China Mobile Limited

Stock Codes: 941 (HKD Counter) and 80941 (RMB Counter)

1

1

0

1

0

0

00
1

1

1 0

0
0 1

0

00
1

1

0

01
1

1

0

1
0

0

AI
DATA
COMPUTILITY
New InstrumentofEnergy
Production
Factorof Production
Fundamental

Developing new quality

PRODUCTIVE FORCESANNUAL REPORT 2023

1

1

0

1

0

0

00
1

1

1 0

0
0 1

0

00
1

1

0

01
1

1
1
0

0

COMPUTILITY
AI
Fundamental
New InstrumentofEnergy
Production

0

1

1

0

1

0

0

00
1

1

1 0

0
0 1

0

00
1

1

0

01
1

1
1
0

0

COMPUTILITY
DATA
Fundamental
EnergyNew Factor
of Production

0COMPUTILITY
New Fundamental Energy

Forward-Looking Statements
Forward-looking statements contained in this annual report do notconstitute and should not be viewed as commitments made by theCompany. Such forward-looking statements involve known andunknown risks, uncertainties and other factors, which may cause
the actual performance, financial condition or results of operationsof the Company to be materially different from those implied bysuch forward-looking statements. In addition, the Company does
not intend to update such forward-looking statements. Investors are
cautioned not to unduly rely on such forward-looking statements.

ThemeAs the integrated innovation of informationand energy delves deeper, we see profoundchanges in how human labor, means oflabor, subject of labor and their optimal
combinations interact. Data has emerged
as a new factor of production, computility
as a new fundamental energy source andAI as a new instrument of production.
Together, they act as prime catalysts indeveloping new quality productive forces.
The information services industry has not
only in itself become an important sector forthe development of new quality productive
forces, but also a strong support for othersectors in this pursuit. China Mobile is readyto seize the abundant opportunities for
growth that lie ahead.

Contents

03

04

06

Financial Highlights

Milestones for 2023

Corporate Profile

07

12

14

Biographies of Directors andSenior Management

Corporate Recognitions

Chairman’s Statement

28

36

41

Business Review

Financial Review

Sustainability Report

45

66

67

Corporate Governance Report

Human Resources Development

81
87
88
90
91
94
171
174

Report of Directors

Independent Auditor’s Report
Consolidated Statement of Comprehensive Income
Consolidated Balance Sheet
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Financial Summary
Corporate Information

Annual Report 2023

Financial Highlights

Operating Revenue

Revenue from Telecommunications Services(RMB million)(RMB million)

2023 / 1,009,309

2023 / 863,514

2022 / 937,259

2022 / 812,058

Profit Attributable to Equity Shareholders

Dividend per Share (Full Year)(RMB million)(HK$)

2023 / 131,766

2023 / 4.83

2022 / 125,459

2022 / 4.41

Operating revenue (RMB million)
Of which: Revenue from telecommunications services (RMB million)
EBITDA (RMB million)
1

EBITDA margin

2023

2022

1,009,309

937,259

863,514812,058

341,478

329,176

33.8%

35.1%

131,766

125,459

13.1%

13.4%

Basic earnings per share (RMB)

6.16

5.88

Dividend per share – Interim (HK$)

2.43

2.20

– Final (HK$)

2.40

2.21

– Full year (HK$)

4.83

4.41

2

Profit attributable to equity shareholders (RMB million)
Margin of profit attributable to equity shareholders3

1
2
3

EBITDA = profit from operations + depreciation and amortization
EBITDA margin = EBITDA / operating revenue
Margin of profit attributable to equity shareholders = profit attributable to equity shareholders / operating revenue

03

04

China Mobile Limited

Milestones for 2023

Mar 2023

Jul 2023

Aug 2023

Aug 2023

The “Computility
Routing” Working
Group promotedby China Mobile
was approved forestablishment by theInternet Engineering
Task Force (IETF)

Released Jiutian large
industry models on
massive-computing
public administrationand customer services

China Mobile
topped the list of
telecommunications
companies as
the number one
telecommunications
operator worldwide on
the Fortune Global 500

Launched the Baichuan
integrated computility
and network platform
to include a wide arrayof social computilities

May 2023
China Mobile’s 5G
package customers
exceeded 700 million

0

1 0

0

1

0

Annual Report 2023

Milestones for 2023

Aug 2023

Oct 2023

Oct 2023

Nov 2023

Successfully
developed China’s firstreconfigurable 5G radio
frequency transceiverchip “Breaking Wind
8676”

Jointly released theJiutian Zhongqing
foundation large modelto achieve independent
mastery over coretechnologies across theentire chain

Initiated the “BASIC6”
sci-tech innovation
plan to unleash new
momentum for sci-techinnovation

Co-developed theworld’s first 1.2T
ultra-high-speed nextgeneration Internet
backbone

Dec 2023
China Mobile wasnamed one of the “Top
Ten China ESG ModelEnterprises” at thefirst “China ESG Model
Annual Ceremony” heldby China Media Group

1

0

00
1

1

1

1 1

0

0
1

1

05

06

China Mobile Limited

Corporate Profile

China Mobile Limited (the “Company”, and together
with its subsidiaries, the “Group”) was incorporated in
Hong Kong on 3 September 1997. The Company was
listed on the New York Stock Exchange (“NYSE”) and
The Stock Exchange of Hong Kong Limited (the “HongKong Stock Exchange”) on 22 October 1997 and 23
October 1997, respectively. The shares of the Company
were admitted as a constituent stock of the Hang Seng
Index in Hong Kong on 27 January 1998. On 7 May
2021, the NYSE filed a Form 25 with the US Securities
and Exchange Commission and the delisting of theAmerican Depositary Shares of the Company became
effective on 18 May 2021. On 5 January 2022, theCompany’s RMB ordinary shares (“RMB Shares” or “A
Shares”) were listed on the Shanghai Stock Exchange(“SSE”). On 19 June 2023, a RMB counter was added
for the trading of shares in the Company listed on theMain Board of the Hong Kong Stock Exchange (the“Hong Kong Shares”).
As the leading ICT services provider in the mainlandof China, the Group provides communications andinformation services in all 31 provinces, autonomous
regions and directly-administered municipalities
throughout the mainland of China and in Hong Kong
SAR, and boasts a world-class telecommunications andinformation operator with the world’s largest networkand customer base, a leading position in profitability,
brand value and market value ranking. Its businesses
primarily consist of voice, data, broadband, dedicatedlines, IDC, cloud computing, IoT and other services in
the Customer, Home, Business and New (“CHBN”)
markets. As of 31 December 2023, the Group’s total
number of employees approached 451,830, and had atotal of 991 million mobile customers and 298 million
wireline broadband customers, with its annual revenue
reaching RMB1,009.3 billion.
The Company’s ultimate controlling shareholder is China
Mobile Communications Group Co., Ltd. (“CMCC”),
which, as of 31 December 2023, directly and indirectly
held approximately 69.81% of the total number of issued
shares of the Company. The remaining approximately
30.19% was held by public investors.
In 2023, the Company was once again selected as oneof The Global 2,000 World’s Largest Public Companies
by Forbes magazine and Fortune magazine’s Global 500
list. The China Mobile brand was once again listed in
BrandZ™ Top 100 Most Valuable Global Brands 2023
ranking 73. Currently, the Company’s corporate credit
ratings are equivalent to China’s sovereign credit ratings,
namely, A+/Outlook Stable from Standard & Poor’s andA1/Outlook Negative from Moody’s.

China Mobile Principal Organizational Structure
as at 31 December 2023
China Mobile Communications Group Co., Ltd.
China Mobile (Hong Kong) Group Limited
China Mobile Hong Kong (BVI) Limited
69.61%

Other holders of Hong Kong Shares

4.22%*

26.17%

Holders of RMB Shares

China Mobile Limited
China Mobile International Limited

China Mobile Communication Co., Ltd.

Operating subsidiaries in 31 provinces, autonomous
regions and directly-administered municipalities
in the mainland of China and Hong Kong

Aspire Holdings Ltd.

Other specialized subsidiaries#* Includes 0.20% of the shares of the Company that were directly held by CMCC#

Other specialized subsidiaries include:•

China Mobile Group Design Institute Co., Ltd.

•

China Mobile IoT Company Limited•

China Mobile Group Device Co., Ltd.

•

China Mobile Information Technology Company Limited•

China Mobile Online Services Co., Ltd.

•MIGU Co., Ltd.

•

China Mobile (Suzhou) Software Technology
Co., Ltd.

•

China Mobile (Hangzhou) Information Technology
Company Limited•

China Mobile Internet Company Limited•

China Mobile TieTong Company Limited•

China Mobile Investment Holdings Co., Ltd.

•

China Mobile System Integration Co., Ltd.

•

China Mobile Financial Technology Co., Ltd.

•

China Mobile (Chengdu) ICT Co., Ltd.

•

China Mobile (Shanghai) ICT Co., Ltd.

•

China Mobile e-Commerce Co., Ltd.

•

China Mobile Xiong’an ICT Co., Ltd.

•

China Mobile Information System Integration Co., Ltd.

•

China Mobile Group Finance Co., Ltd.

Annual Report 2023

Biographies of Directors andSenior Management
EXECUTIVE DIRECTORS

Mr. YANG Jie

Mr. LI Pizheng

Age 61, Executive Director and Chairman of theCompany, joined the Board of Directors of the Company
in March 2019, in charge of the overall managementof the Company. He is currently the Chairman of
CMCC and a Director and the Chairman of China
Mobile Communication Co., Ltd. (“CMC”). Mr. Yang
formerly served as deputy director general of Shanxi
Posts and Telecommunications Administration, generalmanager of Shanxi Telecommunications Corporation,
vice president of China Telecom Beijing ResearchInstitute, general manager of Business Department of
the Northern Telecom of China Telecommunications
Corporation, vice president, president and chairman ofChina Telecommunications Corporation, and president
and chief operating officer, and chairman and chief
executive officer of China Telecom Corporation Limited.
Mr. Yang graduated from the Beijing University ofPosts and Telecommunications majoring in radio
engineering in 1984 and obtained a doctorate degree inbusiness administration from the ESC Rennes Schoolof Business, France in 2008. Mr. Yang is a professorlevel senior engineer with long-term involvement in theoperation and management of basic telecommunications
enterprises as well as extensive experience inmanagement and the ICT industry.

Age 59, Executive Director of the Company, joined
the Board of Directors of the Company in May 2022,
principally in charge of human resources and inspection
matters. He is also a Director of CMCC and CMC. Mr.
Li formerly served as a deputy director of Shaanxi Post
Bureau, director of Information Technology Bureau of
the State Post Bureau of China, director of Information
Technology Bureau of China Post Corporation(restructured into China Post Group Co., Ltd. in 2019)(“China Post”), President of Anhui Post, Chairmanof Anhui Postal Express & Logistics Co., Ltd., Vice
President and Director of China Post. Mr. Li received a
Bachelor’s degree in Engineering from Beijing Universityof Posts and Telecommunications in 1984, and a Masterof Business Administration degree from Xi’an Jiaotong
University in 1998. Mr. Li is a professor-level senior
engineer with many years’ experience in the postal andtelecommunications industry.

07

08

China Mobile Limited

Biographies of Directors andSenior Management

INDEPENDENT NON-EXECUTIVEDIRECTORS

Mr. LI Ronghua

Mr. Stephen YIU Kin Wah, JP

Age 58, Executive Director and Chief Financial Officerof the Company, joined the Board of Directors of
the Company in October 2020, principally in chargeof finance, internal audit and securities affairs of theCompany. He is also a member of our Sustainability
Committee since 1 January 2024, the Chief Accountant
of CMCC, and a director and Vice President of CMC.
Mr. Li formerly served as Vice Manager and Manager
of Finance and Assets Department of State Grid
Corporation of China, Deputy General Accountant ofState Grid Corporation of China, Director and Chairmanof State Grid Overseas Investment Limited (Hong Kong),
and Chairman of State Grid Yingda International HoldingsGroup Ltd. During the period between December 2019
and September 2020, Mr. Li had served as the Headof the preparatory team, and Director and Chairmanof State Grid Yingda Co., Ltd. (listed in Shanghai). Mr.
Li received a Bachelor’s degree in Accounting from
Zhongnan University of Economics in 1998, and an
Executive Master of Business Administration degreefrom Wuhan University in 2004.

Age 63, Independent Non-Executive Director of theCompany, joined the Board of Directors of the Company
in March 2017, and now also the Chairman of the
Audit Committee and the Remuneration Committee,
and a member of the Nomination Committee. Mr. Yiu
is currently the Chairman of the Hong Kong Insurance
Authority, a director of Hong Kong Academy ofFinance, an Independent Non-Executive Director of
ANTA Sports Products Limited and Amer Sports, Inc.
(a company listed on New York Stock Exchange), a
Council member and the Treasurer of The Hong Kong
University of Science and Technology, a board memberof Airport Authority Hong Kong, and a member of theInternational Advisory Council of the National Financial
Regulatory Administration, the Exchange Fund Advisory
Committee of The Hong Kong Monetary Authority and
ICAC Complaints Committee. Mr. Yiu joined the global
accounting firm KPMG (“KPMG”) in Hong Kong in 1983
and was seconded to KPMG in London, the United
Kingdom from 1987 to 1989. Mr. Yiu became a partner
of KPMG in 1994, served as the Partner in Charge ofAudit of KPMG from 2007 to 2010, and served as the
Chairman and Chief Executive Officer of KPMG China
and Hong Kong as well as a member of the Executive
Committee and the Board of KPMG International and
KPMG Asia Pacific from April 2011 to March 2015. Mr.
Yiu previously served as an Independent Non-Executive
Director of Hong Kong Exchanges and Clearing Limited,a member of the Audit Profession Reform Advisory
Committee and the Mainland Affairs Committee of theHong Kong Institute of Certified Public Accountants. Mr.
Yiu is a fellow member of the Association of Chartered
Certified Accountants and the Hong Kong Instituteof Certified Public Accountants. Mr. Yiu received aprofessional diploma in accountancy from The Hong
Kong Polytechnic (now known as The Hong Kong
Polytechnic University) in 1983, and holds a master’s
degree in business administration from the University of
Warwick in the United Kingdom.

Annual Report 2023

Biographies of Directors andSenior Management

Dr. YANG Qiang

Mr. Carmelo LEE Ka Sze, JP

Age 62, Independent Non-Executive Director of theCompany, joined the Board of Directors of the Company in
May 2018, and now also the Chairman of the Nomination
Committee and a member of the Audit Committee andthe Remuneration Committee. Dr. Yang is currently
the Chief AI Officer of WeBank Co., Ltd., the Professor
Emeritus and the former Head of the Department ofComputer Science and Engineering of the Hong Kong
University of Science and Technology (HKUST), as wellas the Co-founder and a non-executive director of Beijing
Fourth Paradigm Technology Co., Ltd. Dr. Yang had
served as, among other posts, an Assistant Professor
and a Tenured Associate Professor at the Departmentof Computer Science of the University of Waterloo in
Canada from September 1989 to August 1995, a Tenured
Associate Professor, an Industrial Research Chair anda Full Professor at the School of Computing Science ofSimon Fraser University in Canada from August 1995 toAugust 2001, and an Associate Professor, a Full Professor
and an Associate Head of the Department of Computer
Science and Engineering of HKUST from August 2001
to June 2012. From 2012 to November 2014, Dr. Yang
was also the Founding Head of Huawei’s Noah’s Ark
Research Lab. He was the President of International Joint
Conference on Artificial Intelligence (IJCAI) from 2017
to 2019 and an executive committee member of the
Association for the Advancement of Artificial Intelligence(AAAI) from 2016 to 2019. He was the AAAI Conference
Chair in 2021. Dr. Yang is a Fellow of several international
professional societies, including AAAI, Association for
Computing Machinery (ACM), Institute of Electricaland Electronic Engineering (IEEE), etc. In 2021, he waselected to be a Fellow of the Royal Society of Canada
and the Canadian Academy of Engineering. Dr. Yang
received a bachelor’s degree in astrophysics from Peking
University in 1982, master’s degrees in astrophysics
and computer science from the University of Maryland,College Park in the United States in 1985 and 1987
respectively, and a doctor’s degree in computer sciencefrom the University of Maryland, College Park in 1989.

Age 63, Independent Non-Executive Director of
the Company, joined the Board of Directors of theCompany in May 2022, and now also a member ofthe Audit Committee, the Nomination Committee,
the Remuneration Committee and the Sustainability
Committee. Mr. Lee has been a partner of Messrs.
Woo Kwan Lee & Lo since 1989 and is currently a NonExecutive Director of Safety Godown Company, Limited
and Playmates Holdings Limited, an Independent
Non-Executive Director of S.F. Holding Co., Ltd., andCompany Secretary of Shenzhen Investment Limited.
Mr. Lee is also a member of Chairmen pool of the
Listing Review Committee of The Stock Exchange
of Hong Kong Limited, a member of the InnoHK
Steering Committee of the Innovation and Technology
Commission, a Chairman of the Appeal Tribunal Panel(Buildings), as well as a member of the Campaign
Committee of The Community Chest of Hong Kong. Mr.
Lee previously served as an Independent Non-Executive
Director of KWG Group Holdings Limited. Mr. Lee isqualified as a solicitor in Hong Kong, England and Wales,
Singapore and Australian Capital Territory, and receiveda Bachelor’s degree in Laws and a Postgraduate
Certificate in Laws from The University of Hong Kong in
1982 and 1983, respectively.

09

10

China Mobile Limited

Biographies of Directors andSenior Management

SENIOR MANAGEMENT

Mrs. Margaret LEUNG KO May Yee, SBS, JP

Mr. LI Huidi

Age 71, Independent Non-Executive Director of
the Company, joined the Board of Directors of theCompany in May 2022, and now also the Chairmanof the Sustainability Committee and a member of the
Audit Committee, the Nomination Committee andthe Remuneration Committee. She is currently an
Independent Non-Executive Director of First PacificCompany Limited, Sun Hung Kai Properties Limited andAgricultural Bank of China Limited. Mrs. Leung is a NonOfficial Member of the Executive Council of the Hong
Kong Special Administrative Region, Chairman of theAdvisory Committee on Arts Development, a member of
the Culture Commission, a member of the Public Service
Commission, a member of the Advisory Committee on
Post-office Employment for Former Chief Executives andPolitically Appointed Officials, a non-ex officio memberof The Law Reform Commission of Hong Kong, as well asa Council member, Treasurer, Chairman of the FinanceCommittee and a member of the Human Resource
Policy Committee of The University of Hong Kong.
Mrs. Leung formerly served as Group General Manager
and Global Co-Head of Commercial Banking of HSBC
Holdings plc, Vice-Chairman and Chief Executive ofHang Seng Bank Limited, as well as Deputy Chairman,
Managing Director and Chief Executive of Chong Hing
Bank Limited. She had also served as an Independent
Non-Executive Director of Swire Pacific Limited,
Hutchison Whampoa Limited, China Construction Bank
Corporation, QBE Insurance Group Limited, Hong Kong
Exchanges and Clearing Limited and Li & Fung Limited.
Mrs. Leung received a Bachelor’s degree in Economics,
Accounting and Business Administration from The
University of Hong Kong in 1975.

Age 55, Vice President of the Company, appointed in
September 2019, principally in charge of planning andconstruction, network, information harbor, information
security, procurement and others. He is also a Vice
President and Chief Cyber Security Officer of CMCC,
and a Director and Vice President of CMC. Previously heserved as a research fellow in Lucent Technologies – Bell
Labs Innovations, a vice president of UTStarcom Inc.,a vice president and general manager of New Mobile
Technology and High-end Products Division of LenovoGroup Limited, chief technology officer and chairmanof Technology Innovation Committee of Lenovo Mobile
Communication Technology Co., Ltd. Mr. Li graduatedin 1990 with a Bachelor of Electronic Engineering from
Harbin Institute of Technology, and received a master’s
degree in Mobile Communications from Polytechnic
Institute of New York University and a doctoral degree inmanagement from Hong Kong Polytechnic University.

Annual Report 2023

Biographies of Directors andSenior Management

Mr. GAO Tongqing
Age 60, Vice President of the Company, appointed
in February 2020, principally in charge of legal andregulatory matters, technology R&D, international
business, investment, information technology andothers. He is also a Vice President, General Counsel andChief Compliance Officer of CMCC, a Director and Vice
President of CMC. In June 2020, Mr. Gao was appointed
as a non-executive director of China Communications
Services Corporation Limited (listed in Hong Kong) andvice chairman of True Corporation. In March 2023, He
was appointed as a director of the amalgamated True
Corporation. In August 2020, Mr. Gao was appointed
as a Non-Executive Director of China Tower (listed in
Hong Kong). Mr. Gao previously served as a deputy
director general of Xinjiang Uygur Autonomous Region
Posts and Telecommunications Administration, deputy
general manager and general manager of Xinjiang
Uygur Autonomous Region Telecom Company, generalmanager of China Telecom Jiangsu branch, vicepresident of China Telecommunications Corporation, andexecutive director and executive vice president of China
Telecom Corporation Limited. He graduated from the
Changchun Institute of Posts and Telecommunications
with a major in telecommunications engineering andreceived a doctorate degree in business administrationfrom the Hong Kong Polytechnic University.

11

12

China Mobile Limited

Corporate Recognitions

Chairman’s Statement

14

China Mobile Limited

Chairman’s Statement

1

0
0
10
1

1

1

1

0

0 1

1

0

Annual Report 2023

Chairman’s Statement

Dear Shareholders,
In 2023, despite various challenges faced by the Company in a complex and severe macro-environment, we seized
the opportunities emerging from accelerated economic and social digital transformation. This helped anchor us in
our position as a world-class information services and sci-tech innovation enterprise. Our efforts were focused on
fully implementing our “1-2-2-5”1 strategy and strengthening innovation and core competitiveness to promote highquality and sustainable development. Our business results reached new milestones, with revenue surpassing the
RMB trillion mark for the first time in our history of development, and net profit attaining a record high. In terms ofoperations, our strategic transformation, reforms and innovation all advanced to a new level, underscoring our solid
progress in establishing a world-class enterprise that takes pride in outstanding products, reputable brands, leading
innovation and modern governance.

2023 RESULTS
Our operating revenue for the year reached RMB1,009.3 billion, or 7.7% growth year-on-year. Of this,telecommunications services revenue accounted for RMB863.5 billion, representing an increase of 6.3% year-onyear and surpassing the industry average. The total number of connections2 reached 3.35 billion, representing a net
addition of 410 million connections. All CHBN3 markets recorded growth, with HBN revenue accounting for 43.2%
of telecommunications services revenue, an increase of 3.4 percentage points year-on-year. Digital transformation
revenue4 increased by 22.2% year-on-year and reached RMB253.8 billion, taking up 29.4% of telecommunications
services revenue. We further reinforced our foundation and optimized our revenue structure while seeing
strong momentum from the “second curve” in generating growth. This formed a solid base for our sustainable
development.
Profit attributable to equity shareholders was RMB131.8 billion, an increase of 5.0% year-on-year, and earnings per
share were RMB6.16. Our profitability remained in a leading position among top-tier global telecommunications
operators. EBITDA 5 was RMB341.5 billion, an increase of 3.7% year-on-year. EBITDA as a percentage oftelecommunications services revenue was 39.5%. Capital expenditure totaled RMB180.3 billion, accounting for
20.9% of telecommunications services revenue and decreasing by 1.9 percentage points year-on-year. Free cash
flow was RMB123.5 billion, an increase of 29.2% year-on-year. These indicators demonstrated our leading efficiency
and effectiveness, and reflected a favorable trajectory for growth.

1

Anchoring ourselves to “one single position” of a world-class information services and sci-tech innovation enterprise; speeding up the “twochanges”, which are the shift from quantitative leadership based on scale to qualitative leadership with a focus on improving effectiveness andefficiency, and the shift from delivering business results in the short-to-mid-term to achieving value growth in the mid-to-long-term. We willcollectively foster the “Two New Elements”: systematically building a new information infrastructure centered on 5G, CN and the integration
platform, and developing a new information services system of connectivity, computility and capability. We will proactively unleash the “fivebenefits” through innovation, customer recognition, reforms, talent and the ecosystem.

2

The total number of connections includes mobile handsets, wireline broadband, IoT cards, home devices and industry devices.

3

CHBN refers to the “Customer” market (C), the “Home” market (H), the “Business” market (B), and the “New” market (N).

4

Digital transformation revenue includes the revenues from new businesses from the “Customer” market (China Mobile Cloud Drive and others);
the revenues from smart home value-added businesses from the “Home” market; the revenues from DICT, IoT and dedicated lines businesses
from the “Business” market; and the revenue from the “New” market (excluding revenue from international basic business).

5

EBITDA = profit from operations + depreciation and amortization.

15

16

China Mobile Limited

Chairman’s Statement

The Board recommends a dividend payout ratio of 71%6 for the full year of 2023. It also recommends a final dividend
payment of HK$2.40 per share7 for the year ended 31 December 2023. Together with the interim dividend alreadypaid, total dividend for the full year of 2023 amounted to HK$4.83 per share, an increase of 9.5% from that of 2022.
To create higher returns for our shareholders and share the results of our growth, after giving full consideration to theCompany’s profitability, cash flow generation and future development needs, in the three-year period from 2024, theprofit to be distributed in cash for each year will gradually increase to above 75% of the profit attributable to equity
shareholders of the Company8 for that year. The Company will strive to create more value for shareholders.

VIGOROUSLY DROVE BUSINESS TRANSFORMATION AND UPGRADEVALUE-ORIENTED OPERATIONS ACHIEVED REMARKABLE RESULTS
Responding to the trends of digitalization and the growing adoption of network and intelligence, we focused onenhancing the capabilities and quality of the information services we provide. We relentlessly pursued valueoriented operations that leverage the scale of our business to drive comprehensive and integrated development in
the CHBN markets. We have also built our presence in new areas and opened new markets, effectively discoveringand satisfying customer demand for upgrading digital consumption. We achieved remarkable results on these fronts,
leading to outstanding performance in all four markets and further consolidating our competitive edges.

“Customer” Market: Integrated Operations Built on Strong Foundation
We furthered the integrated development of data access, applications and customer benefits. The number of 5G
customers represented a growing share of our overall customer base resulting from unleashing the synergies
between the “Home” and “Business” markets, more precisely targeting customer, scenario and market segments.
Moreover, we promoted the upgrade of our benefit superstore to a digital life services platform. We launched the
M-zone Mango Card through a joint initiative linking brand operation and ecosystem cooperation. As a result, thescale and value of our “Customer” market continued to form a strong foundation, underscoring its role in offeringstability to the Company. In 2023, our “Customer” market revenue reached RMB490.2 billion, up by 0.3% year-onyear. Mobile customers totaled 991 million, with a net addition of 15.99 million customers. In our customer base, 795
million were 5G package customers, representing a net addition of 180 million. The number of customers using our
integrated-benefit products9 reached 330 million, a net addition of 42.76 million customers. The number of monthly
active users of our cloud product China Mobile Cloud Drive recorded a net addition of 23.74 million, bringing thetotal to 190 million, the second largest in the industry. The number of customers using our 5G new voice over highdefinition video reached 133 million, a net addition of 41.32 million customers – more than 3.07 million of them weresubscribers of AI applications. The M-zone Mango Card recorded sales of 11.47 million in the five months since its
launch, demonstrating its popularity among young customers. Mobile ARPU (average revenue per user per month)recorded stable and healthy growth, up 0.6% year-on-year to RMB49.3.

6

The exchange rate is determined by the mid-price of HK$ to RMB as announced by the People’s Bank of China at the end of 2023.

7

Dividends on A shares will be paid in RMB at an exchange rate calculated on the basis of the average of the mid-prices of HK$ to RMB asannounced by the People’s Bank of China during the one week before the annual general meeting declared the dividends.

8

The basis of profit distribution of the Company is the profit attributable to equity shareholders under IFRS.

9This refers to the number of normal on-net customers who have subscribed to our benefit products, including benefit-only package products,
telecommunications + benefit package products and paid members of our benefit superstore. Duplicate customers within the benefit business
are removed.

Annual Report 2023

Chairman’s Statement“Home” Market: Upgraded Smart Business with Emphasis on Value
We aspired to develop a smart home ecosystem featuring full-gigabit network and cloud-based applications
by cultivating our leadership in gigabit-driven broadband, content-driven large screens, platform-driven IoTand ecosystem-driven HDICT (home data, information and communications technology, collectively “homeinformatization solutions”). We proactively developed growth areas in smart home spending and continuously
expanded the scenarios for smart home solutions. Our “Home” market maintained favorable growth, and weremained steadfast in our commitment to a stable and lasting business approach that focuses on value. In 2023, our“Home” market revenue reached RMB131.9 billion, up 13.1% year-on-year. The number of household broadband
customers reached 264 million, or a net increase of 20.12 million customers. In terms of net increase, we have held
our industry leadership for multiple consecutive years. Gigabit broadband customers accounted for 30.0% of ourhousehold broadband customer base, an increase of 14.3 percentage points from the end of 2022. Our mobile HD
customer base reached 207 million while the number of customers for smart home network deployment and home
security increased by 36.7% and 40.5% respectively year-on-year. Customers for the HDICT solutions grew to 29.21
million, bringing the revenue contribution from household value-added business to 25.6% of the “Home” market
revenue. Household customer blended ARPU increased by 2.4% year-on-year to RMB43.1.

“Business” Market: Revenue Growth Engine with Strengthened Capabilities
We focused our efforts on the integrated development of network, cloud and DICT (data, information andcommunications technology), consistently enhancing industry insights, system planning, product innovation, andsupport and delivery capabilities in order to establish an innovative operation system that is standardized andproduct-driven for effective management of platform-based solutions. As a result, our “Business” market sustained
rapid growth and continued to be a key driver of incremental revenue. In 2023, “Business” market revenue reached
RMB192.1 billion, up 14.2% year-on-year. Our corporate customer base reached 28.37 million, a net increase of
5.17 million. We proactively formulated plans to tap into the blue-ocean informatization market, focusing on nine
key industries and delivering more effective end-to-end industry solutions. Our growing influence in the market wasevident in a higher share of contracts won in open tenders in 2023. Our share topped the industry, amounting to
14.3% or an increase of 3.0 percentage points year-on-year. China Mobile Cloud comfortably maintained its position
as a top-tier player among domestic cloud services providers, with revenue reaching RMB83.3 billion, an increase of
65.6% year-on-year. Revenue from our proprietary capabilities increased by over 100% year-on-year, with IaaS+ PaaS
revenue share ranked top five in the industry. We continued to advance the integration between cloud on one handand network, edge computing, data, intelligence and security on the other hand, making solid steps toward our goalof becoming an industry leader in this area. Our ability to use 5G to empower digital transformation across industries
continued to be pre-eminent. Throughout 2023, we signed 15,000 5G industry commercialization cases, an increaseof 22.4% over the previous year. The contract value of our 5G DICT projects signed during 2023 reached RMB47.5
billion, or a year-on-year increase of 30.1%; 5G dedicated network revenue amounted to RMB5.4 billion, a year-onyear increase of 113.1%. We maintained our leadership in several industry segments including smart mining, smart
factories, smart grid, smart hospitals, smart city and autonomous driving. In the “To V” market, we expanded boththe scale and capability of our Internet of Vehicles (IoV) market by entering partnerships with all of the Top 10 bestselling new energy vehicle brands in China, boasting the largest market share among telecommunications operators.
High-precision positioning services recorded a cumulative deployment of more than 1,000 billion times. We havejointly launched the largest scale nationwide lane-level navigation application. In the “To G” market, alongside a
growing impact, we have accumulated capabilities in digital government and demonstrated significant exemplary
effects with benchmark projects at the provincial and municipal levels. Throughout 2023, we implemented more than
2,000 projects by deploying our public administration informatization solutions.

