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Glossary of Terms

Term
Definition
Compensation of employees
Compensation of employees
= Wages and salaries (including share-based payments) + Payments in kind and employer's social security expenditure (including contributions to Mandatory Provident Fund schemes, messing, medical expenses and premiums for employees' compensation insurance)
Compensation of employees and payments to labour-only sub-contractors
Compensation of employees and payments to labour-only sub-contractors
= Remuneration to direct employees (comprising wages and salaries to operatives and other employees; payments in kind and employer's social security expenditure as well as any share-based payments) + Payments to labour-only sub-contractors
Construction site
"A construction site refers to a demarcated locality (of an appreciable area at the least) where one or more major stages or processes of building/construction works, such as site formation, piling, caissons and superstructure erection, are being carried on. It differs from fitting, decoration and other construction works done on erected buildings and structures in that the entire building/structure in the construction site in question, being unfinished, is not issued with a Certificate of Completion/Occupation Permit and is as yet not ready for use according to its intended purposes."
Establishment
"An establishment is ideally an economic unit which engages, under a single ownership or control, in one or predominantly one kind of economic activity at a single physical location. In the context of construction, the requirement of a single physical location is relaxed for practical purposes. Where separate figures relating to different activities or different locations under the same management are not available, a combined return is accepted and in this case, the reporting unit is treated as an establishment."
Gross additions to fixed assets
Gross additions to fixed assets
= Acquisitions of fixed assets - Proceeds from disposal of fixed assets
Gross floor area of buildings
The gross floor area of a building is defined as the area contained within the external walls of the building measured at each floor level, including balconies and thickness of the external walls.
Gross margin of real estate development projects
Gross margin of real estate development projects
= Value accrued to project – Total project expenses + Interest payments to finance real estate development projects
Gross surplus
(i) For architectural, surveying and engineering services : Gross surplus = total receipts – consumption of materials and supplies; fuels, electricity and water, and maintenance services – architectural, surveying and engineering design and consultancy fees – miscellaneous operating expenses – compensation of employees (ii) For construction sector : Gross surplus = total receipts – payment for sub-contract works rendered by fee sub-contractors – consumption of materials and supplies; fuels, electricity and water, and maintenance services – miscellaneous operating expenses – compensation of employees and payments to labour-only sub-contractors (iii) For real estate activities : Gross surplus = total receipts – consumption of materials and supplies; fuels, electricity and water, and maintenance services – miscellaneous operating expenses – interest payments to finance real estate development projects – compensation of employees
Gross value of construction works performed
Gross value of construction works performed
= Construction works performed as main contractor at (i) construction sites; (ii) other minor new construction works locations; and (iii) erected buildings and structures + Construction works performed as sub-contractor at (i) construction sites; (ii) other minor new construction works locations; and (iii) erected buildings and structures
Main contractor
"A main contractor is one who enters into a contract directly with a property developer or the client party of a project, and assumes full responsibility for the satisfactory completion of the construction works. A sub-contractor is one who accepts orders from the main contractor or another sub-contractor for specific tasks forming part of a main contract."
Miscellaneous operating expenses
(i) For architectural, surveying and engineering services : Miscellaneous operating expenses mainly include rent, rates and government rent for land and buildings; rentals for machinery, equipment and vehicles; interest payments, insurance premiums, business management fee/management fee and administration charges paid to related companies, accounting, audit and legal fees, expenditure on computer hardware and software; and any other operating expenses not elsewhere specified. Miscellaneous operating expenses do not include consumption of materials and supplies; fuels, electricity and water, and maintenance services; architectural, surveying and engineering design and consultancy fees; provision, loss on disposal of fixed assets, bad debts, fines, write-off, donations to charities, insurance excesses as well as depreciation, amortisation and tax payments.. (ii) For construction sector : Miscellaneous operating expenses mainly include rent, rates and government rent for land and buildings; rentals for machinery, equipment and vehicles, architectural, surveying and engineering design and consultancy fees, interest payments, insurance premiums, business management fee/management fee and administration charges paid to related companies, accounting, audit and legal fees, expenditure on computer hardware and software; and any other operating expenses not elsewhere specified. Miscellaneous operating expenses do not include consumption of materials and supplies; fuels, electricity and water, and maintenance services; payment for sub-contract work rendered by fee sub-contractors, provision, loss on disposal of fixed assets, bad debts, fines, write-off, donations to charities, insurance excesses as well as depreciation, amortisation and tax payments. (iii) For real estate activities : Miscellaneous operating expenses mainly include rent, rates and government rent for land and buildings; rentals for machinery, equipment and vehicles, estate management expenses, interest payments apart from those for financing real estate development projects; insurance premiums, business management fee/management fee and administration charges paid to related companies, architectural, surveying and engineering design and consultancy fees, accounting, audit and legal fees expenditure on computer hardware and software; and any other operating expenses not elsewhere specified. Miscellaneous operating expenses do not include consumption of materials and supplies; fuels, electricity and water, and maintenance services; provision, loss on disposal of fixed assets, bad debts, fines, write-off, donations to charities, insurance excesses as well as depreciation, amortisation and tax payments.
