9.1.2 Other operating expenses

The amounts recognised for the year ended December 31, 2021 mainly represented the compensation payables on contract terminations of RMB1,622,000 (2020: Nil; 2019: Nil) and loss

on disposal of assets of RMB1,112,000 (2020: RMB4,000; 2019: RMB41,000).

9.2 Finance costs


	2021		2020		2019
	RMB’000		RMB’000		RMB’000
Interest on loans and borrowings		6,602		7,544		2,629
Interest on lease liabilities		1,082		2,561		613

Total finance costs		7,684		10,105		3,242

9.3 Finance income


	2021		2020		2019
	RMB’000		RMB’000		RMB’000
Bank interest income		34		45		155
Interest income on loans receivable		—		1,527		—
Interest income on net investments in subleases		45		49		103

Total finance income		79		1,621		258

9.4 Depreciation, amortisation and costs of inventories


	2021		2020		2019
	RMB’000		RMB’000		RMB’000
Included in cost of sales:
Depreciation of property, plant and equipment		9,709		1,448		233
Depreciation of right-of-use assets		696		1,955		66
Amortisation of intangible assets		8,271		5,326		3,720
Costs of inventories recognised as an expense		18,782		11,489		12,465
Included in selling expenses:
Depreciation of right-of-use assets		821		516		489
Included in administrative expenses:
Depreciation of property, plant and equipment		1,000		809		1,018
Depreciation of right-of-use assets		2,622		2,009		1,063
Amortisation of intangible assets		151		40		42

9.5 Research and development costs

The Group’s research and development concentrates on the development of smart music

learning

solutions, which include music education system, musical software (e.g. Kuke music app, digital music cloud library), Kuke music online platform, audiobook, musical education instruments and hardware (e.g. Kukey smart pianos).

Research and development costs of RMB27,811,000, RMB12,598,000 and RMB10,258,000 that are not eligible for capitalisation were expensed and included in administrative expenses for the years ended December 31, 2021, 2020 and 2019, respectively.

9.6 Wages and salaries and pension scheme contributions


	2021		2020		2019
	RMB’000		RMB’000		RMB’000
Wages and salaries		41,473		29,798		19,245
Equity-settled share-based payment expenses		53,933		19,416		—
Pension scheme contributions		3,485		129		3,053

At December 31, 2021, 2020 and 2019, the Group had no forfeited contributions available to reduce its pension scheme

contributions

in future years.