Annual Report 2022

120 China Merchants China Direct Investments Limited Annual Report 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 5. FINANCIAL INSTRUMENTS (CONTINUED) Fair value measurement of financial instruments (continued) Fair value of the Group’s financial assets and financial liabilities that are measured at fair value on a recurring basis (continued) Reconciliation of Level 3 fair value measurements of financial assets: Financial assets at FVTPL US$ Balance at 1 January 2021 485,994,561 Losses recognised in profit or loss (1,841,099) Exchange difference arising on translation to presentation currency 9,969,386 Purchases 25,943,085 Return of capital (24,041,305) Transfer out of Level 3 to Level 1 (14,857,538) Balance at 31 December 2021 481,167,090 Balance at 1 January 2022 481,167,090 Losses recognised in profit or loss (83,669,078) Exchange difference arising on translation to presentation currency (33,732,206) Purchases 10,728,082 Disposals (12,780,861) Return of capital (756,302) Balance at 31 December 2022 360,956,725 Of the total losses for the year included in profit or loss, loss of US$91,290,196 (2021: US$1,998,519) relates to financial assets at FVTPL categorised in Level 3 held at year end. Fair value gains or losses on financial assets at FVTPL are included in “Net (loss) gain on financial assets at fair value through profit or loss”. Transfers between levels of the fair value measurement hierarchy are recognised as of the date of the event or change in circumstances that caused the transfer. In 2021, the listed shares of Cambricon Technologies Corporation Limited held by the Group, which were classified as financial assets at FVTPL and subject to a lock-up period, were transferred from Level 3 to Level 1 during the year since the lock-up period expired on 19 July 2021.