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Provisions

12 Months Ended

Dec. 31, 2024

22.

PROVISIONS

	2024			2023
	US$			US$
Provision for reinstatement costs		71,274			71,872
Provision for defined benefit obligations		185,274			194,260
As at December 31		256,548			266,132
Provision for reinstatement costs
As at January 1		71,872			100,483
Additional provision		3,855			-
Reversal of unutilized amounts		(5,781	)		-
Settled during the year		-			(31,782	)
Increase in discounted amounts arising from the passage of time		1,772			4,009
Exchange realignment		(444	)		(838	)
As at December 31		71,274			71,872
Portion classified as current liabilities		(71,274	)		(71,872	)
Non-current portion		-			-

The Group has certain leases of office properties with clauses of reinstatement of alteration at the end of these leases. The provision for the reinstatement costs of these office properties was estimated based on reinstatement quotes obtained by the Group.

Provision for defined benefit obligations

The Group made provisions for defined benefit obligations in respect of termination benefits and pursuant to applicable labor laws in corresponding jurisdictions. According to the law, employees are entitled to termination benefits upon dismissal or retirement.

The liability for termination of employment is measured using the projected unit credit method. The actuarial assumptions include expected salary increases and discount rates. The amounts are presented based on discounted expected future cash flows using a discount rate determined by reference to market yields at the reporting date on government bonds with a term that is consistent with the estimated term of the termination benefit obligation.

The most recent actuarial valuations of the estimated liabilities for employee benefits were carried out by E. M. Zalamea Actuarial Services, Inc. for the Group’s subsidiaries in the Philippines using the projected unit credit actuarial valuation method for the years ended December 31, 2024 and 2023.

The principal actuarial assumptions used as at the end of the reporting period are as follows:

	2024		2023
Discount rate (%)		6.07 - 6.08		6.15 - 6.19
Expected rate of salary increases (%)		6.00		6.00

A quantitative sensitivity analysis for significant assumptions as at the end of the reporting period is shown below:

			Increase/					Increase/
			(decrease)					(decrease)
			in defined					in defined
	Increase		benefit			Decrease		benefit
	in rate		obligations			in rate		obligations
	%		US$			%		US$
2024
Discount rate		1		(33,908	)		1		43,318
Future annual salary increases		1		42,894			1		(34,214	)
2023
Discount rate		1		(34,297	)		1		43,440
Future annual salary increases		1		43,349			1		(34,637	)

The sensitivity analysis estimates the impact on defined benefit obligations from reasonable changes in key assumptions occurring at the end of the reporting period. The sensitivity analysis is based on changing one assumption at a time, keeping all other assumptions constant, and it may not be representative of an actual change in the defined benefit obligations as it is unlikely that changes in assumptions would occur in isolation from one another.

The total expenses recognized in the consolidated statements of loss and other comprehensive income/(loss) in respect of the plan are as follows:

	2024		2023		2022
	US$		US$		US$
Current service cost		67,548		49,109		69,689
Interest cost		11,583		7,563		5,687
Net benefit expenses recognized in general, administrative and other operating expenses		79,131		56,672		75,376

The movements in the defined benefit obligations classified as non-current liabilities are as follows:

	2024			2023
	US$			US$
At January 1	194,260			101,913
Current service cost		67,548			49,109
Interest cost		11,583			7,563
Benefits paid		(74,016	)		-
Remeasurement losses/(gains) debited/(credited) to other comprehensive income/(loss) arising from:
Changes in financial assumptions		4,147			41,325
Experience adjustments		(19,632	)		(6,440	)
Exchange realignment		1,384			790
At December 31		185,274			194,260