17

18

China Mobile Limited

Chairman’s Statement“New” Market: Scale Operation with Increased Revenue Contribution
The role of “New” business as a growth driver was underscored by its increased contribution to the incremental
revenue, across international business, equity investment, digital content and FinTech. This was achieved by focusing
on upscaling, efficiency enhancement and brand building. In 2023, our “New” market revenue reached RMB49.3
billion, up 28.2% year-on-year. In terms of international business, we deepened the synergies between internationaland domestic markets by quickening the export of outstanding products and 5G solutions to serve the highquality co-construction of the “Belt and Road”. We also upgraded our overseas digital infrastructure and bolsteredinternational ecosystem collaboration. Our international business revenue reached RMB20.7 billion, up 24.2% yearon-year. In terms of equity investment, we optimized the two-pronged approach of direct investment and investing
through funds to actively create a family of businesses to drive ecosystem expansion in the mobile informationindustry. We continued to foster a partnership system featuring the China Mobile model through industry investment
and ecosystem partnerships that amplified the function of capital in connecting and empowering the ecosystem. In
terms of digital content, we made every effort to strengthen the integration of content, technology and innovation,refining core products such as MIGU Video while expanding into new areas such as VR/AR, cloud games and themetaverse. The annual revenue of our digital content business reached RMB28.0 billion, growth of 31.6% year-onyear. The monthly active users for cloud games across all platforms reached 120 million, the largest user base in
the industry. In terms of FinTech, driven by data mining and scenario empowerment, we continuously promoted therapid development of financial services throughout the industry value chain, achieving an annual business scale of
RMB76.6 billion. Through the creation of an all-in-one digital consumption portal across all platforms, “and-Wallet”
monthly active customers grew by 51.8% year-on-year.
We accelerated the pace of digital transformation and development, with a specific focus on value growth and theprovision of digital intelligence services centering around digital industrialization and industrial digitization. We sought
to continuously improve the level of CHBN business operations, allowing customers to enjoy a greater sense ofgain through the advancement of informatization. In 2023, the contribution of our digital transformation revenue toour incremental telecommunications services revenue reached 89.7%. Its share of telecommunications services
revenue increased to 29.4%, becoming the strongest driver of revenue growth. Of which, in terms of industry
digitalization, DICT revenue increased by 23.8% year-on-year to RMB107.0 billion. In the area of personal andhousehold digitalization, benefit revenue increased 37.1% year-on-year to RMB22.4 billion while smart home valueadded business revenue grew by 13.1% year-on-year to RMB33.6 billion.

Annual Report 2023

Chairman’s Statement

VIGOROUSLY ADVANCED THE BUILD-OUT OF THE “TWO NEW ELEMENTS”
SIGNIFICANTLY ENHANCED INFORMATION SERVICES CAPABILITIESWe continued to reinforce the foundation for digital intelligence transformation and improve the quality and efficiencyof our digital intelligence development. With a focus on developing 5G, computility network (CN) and the integration
platform, we relentlessly optimized our new information infrastructure and enriched our new information services
system that integrates connectivity, computility and capability.
Maintained leadership in dual gigabit network. We invested every effort to build a premium 5G network. Throughco-construction and sharing with China Broadcasting Network Corporation Limited, we have basically achieved
continuous coverage across counties and towns nationwide, as well as effective coverage of important venues,
districts and village hotspots. In 2023, 5G network investment amounted to RMB88.0 billion. We have accumulatively
brought into use more than 1.94 million 5G base stations, including 620,000 700MHz 5G base stations. We provided
services to 465 million 5G network customers and delivered a cumulative 33,000 5G commercial cases acrossindustries. Furthermore, we drove 5G technology innovation and built the world’s first 5G new voice network, in
addition to our ongoing efforts to build the world’s largest cloud-based core network. We systematically planned forthe deployment of the world’s largest RedCap commercial network, constructing the “1+5+5”10 RedCap showcase
cities. We gradually progressed research and experiment around new solutions based on the 5G-A technology
including multi-carrier aggregation, sensing and communication integration, passive IoT, space-sky-ground integrationand network system AI to accelerate industry development. We continued to evolve and upgrade our autonomous
networks and our capability in this area received a high rating of L3.2. We built out our gigabit broadband capabilities
with precise scenarios in mind and prioritized the deployment of 10G PON in residential complexes with gigabit
network access. We leveraged our extensive wireline coverage to help precision marketing and realize the effective
use of resources and generate higher return on investment. As of the end of December 2023, our gigabit platform
capability has been available in 100% of OLT11 in urban areas across the country and 95% of OLT in villages. Overall,our gigabit coverage had reached 390 million households.

10

One industry cluster innovation center (Chongqing); five technological innovation cities (Shanghai, Guangzhou in Guangdong Province, Ningbo in
Zhejiang province, Yueyang in Hunan province, and Shiyan in Hubei province); five application showcase cities (video city in Hangzhou, industrial
city in Suzhou, marine city in Ningde, park city in Ningbo and innovation city in Shenzhen).

11

Optical Line Terminal.

19

20

China Mobile Limited

Chairman’s Statement

CN continued to drive growth. We have been proactive in implementing the national strategy of Eastern Data andWestern Computing. Our national CN that boasts leading technology and scale has taken shape within a consistently
improving CN infrastructure. Our data center capability covers all nodes across the Eastern Data and Western
Computing hubs in China with a general computility capacity of 8 EFLOPS (FP32)12. We commenced constructing
a hyper-scale standalone intelligent computing center in Hohhot, alongside 12 intelligent computing center regional
nodes in 11 provinces to speed up the realization of our “N+X”13 multi-layer and full-coverage deployment ofintelligence computility capability. Our intelligent computility capacity reached 10.1 EFLOPS (FP16). We haveestablished the world’s largest interprovincial backbone 400G OTN network and the “1-5-20ms” three-tier latency
ranges. We have seen further breakthroughs in the application of our CN products alongside launching the all-networkcommercialization pilot test of our Tianqiong CN brain to support 115 types of CN business including Eastern Dataand Western Computing, intelligent computing and supercomputing and data express delivery. We promoted the
CN application in areas such as large-scale data backup and recovery, video rendering, astronomy, as well as medical
research and development. In the future, we will broaden our management scope to include more resources, aiming
to enrich our offering and upgrade our CN smart brain. In 2023, we launched the Baichuan integrated computility andnetwork platform to include general computing, intelligent computing, supercomputing and quantum computing andother social computility from more than 10 providers, with a total computility capacity of over 3.3 EFLOPS (FP16).
Our Computility Faucets strategy was set for scaled, standardized and commercialized operation. We continued todrive CN technological innovation by leading more than 100 standards-setting projects in domestic and internationalorganizations. Our proprietary technology such as computility routing has gained international recognition. Our CN
brain supported the panoramic overview of our resources and capabilities and flexible deployment, with nearly 10
million daily deployments of resources between eastern and western China. With that, China Mobile CN has entereda new phase of development, referred to as 2.0, that features integration and unification.

12

According to common industry practice, FP32 is used to measure general computility while FP16 is used to measure intelligent computility.

13

N (national, regional intelligent computing centers) + X (localized and customized edge intelligent computing nodes).

Annual Report 2023

Chairman’s Statement

Scaled development of our integration platform. We continued to build out a comprehensive empowerment
system for our integration platform to expand capability supply services. The development of this platform has
been fast-tracked and entered a stage of precise operation and scale expansion. As of the end of December 2023,
we had included 1,133 integration platform capabilities, which had been deployed a total of 580.7 billion times
throughout the year. The platform played a crucial role in facilitating cloud migration, digitalization and intelligent
transformation across society. It successfully helped organizations internally by significantly reducing costs andincreasing operational efficiency. At the same time, we fully leveraged our advantages in data resources offeredby Wutong Big Data to innovatively establish a distributed and synergetic computing platform for big data. On thisplatform, we centralized the control and management of 80,000 computing nodes, providing the industry withcomprehensive, agile and open platform capabilities covering storage and computing, data and tools. We elevatedour data management ability and received the highest Data Management Capability Maturity (DCMM) rating (Level5) certificate for data governance, and the domestically highest Data Security Maturity Model (DSMM) (Level 4)certificate. Our brand influence in the field of big data continued to grow, which saw broader application of services
offered by our Wutong Big Data platform across public administration, emergency response and fraud prevention.
We played an active role in building the national big data system and enriching the “big data+” product offering toprovide the fundamental elements for a smooth circulation of data.
Significantly strengthened information services supply capabilities. In terms of product offerings, we haveintensified our focus on nurturing core products. As part of this effort, we have introduced a dual-list system thatcategorizes products into strategic products for marketing and strategic products for development, and formeda product system covering digital intelligence services that generate revenue in the millions, billions, and tens ofbillions. Our initiatives have yielded favorable results. In the mass market, 17 of our products each had a user basein excess of 100 million. Of them, the number of users of 4 products exceeded 200 million. We have officiallylaunched the cloud handset for commercial use. Based on computility, its industry-leading features, functions and user
experience received positive reviews from the market. As of the end of December 2023, the number of customers
for cloud handset reached 11.99 million. In the “Business” market, revenue of 6 products exceeded RMB10 billion
each. Of them, the service capability of China Mobile Cloud across all platforms was industry leading. We haveinnovatively built a high-performing computing architecture COCA14 and fostered the heterogeneous computing
ecosystem. Our key products such as the self-developed Tianyuan operating system and cloud host boast industry
leading core performance. China Mobile Internet of Video Things (IoVT)15, which specializes in equipping IoT terminal
devices with video connection, has deployed innovative business plans. Our “China Mobile Home Guard” and“Clairvoyant” cameras have together obtained 56.26 million customers across the network. In terms of service,
we continued to optimize service management covering every aspect and process of service and involving every
member of staff, and obtained notable outcomes. We achieved remarkable results in overall customer satisfactionin the industry while maintaining a leading position in terms of customer satisfaction with mobile network quality.
Customer satisfaction with household broadband network significantly improved for the second year in a row withkey product satisfaction increasing by 1.25 percentage points. The problem-solving rate with regard to large model
application increased by 5.0 percentage points while integrated customer request handling time reduced by 47.0%.
In terms of brand management, we continued to foster our world-class brands that resonate with our customers
and generate favorable perception. We have introduced the “1+4+4” strategic brand system16 as part of our recent
initiatives. China Mobile was a top-ranking brand in the 2023 BrandZ Top 100 Most Valuable Chinese Brand list,
underscoring our leading brand value among global telecommunications operators.

14

Compute on Chip Architecture.

15

China Mobile Internet of Video Things (IoVT) is a new information infrastructure specializing in equipping IoT terminal devices with video
connection services. Using video IoT terminals as the medium, it converges connection, capabilities and services on a video-connected platform.

16“1+4+4” strategic brand system refers to “China Mobile” as the corporate brand; GoTone, M-zone, Easy Own and China Mobile Aijia as four
customer brands; and MIGU Video, China Mobile Cloud, Wutong Big Data and Jiutian as four product brands.

21

22

China Mobile Limited

Chairman’s Statement

VIGOROUSLY FOSTERED INNOVATIONCONTINUOUSLY ENHANCED SUSTAINABLE DEVELOPMENT
The Company has accelerated the advancement of the technological innovation system, continuously expanding an
ecosystem of open cooperation and fully leveraging the efficiencies gained from management reform to strengthen
its future-proof sustainable development capabilities.
Technological Innovation in Full Swing. By upgrading the “Unified Five Rings”17 technology and innovation
framework and initiating the “BASIC6”18 sci-tech innovation plan, we bolstered our efforts in nurturing emerging
and future strategic industries and actively built an ecosystem of collaborative research and open cooperation.
We were able to persistently witness outcomes of innovation. First, our network technologies continued to drive
industry development. We led 60 projects in 5G-A international standard setting, more than any other global
telecommunications operator. We maintained our leading status among global operators in the number of 6G
innovation outcomes. We successfully developed China’s first reconfigurable 5G radio frequency transceiver chip,“Breaking Wind 8676”. We have released top 10 5G-A innovations19. Our new 5G RedCap terminals, featuring asmart, simple and lightweight design, are now commercially available in 52 cities across China. We first proposed the
4.9GHz low frequency integrated sensing and communication technology system, conducted R&D into passive IoT 2.0
products, achieved precision identification and management of items in large-scale warehouses, and completed thefirst-in-industry NR NTN laboratory proof. We successfully sent two land-space experimental satellites – China Mobile
01 satellite and Xinghe verification satellite20 – into Low Earth orbit. In the development of CN, we emphasized CN
as an important component for national strategic emerging industries, and co-developed the world’s first 1.2T ultrahigh-speed next-generation Internet backbone. Second, we achieved breakthrough improvements with our key
digital intelligence capabilities. We have built a “1+N” system of general and industry-specific large models, andindependently developed the secure and controllable Jiutian series of general large models. Specifically, we launched
the Jiutian Zhongqing foundation large model, as well as five large industry models covering customer service,
public administration, network, corporate calling and dynamic travel analytics. The large model for customer service
became the first to commence engineering level application. We have accumulated over 450 AI capabilities in areas
such as intelligent speech recognition, natural language processing, machine vision and intelligent analysis. We built
infrastructure for the circulation of fundamental data elements by launching Data Switching Service Network (DSSN)
and the all-in-one data router. Based on the “AaaS+” action Plan, we built the integration platform to serve the digitaltransformation of society, strengthened integrated innovation and promoted industry upgrades. We reinforced our
security infrastructure to build out traditional security capabilities while deploying emerging security technologies
such as 6G and CN native security, and quantum communications.

17

The “Unified Five Rings” refers to our technology and innovation system that consists of five rings: the inner ring (major research institutes), themid-ring (specialized companies facilitating industry research collaboration), the outer ring (provincial companies and regional innovation institutes),
the partnership ring (tertiary institutes and enterprise partners), and the overseas ring (overseas R&D institutes and international organizations).

18

B-Big data, A-AI, S-Security, I-Integration platform, C-Computility network, 6-6G.

19

Top 10 5G-A innovations were: new smart, simple and lightweight terminals; new sensing and communication integration; new land-spaceconnections; new immersive and real-time experiences; new low-altitude coverage business models; new intelligent native capabilities; newpassive IoT ecosystem; new ultimate performance benchmarks; new inherently assured services; and new sensing, computing and intelligent
architecture.

20

China Mobile 01 satellite carries a base station that supports 5G land-space communication technology. It is the world’s first integrated terrestrial
and celestial signal processing system capable of verifying 5G land-space evolutionary technology. Designed with 6G concepts, Xinghe verification
satellite deploys the industry-first satellite core network capable of in-orbit operation, making it the world’s first verification satellite to validate 6G
architecture.

Annual Report 2023

Chairman’s Statement

Extended open collaboration. With the aim of fostering stronger links in the chains connecting industry, innovation,
capital, supply, ecosystem and value creation, we launched various initiatives to solidify, complement, reinforce andreshape these chains and continued to expand our circles of “relatives”, “friends” and ecosystem. We strengthened
strategic partnerships with central ministries and departments, local governments, enterprises and tertiary institutes,
driving cross-disciplinary collaboration in information services to support the further development of the digital
economy. We supported ecosystem growth and unleased the synergies between industry and capital investment by
providing venture capital in various sectors including AI, Industrial Internet, network and information security, IoVT,
CN and Satellite Internet. We strengthened innovation cooperation by enhancing new joint R&D projects, further
implementing the Joint Innovation Plus scheme and partnering with enterprises, tertiary and sci-tech research
institutes to advance the integrated innovation of industry, academia, research and application. We also promoted thedevelopment of an innovative ecosystem by enhancing our plans on regional and overseas innovation and utilizing
capital to unleash the synergy associated with these developments. Drawing on our leadership in the industry chain,
we have attracted more than 1,300 companies to become links in the chain. Leveraging our subsidiary chains, we
deepened partnership with enterprises of different sizes across verticals and persistently enhanced our leadershipand the industry’s resilience, which resulted in the forming of high-quality industry clusters.
Increased effectiveness of enterprise reforms. We continued with enterprise reforms in greater depth andbreadth, and improved the authorization mechanism for the boards of directors. In our subsidiary operations,reforms in the boards of directors have improved systems and standardized operations. We achieved breakthroughin building a strategic leadership pipeline, with an enhanced talent pool under the “10-10²-10³-10 4” program andimproved “Technical Chief Engineer System” and “Top Talent Demonstration Zones”. The talent structure continued
to be optimized, and the deployment of manpower in key areas of technological innovation and transformation
was significantly strengthened, alongside higher competency of the team to support our business transformation.
We continued to enhance the incentive system to drive business growth and stimulate technological innovation
momentum, and imposed preferential policies for core staff and frontline personnel. Adopting scientific approaches,
we continuously strengthened our management system by ensuring the headquarters, regional companies andspecialized teams each performed their respective roles in overall strategy-setting and management, driving
market development, and enhancing competency. We have also optimized the product operation mechanisms by
establishing coordinated product operation teams between provincial and specialized companies, generating greatersynergy between headquarters, regional companies, and specialized teams. We promoted the construction of adigital intelligence treasury system, significantly improving the efficiency and effectiveness of our capital and assets.
Frontline reforms have generated notable results, highlighted by the forming of 11 research zones including Jiutianand Wutong, and 11 teams for specialized, premium, unique and new products and capabilities such as XinSheng
Tech. The assessment results of our subsidiaries in the national technology company development program andthe Double-hundred Action put us in a leading position among central state-owned enterprises. The Cloud Capability
Center was selected as one of the first batch of World-class Professional Leading Enterprises by the State-owned
Assets Supervision and Administration Commission of the State Council.

23

24

China Mobile Limited

Chairman’s Statement

VIGOROUSLY EMPOWERED ECONOMIC AND SOCIAL DEVELOPMENTONGOING EFFORTS TO ENHANCE ENVIRONMENTAL, SOCIAL AND
GOVERNANCE (ESG) MANAGEMENT
As a responsible corporate citizen, we attach great importance to sustainable development and always adhere to theprinciples of “Sincerity and Fulfillment, Self-Realization and Empowerment”. We drive growth of our organization,
and with that, we benefit and empower the overall development of economy, society and the environment.
Further progress on green development. We advanced the “C² Three Energy – China Mobile Carbon Peak andCarbon Neutrality Action Plan”21. With the themes of energy saving, clean energy and empowerment, we focusedon key areas and built Eight Major Projects22, which aimed to leverage mega projects to drive development. Thisinitiative has achieved outstanding results. We comprehensively implemented the green transformation of the
network architecture, continued to promote low-carbon base stations and data centers, and actively introduced
clean energy such as solar and wind. In 2023, our total energy consumption and total carbon emissions per unit oftelecommunications business decreased by 13.0% and 13.1% year-on-year respectively. We contributed to society’s
wider efforts to reduce carbon emissions by means of information technology adoption and promoted information
services applications in the field of pollution control. During the year, we helped reduce carbon emissions byapproximately 310 million tonnes across society.
Solid social responsibility fulfilment. By leveraging the Company’s strengths, we used digital intelligence andinnovation to contribute to the high-quality development of society and meet people’s needs for a better life. We
comprehensively empowered the digital intelligence transformation of production, livelihood and governance, fully
unleashing the efficiency of information services. We enhanced the coupling of strategies to improve coordinatedregional development, significantly amplifying the synergy of key regions. We delivered services for major
events such as the Chengdu World University Games, Hangzhou Asian Games, and the Belt and Road Forumfor International Cooperation. We endeavored to provide reliable communications for disaster relief of floods andearthquakes and actively prevented and fought illegal crimes in communications networks, striving to create a clean
cyberspace. We promoted the Digital Intelligence Village Revitalization Plan, helping 390,000 administrative villages
across the country meet the standards of digital village. During the year, RMB590 million was allocated to the proconsumption campaign to aid poverty alleviation. Our charity programs including Heart Caring Campaign and Blue
Dream – China Mobile Education Aid Plan have been widely recognized.
Remarkable results of corporate governance. To ensure sound corporate governance, we adhered to principles
of integrity, transparency, openness and efficiency and fully complied with all applicable listing rules and regulations
governing listed companies. We actively responded to global sustainable development initiatives and established theSustainability Committee to strengthen ESG strategy implementation and performance supervision. We continued
to improve our corporate governance and decision-making mechanisms and optimize the top-down design andoperating mechanism of compliance management. This helped the Company modernize its governance system andgovernance capabilities to support the Company’s continuing reform and development. We enhanced our internal
control and supervision across-the-board with a particular focus on key business areas to strengthen risk prevention
and mitigation. By strengthening risk prevention and control and improving risk detection capabilities, we haveenhanced the effectiveness of risk management and safeguarded the healthy and sustainable development of thecompany.

21

C² Three Energy – China Mobile Carbon Peak and Carbon Neutrality Action Plan; “Three Energy” refers to the three guiding principles of actions
which include energy saving, clean energy and empowerment.

22

Eight Major Projects include three projects in the field of energy saving: Green Coverage, Low-carbon Computing Force, and Server Room
Renovation; two projects in the field of clean energy: Wind and Solar-Powered Wireless Network and Green Smart Park; three projects in the fieldof empowerment: Industry Empowerment showcase project that helps industry upgrade, My Share in Carbon Removal project that advocatesphilanthropy, environmental protection and carbon inclusiveness, and Green Recycling project that promotes carbon reduction in the circular
economy.

Annual Report 2023

Chairman’s Statement

Our overall performance has received widespread acclaim. We were named one of the top ten China ESG ModelEnterprises at the first China ESG Model annual ceremony and topped the list of China ESG Listed Companies
Pioneer 100 and China ESG Listed Companies Technology Innovation Pioneer 30. Bloomberg Businessweek/Chinese
Edition bestowed us with the honorary awards of Listed Company of the Year 2023, Most Valuable Investment
Listed Enterprise and the ESG Leading Enterprise Award. We received Gold awards for China’s Best Large Cap
and China’s Best Telecommunications Company from the FinanceAsia magazine. Our outstanding achievementsin overall performance, ESG, investor relations and other areas have also been recognized by Institutional Investor,
The Asset, Asiamoney and Corporate Governance Asia magazines. We were included in the 2023 Listed Company
Directors’ Office Best Practices list by China Association for Public Companies, and also listed among 2023 Wind’s
Top 100 ESG Best Practices for China’s Listed Companies.

FUTURE OUTLOOKThe impact of the new wave of technological revolution and industrial reforms will continue to grow, so will theimportance of integrated innovation. The three aspects of this integrated innovation will be highlighted in the
power of information, the new generation information technology, and the merger of information service and social
operation systems. At the same time this integrated innovation will deepen in three directions – the applications ofa new generation of information technology to rapidly form new growth momentum, the collaboration of industry,
academia, research and application to foster a new innovation paradigm, and the integration of digital and real
economy to open up new development opportunities.
We see valuable opportunities as we expand our information services. With the advocacy of the national “AI+”initiative and the further accelerated advancement of Digital China, the industry experiences new growth potentialfrom the development of new quality productive forces. This progress brings forth the emergence of data as a newfactor of production, computility as a new fundamental energy source and AI as a new instrument of production. The
information services industry has not only in itself become an important sector for the development of new quality
productive forces, but also a strong support for other sectors in this pursuit. General AI, particularly represented
by AI large models, is developing robustly. The role of AI is also fast changing from an assisting tool that helps
different industries improve quality and efficiency, to an indispensable infrastructure and core capability that supports
economic and social transformation and development. While AI brings forth disruptive applications, “AI+” opens
up vast blue-ocean of opportunities. Fixating the vision of building a world-class information services and sci-techinnovation enterprise, we will capture opportunities arising from the development of “AI+” and extending our“5G+” initiatives towards this direction. We will identify a new roadmap of transformation and upgrade throughcomprehensive, systematic and deep-dived integrated innovation. In doing so, we will drive more creation to enrichlife, enhance quality production and support precise governance powered by digital intelligence. We will satisfy, driveand create demand to form a new for value growth trajectory and fuel the future development of the Company.

25

26

China Mobile Limited

Chairman’s Statement

In the meantime, we are faced with some uncertainties in our transformation and future development. The businesslandscape is complex and severe with various international trade and technology barriers. This has threatened thestability of the supply chain and adversely affected our operations to some extent. Integrated innovation and crossdisciplinary collaboration in the information technology sector have emerged as prominent trends, which, coupledwith AI and other emerging technologies, have brought disruptive changes to how information services are delivered.
Players across the industry chain are trying to dominate key segments of the value chain by integrating capabilities
and converging the ecosystems. The information services sector has become more diversified at the same time asseeing more intense competition.
Those who are good at planning will win, those who are forward-looking will prosper. Faced with both opportunities
and challenges, we will fully, accurately and comprehensively align with the new development paradigm. We will
pursue stable progress while forging ahead with a steadfast focus on integrity and innovation. We will enhance corefunctions, improve core competitiveness and fully implement the “1-2-2-5” strategy and relentlessly solidify ourposition as a world-class “Powerhouse”. We will strive to promote digital intelligence transformation and high quality
development. Building upon the foundation of deepening the implementation of the “Two New Elements” (newinformation infrastructure and new information services system), we will comprehensively propel the “BASIC6” scitech innovation plan, reinforce strategic planning for “AI+”, develop new quality productive forces at an accelerated
pace, and establish ourselves as a world-class information services and sci-tech innovation enterprise to a highstandard. In doing so, we strive to achieve favorable growth in revenue and net profit to consistently create greater
value for our shareholders and customers.

ACKNOWLEDGEMENT
Mr. Dong Xin resigned as executive director and chief executive officer in January 2024, concluding his extensive
years of service to the Company. Mr. Dong played a crucial role in promoting China Mobile’s high-quality sustainable
development, achieving remarkable results with considerable contributions. On behalf of the Board of Directors, I
would like to extend my heartfelt thanks to Mr. Dong.
Finally, on behalf of the Board, I would like to take this opportunity to express my heartfelt gratitude for the supportof our shareholders, customers and the public, and for the dedication and contribution of our employees.

Yang Jie
ChairmanHong Kong, 21 March 2024

Business Review

28

China Mobile Limited

Business Review

During 2023, we fully implemented our “1-2–2-5” strategy, continuously
increased our ability to provide information services and fueled
our engine for innovation and development. We steadfastly placed
customers at the center of our business, further consolidated ourfundamental competencies, continuously developed our scale-based
and value-oriented operations in greater depth, robustly drove thecomprehensive and integrated development of our CHBN markets andcontinued to enhance product competitiveness and service quality.
Thanks to these efforts, we achieved favorable growth in our overallbusiness and continued to increase customer satisfaction. Our operating
revenue amounted to RMB1,009.3 billion. Of which, revenue fromtelecommunications services was RMB863.5 billion, representing an
increase of 6.3% year-on-year.

KEY OPERATING DATA
2023

2022

Change %

991

975

1.6%

795

614

29.4%

15.99

18.11

–11.7%

180

227–20.6%

Average Minutes of Usage per User per Month (MOU) (minutes/user/month)

242

256

–5.5%

Average Handset Data Traffic per User per Month (DOU) (GB/user/month)

15.9

14.1

12.7%

Average Revenue per User per Month (ARPU) (RMB/user/month)

49.3

49.0

0.6%

Mobile Business
Customer Base (million)
Of which: 5G Package Customer Base (million)
Net Additional Customers (million)
Of which: Net Additional 5G Package Customers (million)

Broadband BusinessWireline Broadband Customer Base (million)

298

272

9.6%

264

244

8.3%

Wireline Broadband ARPU (RMB/user/month)

34.5

34.1

1.2%

Household Customer Blended ARPU (RMB/user/month)

43.1

42.1

2.4%

Corporate Customer Base (million)

28.37

23.20

22.3%

IoT Card Customer Base (million)

1,316

1,062

23.9%

Of which: Household Broadband Customer Base (million)

Corporate BusinessAnnual Report 2023

Business Review

ENHANCED HIGH-QUALITY DEVELOPMENT WITH COMPREHENSIVE GROWTH
OF CHBN“Customer” Market
Centered around 5G, we better integrated data access, applications and customer benefits to effectively meet
diverse customers’ demands for a rich and convenient digital life. We built and continued to upgrade our customer
management system covering acquisition, retention, value upgrade, attrition control and win-back, enhancing theretention of existing customers and maintaining value contribution from mid – to high-end customers. We stepped up
efforts to accelerate 5G universal adoption and the popularization of 5G devices, and comprehensively enhanced 5G
network residency. Moreover, we pursued innovative methods for integrated customer operations and implemented
a more sophisticated approach to customer segmentation, seamlessly integrating it into our operations. These
initiatives have resulted in a broader customer base, enhanced customer loyalty and increased customer value.
Additionally, we have offered more differentiated services through our customer brands of GoTone, M-zone and Easy
Own, and we were also able to better leverage scale advantage to aggregate consumption to build the largest digital
life services platform in China. The rapid growth in customer scale, coupled with our enhanced integrated operations,has helped our 5G business gain favorable momentum. As of the end of December 2023, our 5G network customer
base reached 465 million and its share of our overall customer base increased to an industry-leading 46.9%. We
gained a net addition of 138 million customers, or a monthly average net addition of more than 11.47 million. The
ARPU and DOU of our 5G network customers reached RMB78.2 and 25.0 gigabytes respectively, driving stable andhealthy growth in overall mobile ARPU.

“Home” Market
Focusing on smart home, we steadfastly pursued the direction of scale expansion, brand recognition, ecosystembuilding and value enhancement in the development of the “Home” market and accelerated household digital
intelligence transformation. We continued to consolidate the foundation for our family information services andaccelerate the upgrade of household broadband network towards diversified connectivity, scenario-based experienceand cloud-based terminal computility. We increased the value contribution of Mobile HD through centralized bigscreen operations and diversified screen types, while infusing greater innovation into vertical scenarios and adopting
a digital intelligence operation. We consistently upgraded our home security intelligent services, enriched valueadded AI functions, and diversified terminal types through enhanced resolution and computility. Moreover, we
extended application scenarios to home security surveillance and the governance of rural villages. We optimized
the operation of our family services portal to realize the auto detection, auto display and auto control of devices,
unleashing synergies across different scenarios. We continued to extend the living circle around the family, andaccelerated the integration of health and elderly care, digitalized community, and the scenario-based governance ofrural villages. As a result of these initiatives, our “Home” market achieved rapid growth in revenue and stable andhealthy growth in customer value. As of the end of December 2023, the number of household broadband customers
reached 264 million, with an average monthly net addition of 1.68 million, while Mobile HD customers reached 207
million, with a net addition of 14.92 million. Home network deployment, big screen, security and other key smart
home businesses saw a rapid uptick in scale, while health and elderly care, full household intelligence and other new
HDICT scenarios witnessed accelerated growth. Household broadband revenue grew by 13.5%, smart home valueadded business revenue increased by 13.1%, and household customer blended ARPU maintained stable and healthy
growth.

29

30

China Mobile Limited

Business Review“Business” Market
Centering around the positioning of the “Business” market as the new driver of revenue growth and a major force
for enterprise transformation and upgrade, we developed “Business” market product and solution lists with key
products and sectors in mind. In doing so, we leveraged the advantages of our innovation capabilities, organizational
synergy, infrastructure resource and localized services to continue improving the scale, quality and competenceof this business. We strove to build a leading cloud engine that allows customers to seamlessly connect to thecloud when they access our network anywhere, from edge devices and within milliseconds. We committed to coretechnologies that are self-developed and under our control, ensuring our leadership in the evolution of the CN brain.
We promoted the compatibility and openness of the industry ecosystem, marking a positive start in the establishmentof our industry-leading China Mobile Cloud. We maintained our leading position in empowering all sectors with 5G,
represented by the development of a dedicated 5G network 3.0 that can be integrated into enterprise production
as a foundation for connection. Centered around the 9-One Industry Platform and our high-value applications, wedeveloped a 4-in-1 solution that integrates cloud, network, platform and applications, resulting in the scale replication
across multiple market segments from an initial stage of isolated adoption. We have achieved significant digital
intelligence transformation in various verticals thanks to these initiatives. In 2023, we achieved leapfrog development
in industry cloud, with revenue amounting to RMB70.8 billion. Our cloud computer’s full-stack capabilities wereentirely self-developed and the product recorded a sales volume of over 2.70 million, representing a more thanten-fold increase year-on-year. The number of IoT card customers reached 1.316 billion, with a net addition of 254
million.