Non-residential buildings
Non-residential buildings include office buildings, hotels and boarding houses, multi-purpose commercial premises, and flatted factory bolcks and warehouses
Number of persons engaged
(i) For architectural, surveying and engineering services : Number of persons engaged = Number of working proprietors and active business partners + Number of employees (ii) For construction sector : Number of persons directly engaged = Number of working proprietors, active partners and unpaid family workers + Number of direct employees, comprising operatives and other employees. Sub-contracting of certain part/stage of the construction works to labour-only sub-contractors is a common practice in the construction sector. The figures of number of persons directly engaged in the construction sector do not include the labour input provided by labour-only sub-contractors. (iii) For real estate activities : Number of persons engaged = Number of working proprietors, active business partners and unpaid family workers + Number of employees
Other business receipts
(i) For architectural, surveying and engineering services : Other business receipts = other service income + rental income from letting/subletting land and buildings + royalty receipts from patents, trademarks, copyrights and franchises + interest income + dividend income + receipts from other sources (excluding any insurance claims, gain/loss on disposal of fixed assets, gain/loss from trading of financial assets) . (ii) For construction sector : Other business receipts = other service income + rental income from letting/subletting land and buildings + interest income + dividend income + receipts from other sources (excluding any insurance claims, gain/loss on disposal of fixed assets, gain/loss from trading of financial assets). (iii) For real estate activities : Other business receipts = other service income + royalty receipts from patents, trademarks, copyrights and franchises + interest income + dividend income + receipts from other sources (excluding any insurance claims, gain/loss on disposal of fixed assets, gain/loss from trading of financial assets).
Real estate development project
A real estate development project is concerned with the development of land and/or redevelopment of existing premises into a new form of property for sale or lease. A development project is not regarded as active if the works that have been initiated relate only to pre-construction preparation.
Total project expenses
Total project expenses = Payments to contractors + Building materials and fittings supplied outside the contract sum + Architectural design and technical consultancy fees + Interest payments to finance real estate development projects + Other project expenses
Total receipts
(i) For architectural, surveying and engineering services : Total receipts = Service income + Other business receipts (ii) For construction sector : Total receipts = Gross value of construction works performed + Other business receipts (iii) For real estate activities : Total receipts = Gross margin of real estate development projects + Service and rental income + Other business receipts
Value accrued to project during reporting period
Value accrued to project during reporting period = { [ (P1 - L1) + (P2 - L2) ] / 2 } x (C2 - C1), where P = market value of the property as if completed; L = market value of the underlying land lot; C = percentage of project completion; 1 = the beginning of reporting period; 2 = the end of the reporting period.
Value added
(i) For architectural, surveying and engineering services : Value added = Total receipts (excluding interest income, dividend income and receipts from other sources) – Consumption of materials and supplies; fuels, electricity and water, and maintenance services – Architectural, surveying and engineering design and consultancy fees – Miscellaneous operating expenses (excluding interest payments) (ii) For construction sector : Value added = Total receipts (excluding interest income, dividend income and receipts from other sources) – Payment for sub-contract works rendered by fee sub-contractors – Consumption of materials and supplies; fuels, electricity and water, and maintenance services – Miscellaneous operating expenses (excluding interest payments) (iii) For real estate activities : Value added = Total receipts (excluding interest income, dividend income and receipts from other sources) – Consumption of materials and supplies; fuels, electricity and water, and maintenance services – Miscellaneous operating expenses + Interest payments apart from those for financing real estate development projects