The Group’s trade receivables arise from the provision of construction services for wastewater treatment projects, sale of wastewater treatment equipment, and operation service of the service concession arrangement. The majority of the Group’s customers are town/village government entities or main contractors of the governmental infrastructure projects whose time of payment for the service or goods received from the Group depend on the appropriation and approval of the fiscal funds. Accordingly, the Group granted various credit terms to different customers, depending on the nature and background of the customers and projects. The Group generally granted customers a credit period of one month to three months, except for some of the customers for construction services, sales of wastewater treatment equipment and maintenance services who will generally settle the amounts owed to the Group in a number of specified installments covering periods ranging from one year to five years. Apart from the trade receivables related to the service concession arrangement which bear no interest, the trade receivables of construction services, operation and maintenance services and sale of wastewater treatment equipment bear an imputed interest rate of 4.75% per annum.

An aging analysis of the trade receivables as of the end of the reporting period, based on the invoice date and net of loss allowance, is as follows:

December 31,

2021 2022 2022

CNY CNY US$

Within 1 year 19,026 18,401 2,667

Between 1-2 years 5,106 13,896 2,015

Between 2-3 years 12,796 4,518 655

Over 3 years 14,099 20,465 2,967

Total 51,027 57,280 8,304

The movement in the loss allowance for trade receivables during the years indicated are as follows:

December 31,

2021 2022 2022

CNY CNY US$

Beginning of the year 13,774 17,614 2,554

(Reversal)/provision for expected credit losses, net 3,840 (3,989 ) (578 )

End of the year 17,614 13,625 1,976

A decrease in the loss allowance of CNY3,992 (US$579) (2021: increase CNY3,839) was the result of a net decrease (2021: a net increase) in the gross carrying amount after the settlement of trade receivables of construction contracts and origination of new trade receivables of construction contracts.

The Group elected to apply the simplified approach for providing impairment for ECLs prescribed by IFRS 9, which permits the use of the lifetime expected loss provision for all trade receivables. To measure the ECLs, trade receivables were grouped based on the shared credit risk characteristics and the days past due. The ECLs below also incorporate forward-looking information. The impairment as of December 31, 2021 and 2022 was determined as follows:

Schedule of impairment
	Past due
	Current	Within 1 year		1-2 years		2-3 years		Over 3 years		Total
As of December 31, 2021:
Expected credit loss rate:		6	%	26	%	13	%	48	%	26	%
Gross carrying amount (CNY)	3,670	16,311		6,865		14,712		27,083		68,641
Impairment allowances (CNY)		955		1,759		1,916	⁽ⁱ⁾	12,984	⁽ⁱⁱ⁾	17,614

As of December 31, 2022:
Expected credit loss rate:		0	%	9	%	29	%	34	%	19	%
Gross carrying amount (CNY)	—	18,406		15,195		6,399		30,905		70,905
Impairment allowances (CNY)		5		1,299		1,881		10,440	⁽ⁱⁱ⁾	13,625
Impairment allowances (US$)		1		188		273		1,514		1,976

(i)

The impairment allowances included CNY221 as of December 31, 2021, for specific trade receivables which were considered to be in default due to conditions which indicated that the Group was unlikely to receive the outstanding contractual amounts in full.

(ii)

The impairment allowances included an amount of CNY4,646 and CNY4,600 (US$667) as of December 31, 2021 and 2022, respectively, for specific trade receivables which were considered to be in default due to conditions which indicated that the Group was unlikely to receive the outstanding contractual amounts in full.