“New” Market
In terms of the international business, to support the high-quality co-construction of the “Belt and Road”, we
continued to optimize the planning of our overseas information infrastructure, continuously enhancing our endto-end service quality, expanding our “circle of friends”, and increasing the scale of our international business.
During the year, revenue from the international business increased by 24.2% year-on-year to RMB20.7 billion. In
terms of equity investment, we focused on securing industry leadership, improved the ecosystem, reinforced corecompetence through direct investment, and strengthened our foothold in leading funds to support technologicalinnovation through a specialized, refined, differentiated and innovative approach. With a focus on key fields such as
AI, Industrial Internet and Visual Internet of Things, we created a bigger “circle of relatives” to collaboratively provide
information services, boosting synergy and unleashing the potential of capital. In the area of digital content, we
adopted the content, technology, and integrated innovation approach to strengthen content generation, aggregationand dissemination, consistently building an industry-leading content ecosystem. In 2023, alongside fast growth inactive users of MIGU Video, cloud games and video connecting tones, revenue from the content business increasedby 31.6% year-on-year. The number of MIGU Video APP’s monthly active customers reached 116 million and thecustomer base for video connecting tones exceeded 400 million. In terms of FinTech, monthly active customers of“and-Wallet” recorded a year-on-year increase of 51.8%. The business scale of the financial services throughout theindustrial chain increased 35.7% year-on-year, serving 59.6% more enterprises.

Annual Report 2023

Business Review

PERSISTENT EFFORTS ON TARGETED INVESTMENTS WITHUPGRADED NETWORK DEPLOYMENT
Thanks to our forward-thinking and targeted approach to investment, we were able to focus on ensuring leading
connection quality, planning computility resources, and fostering and improving capabilities to lead in all aspects
ranging from network coverage and quality to technology and customer experience, while also consolidating our
foundation for digital intelligence, supporting growth across the CHBN markets. At the same time, we improved
resource management, strengthened digital intelligence empowerment, and optimized our project management andinvestment structure by strengthening investment control throughout the process and adopting specialized operationand implementation measures to save energy and protect the environment. These measures have helped us ensure
investment efficiency and promote low-carbon development.
We continued to enhance the capabilities and quality of our infrastructure. As of the end of December 2023, thenumber of our base stations had exceeded 6.60 million, making it the largest network in the world. The total lengthof our optical network reached 28.74 million cable kilometers while our dedicated business network and backbonetransmission network boasted bandwidth of 82.8Tbps and over 859Tbps respectively. The bandwidth of CMNET,
cloud dedicated network and IP dedicated network exceeded 550Tbps.
We continued to optimize our international information infrastructure. As of the end of December 2023, we had
more than 80 submarine and land cable resources that enabled global coverage. Our total bandwidth for internationaltransmission reached 145Tbps and our 235 POPs covered all major countries and regions worldwide. In addition, ourinternational roaming and 5G services covered 264 and 75 locations respectively. Worldwide users covered by ourHand-in-Hand global partnership program exceeded 3 billion.
In 2023, our capital expenditure totaled approximately RMB180.3 billion. In 2024, we expect total capital expenditure
to stand at approximately RMB173.0 billion, which will be spent primarily on areas including enhancing ourleadership in connection perception, accelerating computility development, building out more intensive and effective
capabilities, improving infrastructure planning and expansion, and supporting CHBN business development. Of this,capital expenditure for 5G network will amount to approximately RMB69.0 billion, which will be funded mainly fromcash flow from operating activities.

31

32

China Mobile Limited

Business Review

STRENGTHENED MARKETING WITH SIGNIFICANT ENHANCEMENTS TOSERVICE QUALITY
Channel Transformation
We furthered innovation in our marketing and service system, improved accessibility, and built new channels that
integrated shop, network and people. Firstly, we increased our efforts in turning terminals into an ecosystem,
connecting the channels to form sales chains, and establishing a customer membership system. This has increased
our influence throughout the industry chain. During the year, sales of 5G handsets from China Mobile’s pan-terminaland omni-channel alliance reached 43.88 million units, up by 27.2% year-on-year. Secondly, we optimized gridbased digital intelligence empowerment and operation mechanisms, driving integrated service handling for our
CHBN business, as well as “inverted triangle” full-domain support order handling, big screen visualization of grid
operations and other key capabilities. To further reduce burden and increase efficiency of the frontline in the grids,
we established the “6x1” capability framework1. Thirdly, we innovatively improved online operation by elevating the
China Mobile APP so that it was not only effectively integrated but also running smoothly. This has yielded significant
outcome, with the number of monthly active customers increasing to 370 million. We introduced large AI models to
empower and achieve intelligent interactive service and precision marketing. Thanks to notable progress in channeltransformation, our sales effort became more efficient in 2023. Alongside favorable revenue growth, sales expenses
as a proportion of revenue continued to decline.

Brand Operations
Taking full advantage of the leading position of our brands, we fully adopted the “brand-first approach” by establishing
the new “1+4+4” strategic brand system, centering the “China Mobile” corporate brand and four customer brands– GoTone, M-zone, Easy Own and China Mobile Aijia. Our initiatives for strengthening the customer brands included
cultivating a sense of exclusivity for GoTone through three types of exclusive rebates. For M-zone, we focused on
digital intelligence and trendiness with special offerings and campaigns for young customers. For Easy Own, wehighlighted localized services to shape a sense of warmth. As for China Mobile Aijia, we created the modern smart
home lifestyle with full-gigabit network and cloud-based applications. We continued to enhance the four productbrands – MIGU Video, China Mobile Cloud, Wutong Big Data, and Jiutian. Among them, Wutong Big Data is a
product brand which specializes in big data and provides customers with three cloud-based big data services of PaaS,
DaaS and SaaS, as well as a rich variety of products for vertical industries, enabling digital intelligence transformation
across industries. Jiutian is a product brand which specializes in AI, and through our proprietary core technology, itcreates a new type of intelligent engine based on the Jiutian AI platform, generic and industry-specific large models,and over 450 key AI capabilities. The engine offers full-stack AI services from intelligent computing infrastructure,platform, model capabilities to intelligent applications. In 2023, we continued to enrich our brand proposition. Our
brand value put us in the camp of first-tier global operators, advancing the impact of our brand to a new level.

1“6x1” capability framework refers to one-screen overview of indicators, one tool for marketing, one-click service handling, one-point task
assignment, one-click order handling, and one-grid management of resources.

Annual Report 2023

Business Review

Customer Services
We steadfastly advanced the implementation of a service management system encompassing every aspect andprocess of service and involving every member of staff. We maintained industry-leading customer perceptionof service quality, as reflected by notably higher overall satisfaction ratings and lower complaint rates relative topeers. Meanwhile, reputation rating of our “Heartwarming Service” reached 90%. Network quality saw consistentenhancements, with mobile network quality satisfaction maintaining its advantageous position and householdbroadband network quality satisfaction increasing substantially for two consecutive years. Following our ongoing
efforts to improve product quality, customer satisfaction with key products increased by 1.25 percentage points.
We were the first in the industry to implement a product quality management system that centers on customer
perception. Service touchpoints continued optimizing through continuous upgrades to our service systemempowered by AI. As the initial adopter of industry large models, we improved customer issue resolution rates by
5 percentage points relative to traditional models. We spearheaded video customer service to provide visualized
hotline services for customers, with average monthly service volume reaching 145 million. We steadily enhanced
retail outlet work processing efficiency, shortening integrated service handling time by 47% year-over-year. We
further implemented initiatives to protect customer rights, pushing forward the “Sunshine Actions” program toprotect customer rights and ensuring information security. We continued to strengthen customer communicationand engagement through conducting customer events including manager storefront visits, customer experience
tours and General Manager Customer Reception Days to fortify and further uplift our reputation among customers.

HIGHLIGHTS FOR 2024
In 2024, we will boldly embrace our role as a leading force behind China’s leapfrog development of science andtechnology, making active contributions to the building of “Cyberpower” and “Digital China”. We will expedite thefurther advancement of our core business strategy that centers around accelerating digital intelligence transformation
and achieving high-quality growth. While furthering cloud migration and digitalization, we will emphasize intelligenceas the driving force, expedite the transformation from “+AI” to “AI+”, and better support the development of newquality productive forces. We will devote every effort to deliver in the five areas below:
First, we will continue to build new information infrastructure to solidify our digital intelligence foundation. We will
ensure leading network coverage and perception by building premium “double gigabit” networks. We will accelerate
the development of CN to support the integration and innovation of applications. We will also expedite the upgradingof our integration platform and strengthen capability supply and empowerment.

33

34

China Mobile Limited

Business Review

Second, we will continue to establish the new information service system, promoting the quality and efficiency
of digital intelligence development. We will take a deeper, broader and more thorough approach to value-oriented
operations by leveraging our business scale and driving the comprehensive and integrated development of our
CHBN+VG markets. Focusing on business priorities, we will improve value creation capabilities and strengthen
our existing customer operation system. We will also vigorously develop the corporate market, promote thestandardization, productization and platformization of government-enterprise solutions, as well as enriching innovative
offerings in the field of Internet of Video Things.
Third, we will deepen application of AI empowerment and improve digital intelligence operation. Internally, we will
promote the intelligent upgrade of our business operation model by implementing AI+ smart operation, AI+ smart
service, AI+ smart construction and maintenance, and AI+ smart management. Externally, we will provide highstandard smart applications to support the digital transformation of production, lifestyle and governance.
Fourth, we will foster our world-class brand power and establish a leading reputation in digital intelligence, providing
premium networks, outstanding products and excellent “Heartwarming Service” experience to enhance the added
value of our brand. To enhance brand value, we will endow our corporate brand with technology, customer brands
with more innovative operations, and product brands with the outcome of innovation. We will make efforts in brandcommunications and management to enhance our reputation.
Fifth, we will continue to drive reforms and innovations, as well as enhancing management to stimulate the internal
vitality of digital intelligence. We will carry out a new round of reforms to strengthen system planning, enhance
technological innovations, implement the “BASIC6” sci-tech innovation plan, and optimize our technologicalinnovation systems and mechanisms. We will improve the mechanisms for governance, talent development andincentive while continuously optimizing our organizational structure. We will enhance our professional managementlevel by strengthening the collaboration and synergy between the headquarters, regional companies and specialized
teams so as to ensure performance in their respective roles to contribute to the improvement of corporate
management and operational efficiency, and preventing management risks.

Financial Review

36China Mobile Limited

Financial Review

In 2023, we made every effort to seize the valuable opportunities arisingfrom the thriving digital economy and achieved all-round growth incustomer value, corporate value and shareholder returns. Our businessresults were remarkable, with revenue surpassing the RMB trillion markfor the first time in our history of development, and net profit attaining arecord high.

2023

2022

Change1,009,309

937,259

7.7%

Revenue from telecommunications services (RMB million)

863,514812,058

6.3%

Revenue from sales of products and others (RMB million)

145,795

125,201

16.4%

341,478

329,176

3.7%

33.8%

35.1%

–1.3pp131,766

125,459

5.0%

13.1%

13.4%

–0.3pp

6.16

5.88

4.8%

Operating revenue (RMB million)

EBITDA (RMB million)
EBITDA margin
Profit attributable to equity shareholders (RMB million)
Margin of profit attributable to equity shareholders
Basic earnings per share (RMB)

We proactively pursued market expansion and, at the same time, strengthened our “All Members, All Elements, All
Processes” cost control practices, thereby maintaining our profitability at a leading level among international firstclass telecommunications operators and continuing to create value for our shareholders.

OPERATING REVENUEIn 2023, our operating revenue reached RMB1,009.3 billion, up by 7.7% year-on-year, of which revenue fromtelecommunications services was RMB863.5 billion, up by 6.3% year-on-year. We furthered value-oriented
operations by leveraging our business scale, drove the comprehensive and integrated development of our CHBN
markets, and achieved solid growth in revenue.

Revenue from Telecommunications Services
We furthered the integrated development of data access, applications and customer benefits, expedited customers’
migration to 5G, continued to boost 5G customer penetration rate, and persisted in the optimization of our revenue
structure. Our revenue from wireless data traffic services for the year was RMB394.8 billion, down by 3.1 percentage
points when expressed as a percentage of revenue from telecommunications services.
Our broadband business continued to expand as we enhanced the quality and coverage of our broadband services,
and as we accelerated the transformation and upgrade of our “Home” business towards HDICT integrated solutions.
Our revenue from wireline broadband services continued to make up a growing portion of our revenue from year toyear and reached RMB118.8 billion, up by 13.1% year-on-year and by 0.8 percentage points when expressed as apercentage of revenue from telecommunications services.

Annual Report 2023

Financial Review

Benefiting from rapid growth across DICT and other businesses in the “Business” market, “Mobile HD” and othervalue-added services in the “Home” market, as well as “MIGU Video” and other businesses in the “New” market,
our revenue from applications and information services for the year reached RMB221.6 billion, up by 21.5% yearon-year, and contributed 4.8 percentage points of the increase in revenue from telecommunications services. It
maintained a solid growth momentum and contributed to the further optimization of our overall revenue structure.

Revenue from Sales of Products and Others
Driven by sales of handsets and other terminals, our revenue from sales of products and others was RMB145.8
billion, up by 16.4% year-on-year. Our terminal sales business mainly serves to support the expansion of our principal
telecommunications businesses, and hence its contribution to our profit is relatively low.

OPERATING EXPENSES
We actively promoted our low-cost, high-efficiency operating model, stepped up measures to reduce costs andenhance efficiency, strengthened our “All Members, All Elements, All Processes” cost control practices, andcontinued to improve and refine our management. Meanwhile, we constantly optimized the structure of resource
deployment, and endeavoured to strike a balance between short-term operating results and long-term development,in order to maintain our sound profitability.
In 2023, our operating expenses were RMB875.0 billion, up by 8.3% year-on-year. Our operating expenses
represented 86.7% of our operating revenue.
2023

2022

RMB million

RMB million

Change874,963

808,160

8.3%

Network operation and support expenses

268,895

254,182

5.8%

Depreciation and amortization

207,132

200,077

3.5%

Employee benefit and related expenses

144,333

130,157

10.9%

Selling expenses

52,47749,592

5.8%

Cost of products sold

142,807

122,743

16.3%

Other operating expenses

59,31951,40915.4%

Operating expenses

Network Operation and Support Expenses
Network operation and support expenses were RMB268.9 billion, up by 5.8% year-on-year and representing 26.6%of operating revenue. Of which, maintenance, operation support and related expenses increased by 8.9% yearon-year and reached RMB175.6 billion, primarily driven by rapid commissioning of new infrastructure projects andincreased transformation-related investments.

Depreciation and Amortization
Depreciation and amortization were RMB207.1 billion, up by 3.5% year-on-year and representing 20.5% of operating
revenue. This was primarily driven by an increase in depreciation of fixed assets, as we accelerated network
upgrades and business transformation and maintained substantial capital expenditure.

37

38

China Mobile Limited

Financial Review

Employee Benefit and Related Expenses
Employee benefit and related expenses were RMB144.3 billion, up by 10.9% year-on-year and representing 14.3%
of operating revenue. We continued to refine and optimize our workforce structure, and stepped up incentives fortalents in technological innovation, to provide solid talent support for our reform, innovation, transformation anddevelopment.

Selling Expenses
Selling expenses were RMB52.5 billion, up by 5.8% year-on-year and representing 5.2% of operating revenue, downby 0.1 percentage points year-on-year. The increase in selling expenses was primarily driven by increases in channel
operation support services and business development efforts with small and medium enterprises.

Cost of Products Sold
Cost of products sold was RMB142.8 billion, up by 16.3% year-on-year and representing 14.1% of operating
revenue. The increase was primarily driven by the growth in revenue from sales of products.

Other Operating Expenses
Other operating expenses were RMB59.3 billion, up by 15.4% year-on-year and representing 5.9% of operating
revenue. The increase was primarily driven by expected credit losses in accounts receivable and increases ininternational roaming expenses.

Profitability
In 2023, we continued to improve the quality and efficiency of our operations, enhanced our value to shareholders,and maintained an industry-leading level of profitability. Profit from operations was RMB134.3 billion, up by 4.1%
year-on-year. EBITDA was RMB341.5 billion, up by 3.7% year-on-year, and EBITDA margin was 33.8%, down by 1.3
percentage points year-on-year. Benefiting from healthy growth in revenue and better cost control, profit attributable
to equity shareholders was RMB131.8 billion in 2023, up by 5.0% year-on-year. The margin of profit attributable toequity shareholders was 13.1%.
2023

2022

RMB million

RMB million

Change134,346

129,099

4.1%

Other gains

9,823

9,388

4.6%

Interest and other income

21,134

15,72934.4%

Finance costs

3,730

2,330

60.1%

Income from investments accounted for using the equity method

8,958

10,986–18.5%

Taxation

38,59637,278

3.5%

Profit attributable to equity shareholders

131,766

125,459

5.0%

Profit from operations

Annual Report 2023

Financial Review

CAPITAL STRUCTURE
Our financial position continued to remain robust. As at the end of 2023, total assets and total liabilities were
RMB1,992.7 billion and RMB646.7 billion, respectively. The liabilities to assets ratio was 32.5%.
We consistently and firmly adhered to our prudent financial risk management policies and maintained soundrepayment capabilities. The effective interest coverage multiple was 41 times.
As at
31 December
2023

As at
31 December
2022

RMB million

RMB million

Change498,104

456,371

9.1%

Non-current assets

1,494,553

1,479,167

1.0%

Total assets

1,992,657

1,935,538

3.0%

Current liabilities

558,565

533,337

4.7%

Non-current liabilities

88,107100,778–12.6%

Total liabilities

646,672

634,115

2.0%

4,253

4,075

4.4%

Total equity attributable to equity shareholders

1,341,732

1,297,348

3.4%

Total equity

1,345,985

1,301,423

3.4%

Current assets

Non-controlling interests

39

40

China Mobile Limited

Financial Review

FUND MANAGEMENT AND CASH FLOW
We consistently and firmly adhered to our sound and prudent financial policies and stringent fund management
systems, and strived to maintain a healthy cash flow and ensure the safety and integrity of our funds through ourhighly centralized management of investing and financing activities. Meanwhile, we continued to reinforce ourcentralized fund management efforts and made appropriate allocations of our funds, thereby fully leveraging our fundscale efficiency.
In 2023, our cash flow remained healthy. Net cash generated from operating activities was RMB303.8 billion, up by
8.2% year-on-year. Net cash used in investing activities was RMB205.7 billion, down by 13.6% year-on-year. Net
cash used in financing activities was RMB123.8 billion, up by 2.8% year-on-year. Free cash flow was RMB123.5
billion, up by 29.2% year-on-year. As at the end of 2023, our total cash and bank balances were RMB234.2 billion,of which 91.6%, 2.4% and 5.8% were denominated in Renminbi, U.S. dollars and Hong Kong dollars, respectively.
Our robust fund management and healthy cash flow provided a solid foundation for our sustainable and healthy
development.
2023

2022

RMB million

RMB million

ChangeNet cash generated from operating activities

303,780

280,750

8.2%

Net cash used in investing activities

205,699

238,053–13.6%Net cash used in financing activities

123,843

120,514

2.8%

Free cash flow

123,486

95,566

29.2%

CREDIT RATINGS
Currently, the Company’s corporate credit ratings are equivalent to China’s sovereign credit ratings, namely, A+/
Outlook Stable from Standard & Poor’s and A1/Outlook Negative from Moody’s. These ratings reflect that our soundfinancial strength, favourable business potential and solid financial management are highly recognized by the market.

Annual Report 2023

Sustainability Report

The Company steadfastly pursues a sustainable development strategy, focuses on promoting the wide applicationof digital intelligent information technology, continuously leverages the empowering role of the next generationof information technologies. In our journey towards establishing a world-class information service and science &technology innovation company, we strive to generate more superior value for the sustainable development of theeconomy, society, and environment.
Leveraging digital intelligence innovation, we robustly support the development of the economy and society.
The Company systematically builds a new type of information infrastructure focused on 5G, CN, and integration
platform, pioneering a novel information service system encapsulated by “connectivity + computility + capability”.
We aim to construct a top-tier dual gigabit network, hasten the development of core advantages in computility
networks, and enhance the operational quality and efficiency of the integration platform. By the end of 2023, we
had built over 1.94 million 5G base stations, covered 390 million households with gigabit broadband, and our data
center capabilities covered all key nodes of the national “East Data West Computing” strategy. It provided generalcomputing power services with a scale of 8 EFLOPS (FP32), accelerated the formation of a multi-level and multicoverage intelligent computing layout, offered intelligent computing power services with a scale of 10.1 EFLOPS(FP16), and developed over 30,000 commercial 5G industry cases. We’ve strengthened our sci-tech innovation
system structure, initiated the “BASIC6” sci-tech innovation plan, and rapidly nurtured and expanded strategic
emerging industry clusters. To meet the public’s growing demand for high-quality consumption, we’ve enriched
our digital product supply system, including high-definition video, China Mobile Cloud Drive, and super SIMs. We
focus on enhancing the resilience and security levels of industrial and supply chains, perfecting our data security
governance system, and consistently maintaining a strong stance against telecommunications network fraud,
blocking 371 million fraudulent calls, 279 million fraudulent messages, and 8.8924 million fraudulent websites over
the year.
Embracing inclusive growth, we share our developmental achievements with the entire society. Upholding
the principle of prioritizing people, the Company shares the dividends of development with the community. We
deeply implement the Talent Strengthens Enterprise initiative, accelerate talent capability transformation, and truly
forge our talent into the Company’s core competitive advantage. Respecting and protecting employee rights andinterests, we deeply implement heartwarming projects like “Five Small Projects”, “Happiness 1+1”, and employee
assistance programs, providing a friendly work environment. We pay attention to the digital needs of the elderly,
disabled, ethnic minorities, and others, achieving 4G network coverage of 99.6% of the nation’s administrative
villages and basically continuous 5G network coverage across counties and towns nationwide, effectively coveringlarge administrative villages and developed rural areas, accelerating the closure of the digital divide. We consolidate
and expand the achievements of poverty alleviation, comprehensively advance digital and intelligent agriculture,and have built over 390,000 digital villages and 155,900 smart communities. Deeply committed to public welfare
and charity, we continue to enhance the operation of the China Mobile Public Welfare Platform, carry out brandedcharity projects, and actively support volunteer services. Supporting regional coordinated development, we assist
in the high-quality joint construction of the “Belt and Road” and aid in the development of a new pattern of mutual
promotion between domestic and international dual circulation.

41

42

China Mobile Limited

Sustainability Report

Focusing on green development, we are committed to facilitating the construction of a green society. The
Company places a high emphasis on addressing climate change, steadfastly following an eco-friendly and lowcarbon development path. We advance the C2 Three Energy – China Mobile Carbon Peak and Carbon Neutrality
Action Plan, intensify efforts in green, low-carbon technology, lead in energy-saving and consumption reduction
at 5G base stations, enhance the energy efficiency of data centers, have built 86,000 minimalist base stations,improved the energy efficiency of newly-built 5G stations by 9% year-on-year, and lowered the average Power
Usage Effectiveness (PUE) of newly built large and super-large data centers to below 1.32. We actively increase theproportion of clean energy supply, with capacities in wind and solar energy reaching 210 million peak watts. Playing
a leading role in the supply chain, we have issued the China Mobile Green Supply Chain Guidance to enhance thegreen supply capability of the supply chain, achieving a 99.9% paperless procurement rate, reducing paper usage by
130 million sheets, cutting carbon emissions by 260 tonnes during the year, applying green packaging for new mainequipment in more than 80% of cases, and saving 278,500 cubic meters of lumber. We leverage IT to reduce carbon
footprint, promote the deep integration of emerging information technologies with green, low-carbon industries,
encouraging a comprehensive green transformation of economic and social development, enabling society to reducegreenhouse gas emissions by approximately 310 million tonnes over the year.
Excellence in governance, we continuously improves our sustainable development capabilities. Our entire
Board of Directors works diligently, constantly enhancing the effectiveness, professionalism, and diversity of theBoard. We implement modern corporate systems, continually perfect our corporate governance structure, andstandardize the governance process. We initiate a new round of corporate reform to deepen and enhance action,
deepening reforms in key areas such as the Double Hundred Action, Science and Technology Reform Action, andSpecialization, Refinement, Differential, and Innovation, strengthening the internal drive for high-quality development.
We construct a centralized, unified, comprehensive, authoritative, efficient, and innovative audit and supervisionsystem. We promote the construction of Legal Mobile, implementing the Compliance Escort Plan across theCompany, strengthening the legal guarantees for high-quality development. We persistently fight against corruption,
adhering to the principle that one should not dare, cannot, and does not want to be corrupt, strengthening theconstruction of a clean culture in the new era, and fostering a healthy political atmosphere of integrity.

Annual Report 2023

Sustainability Report

We have established a robust sustainability management structure and work system. Adhering to thesustainability philosophy of Sincerity and Fulfillment, Self-Realization and Empowerment, we have set up a
Sustainable Development Committee under the Board of Directors to strengthen the supervision and management ofsustainability efforts. For 18 consecutive years, we have published the Sustainability Report, addressing concerns ofstakeholders. For 16 consecutive years, we have conducted the Outstanding Corporate Social Responsibility PracticeCase Selection, collecting 1,229 cases and selecting 268 outstanding achievements, promoting the application anddissemination of excellent sustainability practices both internally and externally.

China Mobile’s Sustainability Model

formation S
New In
ervi
ces
ding
a
e
L
i
g
D
i
r
t
a
e
t
l Intel
et
B
a
lige
g
nce
blin
Ena

Inclusive Growth

Green Development

n
ctio
rote
al P
ent
ns
nm
tio
iro
ra
nv
pe
dE
an

perityProsnmoalents
ed T
om
d
C
n
u
r
fo
-Ro
ell
ng
W
g
tin

Advanced
GovernanceConducting Gre
en
a
n
d Lo
wial Initiatives in E
Can
ing Soc
e
r
r
bo
g
port
y
Co
nO
Sup
nse
r
v
ati
on

Digital-Intelligent
Innovation

St
riv
C
u
i
lti
va

CSR Philosophy: Sincerity and Fulfillment.
Self-Realization and Empowerment

43

44

China Mobile Limited

Sustainability Report

China Mobile’s Sustainability Management Structure
The Company formed a Sustainable Development Steering Committee, led by the
Chairman and including key leaders and responsible individuals from relevant
departments, to guide all aspects of sustainable development within the Company andits parent entity.
Decision-Making Level

In November 2023, a Sustainable Development Committee was newly created underthe Board of Directors, set to start its duties on January 1, 2024. This committee istasked with advising the Board on objectives, strategies, priorities, actions, andpurposes regarding corporate social responsibility and sustainable development, aiding
the Board in decision-making related to these areas. The establishment of thiscommittee aims to enhance the Company's capabilities in governing sustainability
efforts.

Organizational Level

The Company has set up a dedicated Sustainable Development Office, serving as apermanent entity tasked with spearheading the management of critical sustainability
matters and overseeing the disclosure of related information.

Implementation Level

The departments specializing in sustainable development across various professional
divisions and subsidiaries are charged with adhering to and implementing theCompany’s sustainable development directives and guidelines, while also providing
regular updates on their progress in these areas.

China Mobile’s Sustainability Management System
Strategy Management

Implementation Management• Sustainability philosophy• Sustainability strategy and planning• Sustainability management system and policies• Sustainability team building• Sustainability research and training• Identification and management of material sustainability
issues• Integrating sustainability into professional management

Communication Management

Performance Management• Preparation, release, and dissemination of sustainability
reports• Routine and topic-oriented communication withstakeholders• Integrating sustainability into strategic performance
management• Awarding outstanding CSR practices

For more detailed information on our sustainability performance in 2023, please refer to the China Mobile Limited
Sustainability Report 2023 released on the Company’s website (www.chinamobileltd.com).

Annual Report 2023

Corporate Governance Report

Our goal has always been to enhance our corporate value, maintain our sustainable long-term development andgenerate greater returns for our shareholders. In order to better achieve these objectives, we have established soundcorporate governance practices following the principles of integrity, transparency, openness and efficiency, while
continuing to refine various policies, internal controls and management mechanisms and procedures having regard to
the major stakeholders in good corporate governance, including shareholders, board of directors and its committees,
management and staff, internal auditors, external auditors and the wider community such as customers, local
communities, industry peers, regulatory authorities so as to prevent and resolve all kinds of risks.
As a company listed in Hong Kong and Shanghai, we shall also comply with corporate governance practices requiredby China Securities Regulatory Commission (“CSRC”) and the SSE. Please see “2. Major Differences Between the
Company Laws of the Place of Incorporation, the Articles of Association and the Company Laws and other Domestic
Laws” under “Section 9 – Corporate Governance” in the Prospectus for Initial Public Offering of RMB Ordinary
Shares (A Shares) of China Mobile Limited dated 21 December 2021 on the major differences between our corporate
governance practices and those required of listed issuers under the regulations of the CSRC.

COMPLIANCE WITH THE CODE PROVISIONS OF THE CORPORATE GOVERNANCE
CODE
For the year ended 31 December 2023, our Board of Directors (the “Board”) was responsible for corporate
governance and formulates terms of reference, corporate governance principles and structure, and the Company
complied with all the code provisions under Part 2 of the Corporate Governance Code as set out in Appendix C1 to
the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Hong Kong Listing
Rules”).
On 1 January 2024, we established a Sustainability Committee under the Board, consisting of one executive
directors and two independent non-executive directors (“INED”, to be responsible for performing environmental,social and corporate governance (“ESG”) and related duties on behalf of the Board.
We require the procedures of our Board, its committees and other internal bodies to strictly comply with theprinciples of the Corporate Governance Code. We set out below the major aspects in which China Mobile meets orexceeds the principles of the Corporate Governance Code:✓ More than one-third of the Board (4 out of 8 as of 31 December 2023) are INEDs.
✓ Indication of important shareholders’ dates in the coming financial year.
✓ Disclosure of directors’ interests in shares of the Company and its associated corporations, and their confirmationof compliance with the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix
C3 to the Hong Kong Listing Rules (the “Model Code”).
✓ The Company established a Sustainability Committee under the Board and formulated and published its terms ofreference.
✓ Publication of the terms of reference and membership of each Board committee on the websites of the Company,
the HKEX and the SSE.
✓ Except our Sustainability Committee, all Board committees are made up of INEDs, each with professional
qualifications and/or extensive experience in accounting, finance and risk management, artificial intelligence andsci-tech research, laws and regulations, economics and business and so forth.
✓ Appropriate training to directors and management on an annual basis.

45

46

China Mobile Limited

Corporate Governance Report✓ Each director discloses to the Company at the time of his/her appointment and timely thereafter in respect of any
change, to his/her position in any public companies or organizations and other significant commitments.
✓ Publication of Sustainability Reports for 18 consecutive years, reporting on its performance on ESG issues, which,in many respects, exceeds the requirements of the ESG Reporting Guide set out in Appendix C2 to the Hong
Kong Listing Rules.
✓ Our Audit Committee discusses and conducts annual evaluation with respect to the effectiveness of theCompany’s risk management and internal control system, and publishes the results of its evaluation.
✓ The Company and its subsidiaries have set up internal audit departments, which independently audit the business
units of the Company and its subsidiaries.

