5 Expenses and other income


	2019			2018			2017
	US$M			US$M			US$M
Employee benefits expense:
Wages, salaries and redundancies		3,683			3,653			3,392
Employee share awards		138			123			105
Social security costs		4			4			3
Pension and other post-retirement obligations		292			292			273
Less employee benefits expense classified as exploration and evaluation expenditure		(85	)		(82	)		(79	)
Changes in inventories of finished goods and work in progress		496			(142	)		(743	)
Raw materials and consumables used		4,591			4,389			3,830
Freight and transportation		2,378			2,294			1,786
External services		4,745			4,786			4,037
Third party commodity purchases		1,069			1,374			1,060
Net foreign exchange (gains)/losses		(147	)		(93	)		103
Government royalties paid and payable		2,538			2,168			1,986
Exploration and evaluation expenditure incurred and expensed in the current period		516			641			610
Depreciation and amortisation expense		5,829			6,288			6,184
Net impairments:
Property, plant and equipment		250			318			160
Goodwill and other intangible assets		14			14			33
Available for sale financial assets		–			1			–
Operating lease rentals		405			421			391
All other operating expenses		1,306			1,078			989

Total expenses		28,022			27,527			24,120

(Gains)/losses on disposal of property, plant and equipment		(22	)		10			(286	)
Other income		(371	)		(257	)		(376	)

Total other income		(393	)		(247	)		(662	)

Other income is generally income earned from transactions outside the course of the Group’s ordinary activities and may include certain management fees from non-controlling interests and joint arrangements, dividend income, royalties, commission income and gains or losses on divestment of subsidiaries or operations.

Recognition and measurement

Income is recognised when it is probable that the economic benefits associated with a transaction will flow to the Group and they can be reliably measured. Dividends are recognised upon declaration.