annual_report_2019_en

116 Huawei Investment & Holding Co., Ltd.

9 Other income, net

(CNY million) Note 2019 2018

Factoring expenses (1,151) (1,269)

Government grants (i) 1,667 1,545

Impairment of property, plant and equipment,

intangible assets, goodwill and right-of-use assets

(140) (89)

Net (loss)/gain on disposal of property, plant and

equipment, intangible assets, goodwill and

right-of-use assets

(ii) (233) 750

Gain on deemed disposal of a joint venture – 269

Others, net 827 618

970 1,824

(i) During the year ended December 31, 2019, the Group received unconditional government grants of CNY1,189

million (2018: CNY969 million) which were immediately recognised in other income.

During the year ended December 31, 2019, the Group received government grants of CNY281 million (2018:

CNY444 million) which were conditional upon completion of research and development projects. These grants

were initially included in the consolidated statement of financial position as deferred government grants, and

are recognised in profit or loss as other income at the timing as described in note 3(r). During the year ended

December 31, 2019, conditional government grants of CNY478 million (2018: CNY576 million) were recognised

in profit or loss.

(ii) The amount for the year ended December 31, 2018 mainly comprises the gain on sales of patents to a third

party.

10 Personnel expenses

(CNY million) 2019 2018

Salaries, wages and other benefits 134,937 112, 4 03

Time-based unit plan (TUP) 14,048 16,906

Post-employment plans and others

Defined benefit plan 4,713 3,771

Defined contribution plans and others 14,631 13,504

19,344 17, 275

168,329 146,584

TUP

TUP is a profit-sharing and bonus plan based on employee performance for all eligible employees (recipients)

in the Group. Under TUP, time-based units (TBUs) are granted to recipients for a term of five years which

entitle them to receive an annual cash incentive based on an annual profit-sharing amount and an end-of-term

cumulative appreciation amount. Both the annual profit-sharing and the end-of-term appreciation amount are

determined at the discretion of the Group. Recipients receive the annual profit-sharing amount in each year

following the financial year in which it is earned during the five-year period. TBUs expire on the earlier of the

end of the five-year period or the date recipients leave the Group’s employment, when the accrued end-of-term

appreciation amount will be paid.