I. SHAREHOLDERSThe Company is incorporated in 1997 in Hong Kong and owned by all shareholders. Our ultimate controllingshareholder is CMCC. Our ordinary shares were listed on the HKEX and the SSE on 23 October 1997 and 5
January 2022, respectively. As of 31 December 2023, our total number of issued shares was 21,390,880,312,
among which, approximately 69.81% were held directly and indirectly by CMCC. The remaining approximately
30.19% were held by public investors.

Shareholder Rights
Full text of the Articles of Association of the Company is available on the websites of the Company, the HKEX
and the SSE. According to the Articles of Association of the Company and the Companies Ordinance (Chapter
622 of the Laws of Hong Kong) (the “Hong Kong Companies Ordinance”), shareholders holding the requisite
voting rights may: (i) requisition to move a resolution at an annual general meeting (“AGM”); (ii) requisition toconvene an extraordinary general meeting (“EGM”); and (iii) propose a person other than a retiring director forelection as a director at a general meeting.
Shareholders may make inquiries in writing to the Board. Inquiries must be deposited at our registered officeat 60/F, The Center, 99 Queen’s Road Central, Hong Kong (the “Registered Office”), for the attention of theCompany Secretary, providing sufficient contact information so that such inquiries can be properly handled. In
addition, shareholders may also raise their concerns and suggestions in the Q&A session at our AGMs.

I. Requisition to move a resolution at an AGM
 The Company holds a general meeting as its AGM every year. The AGM is usually held in May.
 A requisition to move a resolution at the AGM may be submitted by:(i) any number of shareholders representing not less than one-fortieth (1/40th) of the total voting rights ofall shareholders having the right to vote at the AGM; or(ii) not less than 50 shareholders holding shares in the Company on which there has been paid up an
average sum, per shareholder, of not less than HK$2,000.
 The requisition must state the resolution, and must be signed by all the requisitionists on one or more
copies which between them contain the signatures of all the requisitionists.

Annual Report 2023

Corporate Governance Report The requisition must be deposited at the Registered Office, for the attention of the Company Secretary (i)not less than six weeks before the meeting in the case of a requisition requiring notice of a resolution and (ii)
not less than one week in the case of any other requisition.
 The requisition will be verified with Hong Kong Registrars Limited, the Company’s share registrar,and upon their confirmation that the requisition is proper and in order, the Company Secretary will ask
the Board to include the resolution in the agenda for the AGM provided that the requisitionists havedeposited or tendered with the requisition a sum reasonably sufficient to meet the Company’s expenses
in serving the notice of the resolution in accordance with the statutory requirements to all the registeredshareholders of the Company. On the contrary, if the requisition has been verified as not in order or
the requisitionists have failed to deposit sufficient sum to meet the Company’s expenses for the said
purposes, the requisitionists will be advised of this outcome and accordingly, the proposed resolution will
not be included in the agenda for the AGM.

II. Requisition to convene an EGM
 Shareholders holding not less than one-twentieth (1/20th) of the paid-up capital of the Company which
carries the right of voting at general meetings of the Company can deposit a requisition to convene an
EGM.
 The requisition must state the objects of the meeting, and must be signed by the requisitionists and may
consist of several documents in like form, each signed by one or more requisitionists. The requisition must
be deposited at the Registered Office, for the attention of the Company Secretary.
 The requisition will be verified with Hong Kong Registrars Limited, the Company’s share registrar, andupon their confirmation that the requisition is proper and in order, the Company Secretary will ask theBoard to convene an EGM by serving sufficient notice in accordance with the statutory requirements
to all the registered shareholders. On the contrary, if the requisition has been verified as not in order,
the requisitionists will be advised of this outcome and accordingly, an EGM will not be convened as
requested.

III. Proposing a person other than a retiring director for election as a director at a general meeting
If a shareholder wishes to propose a person other than a retiring director for election as a director at a general
meeting, he/she must lodge a written notice to that effect at our Registered Office for the attention of theCompany Secretary. In order for the Company to inform shareholders of that proposal, the written noticemust state the full name and biographical details of the person proposed for election as a director as requiredby Rule 13.51(2) of the Hong Kong Listing Rules, and be signed by such shareholder. A written notice signedby the person proposed for election as a director indicating his/her willingness to be elected must also be
lodged with the Company. The period for lodgment of such written notices shall be of not less than sevendays and shall commence no earlier than the dispatch of the notice of the general meeting and end no later
than seven days prior to the date of the general meeting. If the notices are received less than 15 days prior to
the general meeting, the Company will need to consider the adjournment of the general meeting in order toallow shareholders 14 days’ notice of the proposal.
The above details and procedures on shareholders’ rights are available on our website.

47

48

China Mobile Limited

Corporate Governance Report

Shareholder Value and Communication
The Company’s established principle is to strive to create value and generate greater returns for our shareholders.
We believe that our industry-leading profitability and ability to generate healthy cash flow will provide sufficient
support for our future development while continuing to create higher value for our shareholders.
From 21 January 2022 to 29 December 2023, CMCC increased its shareholding in the Company by acquiring a
total of 42,367,000 A Shares on the SSE, accounting for approximately 0.198% of our total number of issued
shares or 4.693% of our total number of issued A Shares, for an aggregate price of RMB3,000,036,465.84(excluding commissions and transaction taxes and fees).

Financial Year

Ordinary
Dividend
Per Share

Total
Dividend
Per Share

(HKD)

(HKD)
4.830

2023

final

2.400

interim

2.430

2022

final

2.210

interim

2.200

2021

final

2.430

interim

1.630

2020

final

1.760

interim

1.530

final

1.723

interim

1.527

2019

1

2

4.410
4.060
3.290
3.250

1

Pending approval at the AGM.

2

The final dividend will be denominated and declared in Hong Kong dollars, and paid to holders of A Shares in RMB at an exchange rate
calculated on the basis of the average of the mid-prices of HKD to RMB as announced by the People’s Bank of China during the one weekprior to the date of the AGM for declaring the dividend.

To ensure effective communications between the Company and its shareholders, we have formulatedshareholders communication policies. We regularly review the implementation of these policies and consider
them to be effective. We have established a securities affairs department, dedicated to providing necessary
information and services to shareholders and investors, to maintain an active dialogue with them as well as otherparticipants in the capital markets, and to make sure they are fully informed of our operations and development.

Annual Report 2023

Corporate Governance Report

We use a number of formal channels to report to shareholders on the performance and operations of theCompany, particularly through our annual and interim reports. Generally, when announcing interim results,
annual results or major transactions in accordance with the relevant regulatory requirements, the Company
arranges investment analyst conferences, press conferences and investor conferences to explain the relevant
results or major transactions to the shareholders, investors and the general public, listen to their opinions andaddress any questions they may have. In addition, the Company adheres to the practice of disclosing certain key,unaudited operational and financial data on a quarterly basis, and voluntarily discloses certain customer statistics
on a monthly basis, to further increase the Group’s transparency and to provide shareholders, investors andthe general public with additional and timely information so as to facilitate their understanding of the Group’s
operations.
The Company keeps in touch with investors through investment conferences, one-on-one meetings,
teleconferences and other forms of exchange and interaction to timely deliver information on our operations
to the capital markets. In October 2023, we organized an investor event under the theme of “Inside Listed
Company”, and had in-depth discussions with 20 institutional investors on the Company’s latest development
in different markets, AI strategies, plans and developments in satellite communications and more. In 2023, we
attended 38 investor conferences and 204 routine investor meetings, and met more than 2500 investors. We willcontinue our efforts to enhance investor relations.
The Company also attaches great importance to general meetings, including AGMs and EGMs, and makes
substantial efforts to enhance communications between the Board and the shareholders. At each general
meeting, the Board always makes efforts to fully address questions raised by shareholders. In 2023, we held one
AGM and one EGM.
On 11 January 2023, we held an EGM in the Grand Ballroom, Grand Hyatt Hong Kong, 1 Harbour Road, Wanchai,Hong Kong, at which a resolution on the entering into of affiliated transaction agreements with China Tower
Corporation Limited and the expected 2023 annual caps in respect of such affiliated transactions was approved
with 99.9959% votes cast in favour of the resolution.
On 24 May 2023, we held our AGM in the Grand Ballroom, Conrad Hong Kong, Pacific Place, 88 Queensway,
Hong Kong. The major items discussed and the percentage of votes cast in favour of the resolutions are set out asfollows:
1. to consider and approve the 2022 Annual Reports (including the audited consolidated financial statements,
the Report of the Directors and the Report of the Auditors for the year ended 31 December 2022) of theCompany (99.9912%);
2. to consider and approve the profit distribution plan of the Company and declare a final dividend for the year
ended 31 December 2022 (99.9912%);
3. to consider and approve the authorization to the Board to determine interim profit distribution of the Company
for the year ending 31 December 2023 (99.9906%);

49

50

China Mobile Limited

Corporate Governance Report

4. to re-elect Mr. LI Pizheng and Mr. LI Ronghua as executive director of the Company (99.8280% and99.8368%, respectively);
5. to re-elect Mr. Stephen YIU Kin Wah, Mr. Carmelo LEE Ka Sze and Mrs. Margaret LEUNG KO May Yee as
independent non-executive director of the Company (99.4068%, 99.6120% and 99.8123%, respectively);
6. to re-appoint KPMG and KPMG Huazhen LLP as the auditors of the Group, and to authorize the Board to fix
their remuneration (99.9909%);
7. to give a general mandate to the Board to buy back Hong Kong Shares not exceeding 10% of the number ofissued Hong Kong Shares (99.8487%);
8. to give a general mandate to the Board to allot, issue and deal with additional Hong Kong Shares notexceeding 20% of the number of issued Hong Kong Shares (96.7430%);
9. to extend the general mandate granted to the Board to allot, issue and deal with Hong Kong Shares by the
number of Hong Kong Shares bought back (96.9777%); and10. to consider and approve the external guarantees plan for 2023 (98.2066%).
All resolutions were duly passed at the EGM and AGM. Hong Kong Registrars Limited, the Hong Kong shareregistrar of the Company, acted as scrutineer for vote-taking at the above general meetings. Poll results wereannounced on the websites of the Company, the HKEX and the SSE on the day of each of the above general
meetings.

Shareholders’ Calendar
The following table sets out the tentative important dates for our shareholders for the financial year ending 31
December 2024. Such dates are subject to change. Shareholders should refer to our announcements issued fromtime to time.
2024 Important Shareholders’ Dates
21 March

Announcement of final results and final dividend for the year ended 31 December
2023;
Publication of 2023 A-Share annual report on the websites of the Company and theSSE

15 AprilPublication of 2023 annual report on the websites of the Company and the HKEX

16 April

Dispatch of 2023 annual reports to Hong Kong shareholders

22 May2024 AGM

Late June

Payment of final dividend for the year ended 31 December 2023

Mid-August

Announcement of interim results and interim dividend, if any, for the six months
ending 30 June 2024

Late September

Payment of interim dividend for the six months ending 30 June 2024, if any

Annual Report 2023

Corporate Governance Report

II. THE BOARD OF DIRECTORS AND THE BOARD COMMITTEESThe Board of Directors
The key responsibilities of the Board include formulating the Group’s overall strategies and objectives, setting
management targets, overseeing internal controls and financial management, and supervising the performance ofour management, while day-to-day operations and management are delegated by the Board to the managementof the Company.
In accordance with the Articles of Association and the Policy Governing the Procedures of Board Meetings of theCompany, the main functions and powers of the Board include:
1. to convene general meetings and report its work at general meetings;
2. to execute resolutions passed at general meetings;
3. to formulate proposals for distribution of dividends of the Company;
4. to formulate proposals for increasing or reducing the number of issued shares of the Company;
5. to formulate proposals for the amalgamation, winding up or change of company status of the Company(including a change from a public company to a private company):
6. to the extent permitted under or authorized at applicable laws and regulations, the listing rules, general
meetings and the Articles of Association, to consider and approve the material transactions, external
investments, acquisitions or disposals of assets, pledges of assets, external guarantees, entrusted financial
management, connected transactions, affiliated transactions and other matters of the Company;
7. to appoint or remove the chief executive officer, other members of senior management and the company
secretary of the Company, and to determine their remuneration as well as awards and penalties;
8. to formulate proposals for amending the Articles of Association;
9. to propose to the general meeting the appointment or change of the auditors in charge of the audit of theCompany;
10. to the extent permitted by applicable laws and regulations and the listing rules, to consider and approve theissue of bonds (other than convertible bonds that require consideration and approval at a general meeting) by
the Company; and11. other functions and powers as provided under applicable laws and regulations, the listing rules, the Articles of
Association and so forth.

51

52

China Mobile Limited

Corporate Governance Report

The Board currently comprises seven directors, namely Mr. YANG Jie (Chairman), Mr. LI Pizheng and Mr. LI
Ronghua (CFO) as executive directors, and Mr. Stephen YIU Kin Wah, Dr. YANG Qiang, Mr. Carmelo LEE Ka
Sze and Mrs. Margaret LEUNG KO May Yee as INEDs. There is no financial, business, family or other material/
relevant relationship(s) between the Board members. The list of directors and their roles and functions is available
on the websites of our Company, the HKEX and the SSE. The biographies of our directors are presented on
pages 7 to 11 of this annual report and on our website.
Mr. Dong Xin has resigned from his positions as an executive director and the Chief Executive Officer of theCompany by reason of work reassignment with effect from 11 January 2024. Mr. Dong confirmed that there wasno disagreement with the Board and there was no matter relating to his resignation that needed to be brought tothe attention of the shareholders of the Company.

Remuneration, Appointment and Rotation of Directors
The Remuneration Committee is responsible for determining the remuneration packages of all executive directors
and senior management. The remuneration package of our executive directors consists of a basic annual salary,a performance-linked annual bonus and a term incentive. The remuneration of INEDs is determined in part byreference to their experience, the prevailing market conditions and their workload as INEDs and members of theBoard committees of the Company. Please refer to note 12 to the consolidated financial statements on pages
120 to 121 of this annual report for directors’ and senior management’s remuneration in 2023.
The Board has adopted a Director Nomination Policy. The Nomination Committee and/or the Board should, uponreceipt of the proposal on appointment of new director and the biographical information (or relevant details) of thecandidate, evaluate such candidate based on the criteria as set out below to determine whether such candidate
is qualified for directorship. The Nomination Committee should then recommend to the Board to appoint theappropriate candidate for directorship, as applicable. Criteria in evaluating and selecting candidates for directorship
include: Character and integrity;
 Qualifications including professional qualifications, skills, knowledge and experience that are relevant to theCompany’s business and corporate strategies, and diversity considerations under the Board Diversity Policy;
 Requirement for the Board to have independent directors in accordance with the Hong Kong Listing Rules
and whether the candidate would be considered independent with reference to the independence guidelines
set out in the Hong Kong Listing Rules;
 Any potential contributions the candidate can bring to the Board in terms of qualifications, skills, experience,
independence and gender diversity;
 Willingness and ability to devote adequate time to discharge duties as a member of the Board and/or Board
committee(s) of the Company; and Such other perspectives that are appropriate to the Company’s business and succession plan and whereapplicable, may be adopted and/or amended by the Board and/or the Nomination Committee from time totime for nomination of directors and succession planning.

Annual Report 2023

Corporate Governance Report

All newly-appointed directors receive a comprehensive induction to make sure that they have a proper
understanding of the operations and business of the Company, and that they are fully aware of their
responsibilities as a director, the listing rules of the stock exchanges on which the Company is listed, applicablelaws and regulations, and their duties under the business and governance policies of the Company. The service
contracts of our INEDs do not provide for a specified length of service. All newly-appointed directors are subject
to re-election by shareholders at the first AGM after their appointment. Every director is subject to retirement byrotation and needs to stand for re-election at least once every three years.

Board Meetings
Board meetings of the Company are held at least once a quarter and as and when necessary. Directors arerequested to declare their direct or indirect interests, if any, in any proposals or transactions to be considered by
the Board at Board meetings and abstain from voting as appropriate. In 2023, as all of our executive directors
hold executive positions at CMCC, they have voluntarily abstained from voting on the Board resolutions approving
continuing connected transactions and routine affiliated transactions. Our Chairman held one meeting with the
INEDs without the presence of other directors in 2023.
During the financial year ended 31 December 2023, the Board met on seven occasions (including three occasions
by way of written resolutions) and the directors’ attendances at the meetings were as follows:
Board ofDirectors

Audit Remuneration
Committee
Committee

Nomination
Committee

AGM

EGM

1

1

1

INEDs
Mr. Stephen YIU Kin Wah

7

6

2

Dr. YANG Qiang

7

6

2

1

1

1

Mr. Carmelo LEE Ka Sze

7

6

2

1

1

1

Mrs. Margaret LEUNG KO May Yee

7

6

2

1

1

1

Mr. YANG Jie (Chairman)

6

–

–

–

1

1

Mr. DONG Xin (CEO)

3

7

–

–

–

1

0

Mr. LI Pizheng

6

–

–

–

1

1

Mr. LI Ronghua (CFO)

7

–

–

–

1

1

Executive Directors

3With effect from 11 January 2024, Mr. Dong Xin resigned from his positions as an executive director and the CEO of the Company.

Our directors attend Board meetings and committee meetings in person or by video or telephone conferencing.
In 2023, the Board met and resolved on various matters relating to our continuing connected transactions androutine affiliated transactions, establishment of a Sustainability Committee, amendment of the Information
Disclosure Internal Controls and the Charter of Information Disclosure Committee, the 2023 interim reports, the2023 interim dividend, the special report on deposit and actual utilization of proceeds from the RMB Share Issue,
the 2022 Annual Reports (including the audited consolidated financial statements and the Report of the Auditors
for the year ended 31 December 2022), the sustainability report, the 2022 final and 2023 interim profit distributionplans, the annual internal controls evaluation report, INEDs work report, re-appointment of auditors anddetermination of their remuneration, annual business, investment and financial plans, annual external guarantees
plan, equity investment plan, internal audit work plan, annual internal audit project plan, amendment of the termsof reference of the Remuneration Committee and other matters. In addition, the Board reviewed and approved
our quarterly results and other matters by means of written resolutions.

53

54

China Mobile Limited

Corporate Governance Report

Before the establishment of the Sustainability Committee, the Board was responsible for performing corporate
governance duties on its terms of reference on corporate governance functions. In 2023, the Board met anddiscussed the Company’s corporate governance report. With the establishment of the Sustainability Committee
on 1 January 2024, the Sustainability Committee will be responsible under its terms of reference for performing
corporate governance duties and making recommendations to the Board.
The Board has adopted a Board Diversity Policy since September 2013. In considering the composition of theBoard, diversity will be considered from a number of perspectives in accordance with our business model andspecific needs, including professional experience and qualifications, regional and industry experience, educationaland cultural background, skills, industry knowledge and reputation, knowledge of the laws and regulations
applicable to the Group, gender, ethnicity, language skills and length of service etc. Such perspectives underthe Board Diversity Policy shall be taken into account in recommending appointment and re-election of directors
and be monitored on an on-going basis by the Nomination Committee of the Company. In 2023, our Nomination
Committee reviewed and approved the composition of our Sustainability Committee. The Board currently
includes one female director and has met its target for gender diversity.
We have established a succession mechanism to maintain a balanced composition of the Board, and to ensure
independent views and input are available to the Board.
The Board has adopted a Dividend Policy in 2019 to set out the principles and guidelines that the Company
intends to apply in relation to the declaration, payment and distribution of dividends to the shareholders of theCompany, which includes, among others, in recommending or declaring dividends, the Company shall allow
its shareholders to participate in the Company’s profits whilst retaining adequate cash reserves for meeting its
working capital requirements and long-term sustainable development needs. The Company shall also take into
account the Group’s actual financial performance, business strategies and operations, future capital requirements
and investment needs, as well as economic conditions and other internal or external factors that may have an
impact on the business or financial performance and conditions of the Group, and other factors that the Board
may consider relevant, etc. To fully protect the rights and interests of the shareholders, to provide a sustainable,
stable and reasonable investment return to the shareholders, to further improve the profits distribution
mechanism, and to enable shareholders to supervise the Company’s profits distribution, after taking into fullaccount the Company’s actual operation conditions and the needs for future development, the Company put
forward to the shareholders for approval, and the shareholders approved at the 2021 EGM, a shareholder returnplan within three years following the RMB Share Issue. Such shareholder return plan took effect from the dateof listing of RMB Shares on the SSE. The profit to be distributed in cash for 2023 reached 70% or above of the
profit attributable to equity shareholders of the Company for that year.
To ensure the timely disclosure of any change to directors’ personal information, we have set up a specificcommunication channel with each of our directors. The directors have disclosed to the Company their positionsin other public companies or organizations and other significant commitments at the time of their respective
appointment, and the Company has made enquiries with all directors for any changes in the course of preparing
our annual and interim reports and made appropriate disclosures in a timely manner. Information regarding theirdirectorships in other listed public companies in the last three years is set out on pages 7 to 11 of this annual
report and on the Company’s website. The Company purchases a directors and officers’ liabilities insurance onbehalf of its directors and officers and reviews the terms of such insurance annually.

Annual Report 2023

Corporate Governance Report

The Company has received a confirmation of independence from each of our INEDs, namely Mr. Stephen YIU
Kin Wah, Dr. YANG Qiang, Mr. Carmelo LEE Ka Sze and Mrs. Margaret LEUNG KO May Yee and considers them
to be independent.
All of our directors have complied with Code Provision C.1.4 of the Corporate Governance Code on participationin continuous professional development, and provided records of the trainings they received to the Company.
In late 2023, we held a Board meeting in Ningbo, Zhejiang Province, and organized trainings and visits for our
directors. In addition, we also provided directors with training materials on new ideas and logical analysis forscientific management of market value.
The Company has adopted the Model Code set out in Appendix C3 to the Hong Kong Listing Rules to regulate
the directors’ securities transactions. Save and except for the interests disclosed on page 72 of this annual report,none of the directors had any other interest in the shares of the Company as of 31 December 2023. All directors
have confirmed, following specific enquiry by the Company that they have complied with the Model Code during
the period between 1 January 2023 and 31 December 2023.
The directors of the Company are responsible for the preparation of the accounts of the Company. Our
management submits monthly reports to the members of the Board, setting out the Company’s performance aswell as industry reports and information, to enable them to make a more comprehensive assessment and to havea more throughout understanding of our performance and prospects. For the reporting responsibilities of theauditors with respect to our financial statements, please refer to the Independent Auditor’s Report on pages 81
to 86 of this annual report.

The Board Committees
We established a Sustainability Committee under the Board, and formulated and published its terms of reference,with effect from 1 January 2024, to empower our long-term value management and better fulfill our social
responsibilities so as to achieve sustainable and healthy development. The Sustainability Committee consists ofMrs. Margaret LEUNG KO May Yee as Chairman, and Mr. LI Ronghua and Mr. Carmelo LEE Ka Sze as members.
As a result, the Board currently has four principal Board committees, namely, the Audit Committee, theRemuneration Committee, the Nomination Committee and the Sustainability Committee, Except the Sustainability
Committee, each committee consists solely of INEDs. With the appointment and authorization of the Board, eachof the Board committees operates under its written terms of reference.
The terms of reference of the Board committees of the Company are available on the websites of the Company,
the HKEX and the SSE, and can be obtained from the Company Secretary upon written request.

Audit Committee
Membership:
The current members are Mr. Stephen YIU Kin Wah (Chairman), Dr. YANG Qiang, Mr. Carmelo LEE Ka Sze
and Mrs. Margaret LEUNG KO May Yee, who are all INEDs. The members of our Audit Committee possess
professional qualifications and extensive experience in accounting, finance and risk management, artificial
intelligence and sci-tech research, laws and regulations, economics and business and so forth.

55

56

China Mobile Limited

Corporate Governance Report

Summary of Authorities and Duties:
The Audit Committee is authorized by the Board to investigate any activity within its terms of reference.
It is also authorized to seek any information it requires from any employee and to seek outside legal orother independent professional advice at the Company’s expense. The duties of the Audit Committee are,among others, to be primarily responsible for making recommendations to the Board on the appointment,
re-appointment and removal of external auditors, to approve the remuneration and terms of engagementof external auditors, and to deal with any questions of resignation or dismissal of such auditors; to review
and monitor external auditors’ independence and objectivity and the effectiveness of the audit process inaccordance with applicable standards; to develop and implement policy on the engagement of external
auditors to provide non-audit services; to monitor the truth, integrity and accuracy of the Company’s financial
statements, annual reports and accounts, interim reports and, where applicable, quarterly reports, and toreview significant financial reporting judgments contained in them; to oversee the Company’s financial
reporting system, risk management and internal controls; and to review and supervise the training andcontinued professional development of and performance of duties by directors and senior management, andto formulate and review manuals (if any) on the performance of duties and compliance by employees anddirectors and to supervise the implementation of such manuals (if applicable).

Summary of Work Done in 2023:
In 2023, the Audit Committee met on six occasions and the attendance of each member is disclosed on page53 of this annual report. It met with our external auditors for three times in 2023 and one of such meetings
was held without any executive directors being present.
Work done by the Audit Committee in 2023 mainly included the following:•

reviewed and approved the audited financial statements, annual results, report of the directors, financial
review, etc. for the financial year ended 31 December 2022;•

reviewed and approved the 2022 profit distribution plan and the 2023 interim dividend;•

reviewed and approved the re-appointment of external auditors of the Company;•

reviewed and approved the quarterly results for the first quarter of 2023, the interim results for the six
months ended 30 June 2023 and the quarterly results for the first three quarters of 2023;•

reviewed and approved the budgets and remuneration of the external auditors;•

reviewed and approved the 2022 internal control evaluation report;•

reviewed and approved the 2023 internal audit project plan and budget for external engagements;•

reviewed and approved the internal audit work plan;

Annual Report 2023

Corporate Governance Report•

reviewed and approved the internal audit reports;•

reviewed and approved the 2023 risk assessment report;•

reviewed and approved the 2022 assessment report on accounting and financial reporting system;•

reviewed and approved connected (affiliated) transactions; and•reviewed and approved the report on compliance with relevant laws and regulations in 2022.

In 2023, our Audit Committee completed a review on risk management and internal controls, and issued awork report on review of its own performance in the previous year.

Remuneration Committee
Membership:
The current members are Mr. Stephen YIU Kin Wah (Chairman), Dr. YANG Qiang, Mr. Carmelo LEE Ka Sze
and Mrs. Margaret LEUNG KO May Yee, who are all INEDs.

Summary of Duties:
The duties of the Remuneration Committee are, among others, to make recommendations to the Board on
the remuneration packages of individual executive directors and senior management, including benefits inkind, pension rights and compensation payments including any compensation payable for loss or terminationof their office or appointment, and make recommendations to the Board on the remuneration of non-executive
directors; to review and approve the management’s remuneration proposals with reference to corporate
goals and objectives resolved by the Board from time to time; to review and approve compensation payable
to executive directors and senior management for any loss or termination of office or appointment, andcompensation arrangements relating to dismissal or removal of directors for misconduct to ensure that they
are consistent with contractual terms; to ensure that no director or any of his associates is involved in deciding
his own remuneration; to make recommendations to the Board on the Company’s policy and structure forremuneration of all directors, senior management and employees including salaries, incentive schemes andother share option schemes, and on the establishment of formal and transparent procedures for developing
remuneration policy; and to review and/or approve matters relating to share schemes under Chapter 17 of theHong Kong Listing Rules.

Summary of Work Done in 2023:
In 2023, the Remuneration Committee met on two occasions, during which the committee primarily resolved
to approve the target and actual completion rate of senior management’s annual KPI, revision of the termsof reference of our Remuneration Committee, and the remuneration structure for the members of ourSustainability Committee.

57

58

China Mobile Limited

Corporate Governance Report

Nomination Committee
Membership:
The current members are Dr. YANG Qiang (Chairman), Mr. Stephen YIU Kin Wah, Mr. Carmelo LEE Ka Sze
and Mrs. Margaret LEUNG KO May Yee, who are all INEDs.

Summary of Duties:
The duties of the Nomination Committee are, among others, to review the structure, size and composition(including the skills, knowledge and experience) of the Board at least annually and make recommendations on
any proposed changes to the Board to complement the Company’s corporate strategy; to identify individuals
suitably qualified to become board members and select or make recommendations to the Board on theselection of, individuals nominated for directorships; to assess the independence of INEDs; and to makerecommendations to the Board on the appointment or reappointment of directors and succession planning for
directors, in particular the Chairman and the Chief Executive Officer.

Summary of Work Done in 2023:
In 2023, the Nomination Committee met on one occasion, during which the committee resolved to approve
the appointment of members to our Sustainability Committee.

Sustainability Committee (established on 1 January 2024)
Membership:
The current members are Mrs. Margaret LEUNG KO May Yee (INED) (Chairman), Mr. LI Ronghua (ED) and Mr.
Carmelo LEE Ka Sze (INED).

Summary of Duties:
The duties of the Sustainability Committee are, among others, to discuss issues related to environmental,social and governance matters, to propose and make recommendations to the Board on the Company’s
corporate social responsibility and sustainability objectives, strategies, priorities, initiatives and goals, andto report to the Board on its decisions; to oversee, review and evaluate actions taken by the Company infurtherance of the corporate social responsibility and sustainability priorities and goals; to review and report to
the Board on sustainability risks and opportunities; to develop and review policies and practices on corporate
governance, and make recommendations to the Board; to review and monitor the Company’s policies andpractices on compliance with legal and regulatory requirements; to review and monitor the training andcontinuous professional development of directors and senior management; and to develop, review andmonitor the code of conduct and compliance manual (if any) applicable to employees and directors.

Annual Report 2023

Corporate Governance Report

III. MANAGEMENT AND EMPLOYEESThe task of the management and employees is to implement the strategy and direction as determined by the
Board, to take care of day-to-day operations and functions of the Company, and to maintain the values andcorporate culture of China Mobile. The division of responsibilities among our principal executive officers andsenior management is set out in the biographies of directors and senior management on pages 7 to 11 of thisannual report and on the Company’s website.
The Company provides clear guiding principles for our management and employees to do what is right and obey
all laws and regulations. They are also subject to various trainings and continuous professional development,
including a variety of online learning and information sources, formal executive development programs andattendance at executive briefings on relevant topics. These principles cover all aspects of our operations.
We embrace diversity and uphold non-discriminatory employment practices. Strictly abiding by the requirements
under the laws and regulations of where we operate, we have upheld the principles of fairness, openness andimpartiality in our recruitment process, and challenged and taken measures to prevent any form of workplace
discrimination. We formulated and stipulated in the China Mobile Recruitment Management Measures that there
shall be no discriminatory conditions such as race, ethnicity, gender, religion, body height, appearance or any
other conditions that are irrelevant to the work duties. By the end of 2023, the total number of our employees(including senior management) reached 451,830, among which 236,487 were female employees.

Code of Ethics and Anti-Corruption
For the purpose of promoting honest and ethical conducts and deterring wrongdoings, the Company, in 2004,
adopted a code of ethics, which is applicable to our chief executive officer, chief financial officer, deputy chief
financial officer, assistant chief financial officer and other designated senior officers of the Group. In the eventof a breach of the code of ethics, the Company may take appropriate preventive or disciplinary actions after
consultation with the Board.
On whistleblowing, the Company has set up a mailing address (Tower A, 29 Jin Rong Avenue, Xicheng District,
Beijing 100033) and a CEO mailbox, as well as welcomes reports during on-site supervision and inspections, as
channels for employees and the public to raise concerns about misconduct, malpractices or improprieties in any
matter related to the Company. The Company upholds whistleblowers’ lawful rights and interests and keeps
reports, status of investigations and information of whistleblowers strictly confidential. More information for thenumber of corruption litigation cases and their results are published on the website of the Central Commission
for Discipline Inspection and the National Supervisory Commission.

