kang Uei
Wu Hsioh Kwang
Yeo Eng Koon
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.
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 2023, statements of comprehensive income, changes in funds and cash flows for the year then ended, and notes to the financial statements, including material accounting policy information, as set out on pages FS1 to FS42
In our opinion, the accompanying financial statements are properly drawn up in accordance with the provisions of the Companies Act 1967 (‘the Companies Act’), the Charities Act 1994 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 2023 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 withtheethicalrequirementsthatarerelevanttoourauditofthefinancialstatementsinSingapore, 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. 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.
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, 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 toissue 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.
• 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.
• Evaluatetheoverall presentation, structure and contentof 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 monies 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.
Accountants and Chartered Accountants
Singapore 24 May 2024
statements Year ended 31 December 2023
Balance sheet As at 31 December 2023
Financial statements Year ended 31 December 2023
Statement of comprehensive income Year ended 31 December 2023
Income from charitable activities:
income from education programme (including CDAC Centres)
Charitable activities:
Hardship
The accompanying notes form an integral part of these financial statements.
Year ended 31 December 2023
Statement of comprehensive income (cont’d)
Year ended 31 December 2023
Other comprehensive income Items that will not be reclassified to profit or loss:
The accompanying notes form an integral part of these financial statements.
statements
Year ended 31 December 2023
Statement of cash flows
Year ended 31 December 2023
The accompanying notes form an integral part of these financial statements.
Year ended 31 December 2023
Statement of cash flows
Year ended 31 December 2023
The accompanying notes form an integral part of these financial statements.
Statement of changes in funds Year ended 31 December 2023
The accompanying notes form an integral part of these financial statements.
(1,652,866)
Statement of changes in funds (cont’d) Year ended 31 December 2023
The accompanying notes form an integral part of these financial statements.
Chinese Development Assistance Council
Financial statements
Year ended 31 December 2023
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 24 May 2024.
1 Domicile and activities
ChineseDevelopmentAssistanceCouncil(the“Council”),apubliccompanylimitedbyguarantee and not havingasharecapital,isincorporatedin Singapore. TheregisteredaddressoftheCouncil is at 65 Tanjong Katong Road, Singapore 436957.
The Patron of the Council is Senior 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 2027
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 Financial Reporting Standards in Singapore (“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 ofcomprehensiveincome,statementsofcashflows andstatementsofchangesinfunds 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.
Year ended 31 December 2023
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 onan 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 Note 25 – Financial risk management
2.5
Changes in material accounting policies
New accounting standards and amendments
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 2023:
• FRS 117: Insurance Contracts
• Amendments to FRS 12: Deferred tax related to Assets and Liabilities arising from a Single Transaction
• Amendments to FRS 12: International Tax Reform – Pillar Two Model Rules
• Amendments to FRS 1 and FRS Practice Statement 2: Disclosure of Accounting Policies
• Amendments to FRS 8: Definition of Accounting Estimates
The application of these amendments to standards and interpretations does not have a material effect on the financial statements.
Management reviewed the accounting policies and made updates to the information disclosed in Note 3 Material accounting policies (2022: Significant accounting policies) in certain instances to be in line with the amendments.
3 Material 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 profitorloss.Animpairmentlossisreversediftherehasbeenafavourablechangeintheestimates 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 foreigncurrency gainorloss on themonetary itemsis 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 and presented within finance costs/income, 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.
Year ended 31 December 2023
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 thecarrying amount oftheitem ifitisprobable that thefutureeconomic benefitsembodied within thecomponent willflowtothe Councilanditscostcanbemeasuredreliably Thecarryingamount 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 - Over the period of the lease term
Office equipment - 3 years
Computer equipment - 2 years
Furniture and fittings - 5 years
Renovation - 5 to 7 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.
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 or minus, 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.
Year ended 31 December 2023
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;
• therisksthataffecttheperformanceofthebusinessmodel(andthefinancialassetsheldwithin 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
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).
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.
statements
Year ended 31 December 2023
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 effectiveinterest 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 profitorlossunlessthedividendclearlyrepresentsarecoveryofpart ofthecost oftheinvestment. Other net gains and losses are recognised in OCI and are never reclassified to profit or loss.
Cumulative gains or losses recognised under fair value reserve are reclassified to accumulated fund upon disposal of equity investments at FVOCI.
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.
(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:
- substantiallyalloftherisksandrewardsofownershipofthefinancialassetaretransferred; 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 substantiallyall of the risks and rewards of the transferred assets.
Year ended 31 December 2023
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 differencebetween 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
Cashandcashequivalentscomprisecashbalancesandshort-term depositswithmaturitiesofthree 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
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 simplifiedapproachrequirestheloss allowance to be measuredat anamount equal tolifetime ECLs.
General approach
The Council applies the general approach to provide for ECLs on all other financial instruments. Under thegeneralapproach,thelossallowanceismeasuredat anamount equalto12-monthECLs at initial recognition.
statements
Year ended 31 December 2023
At each reporting date, the Council assesses whether the credit risk of a financial instrument has increasedsignificantlysinceinitialrecognition. Whencreditriskhasincreasedsignificantlysince 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 quantitativeandqualitativeinformationandanalysis,basedonthe Council’shistorical 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.
