2 -
7.
8.
"Total operating costs" means the aggregate of the Companies' electricity-related operating costs, and includes :
a)
b)
depreciation;
interest payable on consumers' deposits and
on bank overdrafts less interest receivable on bank deposits.
"Scheme of Control net revenue" means the difference obtained by deducting from gross tariff revenues of China Light the total operating costs, and the Scheme of Control taxation charge stated in H. below.
9.
10.
11.
"Permitted Return" as stated in paragraph B.1 of the Scheme means the gross return after taxes, allowed the Companies jointly for any year. In this context, the "increase in the opening balance" means the opening balance in the year concerned less the balance at 1st October, 1978.
"Net Return" means the difference obtained by deducting from the Permitted Return the annual charge on the Development Fund as stated in paragraph B.3 of the Scheme and such interest on long term borrowed capital as is chargeable to operating costs, provided that the interest so deducted does not exceed an amount corresponding to the rate of 8% per annum.
#
"Commissioning" means the taking into service of a fixed asset upon its acceptance by one of the Companies.
C.
Capital Expenditure.
1.
All capital expenditure will be incorporated in fixed asset accounts at the dates shown hereunder :
a)
b)
Advance or progress payment(s)
Delivery of goods (other
than covered by a) above):
: when payment(s) made;
when title passes to one of the Companies, i.e.
in the case of F.O.B.
orders, when asset(s) placed on board; and
in all other cases, when asset(s) received by one of the Companies;
c)
Interest due in
accordance with G.3.a) below
d) Other charge(s) made in
respect of fixed assets, e.g. salaries, wages and insurance premia
*
when payment(s) made before commissioning or when accrued at commissioning;
: when incurred.
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