59

60

China Mobile Limited

Corporate Governance Report

With respect to anti-corruption, we persisted in establishing anti-corruption systems that cover all aspects ofanti-corruption. We deepened the construction of embedded integrity risk prevention and control mechanisms,
and furthered and optimized the construction and digital intelligence level of our embedded integrity risk
prevention and control mechanisms. In 2023, we formulated an Integrity Commitment Trial System and expanded
the scope of commitment, and carried out anti-corruption trainings focusing on key areas such as marketing,government and enterprises market, networks and supply chains. We furthered the digital intelligence level ofintegrity risk prevention and controls, promoted the showcases of our embedded integrity risk prevention andcontrols, so as to improve our governance capabilities from grassroots.
Indicator

2021

2022

2023

Anti-corruption education events held during the year

11,39011,524

13,705Anti-corruption education and trainings– participants during the year (person-times)

786,085

724,519

833,181Management Mechanism
The Company has established collective decision-making policies for major issues. We keep refining ourmajor issue catalogue and criteria to prevent risks in decision-making. We have continuously strengthened
the inspection mechanisms, especially on key areas such as procurement biddings to look for loopholes in ourmanagement system and resolve them. Within the Group, we urge for honest operation, healthy development,
good performance and shareholders’ interest protection.
We continued to optimize our management system and improve our business processes, updating the internal
control manual and matrix every six months to maintain the same frequency resonance with businesses
procedures. With respect to risk management, focusing on the overall operation objectives, we embedded
the basic risk management processes and institutional systems in all aspects of the production and operations,striving to build an integrated, unified and coordinated risk management system. In 2023, we refined andpublished several top-level internal control risk management methods such as China Mobile Risk Management
and Internal Control Management Measures, China Mobile Specific Risk Assessment Management Measures
for Major Projects, China Mobile Major Operational Risk Event Reporting Management Measures, so as tostrengthen risk prevention and control throughout the process. On the basis of organization, policies andmeasures, we built 41 evaluation indicators and carried out a trial evaluation of risk control quality in five units
throughout the year.
With respect to compliance management, we safeguarded our new development targets by furthering our“Compliance Escort Plan”. We kept on combining and promoting compliance management with governancecapabilities, and risk prevention and mitigation, so as to ensure our quality and sustainable development withquality compliance. Benchmarking the practices of world-class enterprises, we revised the basic compliancemanagement policies, refined the top-level design and operation mechanism of compliance management, toprovide a strong guarantee for the Company’s reform and development. In 2023, we promoted the establishmentof chief compliance officers in affiliated companies, and carried out diversified compliance-themed trainings
and activities to enhance the compliance capabilities of personnel in key positions and promote a cultural
atmosphere of compliance management. We furthered compliance risk prevention and control in key areas andupdated the compliance guidelines for market competition. Focusing on the BASIC 6 sci-tech innovation plan,
we strengthened our compliance review support in the field of sci-tech innovation. We continued to empowercompliance management with digital intelligence, furthered the centralized supply of compliance capabilities andthe AI aggregation of legal intelligence capabilities to improve compliance effectiveness.

Annual Report 2023

Corporate Governance Report

IV. INTERNAL AUDITThe Internal Audit Department (the “IA Dept.”) conducts independent and objective confirmation and provides
consulting services in respect of the appropriateness, compliance and effectiveness of the Company’s businessactivities, internal controls and risk management by applying systematic and standardized auditing procedures
and methods. The IA Dept. also assists the Company in improving the effectiveness of corporate governance,risk management and internal controls, with an aim to promoting its corporate value, operations, and sustainable
and healthy development as well as contributing to the achievement of its strategic objectives.
The Company and its operating subsidiaries have set up internal audit departments, which independently audit
the business units of the Company and its operating subsidiaries. The head of the IA Dept. directly reports,
four times a year, to the Audit Committee which, in turn, reports to the Board regularly. The Board and the
Audit Committee give instructions with respect to internal auditing. The IA Dept. regularly reports to the senior
management. The senior management ensures that adequate resources and level of authorization are allocatedand granted for internal audit, and deploys and supervises follow-up and rectification in connection with issues
identified in audit. The IA Dept. has unrestricted access to the relevant businesses and assets records andpersonnel in the course of performing their duties.
The IA Dept. establishes an internal audit scope and framework and carries out risk investigations on an annual
basis. According to the results of the risk investigations, the IA Dept. formulates an annual audit plan and,
together with the Audit Committee and the Board, reviews and approves the annual audit plan and resources
allocation. The annual audit plan of the IA Dept. covers various areas including financial audit, internal controls
audit, information systems audit and risk assessment. For financial audit, the IA Dept. reviews and assesses thetruthfulness, accuracy, compliance and efficiency of the Company’s financial activities and financial information
as well as the management and utilization of the Company’s capital and assets. For internal controls audit, the IA
Dept. audits and assesses the effectiveness in the design and implementation of the Company’s internal control
system. According to the requirements under the Corporate Governance Code under the Hong Kong Listing
Rules, the General Provisions on Annual Internal Control Evaluation Report from the CSRC, the Guideline No. 1
for Self-Discipline of Listed Companies – Standardized Operation from the SSE, the Basic Norms for EnterpriseInternal Controls, the Guidelines for Evaluation of Enterprise Internal Controls and other relevant regulatory
requirements of the mainland of China, the IA Dept. organizes and performs audit assessment on the internal
control over financial and non-financial reporting of the Group, covering all material areas such as financial,
operational and compliance controls, on an annual basis, to provide assurance for the Company’s management
in its issuance of the internal control assessment report. The information systems audit focuses on reviewing
and assessing the information systems, information technology applications, information security and the related
internal controls and procedures. At the same time, the IA Dept. carries on special projects and investigations
in response to requests from the Company’s management or the Audit Committee or if otherwise required. In
addition, without prejudice to its independence, if requested by the Company’s management and as requiredby business needs, the IA Dept. provides management advice or consultancy services by making use of audit
resources and audit information to facilitate the Company’s decision-making and operational management.
The IA Dept. makes improvement recommendations in respect of its findings in the course of the audits andrequests the management to undertake and to confirm the implementation plans, methods and timeline. It
regularly monitors the status of the implementation of the recommendations to ensure their completion.

61

62

China Mobile Limited

Corporate Governance Report

In 2023, we further enhanced our centralized, unified, comprehensive, authoritative, efficient, innovative andleading audit supervision system, refined the “1+3+N” internal audit structure, and formulated our internal audit
work plan to build a strong all-in audit mechanism. We conducted internal audits focusing on the Company’s key
businesses, major costs and expenses, technology innovation, equity investment, overseas operations and others
during our transformation period, further consolidated audit rectification supervision, and intensified audit transfer
and accountability. Moreover, in order to build a smart audit ecosystem, we promoted our “on-site + remote +cloud” audit model so as to accelerate the release of digital intelligence value and deepen the technology-based
audit.
We report regularly to the Board and the Audit Committee with respect to the building up of our internal audit
organization, its human resources and qualifications, staff training, annual audit plan and budget, and the audit
results. In 2023, we focused our audit on the main findings of each audit project and their rectification. We
provide specific guidance on development plans, audit focus, rectification advice, data audit, team building andothers to ensure the effectiveness of internal audit functions.
In 2024, we will further advance our top-level design of internal audit, deepen audit supervision, and weave a tight“net” for risk prevention and control to improve the quality and efficiency of audit rectification. We will create a
new brand of AI + smart audit, build a solid lifeline of audit quality and a special forces for economic supervision
to protect the Company’s quality and sustainable development with quality auditing.

V. EXTERNAL AUDITORSCMCC, our ultimate controlling shareholder, is a central state-owned enterprise regulated by the State-owned
Assets Supervision and Administration Commission of the State Council of China (“SASAC”). Under the
relevant requirements of the Ministry of Finance and SASAC, there are certain limits to the number of years
for which an accounting firm may continuously undertake financial auditing work in respect of a central stateowned enterprise and its subsidiaries. Due to the relevant requirements, the former external auditors of theGroup, PricewaterhouseCoopers and PricewaterhouseCoopers Zhong Tian LLP (collectively, “PwC”), retired as
the auditors of the Group with effect from the conclusion of the 2021 AGM of the Company and were not reappointed. PwC had confirmed in writing that there were no other matters or circumstances that need to bebrought to the attention of the shareholders of the Company in connection with the above change. The Board
confirmed that there were no other matters or circumstances that need to be brought to the attention of theshareholders of the Company in connection with the above change. The Board and the Audit Committee also
confirmed that there were no disagreements or unresolved matters between the Company and PwC on any
matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure
At the recommendation by the Audit Committee, the Board proposed, and the shareholders approved at the2021 AGM, to appoint KPMG and KPMG Huazhen LLP (collectively, “KPMG”) as the auditors of the Group.
Subsequently, with the shareholders’ approval at the 2022 AGM and the 2023 AGM, the Company re-appointed
KPMG as the external auditors of the Group for the year ending 31 December 2022 and 2023 for financial
reporting purposes. The principal services provided by KPMG in 2023 included:•

review of interim consolidated financial information of the Group;•

audit of annual consolidated financial statements of the Group and annual financial statements of its
subsidiaries;

Annual Report 2023

Corporate Governance Report•

audit of the effectiveness of the Group’s internal control over financial reporting as of 31 December 2023; and•other non-audit services, pre-approved by the Audit Committee.

The following table sets forth the types of, and fees for, the principal audit services and non-audit services
provided by KPMG (please refer to note 8 to the consolidated financial statements for details):

Audit fees4
Non-audit services fees

5

2022

2023

RMB million

RMB million

88

86

2

1

4

The item (excluding VAT) includes RMB16 million (2022: RMB16 million) as the fees rendered for the audit of internal control over financial
reporting as required by relevant regulatory requirements.

5

Including the fees for tax compliance services and advisory services, etc..

RISK MANAGEMENT AND INTERNAL CONTROLSThe Board is responsible for the Group’s risk management and internal control systems and for reviewing theireffectiveness. Our Audit Committee under the Board conducts annual review of the effectiveness of the Group’s risk
management and internal control systems to reasonably ensure that the Company is operating legally and the assets
are safeguarded and to ensure the accuracy and reliability of the financial information that the Company employs
in its business or releases to the public. The said systems are designed to manage rather than eliminate the risk offailure to meet business objectives, and can only provide reasonable but not absolute assurances against material
misstatement or losses. Our Audit Committee evaluated the effectiveness of the Group’s risk management andinternal controls for the year ended 31 December 2023, covering all important aspects including financial, operationaland compliance controls, to ensure we have adequate resources, staff qualifications and experience, staff training
programmes and budget for accounting, internal audit, financial reporting, and ESG performance and reporting. Basedon such review, the Board considered the Group’s risk management and internal control systems to be effective andadequate.
Our management is responsible for establishing and maintaining internal control over financial reporting. The
management of the Company reports to Audit Committee at least twice a year about the building-up andperformance of its risk management and internal controls, including interim and annual evaluation reports, andreceives guidance and supervision from the Audit Committee. In compliance with the provisions and requirements
under the Hong Kong Listing Rules, and Basic Norms for Enterprise Internal Controls, the Guidelines for Evaluationof Enterprise Internal Controls and other relevant regulatory requirements of the mainland of China, we established astringent internal control system over financial reporting.

63

64

China Mobile Limited

Corporate Governance Report

We established a hierarchical top-down risk assessment mechanism, relying on the strategic level risk assessment(material risk assessment), the management level risk assessment (major projects risk assessment) and theoperational level risk assessment (procedure risk assessment), to assist the management to acknowledge risk
information in a timely manner in order to make a reasonable decision. Based on risk assessment, we established athree-tier internal controls of “the top level internal control system, the internal control professional system and theinternal control practices guidelines”, which brought the control requirements to the whole process of marketing,production and management. Based on our business operation, we focus on high risk and key management areasand perform risk assessment, so as to enforce our internal control requirement in our daily operations. Meanwhile,
we assigned specific responsibilities to individuals and input the control requirements in our IT systems tostrengthen the internal controls. And through multiple internal and external supervision and inspections, including
self-assessment, management evaluation, external audit, etc., we effectively improved the execution efficiency andeffectiveness of our internal controls.
Based on daily and specific supervision of internal controls, the management of the Company conducted evaluationon the effectiveness of the internal controls as of 31 December 2023 (the reference date of the internal control
evaluation report)), and concluded that there were no significant deficiencies and material weaknesses in theinternal controls over financial and non-financial reporting. The Board believes that the Company’s internal control
over financial reporting was effective in all material aspects, in accordance with the requirements of the norms forenterprise internal controls and relevant regulations.

INFORMATION DISCLOSURE AND INSIDER DEALINGS
Information disclosure by the Company is made under the unified leadership and management of the Board, andperformed by the management. Since 2003, the Company has implemented the information disclosure internal
controls and procedures, and established a Disclosure Committee, the members of which include our Chairman,
chief executive officer, chief financial officer and heads of main functional departments. Empowered by the
Board, the Disclosure Committee is responsible for organizing and coordinating routine reporting and disclosure toprompt timely, compliant, truthful and complete disclosure of information, ensure good corporate governance andtransparency, properly get back to the investors, analysts and media inquiries, and prevent volatility of our share pricecaused by false market information.
To satisfy the relevant regulatory requirements in relation to our RMB Share Issue, the Board reviewed and approved
the Administrative Measures for Information Disclosure and the Administrative Measures for Raised Funds, which
had taken effect on 5 January 2022 and are available in Chinese on the websites of the Company, the HKEX and theSSE. In 2023, in view that the Company’s shares have been listed on the SSE and delisted from the NYSE, in orderto further standardize our information disclosure and ensure its legality, authenticity, accuracy, integrity, timelinessand fairness, we have revised and implemented our Information Disclosure Internal Controls and our Charter ofInformation Disclosure Committee.
Under circumstances where any departments or officers are in breach of disclosure procedures and internal controls,
resulting in reporting or disclosure errors, or in breach of disclosure related laws and regulations, the Company shallhold the relevant personnel accountable.

Annual Report 2023

Corporate Governance Report

In compliance with the provisions of Hong Kong Securities and Futures Ordinance (Chapter 571 of the Laws ofHong Kong) (the “SFO”), the Securities Law of China, Administrative Measures for Information Disclosure of Listed
Companies from the CSRC and other requirements, we formulated the Measures for Registration of Insiders with
Inside Information of China Mobile Limited, setting up rules and black-out periods on directors, management andemployees in dealing with the shares of the Company or exercising share options while they are in possessionof inside information. Those who may come into possession of inside information in performing their duties are
required to sign an undertaking on their duty of confidentiality and prohibition against insider dealing. Unauthorized useof confidential or inside information for profits is strictly prohibited to prevent violation of laws and regulations andinternal disciplines.
The Company attaches great importance to the management of inside information. In general, any authorized
speaker from the Company only makes clarification and explanation on information already available in the market,
and avoid revealing any unpublished inside information. Before any external interview, such speaker shall seek
verification from the relevant department about any information to be disclosed.

CONTINUOUS EVOLVEMENT OF CORPORATE GOVERNANCE PRACTICES
We will closely study the development of governance practices among the world’s leading corporations, future
evolution of the relevant regulatory environment and the requirements of the investors on an ongoing basis. We will
also review and enhance our corporate governance procedures and practices from time to time to keep improving
our capabilities in fulfilling our governance responsibilities, so as to meet our shareholders’ expectations and ensure
the long-term sustainable development of the Company.

65

66

China Mobile Limited

Human Resources Development

In 2023, our human resources work fully adhered to the strategy of becoming a world-class enterprise by building a
dynamic “Powerhouse” and fully implemented our “1-2–2-5” strategy. We focused on continuously strengthening
our talent pool for sci-tech innovation, furthering our “Two Inputs and Two Outputs” systematic reforms, and greatly
optimizing the structure and enhancing the competency of our workforce, to guarantee solid organizational and talent
support for our high-quality, sustainable development and our mission of sci-tech innovation.
We focused on forming a team of high-quality talents to support sci-tech self-sufficiency. Firstly, we
strengthened the integration of our key talent plans with national talent projects, and made breakthroughs inrecruitment of high-end talents, including group-level chief scientists and group-level chief experts. Secondly, we
focused on internal cultivation and external recruitment of talents to expand and enhance our talent pool. The numberof our “T-H-T” (Ten-Hundred-Thousand) provincial-level experts exceeded 5,000. We selected and recruited over
10,000 outstanding engineers in four major fields of network, IT, cloud and security. We systematically optimized ourrecruitment policies and procedures to source top talents for our sci-tech innovation. Thirdly, we furthered reforms
in our talent mechanisms to constantly motivate innovation and drive breakthroughs in major sci-tech projects. We
continued to develop our top talent pool, formulated guidelines for building “Top Talent Demonstration Zones”,
emphasized policy-based allocation of resources, and tailored ‘building plans’ to meet the needs of different ‘zones’,
to showcase and lead enterprise reforms.
We focused on optimizing allocation of remuneration resources to serve our strategies. We systematically
optimized our incentive systems to drive business growth, with a focus on our development goals of “TwoBreakthroughs” and “Four Improvements”. We furthered the implementation of our innovative incentive model
whereby one takes a fair share of the total labour costs in proportion to contribution. We dedicated resources toimplement special incentives for outperformers and profit-makers, and reward contribution to our CHBN projects,
4+8 regional enhancements and other business development efforts, to fuel growth in revenue and profit. We
focused on the “Two New Elements”, and coordinated the precise and effective implementation of a series of
remuneration and incentive policies, under various themes such as connectivity, computility and capability. We
furthered the implementation of comprehensive incentive packages to unleash momentum for sci-tech innovation.
We invested significant remuneration resources in sci-tech bodies, teams and talents to meet our commitment toinnovation. We formulated unified sci-tech innovation incentive policies and systematically implemented “specialzone” incentives for our teams tasked with strategic innovative missions. We formulated guidelines for advancing
medium- to long-term incentives among our subsidiaries, orderly expanded equity and bonus incentives for sci-techorganizations, and promoted the participation of knowledge, technology, management and other elements in income
sharing.
We focused on coordinating optimizations in workforce structure and boosting workforce competency
to drive team transformation and upgrade. Firstly, we optimized the overall strategic layout of our workforce,
remained committed to prefer areas of transformation in allocation of resources, and continued to refresh andcultivate a high-quality workforce. Secondly, we enhanced human resources for key business areas, such as teams
responsible for products, anti-fraud and customer services. We explored new productive forces and developed over
28,000 digital staff. Thirdly, we enhanced development of leadership skills with our team of cadres for the era oftransformation. We launched the innovative “Digital Intelligence Transformation Leadership Skills Upgrade” special
training programme, under which we developed a system of operational and management trainings with China
Mobile characteristics, and provided tailored “Leadership Skills Empowerment” training series having regard tofeatures of different classes of cadres, such as new members of senior management, young cadres, prefecture- andcity-level leaders and international managers. Fourthly, we empowered employees in key areas of innovation, andfocused on fostering achievements in business results through team cultivation. We organized innovative productmarketing training competitions, and converted our workforce empowerment efforts into business growth. Keeping
up with trends in technological evolution, we advanced the reshaping of our core skilled talents, and trained andawarded certification to a total of more than 70,000 individuals. Last but not least, we also launched the innovative“Computility Empowerment” training series, on our hub nodes for “Eastern Data and Western Computing”.

Annual Report 2023

Report of Directors

The directors take pleasure in submitting their annual report together with the audited financial statements for theyear ended 31 December 2023.

PRINCIPAL ACTIVITIESThe Group’s principal activity is providing telecommunications and information services in 31 provinces, autonomous
regions and directly-administered municipalities in the mainland of China and Hong Kong. The principal activity of theCompany is investment holding.
The revenue of the Group during the financial year consisted primarily of revenue generated from the provision of
telecommunications and information services.

RMB SHARE ISSUE
In order to grasp the window of opportunity to develop the information services market, promote the implementationof the strategy of becoming a world-class enterprise by building a dynamic “Powerhouse”, advance digitalized andintelligent transformation, cultivate a digitalized and intelligent ecosystem with new vitality and build new momentum
toward high-quality development, the Company conducted an initial public offering of RMB ordinary shares (the “RMB
Shares”, also known as “A Shares”, and such initial public offering, the “RMB Share Issue”). On 5 January 2022, theRMB Shares were listed on the Main Board of the Shanghai Stock Exchange (the “SSE”).
The total gross proceeds from the RMB Share Issue were RMB51,981,373,781.86. After deducting offering
expenses, the net proceeds from the RMB Share Issue were RMB51,373,879,467.74. As set out in the Company’s
circular dated 24 May 2021 (the “Circular”) and the prospectus dated 21 December 2021 (the “Prospectus”) in
relation to the RMB Share Issue, and as approved by the shareholders of the Company, after deducting offering
expenses, all proceeds from the RMB Share Issue will be used towards projects related to the Company’s principal
business, which include the development of premium 5G networks, the development of new infrastructure for cloud
resources, the development of gigabit broadband and smart home, the development of smart mid-end platform, theresearch and development of the next-generation information technology and digitalized and intelligent ecosystem.
As at 31 December 2022, the total amount of proceeds utilized by the Company was approximately RMB42,917
million and the total amount of proceeds not yet utilized by the Company was approximately RMB8,457 million. The
total amount of proceeds utilized by the Company during the year ended 31 December 2023 was approximately
RMB6,654 million.
Delays in procurement, acceptance and delivery have, to some extent, affected the progress of utilization ofproceeds under the projects of the development of new infrastructure for cloud resources, the development ofsmart mid-end platform, and the research and development of the next-generation information technology anddigitalized and intelligent ecosystem. After careful consideration by the Company, to safeguard the overall interestsof all shareholders, improve the quality of implementation of these projects, and reduce risks associated with useof proceeds, the target date for the projects of the development of new infrastructure for cloud resources, thedevelopment of smart mid-end platform, and the research and development of the next-generation information
technology and digitalized and intelligent ecosystem to be ready-for-use has been postponed to the end of 2024.
Save as disclosed above, during the year ended 31 December 2023, the proceeds from the RMB Share Issue wereused, and were proposed to be used, according to the intentions previously disclosed by the Company in the Circularand the Prospectus, and there was no material change or delay in the use of proceeds.

67

68

China Mobile Limited

Report of Directors

Details of the use of proceeds from the RMB Share Issue are as follows:

Total
proceeds
committed

Amountutilized
during theyear ended
31 December
2023

Amountutilized
as at
31 December
2023

Amount not
yet utilized
as at
31 December
2023

RMB million

RMB million

RMB million

RMB million

Development of premium 5G networks

27,313–27,313–2022

Development of new infrastructure
for cloud resources

6,875

2,068

6,008

867

2024

Development of gigabit broadband andsmart home

4,297

352

4,297

–

2023

Development of smart mid-end platform

4,297

649

4,203

94

2024

Research and development of thenext-generation information technology
and digitalized and intelligent ecosystem

8,593

3,586

7,751

842

2024

Total

51,374

6,654

49,571

1,803

Project

Expected
timing for full
utilization ofproceeds

Note: Discrepancies in this table between totals and sums of amounts listed are due to rounding.

MAJOR CUSTOMERS AND SUPPLIERS
The Group’s aggregate revenue with its five largest customers was RMB33.3 billion, accounting for 4% of theGroup’s total revenue in 2023. None of the five largest customers is an “affiliated party” within the meaning of theRules Governing the Listing of Stocks on Shanghai Stock Exchange (the “SSE Listing Rules”).
Purchases for the Group mainly included network equipment purchases, and payments in relation to network
operation and support expenses and interconnection arrangements. Purchases from the largest supplier for the year
represented 12% of the Group’s total purchases. The Group’s aggregate purchases with its five largest suppliers
was RMB190.3 billion, accounting for 34% of the Group’s total purchases in 2023. Out of the purchases with these
five largest suppliers, purchases with affiliated parties within the meaning of the SSE Listing Rules were RMB41.0
billion, accounting for 7% of the Group’s purchases in 2023.
Except as disclosed in the section headed “Directors’ and Chief Executive’s Interests and Short Positions in Shares,
Underlying Shares and Debentures” below, at no time during the year ended 31 December 2023 have the directors,
their close associates or any shareholder of the Company (which to the knowledge of the Board owns more than 5%of the number of issued shares of the Company) had any interest in these five largest suppliers.

Annual Report 2023

Report of Directors

SUBSIDIARIES AND INVESTMENTS ACCOUNTED FOR USING THE EQUITYMETHOD
Particulars of the Company’s subsidiaries and the Group’s investments accounted for using the equity method as at
31 December 2023 are set out in notes 21 and 22, respectively, to the consolidated financial statements, and the listof directors of each of the Company’s subsidiaries is available on the Company’s website.

FINANCIAL STATEMENTS
The profit of the Group for the year ended 31 December 2023 and the financial conditions of the Company and theGroup as at that date are set out in the consolidated financial statements on pages 87 to 170.

DIVIDENDS
The Board has adopted a dividend policy. In recommending or declaring dividends, the Company shall allow its
shareholders to participate in the Company’s profits whilst to retain adequate cash reserves for meeting its working
capital requirements and long-term sustainable development. The Board has the discretion to propose, declare anddistribute dividends to the shareholders of the Company, subject to the Company’s Articles of Association (the“Articles of Association”) and all applicable laws and regulations and taking into account the following factors of theCompany and its subsidiaries:•

the actual financial performance of the Group;•

the Group’s business strategies and operations, including future capital requirements and investment needs;•

economic conditions and other internal or external factors that may have an impact on the business or financial
performance and situation of the Group; and•any other factors that the Board may consider relevant.

The Board recommends a dividend payout ratio of 71% for the full year of 2023. It also recommends a final dividend
payment of HK$2.40 per share for the year ended 31 December 2023. Together with the interim dividend alreadypaid, total dividend for the full year of 2023 amounted to HK$4.83 per share, an increase of 9.5% from that of 2022.
The Board believes that our industry-leading profitability and ability to generate healthy cash flow will provide
sufficient support for the Company’s future development and create favourable returns for our shareholders.

DONATIONS
Donations made by the Group during the year amounted to RMB71,308,749 (2022: RMB76,145,361).

69

70

China Mobile Limited

Report of Directors

PROPERTY, PLANT AND EQUIPMENT
Changes to the property, plant and equipment of the Group during the year ended 31 December 2023 are set out innote 16 to the consolidated financial statements.

SHARE CAPITAL
Details of the Company’s share capital are set out in note 39 to the consolidated financial statements.

RESERVES
Changes to the reserves of the Group during the year are set out in the consolidated statement of changes inequity. Changes to the reserves of the Company during the year are set out in note 39 to the consolidated financial
statements.

DIRECTORSThe directors of the Company during the financial year were:

Executive Directors:
YANG Jie (Chairman)
DONG Xin (resigned on 11 January 2024)
LI Pizheng
LI Ronghua

Independent Non-Executive Directors:
Stephen YIU Kin Wah
YANG Qiang
Carmelo LEE Ka Sze
Margaret LEUNG KO May Yee
Pursuant to Article 109 of the Articles of Association, Mr. YANG Jie and Dr. YANG Qiang will retire by rotation at theforthcoming annual general meeting of the Company and, being eligible, offer themselves for re-election.
The biographies of the directors proposed for re-election at the forthcoming annual general meeting (the “Directors
for Re-election”) are set out on pages 7 to 11 of this annual report. Except as disclosed in such biographies, theDirectors for Re-election have not held any other directorships in any listed public companies in the last three years.
Further, except as noted in the biographies, none of the Directors for Re-election is connected with any otherdirectors, senior management or substantial or controlling shareholders of the Company. None of the Directors for
Re-election has any interests in the shares of the Company within the meaning of Part XV of the Securities andFutures Ordinance (Chapter 571 of the Laws of Hong Kong) (“SFO”).

Annual Report 2023

Report of Directors

The service contracts of all the Directors for Re-election do not provide for a specified length of service, and eachof the Directors for Re-election will be subject to retirement by rotation and re-election at annual general meetingsof the Company every three years. Each of the Directors for Re-election is entitled to an annual director’s fee of
HK$180,000 as proposed by the Board and approved by the shareholders of the Company. Director’s fees arepayable on a time pro-rata basis for any non-full year’s service. Mr. YANG Jie and Dr. YANG Qiang have voluntarily
waived their annual director’s fees. The remuneration of the Directors for Re-election has been determined withreference to the individual’s duties, responsibilities and experience, and to prevailing market conditions. Details of
the remuneration of the directors of the Company are set out in note 12 to the consolidated financial statements.
None of the Directors for Re-election has an unexpired service contract which is not determinable by the Company
or any of its subsidiaries within one year without payment of compensation, other than under normal statutory
obligations.
Save as disclosed herein, there are no other matters relating to the re-election of the Directors for Re-election thatneed to be brought to the attention of the shareholders of the Company nor is there any information to be disclosed
pursuant to any of the requirements of Rule 13.51(2) of the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (the “Hong Kong Listing Rules”).

DIRECTORS’ INTERESTS IN TRANSACTIONS, ARRANGEMENTS OR CONTRACTS
OF SIGNIFICANCE
No transaction, arrangement or contract of significance to which the Company, any of its holding companies or
subsidiaries, or any of its holding companies’ subsidiaries has been a party and in which a director of the Company
or an entity connected with a director of the Company is or was materially interested, whether directly or indirectly,
subsisted at the end of the year or at any time during the year.

PERMITTED INDEMNITY PROVISION
Pursuant to Article 175 of the Articles of Association, every director or other officer of the Company shall be
indemnified out of the assets of the Company against all liabilities (to the extent permitted by the Companies
Ordinance (Chapter 622 of the Laws of Hong Kong)) sustained or incurred by such director or officer in or about
the execution of his office or otherwise in relation thereto. In addition, the Company has purchased directors andofficers’ liabilities insurance on behalf of its directors and officers.

71

72

China Mobile Limited

Report of Directors

DIRECTORS’ AND CHIEF EXECUTIVE’S INTERESTS AND SHORT POSITIONS IN
SHARES, UNDERLYING SHARES AND DEBENTURES
Details of the directors’ holding of shares of the Company and its associated corporations (within the meaning of Part
XV of the SFO) as at 31 December 2023 are as follows:

Long Positions in the Shares and Underlying Shares of the Company

Director

Capacity

Margaret LEUNG KO May Yee

Beneficial owner*

Number ofordinaryshares held

Percentageof the total
number ofissued shares*

20,000

0.00%

The calculation is based on the total number of issued ordinary shares of the Company (i.e. 21,390,880,312 ordinary shares) as at 31 December
2023, and rounded off to two decimal places.

Long Positions in the Shares and Underlying Shares of Associated Corporations

Associated corporation

Director

Capacity

Class ofsharesChina Tower Corporation Limited(“China Tower”)^

Carmelo LEE Ka Sze

Beneficial owner

H shares

Percentageof thetotal number
of issued
Number ofshares#shares held
500,000

0.00%#

The calculation is based on the total number of issued shares of China Tower (i.e. 176,008,471,024 shares) as at 31 December 2023, androunded off to two decimal places.

^

China Tower was one of the Group’s five largest suppliers in 2023.

Apart from those disclosed herein, as at 31 December 2023, none of the directors nor the chief executive of theCompany had any interests or short positions in any of the shares, underlying shares or debentures of the Company
or any of its associated corporations that is recorded in the register required to be kept under section 352 of the SFO
or any interests otherwise notified to the Company and the Hong Kong Stock Exchange pursuant to the Model Codefor Securities Transactions by Directors of Listed Issuers.

Annual Report 2023

Report of Directors

DIRECTORS’, CHIEF EXECUTIVE’S AND EMPLOYEES’ RIGHTS TO ACQUIRESHARES
Save as disclosed below, at no time during the year ended 31 December 2023 was the Company, any of its holding
companies or subsidiaries, or any of its holding companies’ subsidiaries a party to any arrangement to enable thedirectors or chief executive of the Company or any of their spouses or children under eighteen years of age toacquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.

Share Option Scheme of the Company
Pursuant to a resolution passed at the annual general meeting of the Company held on 20 May 2020, a share option
scheme of the Company (the “Scheme”) was adopted. For details of the Scheme, please refer to the following
paragraphs and also the Company’s circular dated 14 April 2020 in relation to “Proposed Adoption of Share Option
Scheme”.