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 cashflowstorepaytheamountssubject tothewrite-off. However,financial assetsthat arewritten off could still be subject to enforcement activities in order to comply with the Council’s procedures for recovery of amounts due.
Year ended 31 December 2023
(ii) Non-financial assets
The carrying amounts of the Council’s non-financial assets 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 discountedto 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.
Impairment losses are recognised in profit or loss.
3.7
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 Council 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.
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.
Year ended 31 December 2023
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.
3.8 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 initiallymeasured at cost, which comprisesthe initial amount ofthelease 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.
Theright-of-useassetissubsequentlystatedatcost lessaccumulateddepreciationandimpairment 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 theterms of thelease and type of the asset leased.
statements
Year ended 31 December 2023
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,extensionor terminationoption orifthereis arevisedin-substancefixedlease 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.
3.9 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 aremeasured on an undiscounted basis andare 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.
Year ended 31 December 2023
3.10
New accounting standards and interpretations not adopted
A number of new accounting standards and interpretations and amendments to accounting standards are effective for annual periods beginning after 1 January 2023 and earlier application is permitted. However, the Council has not early adopted the new or amended accounting standards and interpretations in preparing these financial statements.
ThefollowingamendmentstoFRSsarenotexpectedtohaveasignificant impact onthe Council’s financial statements.
• Amendments to FRS 1: Classification of Liabilities as Current or Non-current and Noncurrent Liabilities with Covenants
• Amendments to FRS 21: Lease Liability in a Sale and Leaseback
• Amendments to FRS 7 and FRS 107: Supplier Finance Arrangement
• Amendments to FRS 21: Lack of Exchangeability
Mandatory effective date deferred
• Amendments to SFRS(I) 1-28: Investments in Associates and Joint Ventures and SFRS(I) 10: Consolidated Financial Statement – Sale or Contribution of Assets between an Investors and its Associate and Joint Venture
Property, plant and equipment
Land and buildings comprise of right-of-use assets relating to the lease of CDAC headquarters office and CDAC Centres
5 Direct investments
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. Fair value as at 31 Dec 2023
income recognised during 2023
value as at 31 Dec 2022
In FY2022, equity investments with a fair value of $3,294,949 were disposed during the year The cumulative gain of $1,203,472 was recognised in the fair value reserves
In FY2023, the Council transferred the cumulative gain of $1,203,472 from fair value reserves to the accumulated fund.
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-HelpGroups(SHGs)”),toincorporateSelfHelpGroupsStudentCare 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. TheCouncilhasappointedLowYenLingandTanYapKintotheBoardofDirectorsofSHGSCL. 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 SHGSC and concluded that the Council has significant influence over SHGSCL. Therefore, the Council recognised SHGSCL as an associate in the balance sheet.
statements
ended 31 December 2023
Details of the associate are as follows:
The summarised financial information of the associate which is prepared in accordance with FRS is as follows:
Interest in net assets of investee at beginning of the year – –Share of
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, if any, at 50%, based on the Council’s proportionate share of loan commitment to the associate as set out in the MOU The Council’sexposureto losses islimitedto the carrying amount of the investment, together with any long-term interests.
Loan to associate representsthe Council’s commitment to the associate which ismade in theform 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.
The SHGs also agree to continue providing funding support to the associate while it scales up its operation. As at 31 December 2023, the Council has provided funding support of $2,500,000 (2022: $2,500,000)
Year ended 31 December 2023
7 Other receivables
The movement in the allowance for impairment in respect of student fees receivable during the year is as follows:
Contributions receivable through the CPF scheme relates to the December contributions made by individuals of the Chinese community.
8 Fund management investment schemes
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 $30.00 million (2022: $32.87 million) to the Council at the end of the relevant fund management periods on one portfolio (2022: one portfolio). The funds are invested in investments that are in compliance with the provisions of the Trustees Act.
Year ended 31 December 2023
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:
The Council’s exposure to credit, currency and interest rate risks is disclosed in note 25 9
Cash and cash equivalents
Chinese Development Assistance Council Financial statements
Year ended 31 December 2023
The weighted average effective interest rates per annum of the interest-earning deposits at the reporting date are as follows:
Interest rates reprice at intervals of 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 interest of associate, the carrying amount of the Operation Fund as at 31 December 2023 amounts to $42,076,044 (2022: $37,879,647)
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
Terms and conditions of outstanding lease liabilities are as follows:
Reconciliation of movements of liabilities to cash flows arising from financing
Changes from financing cash flows
15 Accrued operating expenses
Donation income
Tax deductible donations during the year amounts to $31,578,433 (2022: $30,681,472).
17
Grants and subsidies from government agencies
- defrayment of operating lease expense for CDAC
Government grants recognised includes the Top-Up Grant to support the Council’s programmes and assistance schemes for students and families.
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.