Purposes
The Scheme aims at (1) further improving the governance structure of the Company, and establishing and improving
the balance of interests mechanism between employees and shareholders, investors and the Company; (2)establishing a benefit sharing and risk sharing mechanism among shareholders, the Company and employees toenhance the Company’s performance and long-term stable development; and (3) effectively attracting, motivating
and retaining the core backbone employees of the Company to support the Company’s strategic transformation andlong-term development.

Scope of Scheme Participants
Scheme participants are in principle limited to directors (excluding independent non-executive directors) and senior
management of the Company, and backbone management, technical and business personnel who have a direct
impact on the Company’s operating performance and sustainable development. The assessment results of thescheme participants shall meet or exceed the relevant standards for performance appraisal of the Company.

Effective Period
The Scheme will be effective for a term of 10 years commencing from 20 May 2020, unless terminated in advanceunder relevant requirements of the Scheme.

Maximum Quantity of Grant
The maximum number of ordinary shares to be issued upon the exercise of the share options granted under the
Scheme (and any other schemes) shall not in aggregate exceed 2,047,548,289 shares (the “Scheme Mandate
Limit”), being 10% of the total share capital of the Company as at the date of approval of the Scheme orapproximately 9.57% of the total share capital of the Company as at the date of this annual report (being 21 March
2024).
Unless approved at a general meeting, the ordinary shares issued and to be issued upon the exercise of the shareoptions granted to any individual scheme participant (including exercised or outstanding share options) during theeffective period of the Scheme shall not exceed 1% of the total share capital of the Company.

73

74

China Mobile Limited

Report of Directors

Exercise Price
The exercise price of the share options shall be determined in accordance with the fair market price principle, withthe base day for pricing being the grant date. The exercise price shall not be lower than the higher of:(i)the closing price of the ordinary shares of the Company on the grant date; and(ii)

the average closing price of the ordinary shares of the Company on the five trading days prior to the grant date.

Application or Acceptance Fee
No fee shall be payable by a scheme participant on the application for or acceptance of the grant of share options.
As a formality, a scheme participant shall pay HK$1.00 as nominal consideration for acceptance of the grant of shareoptions.

Lapse and Cancellation of Share Options
If any of certain events (including but not limited to a failure in performing his/her duties effectively or a serious
breach or dereliction of his/her duties) occurs in relation to a scheme participant, his/her share options willautomatically lapse, and the Board shall cease granting new share options, cancel share options which are not yet
exercised by him/her, and recover any gains obtained by him/her from the exercise of the share options.

Movement of Share Options During the Year
During the year ended 31 December 2023, the Company did not grant any share options under the Scheme.
The movement of share options under the Scheme during the year ended 31 December 2023 is set forth as follows:
Number of ordinary shares underlying share options
Outstanding
as at
1 January
2023

Grantees

Grantedduringthe year

Exercisedduringthe year

Lapsed andcancelledduringthe year

Outstandingas at
31 December
2023

Grant date

Exercise
price
HK$

Employees of the Company
Total

Remaining Scheme Mandate Limit

280,101,539

0

28,053,548

17,029,444

235,018,547

12 June 2020

55.00

607,498,179

002,458,393

605,039,786

19 September 2022

51.60

887,599,718

0

28,053,548

19,487,837

840,058,333

As at
1 January
2023

As at
31 December
2023

1,159,948,571

1,179,436,408

Note: Subject to the satisfaction of the conditions for vesting as provided under the Scheme, the share options granted shall be vested in threebatches as follows:(i)the first batch (being 40% of the share options granted) will be vested on the first trading day after 24 months from the grant date;(ii)

the second batch (being 30% of the share options granted) will be vested on the first trading day after 36 months from the grant date;
and

(iii)

the third batch (being 30% of the share options granted) will be vested on the first trading day after 48 months from the grant date.

The exercise period begins upon vesting and ends on 10 years from the grant date.

Annual Report 2023

Report of Directors

Details of share options exercised during the year ended 31 December 2023 are set forth as follows:

Period during which share options were exercised
13 January 2023 to 29 December 2023

Exercise
price

Weighted
average closing
price per share
immediately
before datesof exercise

HK$

HK$

55.00

64.80

Number ofordinary shares
underlying
share options
exercised
28,053,548

SUBSTANTIAL SHAREHOLDERS’ AND OTHER PERSONS’ INTERESTS AND
SHORT POSITIONS IN SHARES AND UNDERLYING SHARESThe Company has been notified of the following interests in the Company’s issued shares as at 31 December 2023
amounting to 5% or more of the ordinary shares in issue:

Long Positions in the Shares and Underlying Shares of the Company

directlyindirectly

Percentageof the total
number ofissued shares

42,367,000

14,890,116,842

69.81%–

14,890,116,842

69.61%

14,890,116,842–

69.61%

Number of ordinary shares held(i) China Mobile Communications Group Co., Ltd.
(“CMCC”)(ii) China Mobile (Hong Kong) Group Limited(“CMHK (Group)”)(iii) China Mobile Hong Kong (BVI) Limited(“CMHK (BVI)”)

Note: As at 31 December 2023, CMCC held 42,367,000 RMB Shares and CMHK (BVI) held 14,890,116,842 Hong Kong Shares. In light of the factthat CMCC and CMHK (Group) directly or indirectly control one-third or more of the voting rights in the shareholders’ meetings of CMHK (BVI),
in accordance with the SFO, the interests of CMHK (BVI) are deemed to be, and have therefore been included in, the interests of CMCC andCMHK (Group).

Apart from the foregoing, as at 31 December 2023, no other person (other than a director or the chief executive of
the Company) had any interests or short positions in the shares and underlying shares of the Company as recordedin the register required to be kept under section 336 of the SFO, or as otherwise notified to the Company and theHong Kong Stock Exchange.

75

76

China Mobile Limited

Report of Directors

CONNECTED OR AFFILIATED TRANSACTIONSContinuing Connected Transactions
Details of related party transactions entered into by the Group for the year ended 31 December 2023 are set out
in note 41 to the consolidated financial statements. The majority of these transactions also constitute continuingconnected transactions as defined under Chapter 14A of the Hong Kong Listing Rules.
For the year ended 31 December 2023, the following continuing connected transactions (the “Continuing ConnectedTransactions”) have not exceeded their respective annual caps:(1)

the services charges received by the Group for the provision of telecommunication facilities construction
services to CMCC and its subsidiaries did not exceed RMB2,500 million. The provision of telecommunication
facilities construction services by the Group to CMCC and its subsidiaries in respect of individual projects was
subject to public tender process, and the pricing for the telecommunication facilities construction services wasprimarily based on market rates as determined through the public tender process and the relevant standards
laid down in applicable regulations. For individual projects not subject to the public tender process, selection
criteria and pricing mechanism similar to those in a public tender process were applied;(2)

the total value of right-of-use assets recognized by the Group pursuant to the lease of properties from CMCC
and its subsidiaries did not exceed RMB2,900 million, and the property management service charges paid by
the Group to CMCC and its subsidiaries and the rental and property management service charges received by
the Group from CMCC and its subsidiaries were below 0.1% of each of the applicable percentage ratios set
out in Rule 14.07 of the Hong Kong Listing Rules. The rental charges payable in respect of individual properties
owned by a party or its subsidiaries were determined with reference to one of the following benchmarks: (i)value as determined by independent intermediaries; (ii) applicable market rates or charges which are publicly
available; or (iii) rates charged by that party or its subsidiaries to independent third parties. The rental charges
payable in respect of individual properties which a party or its subsidiaries leased from third parties and sub-let
to the other party or its subsidiaries were determined with reference to the actual rent payable by the lessor
party or its subsidiaries to such third parties;(3)

the leasing fees paid by the Group to CMCC and its subsidiaries for the lease of power support and othernetwork assets and resources did not exceed RMB9,500 million, and the leasing fees received by the Group
from CMCC and its subsidiaries were below 0.1% of each of the applicable percentage ratios set out in Rule
14.07 of the Hong Kong Listing Rules. The leasing fees were determined with reference to prevailing market
rates. In determining the market rates for the leasing fees, the Company took into account the levels of fees
payable by the Company and CMCC to independent third parties (including other operators) as well as thosereceivable by the Company and CMCC from independent third parties (including other operators). The leasing
fees paid by the Company to CMCC were not more than the leasing fees charged to independent third parties
for same kinds of network assets; and(4)

the total value of right-of-use assets recognized by the Group pursuant to the lease of machinery rooms andtransmission pipelines from CMCC and its subsidiaries did not exceed RMB10,000 million, and the leasing fees
received by the Group from CMCC and its subsidiaries were below 0.1% of each of the applicable percentage
ratios set out in Rule 14.07 of the Hong Kong Listing Rules. The leasing fees were determined with reference
to prevailing market rates. In determining the market rates for the leasing fees, the Company took into accountthe levels of fees payable by the Company and CMCC to independent third parties (including other operators) as
well as those receivable by the Company and CMCC from independent third parties (including other operators).
The leasing fees paid by the Company to CMCC were not more than the leasing fees charged to independent
third parties for same kinds of network assets.

Annual Report 2023

Report of Directors

The transactions referred to in paragraph (1) above were entered into pursuant to the 2020 telecommunication
facilities construction services agreement dated 2 January 2020 between the Company and CMCC, as further
renewed for a term of one year commencing on 1 January 2023 by the 2023 telecommunication facilities construction
services extension letter dated 6 January 2023 between the Company and CMCC (the “2023 Telecommunication
Facilities Construction Services Extension Letter”). The entering into of the 2023 Telecommunication Facilities
Construction Services Extension Letter was announced by the Company on 6 January 2023.
The transactions referred to in paragraph (2) above were entered into pursuant to the 2023-2024 property leasing
and management services agreement dated 6 January 2023 between the Company and CMCC (the “2023-2024
Property Leasing Agreement”). The entering into of the 2023-2024 Property Leasing Agreement was announced by
the Company on 6 January 2023. The 2023-2024 Property Leasing Agreement had a term of two years commencing
on 1 January 2023.
The transactions referred to in paragraph (3) above were entered into pursuant to the 2023 power support and othernetwork assets and resources leasing agreement dated 6 January 2023 between the Company and CMCC (the “2023Power Support and Other Network Assets and Resources Leasing Agreement”). The entering into of the 2023
Power Support and Other Network Assets and Resources Leasing Agreement was announced by the Company on 6
January 2023. The 2023 Power Support and Other Network Assets and Resources Leasing Agreement had a term of
one year commencing on 1 January 2023.
The transactions referred to in paragraph (4) above were entered into pursuant to the 2022-2024 machinery rooms
and transmission pipelines leasing agreement dated 3 January 2022 between the Company and CMCC (the “20222024 Machinery Rooms and Transmission Pipelines Leasing Agreement”). The entering into of the 2022-2024
Machinery Rooms and Transmission Pipelines Leasing Agreement was announced by the Company on 3 January
2022. The 2022-2024 Machinery Rooms and Transmission Pipelines Leasing Agreement had a term of three years
commencing on 1 January 2022.
CMCC is the ultimate controlling shareholder of the Company and hence a connected person of the Company.
Accordingly, the transactions referred to in paragraphs (1) to (4) above constitute continuing connected transactions
for the Company under the Hong Kong Listing Rules.
In the opinion of the independent non-executive directors of the Company, the Continuing Connected Transactions
were entered into by the Group:(i)in the ordinary and usual course of its business;(ii)

on normal commercial terms or better; and(iii)

according to the agreements governing such transactions on terms that are fair and reasonable and in theinterests of the shareholders of the Company as a whole.

77

78

China Mobile Limited

Report of Directors

The auditors of the Company were engaged to report on the Continuing Connected Transactions in accordance with
Hong Kong Standard on Assurance Engagements 3000 (Revised) “Assurance Engagements Other than Audits or
Reviews of Historical Financial Information” and with reference to Practice Note 740 (Revised) “Auditor’s Letteron Continuing Connected Transactions under the Hong Kong Listing Rules” issued by the Hong Kong Instituteof Certified Public Accountants. The auditors have issued their unqualified letter containing their findings andconclusions in respect of the Continuing Connected Transactions in accordance with Rule 14A.56 of the Hong Kong
Listing Rules. The auditors’ letter has confirmed that nothing has come to their attention that causes them to believethat the Continuing Connected Transactions:(A)

have not been approved by the Board;(B)were not, in all material respects, in accordance with the pricing policies of the Group as stated in this annual
report;(C)

were not entered into, in all material respects, in accordance with the relevant agreements governing theContinuing Connected Transactions; and(D)

have exceeded their respective annual caps for the year ended 31 December 2023 set out in the previous
announcements of the Company.

In respect of the Continuing Connected Transactions, the Company has complied with the disclosure requirements
under the Hong Kong Listing Rules in force from time to time, and has followed the policies and guidelines as laid
down in the guidance letter HKEX-GL73-14 issued by the Hong Kong Stock Exchange when determining the priceand terms of the transactions conducted during the year ended 31 December 2023.

2023 Business Collaboration Framework Agreement with Venustech
On 23 March 2023, the Company announced that China Mobile Communication Co., Ltd. (a wholly-owned subsidiaryof the Company) (“CMC”) and Venustech Group Inc. (“Venustech”) entered into the 2023 business collaboration
framework agreement (the “2023 Business Collaboration Framework Agreement”). Pursuant to the 2023 Business
Collaboration Framework Agreement, CMC and its subsidiaries provided information and communications technology
services and products to Venustech and its subsidiaries and, at the same time, procured network security softwareand hardware products and related services from Venustech and its subsidiaries. The 2023 Business Collaboration
Framework Agreement had a term of one year commencing on 1 January 2023.
Pursuant to an investment and collaboration agreement dated 17 June 2022 entered into between China Mobile
Capital Holding Co., Ltd. (a wholly-owned subsidiary of CMCC) (“China Mobile Capital”) and Venustech (among
others) (as supplemented by relevant supplementary agreement(s)) (the “Investment and Collaboration Agreement”),
China Mobile Capital agreed to subscribe for certain privately-offered shares in Venustech (the “Subscription”),
and certain shareholders of Venustech agreed to give up voting rights corresponding to part of their shareholdings
in Venustech. Immediately after completion of the Subscription, China Mobile Capital became the single largest
shareholder of Venustech in terms of voting rights. Moreover, pursuant to the Investment and Collaboration
Agreement, from completion of the Subscription, the board of directors of Venustech shall comprise nine directors,
among which China Mobile Capital shall be entitled to nominate four non-independent director candidates and two
independent director candidates. As such, upon completion of the Subscription, Venustech became a subsidiary of
CMCC and hence a connected person of the Company.

Annual Report 2023

Report of Directors

The Subscription was completed on 5 January 2024. During the year ended 31 December 2023, Venustech was
not a connected person of the Company, and the transactions contemplated under the 2023 Business Collaboration
Framework Agreement did not constitute continuing connected transactions for the Company, under the Hong Kong
Listing Rules.

Other Material Affiliated Transactions
Each of CMCC and Venustech is an “affiliated corporation” of the Company under relevant provisions of the SSE
Listing Rules. Apart from the continuing connected transactions with CMCC set out above, there were othertransactions between the Company on the one hand and CMCC, China Tower or Venustech on the other hand that
constituted material affiliated transactions under laws and regulations of the mainland of China. Details of such
affiliated transactions are set out in the section headed “Material Affiliated Transactions” under “Other Important
Matters” in the Company’s annual report published on the SSE.

PURCHASE, SALE OR REDEMPTION OF THE COMPANY’S LISTED SECURITIES
During the year ended 31 December 2023, neither the Company nor any of its subsidiaries purchased, sold orredeemed any of the Company’s listed securities.

FINANCIAL SUMMARY
A summary of the results and of the statements of the assets and liabilities of the Group for the last five financial
years is set out on pages 171 to 173 of this annual report.

EMOLUMENT POLICY
In order to continue to maintain the sustainable development of the Group’s competitiveness, the Group has
always emphasized the importance of recruiting, incentivizing, developing and retaining its employees, paid close
attention to the external competitiveness, internal fairness of its remuneration structure and the cost-effectivenessof remuneration and emphasized the importance of the correlation between remuneration management andperformance management. For the year ended 31 December 2023, employees’ remuneration comprised a basic
salary and a performance-based bonus, as well as medium- to long-term incentives.

EMPLOYEE RETIREMENT BENEFITS
Particulars of the employee retirement benefits of the Group are set out in note 7 to the consolidated financial
statements.

PUBLIC FLOAT
As at the date of this annual report and based on the information that is publicly available to the Company and to theknowledge of the directors of the Company, the Company has maintained the public float prescribed under the Hong
Kong Listing Rules.

AUDITORS
A resolution will be proposed at the forthcoming annual general meeting for the re-appointment of KPMG and KPMG
Huazhen LLP as the auditors of the Group.

79

80

China Mobile Limited

Report of Directors

LIST OF DIRECTORS OF SUBSIDIARIES
A list of directors of the Group’s subsidiaries is set out on the Company’s website.
Please also refer to the sections headed “Chairman’s Statement”, “Business Review”, “Financial Review” and“Human Resources Development” in this annual report (which form part of this Report of Directors).

By order of the Board
Yang Jie
ChairmanHong Kong, 21 March 2024

Annual Report 2023

Independent Auditor’s Report

Independent auditor’s reportto the members of China Mobile Limited(incorporated in Hong Kong with limited liability)

OPINION
We have audited the consolidated financial statements of China Mobile Limited (“the Company”) and its subsidiaries(“the Group”) set out on pages 87 to 170, which comprise the consolidated balance sheet as at 31 December 2023,
the consolidated statement of comprehensive income, the consolidated statement of changes in equity and theconsolidated statement of cash flows for the year then ended and notes to the consolidated financial statements,
including material accounting policy information.
In our opinion, the consolidated financial statements give a true and fair view of the consolidated financial position of
the Group as at 31 December 2023 and of its consolidated financial performance and its consolidated cash flows forthe year then ended in accordance with IFRS Accounting Standards (“IFRSs”) issued by the International AccountingStandards Board (“IASB”) and Hong Kong Financial Reporting Standards (“HKFRSs”) issued by the Hong Kong
Institute of Certified Public Accountants (“HKICPA”) and have been properly prepared in compliance with the Hong
Kong Companies Ordinance.

BASIS FOR OPINION
We conducted our audit in accordance with Hong Kong Standards on Auditing (“HKSAs”) issued by the HKICPA.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of
the consolidated financial statements section of our report. We are independent of the Group in accordance with
the HKICPA’s Code of Ethics for Professional Accountants (“the Code”) and we have fulfilled our other ethicalresponsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion.

81

82

China Mobile Limited

Independent Auditor’s Report

KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of theconsolidated financial statements of the current period. These matters were addressed in the context of our auditof the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide aseparate opinion on these matters.
Revenue recognition
Refer to note 2(s) and note 5 of the consolidated financial statements.
The Key Audit Matter

How the matter was addressed in our audit

The Group’s revenue is primarily generated fromthe provision of various telecommunications
services and sales of telecommunication related
products.

Our audit procedures to assess the recognition of service
revenue included the following:•

The accuracy of revenue from telecommunication
services (“service revenue”) recorded in the
consolidated financial statements is an inherent
industry risk because the billing systems oftelecommunications companies are complex
which process large volumes of data with a
combination of different services provided.
We identified service revenue recognition asa key audit matter because service revenue is
one of the key performance indicators of theGroup and involves complex IT systems whichgive rise to an inherent risk that service revenue
transactions may be incorrectly recorded using
manual journals outside the billing systems orrecorded in the incorrect period.

assessing, with the assistance of our IT specialists, thedesign, implementation and operating effectiveness ofmanagement’s key internal controls over:–the general IT controls for the billing systems,
including access to program controls, programchange controls, program development controls andcomputer operation controls;–

the completeness and accuracy of bill generation andthe end-to-end reconciliation controls from the billingsystems to the accounting system;•

assessing the appropriateness of the accounting policies
adopted in service revenue recognition for different
revenue streams by inspecting the main terms andconditions in selected contracts;•

selecting service packages, on a sample basis, comparing
services offering in the selected packages and the package
prices with the relevant settings in the billing systems;•

selecting bills issued to customers, on a sample basis, andcomparing to the services subscribed by the customers,
the corresponding accounts receivable details, and, whereappropriate, collection records in the billing systems;•

reconciling selected service revenue records in the Group’s
accounting system to external cash collection records;•

recalculating the balances of accounts receivable andadvances from customers at period end with the use ofcomputer assisted audit techniques using data extracted
from the billing systems and reconciling the results to theGroup’s financial records; and•inspecting journals entries relating to revenue which met
specific risk-based criteria, and comparing details of thesejournals entries with relevant underlying documentation.

Annual Report 2023

Independent Auditor’s Report

Impairment assessment on the interest in an associate
Refer to note 2(d), note 2(k) and note 22 of the consolidated financial statements.
The Key Audit Matter

How the matter was addressed in our audit

The fair value of the Group’s investment inShanghai Pudong Development Bank Co., Ltd.
(“SPD Bank”) based on quoted market price has
been persistently below the carrying amount for aperiod of time. This is considered as an indicatorof impairment.

Our audit procedures to assess the impairment assessment of
the Group’s investment in SPD Bank included the following:

In accordance with IAS/HKAS 36 “Impairmentof Assets”, where an indication of impairmentof these assets exists, the Group will estimate
the recoverable amounts of the relevant assets,based on the higher of its fair value less costs ofdisposal and its value in use. An impairment loss
is recognized if the carrying amount of an asset
exceeds its recoverable amount.
As at 31 December 2023, an impairment
assessment for the investment in SPD Bank was
performed by the Group, with the assistanceof an independent external valuer appointed by
the management, to determine the recoverable
amount based on its value in use by discounted
cash flow forecast, which involves management’s
significant judgements and estimates on certain
key assumptions. Based on the result of theassessment, management determined that there
was no impairment loss in this investment.
We identified the impairment assessment of
the Group’s investment in SPD Bank as a key
audit matter because there were significant
judgements and estimates made by management
in determining the discounted cash flow forecast.

•assessing the design, implementation and operating
effectiveness of key internal controls relating to theimpairment assessment of the Group’s investment in SPD
Bank;

•

evaluating the competence, capabilities and objectivity ofthe external valuer appointed by the management;•

evaluating the reasonableness of key assumptions adopted
in the preparation of the discounted cash flow forecastwith reference to our understanding of the industry,
historical performance and available market data relating
to SPD Bank. Our valuation specialists were also assisting
to evaluate the appropriateness of the methodology anddiscount rate adopted by management in the discounted
cash flow forecast;•comparing the key assumptions used in prior year’s
discounted cash flow forecast with the current year’s
actual performance to consider if there was any indicationof management bias;•

evaluating the sensitivity analyses prepared bymanagement for the key assumptions adopted in the
discounted cash flow forecast and considering if there is
any indication of management bias; and•assessing the reasonableness of the disclosures in
the consolidated financial statements in respect of theimpairment assessment of the Group’s investment in SPD
Bank with reference to the requirements of the prevailing
accounting standards.

83

84

China Mobile Limited

Independent Auditor’s Report

INFORMATION OTHER THAN THE CONSOLIDATED FINANCIAL STATEMENTS
AND AUDITOR’S REPORT THEREON
The directors are responsible for the other information. The other information comprises all the information includedin the annual report, other than the consolidated financial statements and our auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent with the consolidated
financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this otherinformation, we are required to report that fact. We have nothing to report in this regard.

RESPONSIBILITIES OF THE DIRECTORS FOR THE CONSOLIDATED FINANCIAL
STATEMENTS
The directors are responsible for the preparation of the consolidated financial statements that give a true andfair view in accordance with IFRSs issued by the IASB and HKFRSs issued by the HKICPA and the Hong Kong
Companies Ordinance and for such internal control as the directors determine is necessary to enable the preparationof consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the directors are responsible for assessing the Group’s ability tocontinue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have norealistic alternative but to do so.
The directors are assisted by the Audit Committee in discharging their responsibilities for overseeing the Group’s
financial reporting process.

AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE CONSOLIDATEDFINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes ouropinion. This report is made solely to you, as a body, in accordance with section 405 of the Hong Kong Companies
Ordinance, and for no other purpose. We do not assume responsibility towards or accept liability to any other person
for the contents of this report.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordancewith HKSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the aggregate, they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these consolidated financial statements.

Annual Report 2023

Independent Auditor’s Report

As part of an audit in accordance with HKSAs, we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:•

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations or the override of internal control.

•

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of theGroup’s internal control.

•

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated disclosures made by the directors.

•

Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, basedon the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our auditor’s report. However, future events orconditions may cause the Group to cease to continue as a going concern.

•

Evaluate the overall presentation, structure and content of the consolidated financial statements, including
the disclosures, and whether the consolidated financial statements represent the underlying transactions andevents in a manner that achieves fair presentation.

•

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or businessactivities within the Group to express an opinion on the consolidated financial statements. We are responsible
for the direction, supervision and performance of the group audit. We remain solely responsible for our audit
opinion.

We communicate with the Audit Committee regarding, among other matters, the planned scope and timing of theaudit and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethical requirements
regarding independence and communicate with them all relationships and other matters that may reasonably bethought to bear on our independence and, where applicable, actions taken to eliminate threats or safeguards applied.

85

86

China Mobile Limited

Independent Auditor’s Report

From the matters communicated with the Audit Committee, we determine those matters that were of mostsignificance in the audit of the consolidated financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated inour report because the adverse consequences of doing so would reasonably be expected to outweigh the public
interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor’s report is Chan Kim Tak.

KPMG
Certified Public Accountants
8th Floor, Prince’s Building
10 Chater Road
Central, Hong Kong
21 March 2024

Annual Report 2023

Consolidated Statement of Comprehensive Income
for the year ended 31 December 2023 (Expressed in Renminbi (“RMB”))

2023
Million2022
Million863,514145,795

812,058
125,201

1,009,309

937,259

268,895
207,132
144,333
52,477
142,80759,319254,182
200,077
130,157
49,592
122,743
51,409874,963

808,160

134,346

129,099

9,823
21,134(3,730)
8,958

9,388
15,729(2,330)10,986

170,531

162,872(38,596)(37,278)

131,935

125,594

176
(184)

(226)
15

(146)

(12)

25
573

–
2,575

1,068

(1,093)TOTAL COMPREHENSIVE INCOME FOR THE YEAR

133,447

126,853

Profit attributable to:Equity shareholders of the Company
Non-controlling interests

131,766
169

125,459
135

PROFIT FOR THE YEAR

131,935

125,594

Total comprehensive income attributable to:Equity shareholders of the Company
Non-controlling interests

133,275
172

126,718
135

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

133,447

126,853

Note
Operating revenue
Revenue from telecommunications services
Revenue from sales of products and others
Operating expenses
Network operation and support expenses
Depreciation and amortization
Employee benefit and related expenses
Selling expenses
Cost of products sold
Other operating expenses

5

6
7

8

Profit from operations
Other gains
Interest and other income
Finance costs
Income from investments accounted for using the equity method

9
10
11

Profit before taxation
Taxation

14(a)PROFIT FOR THE YEAR
Other comprehensive income for the year, net of tax:
Items that will not be subsequently reclassified to profit or loss
Changes in the fair value of financial assets measured at fairvalue through other comprehensive income
Remeasurement of defined benefit liabilities
Share of other comprehensive loss of investments
accounted for using the equity method

7

Items that may be subsequently reclassified to profit or loss
Changes in the fair value of financial assets measured at fairvalue through other comprehensive income
Currency translation differences
Share of other comprehensive income/(loss) of investments
accounted for using the equity method

Earnings per share – Basic15(a)RMB6.16

RMB5.88

Earnings per share – Diluted

15(b)RMB6.15

RMB5.88

The notes on pages 94 to 170 are an integral part of these consolidated financial statements.

87

88

China Mobile Limited

Consolidated Balance Sheetas at 31 December 2023 (Expressed in RMB)

As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

20
22
23

714,663
74,496
94,753
14,87735,301
2,279
32,720181,715
47,337717,12173,087
108,749
15,24435,301
1,334
31,265
175,649
43,638

24
24
25
26
27

3,518
185,621
5,628
55,387
46,258490
187,130
9,716
45,88734,556

1,494,553

1,479,167

12,026
19,40754,881
12,342
1,205
7,516
809
23,108156,018
32,02037,213
141,559

11,696
13,65742,757
12,863
777
7,040
1,055
18,440108,303
16,30056,377167,106

498,104

456,371

1,992,657

1,935,538

297,456
26,52066,19379,03538,201
15,98535,175

271,306
14,75975,25584,44646,496
10,15630,919558,565

533,337

Note
AssetsNon-current assets
Property, plant and equipment
Construction in progress
Right-of-use assets
Land use rights
Goodwill
Development expenditure
Other intangible assets
Investments accounted for using the equity method
Deferred tax assets
Financial assets measured at fair value through othercomprehensive income
Financial assets measured at fair value through profit or loss
Other financial assets measured at amortized cost
Bank deposits
Other non-current assets
Current assets
Inventories
Contract assets
Accounts receivable
Other receivables
Bills receivable
Prepayments
Prepaid income tax
Other non-financial assets
Financial assets measured at fair value through profit or loss
Other financial assets measured at amortized cost
Bank deposits
Cash and cash equivalents

16
17
18(a)
18(b)
19

28
29
30

31
24
25
26
32

Total assets
Equity and liabilities
Liabilities
Current liabilities
Accounts payable and accrued expenses
Bills payable
Contract liabilities
Receipts in advance
Other payables
Income tax payable
Lease liabilities

33
34
35
36
18(c)

Annual Report 2023

Consolidated Balance Sheetas at 31 December 2023 (Expressed in RMB)

Note
Non-current liabilities
Lease liabilities
Deferred revenue
Defined benefit plan and other employee benefit liabilities
Deferred tax liabilities
Other non-current liabilities

18(c)
37
23

Total liabilities
EquityShare capital
Reserves
Total equity attributable to equity shareholders of the Company

39(a)

As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

67,759
9,281
6,408
3,077
1,582

81,741
8,810
5,951
2,571
1,705

88,107100,778646,672

634,115455,001
886,731453,504
843,844

1,341,732

1,297,348

4,253

4,075

Total equity

1,345,985

1,301,423

Total equity and liabilities

1,992,657

1,935,538

Non-controlling interests

The consolidated financial statements on pages 87 to 170 were approved by the Board of Directors on 21 March2024 and were signed on its behalf.
Yang Jie
Name of Director
Li Ronghua
Name of Director

The notes on pages 94 to 170 are an integral part of these consolidated financial statements.

89

90

China Mobile Limited

Consolidated Statement of Changes in Equity
for the year ended 31 December 2023 (Expressed in RMB)

Attributable to equity shareholders of the Company

As at 1 January 2022
Changes in equity for 2022:
Profit for the year
Changes in the fair value of financial assets
measured at fair value through othercomprehensive income
Remeasurement of defined benefit liabilities (note 7)
Currency translation differences
Share of other comprehensive loss of investments
accounted for using the equity method
Total comprehensive income for the year
Dividends approved in respect of previous year
(note 39(b)(ii))
Dividends declared in respect of current year
(note 39(b)(i))
Issuance of RMB Shares and exercise ofover-allotment (note 39(a)(i))
Purchase of own shares (note 39(a)(ii))
Transfer to PRC statutory reserves (note 39(d)(ii))
Share option scheme– Value of share options (note 38)
Changes in the share of other reserves of investments
accounted for using the equity method
Others
As at 31 December 2022
As at 1 January 2023
Changes in equity for 2023:
Profit for the year
Changes in the fair value of financial assets
measured at fair value through othercomprehensive income
Remeasurement of defined benefit liabilities (note 7)
Currency translation differences
Share of other comprehensive income of investments
accounted for using the equity method
Total comprehensive income for the year
Dividends approved in respect of previous year
(note 39(b)(ii))
Dividends declared in respect of current year
(note 39(b)(i))
Transfer to PRC statutory reserves (note 39(d)(ii))
Exercise of share options (note 39(a)(iii))
Share option scheme– Value of share options (note 38)
Changes in the share of other reserves of investments
accounted for using the equity method
Others
As at 31 December 2023

SharecapitalMillionCapitalreserve
MillionExchangereserve
MillionPRC
statutory
reserves
Million

Other
reserves
MillionRetained
profits
Million402,130(264,455)(1,080)347,373

3,670

718,7121,206,350

3,942

1,210,292

–

–

–

–

–

125,459

125,459135

125,594

–
–
–

–
–
–

–
–
2,575

–
–
–

(226)
15
–

–
–
–

(226)
15
2,575

–
–
–

(226)
15
2,575

–
–

–
–

–
2,575

–
–

(1,105)(1,316)–
125,459(1,105)
126,718–
135(1,105)
126,853

–

–

–

–

–

(44,594)(44,594)(32)(44,626)

–

–

–

–

–

(42,243)(42,243)–(42,243)

51,374
–
–

–
–
–

–
–
–

–
–
8,090

–
–
–

–
(707)
(8,090)51,374
(707)
–

–
–
–

51,374
(707)
–

–

411

–

–

–

–

411

–

411

–
–
453,504
453,504(98)
107(264,035)(264,035)

–
–
1,495
1,495

–
–
355,463355,463

–
12
2,366
2,366

–
18
748,555
748,555(98)
137
1,297,348
1,297,348

–
30
4,075
4,075

(98)
167
1,301,423
1,301,423

–

–

–

–

–

131,766

131,766

169

131,935

–
–
–

–
–
–

–
–
573

–
–
–

198
(184)
–

–
–
–

198
(184)
573

3
–
–

201
(184)
573

–
–

–
–

–
573

–
–

922
936

–
131,766922
133,275–
172

922
133,447

–

–

–

–

–

(43,414)(43,414)(25)(43,439)

–
–
1,497

–
–
(102)

–
–
–

–
12,072––––(47,674)(12,072)–(47,674)
–
1,395

–
–
–

(47,674)
–
1,395

–

717

–

–

–

–

717

–

717

–
–
455,001(4)
88(263,336)

–
–
2,068

–
–
367,535

–
1
3,303

–
–
777,161(4)
89
1,341,732

–
31
4,253

(4)
120
1,345,985

Noncontrolling
Totalinterests
MillionMillion

The notes on pages 94 to 170 are an integral part of these consolidated financial statements.

Total
equityMillionAnnual Report 2023

Consolidated Statement of Cash Flowsfor the year ended 31 December 2023 (Expressed in RMB)

2023
Million2022
Million(Re-presented)

170,531

162,872

207,132

200,077

390
9,227
216
246
(21,134)
3,730(8,958)
(164)
717

892
4,453
284
234
(15,729)2,330(10,986)(123)
411

Operating cash flows before changes in working capital

361,933

344,715

Increase in inventories
Increase in contract assets
Increase in contract costs
Increase in accounts receivable
Decrease/(increase) in other receivables
Increase in bills receivable(Increase)/decrease in prepayments(Increase)/decrease in other non-financial assets
Increase in accounts payable and accrued expenses
Increase in bills payable
Decrease in contract liabilities
Decrease in receipts in advance
Increase in deferred revenue
Increase/(decrease) in other payables
Others(576)(6,437)(3,797)(21,378)
459
(428)
(476)
(4,668)28,414
5,843(9,062)(5,411)471
819(6,195)(1,727)(9,047)(3,410)(10,153)(2,427)
(370)
2,286
118
6,357
3,175
(3,813)
(846)
323
(334)
(2,943)

Cash generated from operations

339,511

321,904

Tax paid– The mainland of China and other countries and regions’enterprise income tax paid
– Hong Kong profits tax paid

(35,219)(512)(41,058)(96)

Net cash generated from operating activities

303,780

280,750

Note
Operating activities
Profit before taxation
Adjustments for:– Depreciation and amortization– Net loss on disposal and write-off of property, plant andequipment and other intangible assets– Expected credit impairment losses– Impairment losses of contract assets– Write-down of inventories– Interest and other income– Finance costs– Income from investments accounted for using the equity method– Net exchange gain
– Share options expenses

8
8
8
8
10
11

91

92

China Mobile Limited

Consolidated Statement of Cash Flowsfor the year ended 31 December 2023 (Expressed in RMB)

2023
Million2022
Million(Re-presented)(181,263)(189,588)

753(38,885)525(39,519)

49,58644,546(1,086)605(48,690)(98,229)

37,7138,300

106,686
13,5252,365(2,089)

58
–

3,699

4,356

(40,980)(141,693)

7,668

60,653(2,976)

–

186

22

(205,699)(238,053)

Investing activities
Payment for property, plant and equipment,
other intangible assets and non-current assets
Proceeds from disposal and write-off of property,
plant and equipment and non-current assets
Purchase of term deposits and certificates of deposits
Proceeds from disposal of term deposits andcertificates of deposits(Increase)/decrease in the statutory deposit reserves
by China Mobile Finance
Purchase of other financial assets measured atamortized cost
Proceeds from disposal of other financial assets measured atamortized cost
Interest and other finance income received
Proceeds from disposal of investments accounted forusing the equity method
Purchase of investments accounted for using the equity method
Dividends received from investments accounted forusing the equity method
Purchase of financial assets measured at fair value throughprofit or loss
Proceeds from disposal of financial assets measured atfair value through profit or loss
Purchase of financial assets at fair value through othercomprehensive income
Proceeds from disposal of financial assets measured atfair value through other comprehensive income
Net cash used in investing activities

Annual Report 2023

Consolidated Statement of Cash Flowsfor the year ended 31 December 2023 (Expressed in RMB)

2023
Million2022
Million(Re-presented)–
1,395(91,088)(25)(9,111)(43)(25,006)
–
35

3,286
–
(86,837)(32)(6,648)(65)(28,925)
(707)
(586)

Net cash used in financing activities(123,843)(120,514)

Net decrease in cash and cash equivalents(25,762)(77,817)

Cash and cash equivalents at beginning of year

167,106

243,943215

980

141,559

167,106

Note
Financing activities
Proceeds received from exercise of over-allotment of RMB Shares
Proceeds received from exercise of share options
Dividends paid to the Company’s equity shareholders
Dividends paid to non-controlling shareholders of subsidiaries
Net repayment of short-term deposits placed by CMCC GroupInterest paid in relation to short-term deposits placed by CMCC Group
Repayment of principal and interest of lease liabilities
Payment for purchase of own shares
Others

39(a)
39(a)

41(a)

39(a)

Effect of changes in foreign exchange rate
Cash and cash equivalents at end of year

32

Changes in liabilities arising from financing activities
There are no changes in liabilities arising from financing activities other than the receipts and repayment of shortterm deposits placed by CMCC Group (note 41(a)), the initial recognition of lease liabilities at the commencement
date, and repayment of the related principal and interest associated with lease liabilities.

The notes on pages 94 to 170 are an integral part of these consolidated financial statements.

93

94

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

1

GENERAL INFORMATION
China Mobile Limited (the “Company”) was incorporated in the Hong Kong Special Administrative Region(“Hong Kong”) of the People’s Republic of China (the “PRC”) on 3 September 1997. The principal activities of
the Company and its subsidiaries (together referred to as the “Group”) are the provision of telecommunications
and information related services in the mainland of China and in Hong Kong (for the purpose of preparing
the consolidated financial statements, the mainland of China refers to the PRC excluding Hong Kong, Macau
Special Administrative Region of the PRC and Taiwan). The Company’s immediate holding company is China
Mobile Hong Kong (BVI) Limited (incorporated in the British Virgin Islands), and the Company’s ultimate holding
company is China Mobile Communications Group Co., Ltd. (“CMCC”, incorporated in the mainland of China).
The address of the Company’s registered office is 60th Floor, The Center, 99 Queen’s Road Central, HongKong.
The ordinary shares of the Company have been listed on The Stock Exchange of Hong Kong Limited (the“HKEX”) since 23 October 1997.
On 5 January 2022, the Company completed the initial public offering of ordinary shares subscribed for andtraded in RMB (the “RMB Shares”), which were listed on the Shanghai Stock Exchange (the “SHEX”).

2

MATERIAL ACCOUNTING POLICIES(a) Statement of compliance
These financial statements have been prepared in accordance with all applicable IFRS AccountingStandards (“IFRSs”) issued by the International Accounting Standards Board (“IASB”), which collective
term includes all applicable individual International Financial Reporting Standards, International AccountingStandards (“IASs”) and Interpretations issued by the IASB. Hong Kong Financial Reporting Standards(“HKFRSs”), which collective term includes all applicable individual Hong Kong Financial ReportingStandards, Hong Kong Accounting Standards (“HKASs”) and Interpretations issued by the Hong Kong
Institute of Certified Public Accountants (“HKICPA”), are consistent with IFRSs that relates to theGroup’s financial statements. These financial statements also comply with HKFRSs, the requirementsof Hong Kong Companies Ordinance Cap. 622 (“HKCO”), and the applicable disclosure provisions of theRules Governing the Listing of Securities on the HKEX (the “Listing Rules”). A summary of the material
accounting policies adopted by the Group is set out below.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(b) Basis of preparation
The consolidated financial statements for the year ended 31 December 2023 comprise the Group and theGroup’s interest in associates and joint ventures.
The measurement basis used in the preparation of the financial statements is the historical cost basis, as
modified by the revaluation of certain financial instruments measured at fair value.
All of the new and amended standards that effective for the year beginning on 1 January 2023 have been
applied for the first time by the Group. The details of adopting these amended standards are disclosed innote 3.
The preparation of financial statements in conformity with IFRSs and HKFRSs requires management
to make judgements, estimates and assumptions that affect the application of policies and reported
amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are
based on historical experience and various other factors that are believed to be reasonable under thecircumstances, the results of which form the basis of making the judgements about carrying values ofassets and liabilities that are not readily apparent from other sources. Actual results may differ from theseestimates.
The estimates and underlying assumptions are reviewed by the Management on an ongoing basis.
Revisions to accounting estimates are recognized in the period in which the estimate is revised if therevision affects only that period, or in the period of the revision and future periods if the revision affects
both current and future periods.
Judgements made by management in the application of IFRSs and HKFRSs that have significant effect on
the financial statements and major sources of estimation uncertainty are disclosed in note 46.

95

96

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(c) Subsidiaries and non-controlling interests(i)

Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The
Group controls an entity when the Group is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power over theentity.
An investment in a subsidiary is consolidated into the consolidated financial statements fromthe date that control commences until the date that control ceases. Intra-group balances andtransactions and any unrealized gains arising from intra-group transactions are eliminated in fullin preparing the consolidated financial statements. Unrealized losses resulting from intra-grouptransactions are eliminated in the same way as unrealized gains but only to the extent that there isno evidence of impairment. Accounting policies of subsidiaries would be changed where necessary
in the consolidated financial statements to ensure consistency with the policies adopted by theGroup.
Non-controlling interests represent the equity in a subsidiary not attributable directly or indirectly
to the Company, and in respect of which the Group has not agreed any additional terms withthe holders of those interests which would result in the Group as a whole having a contractual
obligation in respect of those interests that meets the definition of a financial liability. For eachbusiness combination, the Group can elect to measure any non-controlling interests either at fairvalue or at their proportionate share of the subsidiary’s net identifiable assets.
Non-controlling interests are presented in the consolidated balance sheet within equity, separatelyfrom equity attributable to the equity shareholders of the Company. Non-controlling shareholders’interests in the results of the Group are presented on the face of the consolidated statement ofcomprehensive income as an allocation of the total profit or loss and total comprehensive income
for the year between non-controlling interests and the equity shareholders of the Company.
Changes in the Group’s interests in a subsidiary that do not result in a loss of control are accounted
for as equity transactions, whereby adjustments are made to the amounts of controlling and noncontrolling interests within consolidated equity to reflect the change in relative interests, but noadjustments are made to goodwill and no gain or loss is recognized.
When the Group loses control of a subsidiary, it is accounted for as a disposal of the entire interestin that subsidiary, with a resulting gain or loss being recognized in profit or loss. Any interest
retained in that former subsidiary at the date when control is lost is recognized at fair value and thisamount is regarded as the fair value on initial recognition of a financial asset or, when appropriate,
the cost on initial recognition of an investment in an associate or a joint venture.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(c) Subsidiaries and non-controlling interests (Continued)(ii)

Separate financial statements
In the Company’s balance sheet, an investment in a subsidiary is stated at cost less impairment
losses (see note 2(k)). The results of subsidiaries are accounted for by the Company on the basis of
dividends received and receivable.
Impairment testing of the investments in subsidiaries is required upon receiving a dividend fromthese investments if the dividend exceeds the total comprehensive income of the subsidiary in the
period the dividend is declared or if the carrying amount of the investment in the separate financial
statements exceeds the carrying amount in the consolidated financial statements of the investee’s
net assets including goodwill.

(iii) Business combination other than under common control
The Group applies the acquisition method to account for combination of entities and businesses
which are not under common control. The consideration transferred for the acquisition of a
subsidiary includes the fair values of the assets transferred, the liabilities incurred to the former
owners of the acquiree, the equity interests issued by the Group and the fair value of any asset
or liability resulting from a contingent consideration arrangement. Identifiable assets acquired andliabilities and contingent liabilities assumed in a business combination are measured initially at theirfair values at the acquisition date. Acquisition-related costs are expensed as incurred.

(iv) Business combination under common control
Under IFRSs and HKFRSs, the Group uses merger accounting to account for the combination ofentities and businesses under common control in accordance with the Accounting Guideline 5“Merger Accounting for Common Control Combinations” issued by the HKICPA.
The consolidated financial statements incorporate the financial statements of the combining entities
or businesses in which the common control combination occurs as if they had been combined fromthe date when the combining entities or businesses first came under the control of the controlling
party.
The assets and liabilities of the combining entities or businesses are combined using the carrying
book values from the controlling parties’ perspective. No amount is recognized in consideration
for goodwill or excess of acquirers’ interest in the net fair value of acquiree’s identifiable
assets, liabilities and contingent liabilities over the consideration at the time of common control
combination, to the extent of the continuation of the controlling party’s interest.
The consolidated statement of comprehensive income includes the results of each of the combining
entities or businesses from the earliest date presented or since the date when the combining
entities or businesses first came under the common control, where there is a shorter period,
regardless of the date of the common control combination. Transaction costs, including professionalfees, registration fees, costs of furnishing information to shareholders, costs or losses incurredin combining operations of the previously separate businesses, etc., incurred in relation to thecommon control combination that is to be accounted for by using merger accounting is recognized as
an expense in the period in which they were incurred.

97

98

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(d) Investments in associates and joint arrangements
An associate is an entity, not being a subsidiary, in which the Group exercises significant influence, but
not control or joint control, over its management. Significant influence is the power to participate in thefinancial and operating decisions of the investee but is not control or joint control over those policies.
The Group has applied IFRS/HKFRS 11 to all joint arrangements. Under IFRS/HKFRS 11, investments injoint arrangements are classified as either joint operations or joint ventures depending on the contractual
rights and obligations of each investor. A joint operation is an arrangement whereby the Group andother parties contractually agree to share control of the arrangement, and have rights to the assets andobligations for the liabilities relating to the arrangement. The Group accounts for its assets, liabilities,
revenue and expenses, and its share thereof, in relation to its interests in the joint operation. A joint
venture is an arrangement whereby the Group and other parties contractually agree to share control of
the arrangement, and have rights to the net assets of the arrangement.

Investments accounted for using the equity method
The Group accounted for its investment in associates and joint ventures using the equity method.
Under the equity method, the investment is initially recorded at cost, adjusted for any excess of theGroup’s share of the acquisition-date fair values of the investee’s net identifiable assets over the costof the investment after reassessment (if applicable). Thereafter, the investment is adjusted for the postacquisition change in the Group’s share of the investee’s net assets and any impairment loss relating to
the investment (see note 2(k)). The Group’s share of the post-acquisition post-tax results of the investee
for the year is recognized as income from investments accounted for using the equity method in the
consolidated statement of comprehensive income, whereas the Group’s share of the post-acquisition
post-tax items of the investee’s other comprehensive income is recognized as its share of othercomprehensive income in the consolidated statement of comprehensive income.
When the Group’s share of losses exceeds its interest in the associates or joint ventures, the Group’s
interest is reduced to nil and recognition of further losses is discontinued except to the extent that theGroup has incurred legal or constructive obligations or made payments on behalf of the investee. For thispurpose, the Group’s interest in the investee is the carrying amount of the investment under the equity
method together with the Group’s long-term interests that in substance form part of the Group’s net
investment in the associates or joint ventures.
Unrealized profits and losses resulting from transactions between the Group and its associates or joint
ventures are eliminated to the extent of the Group’s interest in the investee, except where unrealized
losses provide evidence of an impairment of the asset transferred, in which case they are recognized
immediately in profit or loss. Accounting policies of associates and joint ventures would be changed
where necessary in the consolidated financial statements to ensure consistency with the policies adopted
by the Group.
Gain or loss on dilution of equity interest in associates and joint ventures are recognized in profit or loss.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(e) Goodwill
Goodwill represents the excess of:(i)the aggregate of the fair value of the consideration transferred, the amount of any non-controllinginterest in the acquiree and the fair value of the Group’s previously held equity interest in theacquiree; over(ii)

the net fair value of the acquiree’s identifiable assets and liabilities measured as at the acquisition
date.

When (ii) is greater than (i), then this excess is recognized immediately in profit or loss as a gain on abargain purchase.
Goodwill is stated at cost less accumulated impairment losses. Goodwill arising in a business combinationis allocated to each cash-generating unit, or groups of cash-generating units, that is expected to benefit
from the synergies of the combination and is tested annually for impairment (see note 2(k)). Each unit orgroups of units to which the goodwill is allocated represents the lowest level within the Group at which
the goodwill is monitored for internal management purpose. Goodwill is monitored at the operating
segment level.
On disposal of a cash-generating unit, any attributable amount of purchased goodwill is included in thecalculation of the gain or loss on disposal.

(f)Research and development expenditure
Research and development expenditure is classified into expenditure during the research phase andexpenditure during the development phase. Expenditure during research activities is recognized in profit
or loss as incurred. Expenditure during development activities is capitalized when capitalization criteria
are fulfilled and recorded as “development expenditure”, otherwise it is recognized in profit or loss as
incurred.

(g) Other intangible assets
Other intangible assets include assets such as software, operating license and copyrights that are
acquired or transferred upon completion of development or installation (see notes 2(f) and 2(i)). They
are stated in the balance sheet at cost less accumulated amortization (where the estimated useful life isfinite) and impairment losses (see note 2(k)). Amortization of intangible assets with finite useful lives isrecorded in depreciation and amortization on a straight-line basis over the shorter of the assets’ estimateduseful lives or their contractual period, from the date they are available for use. Both the useful lives andmethod of amortization of other intangible assets are reviewed at least annually by the Group.

99

100

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(h) Property, plant and equipment
Property, plant and equipment are stated in the balance sheet at cost less accumulated depreciation andimpairment losses (see note 2(k)).
The cost of property, plant and equipment comprises the purchase price and any directly attributable
costs of bringing the asset to its working location and condition for its intended use. Subsequent costs
are recognized in the carrying amount of an item of property, plant and equipment, only when it isprobable that future economic benefits associated with the item will flow to the Group and the cost of
the item can be measured reliably. All other subsequent expenditure is recognized as an expense in the
period in which it is incurred.
Gains or losses arising from the retirement or disposal of an item of property, plant and equipment are
determined as the difference between the net disposal proceeds and the carrying amount of the related
assets and are recognized in profit or loss on the date of retirement or disposal.
Depreciation is calculated to write off the cost of property, plant and equipment, less their estimatedresidual values, if any, using the straight-line method over their estimated useful lives as follows:

Buildings
Telecommunications transceivers, switching centers,
transmission and other network equipment
Office equipment, furniture, fixtures and others

Estimated
useful lives

Estimated
residualvalue rate

8–30 years

3%

5–10 years
3–10 years

0-3%
3%

Both the assets’ useful lives and residual values are reviewed at least annually by the Group.

(i)

Construction in progress
Construction in progress is stated at cost less impairment losses (see note 2(k)). Cost comprises direct
costs of construction as well as interest expense and exchange differences capitalized during the periodsof construction and installation. Capitalization of these costs ceases and the construction in progressis transferred to property, plant and equipment and other intangible assets when substantially all theactivities necessary to prepare the assets for their intended use are completed. No depreciation isprovided for in respect of construction in progress.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(j)

LeasesA contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset
for a period of time in exchange for consideration. At inception of a contract, the Group assesses whether
the contract is, or contains, a lease. Control is conveyed where the customer has both the right to direct
the use of the identified asset and to obtain substantially all of the economic benefits from that use.

(i)

As lessee
Other than land use right, the Group primarily leases telecommunications towers, buildings andpremises and other network equipment. Lease contracts are typically made for fixed periods withno extension options.
At inception or on reassessment of a contract that contains a lease component, the Group allocatesthe consideration in the contract to each lease and non-lease component on the basis of theirrelative stand-alone prices. Unless the Group applies the practical expedient permitted under IFRS/HKFRS 16 “Leases”.
Recognition and measurement of lease liabilities
Lease liabilities are initially measured at the present value of unpaid lease payments at thecommencement date. Lease payments include fixed payments, variable lease payments that are
based on an index or a rate, residual value guarantees payments, lease payments to be madeunder reasonably certain extension options and payments of penalties for exercising an option toterminate the lease.
As the interest rate implicit in the lease of the Group cannot be readily determined, the Group
uses incremental borrowing rate as the discounted rate for calculating the present value of lease
payments. When determine the incremental borrowing rate, the Group makes adjustments on riskfree interest rate based on lease term and credit risk for leases, as the Group does not have recent
third party loan financing. Lease payments are allocated between principal and finance cost. The
Group calculates interest on the lease liability based on a constant periodic rate, which is charged to
profit or loss as finance cost over the lease period.
Recognition and measurement of right-of-use assets
Right-of-use assets of the Group are measured at cost, comprising the amount of the initial
measurement of lease liabilities, any lease payments made at or before the commencement date,initial direct costs and restoration costs, etc. Right-of-use assets are generally depreciated over the
shorter of the asset’s useful life and the lease term on a straight-line basis.

101

102

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(j)

Leases (Continued)(i)

As lessee (Continued)
Lease modification
The Group accounts for a lease modification as a separate lease if both: (1) the modification
increases the scope of the lease by adding the right to use one or more underlying assets; (2)the consideration for the lease increases by an amount commensurate with the stand-alone pricefor the increase in scope and any appropriate adjustments to that stand-alone price to reflect thecircumstances of the particular contract.
For a lease modification that is not accounted for as a separate lease, at the effective date of
the lease modification the Group redetermine the period of the modified lease and remeasure
the lease liability by discounting the revised lease payments using a revised discount rate. The
Group accounts for the remeasurement of the lease liability by decreasing the carrying amount of
the right-of-use asset to reflect the partial or full termination of the lease for lease modifications
that decrease the scope of the lease and recognizing in profit or loss any gain or loss relating to
the partial or full termination of the lease. For all other lease modifications, the Group makes acorresponding adjustment to the carrying amount of the right-of-use asset.
Other lease expenses
Payments associated with short-term leases and leases of low-value assets are recognized on astraight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of
12 months or less. Leases of low-value asset are leases for which the underlying asset is of low
value, when new. Variable lease payments not based on an index or a rate are recognized in profit
or loss in the period in which the condition that triggers those payments occurs.
Classification of lease related cash flow
Short-term lease payments, payments for leases of low-value assets and variable lease paymentsthat are not included in the measurement of the lease liabilities of the Group are included in the
cash used in operating activities. Repayment of principal and interest of lease liabilities of the Groupis included in the cash used in financing activities.

(ii)

As lessor
Lease income from operating leases where the Group is a lessor is recognized in income on astraight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease
are added to the carrying amount of the lease asset and recognized as expense over the lease termon the same basis as lease income. The respective leased assets are included in the balance sheet
based on their nature.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(k) Impairment of non-financial assets(i)

Impairment of investments accounted for using the equity method
Investments accounted for using the equity method are reviewed at each balance sheet date todetermine whether there is objective indication of impairment. Objective indication of impairment
includes observable data that comes to the attention of the Group about one or more of thefollowing loss events:–

significant financial difficulty of the entity;–a breach of contract, such as a default or delinquency in interest or principal payments;–

it becoming probable that the entity will enter bankruptcy or other financial reorganization;–

significant changes in the technological, market, economic or legal environment that have an
adverse effect on the entity; and–decline in the fair value of an investment in an equity instrument below its carrying amount.

If any such indication exists, the impairment loss is measured by comparing the recoverable amountof the investment with its carrying amount in accordance with note 2(k)(ii). The impairment loss isreversed if there has been a favourable change in the estimates used to determine the recoverable
amount in accordance with note 2(k)(ii).

(ii)

Impairment of other assets
Internal and external sources of information are reviewed at each balance sheet date to identify
indications that the following assets may be impaired or, an impairment loss previously recognized
no longer exists or may have decreased, except in the case of goodwill:–

property, plant and equipment;–

construction in progress;–

right-of-use assets;–land use rights;–

investments in subsidiaries;–

development expenditure; and–other intangible assets with definite life.

If any such indication exists, the asset’s recoverable amount is estimated. For goodwill, therecoverable amount is estimated annually whether or not there is any indication of impairment.

103

104

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(k) Impairment of non-financial assets (Continued)(ii)

Impairment of other assets (Continued)–

Calculation of recoverable amountThe recoverable amount of an asset is the higher of its fair value less costs of disposal andvalue in use (“VIU”). In assessing VIU, the estimated future cash flows are discounted to theirpresent value using a pre-tax discount rate that reflects current market assessments of thetime value of money and the risks specific to the asset. Where an asset does not generatecash inflows largely independent of those from other assets, the recoverable amount isdetermined for the smallest group of assets that generates cash inflows independently (i.e. acash-generating unit).

–

Recognition of impairment losses
An impairment loss is recognized in profit or loss if the carrying amount of an asset, or the
cash-generating unit to which it belongs, exceeds its recoverable amount. Impairment losses
recognized in respect of cash-generating units are allocated first to reduce the carrying amountof any goodwill allocated to the cash-generating unit (or group of units) and then, to reduce thecarrying amount of the other assets in the unit (or group of units) on a pro rata basis, exceptthat the carrying value of an asset will not be reduced below its individual fair value less costsof disposal, or VIU, if determinable.

–

Reversals of impairment losses
In respect of assets other than goodwill, an impairment loss is reversed if there has been afavourable change in the estimates used to determine the recoverable amount. An impairment
loss in respect of goodwill is not reversed.
A reversal of an impairment loss is limited to the asset’s carrying amount that would
have been determined had no impairment loss been recognized in prior years. Reversalsof impairment losses are credited to profit or loss in the year in which the reversals arerecognized.

(l)

Inventories
Inventories are carried at the lower of cost and net realizable value. Cost represents purchase costof goods calculated using the weighted average cost method. Net realizable value is determined byreference to the sales proceeds of items sold in the ordinary course of business or to management’s
estimates based on prevailing market conditions.
When inventories are sold, the carrying amount of those inventories is recognized as cost of products
sold. The amount of any write-down of inventories to net realizable value and all losses of inventories arerecognized as an expense in the period the write-down or loss occurs. The amount of any reversal of any
write-down of inventories, arising from an increase in net realizable value, is recognized as a reduction in
the amount of inventories recognized as an expense in the period in which the reversal occurs.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(m) Investments and other financial assets
Recognition and derecognition
Regular way purchases and sales of financial assets are recognized on trade-date, the date on which
the Group commits to purchase or sell the asset. Financial assets are derecognized when the rights toreceive cash flows from the financial assets have expired or have been transferred and the Group has
transferred substantially all the risks and rewards of ownership.

Classification
The Group classifies its financial assets, depending on the Group’s business model for managing thefinancial assets and the contractual terms of the related cash flows, under the following measurement
categories:•

those to be measured at amortized cost, and•those to be measured at fair value (either through other comprehensive income, or through profit orloss).

Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial
asset not measured at fair value through profit or loss (“FVPL”), transaction costs that are directly
attributable to the acquisition of the financial asset. Transaction costs of financial assets measured at
FVPL are expensed in profit or loss.
(i)

The Group’s financial assets measured at amortized cost represent those financial assets that areheld for collection of contractual cash flows where those cash flows represent solely payments ofprincipal and interest. Interest from these financial assets is included in interest income using theeffective interest rate method. Any gain or loss arising on derecognition is recognized directly in
profit or loss together with foreign exchange gains and losses. Impairment losses are presented inother operating expenses.

(ii)

Debt investments are classified as fair value through other comprehensive income (“FVOCI”), if theinvestment is held within a business model whose objective is achieved by both the collection ofcontractual cash flows and sale and the contractual cash flows of the investment comprise solely
payments of principal and interest. Changes in fair value are recognized in other comprehensive
income, except for the recognition in profit or loss of expected credit losses, interest income(calculated using the effective interest method) and foreign exchange gains and losses. When theinvestment is derecognized, the amount accumulated in other comprehensive income is recycledfrom equity to profit or loss.
For equity instruments that are not held for trading, the Group has made an irrevocable election
at the time of initial recognition to account for these equity investments at FVOCI. There is nosubsequent reclassification of fair value gains and losses to profit or loss following the derecognitionof the investments. Dividends from such investments continue to be recognized in profit or loss
when the Group’s right to receive payments is established.

(iii)

Assets that do not meet the criteria for amortized cost or are not elected/classified as FVOCI areclassified as FVPL. A gain or loss on a financial instrument that is subsequently measured at FVPL
is recognized in profit or loss and presented net within interest and other income in the period inwhich it arises.

105

106

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(m) Investments and other financial assets (Continued)
Impairment
The Group assesses on a forward looking basis the expected credit losses associated with its financial
instruments carried at amortized cost. The Group has adopted the simplified expected credit loss model
for its accounts receivable and contract assets, which requires expected lifetime losses to be recognizedfrom their initial recognition.
For other financial instruments carried at amortized cost, which have low credit risk at both the beginningand end of the reporting period, the Group recognizes a loss allowance equal to 12-month expectedcredit loss unless there has been a significant increase in credit risk of the financial instrument since initialrecognition, in which case the loss allowance is measured at an amount equal to lifetime expected credit
loss.
Financial assets are written off when the Group is satisfied that recovery is remote. When loans or
receivables have been written off, the Group continues to attempt to recover the receivables due. When
recoveries are made, the recovered amount is recognized in profit or loss.

(n) Accounts receivable and other receivables
Accounts receivable are initially recognized at the amount of consideration that is unconditional and otherreceivables are initially recognized at fair value. Both of them are thereafter measured at amortized cost,using the effective interest rate method and including a loss allowance for impairment (see note 2(m)).

(o) Cash and cash equivalents
Cash and cash equivalents comprise bank deposits with original maturity within three months, cash atbanks and in hand, demand deposits with banks, and short-term, highly liquid investments that are readily
convertible into cash of known amounts and which are subject to an insignificant risk of changes in value,
having been within three months of maturity at acquisition.

(p) Accounts payable, accrued expenses and other payables
Accounts payable, accrued expenses and other payables are initially recognized at fair value. After initialrecognition, both of them are stated at amortized cost or invoiced amount if the effect of discounting
would be immaterial.

(q) Deferred revenue
A government grant related to an asset is recognized as deferred revenue and amortized over the usefullife of the related asset on a reasonable and systematic manner in other gains. A grant that compensates
the Group for expenses or losses to be incurred in the future is recognized as deferred revenue,
and included in other gains in the periods in which the expenses or losses are recognized. It shall berecognized in profit or loss immediately when as compensation for expenses or losses already incurred.

(r)Interest-bearing borrowings
Interest-bearing borrowings are recognized initially at fair value less directly attributable transaction costs.
Subsequent to initial recognition, interest-bearing borrowings are stated at amortized cost with any
difference between the amount initially recognized and redemption value being recognized in profit orloss over the period of the borrowings, together with any interest and fees payable, using the effective
interest method.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(s) Revenue recognition from contracts with customers
The Group mainly provides voice, data and other telecommunications services to its customers
through entering into contracts that are either cancellable on a monthly basis or for a fixed contract
period generally with prepayment term and/or penalty for early termination. The Group also sells
telecommunications related products to its customers.
For the telecommunications services and telecommunication related products and/or other services/
products provided by the Group, if the customer can benefit from the services or products and theGroup’s promise to transfer the services or products is separately identifiable, the Group identifies them as
separate performance obligations.
Revenue is measured at the transaction price which is the amount of consideration to which the Groupis entitled in exchange for transferring promised performance obligations to the customer excluding
amounts collected on behalf of third parties. The amount of consideration is generally explicitly stated in
the contract and does not include significant financing component.
When control of a service or product is transferred to a customer, revenue is generally recognized in
profit or loss as follows:(i)

Revenue for each performance obligation is recognized when the Group satisfies the performanceobligation by transferring the promised services or products to the customer. Generally, revenue
is recognized when the customer obtains the control of the telecommunications services over thetime of provision of the services. Revenue is recognized when a customer obtains the control of the
product at a point of time.

(ii)

For contracts which include the provision of multiple performance obligations including services andproducts, the Group allocates the transaction price to each performance obligation based on therelative stand-alone selling price. The stand-alone selling price of services and products are mainly
based on its observable selling price. If a stand-alone selling price is not directly observable, theGroup considers all information that is reasonably available and maximise the use of observable
inputs to estimate the stand-alone selling price. Revenue for each performance obligation is thenrecognized when the control of the promised services or products is transferred to the customer.

(iii)

The Group usually controls the services and the products it provided before they are transferredto the customer. In certain situations, the Group would consider the primary responsibilities in thearrangement, the establishment of selling price, and the inventory risks, etc. to determine if theGroup is acting as a principal or agent. If the Group has assessed and concluded that it does not
obtain the control of a specified product before transferring to the customer, the Group is acting as
agent in satisfying a performance obligation, and the revenue is recognized in the net amount of any
fee or commission to which it expects to be entitled from another party.

107

108

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(s) Revenue recognition from contracts with customers (Continued)
Contract assets primarily relate to the Group’s rights to consideration for services or products provided
to the customers but for which the Group does not have an unconditional right at the balance sheet date.
The contract asset is reclassified to accounts receivable as services are provided and billed.
Contract liabilities arise when the Group receives consideration in advance of providing the services or
products promised in the contract. Contract liabilities mainly comprise non-refundable prepaid service
fees received from customers, unredeemed point rewards under customer point reward program(“Reward Program”) and unused data traffic carried over. The refundable prepaid service fees received
from customers is recorded as receipts in advance.
Contract costs include costs incurred to obtain a contract and cost incurred to fulfil a contract. Costs
incurred to obtain a contract represents incremental costs incurred to obtain a contract, which mainlycomprise sales commissions payable to third party agents and are amortized on a systemic basis that is
consistent with the transfer to the customer of the services or products to which such costs relates overthe expected duration of the contract and recorded in selling expense, if it is expected to be recovered.
When the expected amortization period is one year or less, the Group utilizes the practical expedient andexpenses the costs as incurred. Capitalized incremental costs incurred to obtain a contract is recorded asother non-current assets.
Cost incurred to fulfil a contract represents the cost directly related to the Group’s telecommunications
service contracts which are not within the scope of another accounting standard. The amount isamortized on a systemic basis that is consistent with the transfer to the customer of the services or
products to which the costs incurred to fulfil a customer contract relates over the expected duration of
the contract and recorded as network operation and support expenses, if it is expected to be recovered.
Capitalized cost incurred to fulfil a contract is recorded as inventory or other non-current assets based on
its amortization period.

(t)Interest income
Interest income is recognized as it accrues using the effective interest method.

(u) Income tax
Income tax for the year comprises current tax and movements in deferred tax assets and liabilities.
Current tax and movements in deferred tax assets and liabilities are recognized in profit or loss except
items recognized in other comprehensive income or directly in equity, in which case the relevant amountsof tax are recognized in other comprehensive income or directly in equity, respectively.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous
years.
Deferred tax assets and liabilities arise from deductible and taxable temporary differences respectively,
being the differences between the carrying amounts of assets and liabilities for financial reporting
purposes and their tax bases. Deferred tax assets may also arise from unused tax losses and unused tax
credits.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(u) Income tax (Continued)
Apart from certain limited exceptions, all deferred tax liabilities, and all deferred tax assets to the extent
that it is probable that future taxable profits will be available against which the asset can be utilized,
are recognized. Future taxable profits that may support the recognition of deferred tax assets arisingfrom deductible temporary differences include those that will arise from the reversal of existing taxable
temporary differences, provided those differences relate to the same taxation authority and the same
taxable entity, and are expected to reverse either in the same period as the expected reversal of thedeductible temporary difference or in periods into which a tax loss arising from the deferred tax asset canbe carried back or forward. The same criteria are adopted when determining whether existing taxable
temporary differences support the recognition of deferred tax assets arising from unused tax losses andcredits, that is, those differences are taken into account if they relate to the same taxation authority andthe same taxable entity, and are expected to reverse in a period, or periods, in which the tax loss or credit
can be utilized.
The limited exceptions to recognition of deferred tax assets and liabilities are those temporary differences
arising from initial recognition of goodwill, the initial recognition of assets or liabilities that affect neither
accounting nor taxable profit (provided they are not part of a business combination), and temporary
differences relating to investments in subsidiaries and associates to the extent that, in the case of taxable
temporary differences, the Group controls the timing of the reversal and it is probable that the differences
will not reverse in the foreseeable future, or in the case of deductible differences, and it is not probablethat they will reverse in the future.
The Group recognized deferred tax assets and deferred tax liabilities separately in relation to its leaseliabilities and right-of-use assets.
The amount of deferred tax recognized is measured at the tax rates that are expected to apply to theperiod when the asset is realized or the liability is settled, based on tax rates enacted or substantively
enacted at the balance sheet date. Deferred tax assets and liabilities are not discounted.
The carrying amount of a deferred tax asset is reviewed at the end of each reporting period and isreduced to the extent that it is no longer probable that sufficient taxable profits will be available toallow the related tax benefit to be utilized. Any such reduction is reversed to the extent that it becomesprobable that sufficient taxable profits will be available.
Current tax balances and deferred tax balances, and movements therein, are presented separately fromeach other and are not offset. Current tax assets are offset against current tax liabilities, and deferred tax
assets against deferred tax liabilities, if the Group has the legally enforceable right to set off current tax
assets against current tax liabilities and the following additional conditions are met:–in the case of current tax assets and liabilities, the Group intends either to settle on a net basis, orto realize the asset and settle the liability simultaneously; or–in the case of deferred tax assets and liabilities, if they relate to income taxes levied by the same
taxation authority on either:–

the same taxable entity; or–different taxable entities, which, in each future period in which significant amounts of deferred
tax liabilities or assets are expected to be settled or recovered, intend to realize the current tax
assets and settle the current tax liabilities on a net basis or realize and settle simultaneously.

109

110

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(v) Provisions, contingent liabilities and onerous contracts(i)

Provisions and contingent liabilities
Provisions are recognized for liabilities of uncertain timing or amount when the Group has a legal orconstructive obligation arising as a result of a past event, it is probable that an outflow of economic
benefits will be required to settle the obligation and the amount can be estimated reliably. Where
the time value of money is material, provisions are stated at the present value of the expenditures
expected to settle the obligation.
Where it is not probable that an outflow of economic benefits will be required, or the amount cannot
be estimated reliably, the obligation is disclosed as a contingent liability, unless the probabilityof outflow of economic benefits is remote. Possible obligations, whose existence will only be
confirmed by the occurrence or non-occurrence of one or more future events, are also disclosed ascontingent liabilities unless the probability of outflow of economic benefits is remote.

(ii)

Onerous contracts
An onerous contract exits when the Group has a contract under which the unavoidable costs ofmeeting the obligations under the contract exceed the economic benefits expected to be received
from the contract. Provisions for onerous contracts are measured at the present value of the lowerof the expected cost of terminating the contract and the net cost of fulfilling the contract. The
cost of fulfilling the contract includes both the incremental costs of fulfilling that contract and an
allocation of other costs that relate directly to fulfilling that contract.

(w) Employee benefits(i)Short-term employee benefits and contributions to defined contribution retirement
plans
Salaries, annual bonuses, paid annual leave, leave passage, contributions to defined contribution
retirement plans and the cost of non-monetary benefits are accrued in the year in which theassociated services are rendered by employees. Where payment or settlement is deferred and theeffect would be material, these amounts are stated at their present values.
The Company and subsidiaries incorporated in Hong Kong are required to make contributions to
Mandatory Provident Funds under the Hong Kong Mandatory Provident Fund Schemes Ordinance.
Such contributions are recognized as an expense in profit or loss as incurred.
The employees of the subsidiaries in the mainland of China participate in the defined contribution
retirement plans managed by the local government authorities whereby the subsidiaries are
required to contribute to the schemes at fixed rates of the employees’ salary costs. In addition to
the local governmental defined contribution retirement plans, the subsidiaries also participate in a
pension scheme launched by the Group managed by an independent insurance company whereby
the subsidiaries are required to make contributions to the retirement plans at fixed rates of theemployees’ salary costs or in accordance with the terms of the plans. The Group’s contributions
to these plans are charged to profit or loss when incurred. During the reporting period, no forfeitedcontributions were used by the Group to reduce the existing level of contributions.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(w) Employee benefits (Continued)(ii)

Supplementary retirement benefits
In addition to participating in local governmental defined contribution social insurance, the Groupalso provides other post retirement supplementary retirement benefits to those retired employees
qualified for certain criteria in accordance with the governmental requirement since 2020. Under
such plan, the Group provides or reimburses certain medical benefits to retired employees
annually based on certain criteria. The Group’s payment obligation in the future under such planare discounted and recognized as liabilities, the costs of which are recognized in profit or loss.
Changes arising from remeasurement of the liability due to changes in the actuarial assumptions arerecognized in other comprehensive income when incurred.

(iii) Share-based payments
The fair value of share options granted to employees is recognized as an employee cost with acorresponding increase in a capital reserve within equity. The fair value is measured at grant dateusing the binomial lattice model, taking into account the terms and conditions upon which theoptions were granted. Where the employees have to meet vesting conditions before becoming
unconditionally entitled to the options, the total estimated fair value of the options is spread overthe vesting period, taking into account the probability that the options will vest.
During the vesting period, the number of share options that is expected to vest is reviewed at eachbalance sheet date. Any resulting adjustment to the cumulative fair value recognized in prior years is
recognized in profit or loss for the year of the review, unless the original employee expenses qualify
for recognition as an asset, with a corresponding adjustment to the capital reserve. On vesting date,
the amount recognized as an expense is adjusted to reflect the actual number of share options thatvest (with a corresponding adjustment to the capital reserve). The equity amount is recognized in
the capital reserve until either the option is exercised (when it is transferred to the share capital
account) or the option expires (when it is released directly to retained profits). In the Company’sbalance sheet, share-based payment transactions in which the Company grants share options to
subsidiaries’ employees are accounted for as an increase in value of investments in subsidiaries,
which is eliminated in consolidated financial statements.

(iv) Termination benefits
Termination benefits are recognized when, and only when, the Group demonstrably commits itself
to terminate employment which is without realistic possibility of withdrawal or to provide benefits asa result of voluntary redundancy by having a detailed formal plan which is without realistic possibilityof withdrawal.

111

112

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(x) Borrowing costs
Borrowing costs that are directly attributable to the acquisition, construction or production of anasset which necessarily takes a substantial period of time to get ready for its intended use or sale arecapitalized as part of the cost of that asset. Other borrowing costs are expensed in the period in which
they are incurred.
The capitalization of borrowing costs as part of the cost of a qualifying asset commences when
expenditure for the asset is being incurred, borrowing costs are being incurred and activities that arenecessary to prepare the asset for its intended use or sale are in progress. Capitalization of borrowing
costs is suspended or ceased when substantially all the activities necessary to prepare the qualifying asset
for its intended use or sale are interrupted or completed.

(y) Translation of foreign currencies
The functional currency of majority of the entities within the Group is RMB, which is the currency of the
primary economic environment in which most of the Group’s entities operate. The Group adopted RMB
as its presentation currency in the preparation of the consolidated financial statements, which is also thefunctional currency of the Company.
Foreign currency transactions during the year are translated at the foreign exchange rates ruling at thetransaction dates. Monetary assets and liabilities denominated in currencies other than the functional
currency are retranslated at the foreign exchange rates ruling at the balance sheet date. Exchange gains
and losses are recognized in profit or loss. Non-monetary assets and liabilities that are measured interms of historical cost in a foreign currency are translated using the foreign exchange rates ruling at
the transaction dates. Non-monetary assets and liabilities denominated in foreign currencies that arestated at fair value are translated using the foreign exchange rates ruling at the dates the fair value wasdetermined.
The results of overseas entities are translated into RMB at the exchange rates approximating theforeign exchange rate ruling at the dates of transactions. Assets and liabilities are translated into RMB
at the exchange rates ruling at the balance sheet date. The resulting currency translation differences
are recognized in other comprehensive income and accumulated separately in equity in the exchange
reserve. On disposal of an overseas entity, the cumulative amount of the currency translation differences
relating to that particular foreign operation is reclassified from equity to profit or loss.
For the purpose of the consolidated statement of cash flows, the cash flows of overseas entities within
the Group are translated into RMB by using the exchange rates approximating the foreign exchange rateruling at the dates of the cash flows.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(z) Related parties
(a)

(b)

A person, or a close member of that person’s family, is related to the Group if that person:(i)has control or joint control of the Group;(ii)

has significant influence over the Group; or(iii)

is a member of the key management personnel of the Group or the Group’s parent.

An entity is related to the Group if any of the following conditions applies:(i)

The entity and the Group are members of the same group (which means that each parent,
subsidiary and fellow subsidiary is related to the others);(ii)

One entity is an associate or joint venture of the other entity (or an associate or joint ventureof a member of a group of which the other entity is a member);(iii)

Both entities are joint ventures of the same third party;(iv)

One entity is a joint venture of a third entity and the other entity is an associate of the third
entity;(v)

The entity is a post-employment benefit plan for the benefit of employees of either the Groupor an entity related to the Group;(vi)

The entity is controlled or jointly controlled by a person identified in note 2(z)(a); or(vii)

A person identified in note 2(z)(a)(i) has significant influence over the entity or is a member of
the key management personnel of the entity (or of a parent of the entity).

Close members of the family of a person are those family members who may be expected to influence,or be influenced by, that person in their dealings with the entity.

113

114

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

2

MATERIAL ACCOUNTING POLICIES (CONTINUED)(aa) Segment reporting
An operating segment is a component of the Group that engages in business activities from which theGroup may earn revenue and incur expenses, and is identified on the basis of the internal financial reportsthat are provided to and regularly reviewed by the Group’s Chief Operating Decision Maker (“CODM”) inorder to allocate resources and assess performance of the segment. The CODM has been identified as
the Executive Directors of the Company. For the years presented, the Group as a whole is an operating
segment since the Group is only engaged in telecommunications and information related businesses.
No geographical information has been disclosed as the majority of the Group’s operating activities arecarried out in the mainland of China. The Group’s assets located and operating revenue derived from
activities outside the mainland of China are less than 5% of the Group’s assets and operating revenue,
respectively.

(ab) Dividend distribution
Dividend distribution to the Company’s shareholders is recognized as a liability in the Group’s and theCompany’s financial statements in the period in which the dividends are approved by the Company’s
shareholders or directors, where appropriate.

3

CHANGES IN ACCOUNTING POLICIESThe following new and amended IFRSs/HKFRSs are mandatory for the first time for the Group’s financial year
beginning on 1 January 2023 and are applicable for the Group:•

IFRS/HKFRS 17, Insurance contracts•

Amendments to IAS/HKAS 8, Accounting policies, changes in accounting estimates and errors: Definitionof accounting estimates•

Amendments to IAS/HKAS 1, Presentation of financial statements and IFRS/HKFRS Practice Statement 2,
Making materiality judgements: Disclosure of accounting policies•

Amendments to IAS/HKAS 12, Income taxes: Deferred tax related to assets and liabilities arising from asingle transaction•

Amendments to IAS/HKAS 12, Income taxes: International tax reform – Pillar Two model rules

The adoption of the above new and amended IFRSs/HKFRSs effective for the financial year beginning on 1
January 2023 does not have a material impact on the Group. Among which, impacts of the adoption of theamendments to IAS/HKAS 12, Income taxes: Deferred tax related to assets and liabilities arising from a single
transaction are discussed below:
Prior to the amendments, the Group did not apply the initial recognition exemption to lease transactions andhad recognized the related deferred tax, except that the Group previously determined the temporary difference
arising from a right-of-use asset and the related lease liability on a net basis on the basis they arise from asingle transaction. Following the amendments, the Group has determined the temporary differences in relation
to right-of-use assets and lease liabilities separately, and the associated deferred tax assets and liabilities are
required to be recognized from the beginning of the earliest comparative period presented, with any cumulative
effect recognized as an adjustment to retained earnings or other components of equity at that date. Thechange primarily impacts disclosures of components of deferred tax assets and liabilities in note 23, but does
not impact the overall deferred tax balances or retained earnings/other components of equity presented in the
consolidated balance sheet as the related deferred tax balances qualify for offsetting under IAS/HKAS 12.
In addition, the IASB and HKICPA also published a number of new standards and amendments to standards
which are effective for the Group’s financial year beginning on or after 1 January 2024 and have not been early
adopted by the Group (see note 47). Management is assessing the impact of such standards and will adopt therelevant standards in the subsequent periods as required.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

4

RE-PRESENTATION OF CERTAIN ITEMS IN CONSOLIDATED BALANCE SHEETFor the year ended 31 December 2023, to better reflect the function or nature of items within the Group andto better align the financial information the Group presents in two different markets in which the Company’s
shares are listed, the Group has re-presented certain line items in its consolidated balance sheet. Comparative
figures in the consolidated balance sheet and the consolidated statement of cash flows have also been
re-presented to conform to the presentation for the year. Such re-presentation did not have any impact on theGroup’s total amount of non-current/current assets, non-current/current liabilities, equity as at 31 December
2022, and the profit or loss, total comprehensive income and cash flows for the year then ended.
The following table highlights the impact from the aforesaid changes on certain line items in the Group’s
consolidated balance sheet as at 31 December 2022.

Consolidated Balance Sheet (Extracted)

AssetsNon-current assets
Property, plant and equipment
Development expenditure
Other intangible assets
Current assets
Bills receivable
Prepayments
Other non-financial assets
Prepayments and other current assets
Accounts receivable
Other receivables
Amount due from ultimate holding company
Liabilities
Current liabilities
Accounts payable and accrued expenses
Other payables
Receipts in advance
Accounts payable
Accrued expenses and other payables
Amount due to ultimate holding company
Non-current liabilities
Defined benefit plan and other employee benefit liabilities
Other non-current liabilities

Note

31 December
2022
Million(As previously
reported)

(i)
(i)
(i)

741,029–
8,691(23,908)
1,334
22,574

717,121
1,334
31,265

749,720–

749,720–––
26,25740,245
12,838
2,537

777
7,040
18,440(26,257)2,512
25(2,537)777
7,040
18,440–42,757
12,863–81,877–

81,877–––
156,536
225,576
20,136271,306
46,49684,446(156,536)(225,576)(20,136)

271,306
46,49684,446–––402,248–402,248

–
7,656

5,951
(5,951)

5,951
1,705

7,656

–

7,656

(ii)
(ii)
(ii)
(ii)
(iii)
(iii)
(iii)

(iii), (iv)
(iii), (iv)
(iv)
(iv)
(iv)
(iii)

(v)
(v)

Re-presentation
Million

31 December
2022
Million(As
re-presented)

115

116

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

4

RE-PRESENTATION OF CERTAIN ITEMS IN CONSOLIDATED BALANCE SHEET(CONTINUED)
Consolidated Balance Sheet (Extracted) (Continued)
Note:
(i)

Certain immaterial items previously included in “property, plant and equipment” have been disaggregated and re-presented to “otherintangible assets” to better reflect their function or nature within the Group.
Capitalized expenditure arising from development projects in progress previously included within “other intangible assets”, has beendisaggregated and presented separately.

(ii)

Items previously included in “prepayments and other current assets” have been disaggregated to separately present “bills receivable”
and “prepayments”, with the remaining items included in “other non-financial assets”.

(iii)

Trade-related balances previously included in “amount due from/to ultimate holding company” have been aggregated with other traderelated receivables and payables such that “accounts receivable”/“accounts payable and accrued expenses” now include all receivables
or payables/accruals of trading nature.

(iv)

Accrued expenses have been re-presented and aggregated with account payables as “accounts payable and accrued expenses”, which
now comprise all liabilities related to purchases irrespective of whether invoices have been received.
“Receipts in advance”, previously included in “accrued expenses and other payables” and primarily comprised refundable customer
deposits, have been separately presented.
Apart from the above, the remaining amount of “accrued expenses and other payables” were included in “other payables”.

(v)

5

The non-current portion of defined benefit plan and other employee benefit liabilities previously included in “other non-current liabilities”
have been presented separately.

OPERATING REVENUE

Revenue from telecommunications services
Voice services
SMS & MMS services
Wireless data traffic services
Wireline broadband services
Applications and information services
Others

Revenue from sales of products and others

2023
Million2022
Million72,25831,106
394,797
118,768
221,642
24,94375,032
31,344395,933
105,030
182,461
22,258863,514812,058

145,795

125,201

1,009,309

937,259

The majority of the Group’s operating revenue is from contracts with customers, and the remaining is notmaterial. The revenue recognition policy has been disclosed in note 2(s), while majority of the Group’s revenue
from contracts with customers was recognized over time.
Operating revenue is subject to value-added tax (“VAT”). The VAT rate for basic telecommunications services is
9%. The VAT rate for value-added telecommunications services, information technology services and technicalconsulting services is 6% and the VAT rate for sales of telecommunications terminals is 13%. VAT is excluded
from the revenue.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

5

OPERATING REVENUE (CONTINUED)
The unsatisfied performance obligation of the Group is mainly related to telecommunications services.
The Group generally enters into service contracts with customers monthly or for a fixed term, and bills thecustomers monthly based on the contract terms for the Group’s unconditional right to consideration. Majorityof the transaction considerations that were allocated to unsatisfied performance obligations as at the end of thereporting period are expected to be recognized within one year when services are provided. For the contracts
that have an original expected duration of one year or less and the performance obligations which are regarded
as satisfied as billed, the Group has applied the practical expedient permitted under IFRS/HKFRS 15 “Revenue
from Contracts with Customers”, therefore, the information about the remaining performance obligations were
not disclosed.

6

NETWORK OPERATION AND SUPPORT EXPENSES
Note
Maintenance, operation support and related expenses
Power and utilities expenses
Charges for use of tower assets
Charges for use of lines, network and other assets
Others(i)(iii)(ii)(iii)

2023
Million2022
Million175,551
41,79924,866
18,4158,264

161,277
39,841
26,262
16,458
10,344

268,895

254,182

Note:

7

(i)

Charges for use of tower assets include the non-lease components charges (maintenance, certain ancillary facilities usage and related
support services) for use of telecommunications towers and variable lease payments not based on an index or a rate, which arerecorded in profit or loss as incurred.

(ii)

Charges for use of lines, network and other assets mainly include the non-lease components charges and the lease components
charges for lease contracts that are exempted from recognition of right-of-use assets and lease liabilities, such as short-term lease
payments, lease payments of low-value assets and variable lease payments not based on an index or a rate, which are recorded in profit
or loss as incurred.

(iii)

For the year ended 31 December 2023, short-term lease payments and lease payments of low-value assets amounted to RMB9,950
million (2022: RMB7,081 million), and variable lease payments not based on an index or a rate (mainly about the lease of tower assets),
which are recorded in profit or loss as incurred, amounted to RMB6,058 million (2022: RMB6,743 million).

EMPLOYEE BENEFIT AND RELATED EXPENSES

Salaries, wages, labor service expenses and other benefits
Retirement costs: contributions to defined contribution retirement plans
Share-based compensation expenses

2023
Million2022
Million125,411
18,205717

113,018
16,728411

144,333

130,157

Since 2020, the Group has implemented the transfer of the socialized management of existing retirees toexternal organizations in accordance with the governmental requirement. The Group is also obliged to pay
for certain of such retirees’ post-retirement benefits (mainly including supplementary medical benefits, etc.)
in the future with the principle that the level of such benefits would not be decreased. This benefit plan is
accounted for as a long-term defined benefits obligation and does not have any plan assets. As at the end of
the reporting period, the Group engaged an independent qualified actuary to calculate the Group’s obligation
for this benefit plan using the projected unit credit method, and such obligation was recognized as liability.
Actuarial assumptions mainly included discount rate and life expectancy. For the year ended 31 December
2023, the discount rate was 2.75% per annum (2022: 3.00%). Life expectancy was determined in accordancewith relevant information on the “China Life Insurance Mortality Table (2010-2013) – CL5/CL6”. Reasonablechanges in actuarial assumptions would not have a significant impact on the consolidated financial statementsof the Group.

117

118

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

7

EMPLOYEE BENEFIT AND RELATED EXPENSES (CONTINUED)
The movement of defined benefit plan liabilities is as follows:

82023
Million2022
MillionAs at 1 January

6,282

5,814

Defined benefit costs included in profit or loss
– service cost
– interest cost
Actuarial losses/(gains) included in other comprehensive income
Payments during the year

508
164
184
(357)

631
150
(15)
(298)

As at 31 December

6,781

6,282

2023
Million2022
Million24,867
9,227
246
216

22,359
4,453
234
284

390
6,815

892
6,149

86
1
3,071
14,40088
2
2,898
14,05059,31951,409OTHER OPERATING EXPENSES
Note
Interconnection
Expected credit impairment losses
Write-down of inventories
Impairment losses of contract assets
Net loss on disposal and write-off of property,
plant and equipment and other intangible assets
Co-research and development expenses
Auditors’ remuneration– audit services– other services
Taxes and surcharges
Others

(i)

(ii)

Note:
(i)

The item (excluding VAT) includes service fees for audit of the Group’s internal controls over financial reporting pursuant to regulatory
requirements amounted to RMB16 million (2022: RMB16 million).

(ii)

Others consist of administrative expenses and other miscellaneous expenses.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

9

OTHER GAINS

Compensation income
Additional deduction of input VAT
Others2023
Million2022
Million

1,233
4,431
4,159

1,151
4,223
4,014

9,823

9,388

2023
Million2022
Million

7,332
13,802

10,775
4,954

21,134

15,7292023
Million2022
Million

3,512
40
178

2,101
65
164

3,730

2,330

10 INTEREST AND OTHER INCOME

Interest income
Net gains on hold/disposal of financial assets

11 FINANCE COSTS

Interest for lease liabilities
Interest for short-term deposits received (note 41(a))
Others119

120

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

12 DIRECTORS’ AND OTHER SENIOR MANAGEMENT’S REMUNERATION
Directors’ remuneration during 2023 is as follows:
Contributions
relating
to social
insurance,
housingfund andSalaries,
retirement
allowances
Directors’
schemefees and bonuses
’000
’000
’000
Executive directors (Expressed in RMB)YANG Jie
DONG Xin*
LI Pizheng
LI Ronghua
Independent non-executive directors(Expressed in Hong Kong dollar)
YIU Kin Wah, Stephen
YANG Qiang
LEE Ka Sze, Carmelo
LEUNG Ko May Yee, Margaret

*

2023
Total
’000

–
–
–
–

961
961
890
869

244
244
235
234

1,205
1,205
1,125
1,103

–

3,681

957

4,638

490
–
440
440

–
–
–
–

–
–
–
–

490
–
440
440

1,370

–

–

1,370

On 11 January 2024, Mr. Dong Xin resigned from his positions as an Executive Director and the Chief Executive Officer of the Company

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

12 DIRECTORS’ AND OTHER SENIOR MANAGEMENT’S REMUNERATION(CONTINUED)
Directors’ remuneration during 2022 is as follows:

Executive directors (Expressed in RMB)YANG Jie
DONG Xin
LI Pizheng*
LI Ronghua
WANG Yuhang**
Independent non-executive directors(Expressed in Hong Kong dollar)
YIU Kin Wah, Stephen
YANG Qiang
LEE Ka Sze, Carmelo***
LEUNG Ko May Yee, Margaret***CHENG Mo Chi, Moses****CHOW Man Yiu, Paul*****

Directors’
fees
’000

Salaries,
allowancesand bonuses’000

Contributions
relating
to social
insurance,
housingfund andretirement
scheme
’000

–
–
–
–
–

952
952
405
850
536

229
229
167
219
92

1,181
1,181
572
1,069
628

–

3,695

936

4,631

483
–
273
273
176
174

–
–
–
–
–
–

–
–
–
–
–
–

483
–
273
273
176
174

1,379

–

–

1,379

2022
Total
’000

*

On 18 May 2022, Mr. Li Pizheng was appointed as an Executive Director of the Company**

On 19 April 2022, Mr. Wang Yuhang resigned from his position as an Executive Director of the Company***

On 18 May 2022, Mr. Carmelo Lee Ka Sze and Mrs. Margaret Leung Ko May Yee were appointed as an Independent Non-Executive
Director****

On 18 May 2022, Dr. Moses Cheng Mo Chi resigned from his position as an Independent Non-Executive Director***** On 18 May 2022, Mr. Paul Chow Man Yiu resigned from his position as an Independent Non-Executive Director

In 2023 and 2022, the Company’s executive director and independent non-executive director Dr. YANG Qiang
voluntarily waived their directors’ fees.
Directors’ and other senior management’s remuneration paid during 2023 included basic remuneration forthe year, performance related bonuses for previous years determined and paid during the year. The unpaid
portion of performance related bonuses for 2023 will be determined, accrued and paid in 2024 based on theirperformance, and the additional bonuses related to their term of service will be determined, accrued and paid
based on their performance upon the completion of three-year evaluation period from 2022 to 2024.
In 2023, the Company’s other senior management’s remuneration was within the range between RMB650,000
to RMB1,150,000 (2022: RMB1,050,000 to RMB1,100,000).
In 2022, the Company also settled the additional bonuses related to executive directors and other senior
management’s term of service for the three-year period from 2019 to 2021, including RMB754 thousandfor Mr. YANG Jie, RMB758 thousand for Mr. DONG Xin, RMB302 thousand for Mr. LI Ronghua, RMB678
thousand for Mr. WANG Yuhang (resigned) and the range between RMB450 thousand to RMB750 thousandfor other senior management.

121

122

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

13 INDIVIDUALS WITH HIGHEST EMOLUMENTS
For the year ended 31 December 2023 and 2022, none of the five individuals with the highest emolumentsin the Group are directors or other senior management. The emoluments payable to the five individuals withhighest emoluments are as follows:

Salaries, allowances and benefits in kind
Performance related bonuses
Retirement scheme contributions

2023
’000

2022
’000

6,390
5,302
431

6,882
6,162
396

12,123

13,4402023
Number ofindividuals

2022
Number ofindividuals

4
–
1
–

3
1
–
1

The emoluments fell within the following bands:

Emolument bands
2,000,001–2,500,000
2,500,001–3,000,000
3,000,001–3,500,000
3,500,001–4,000,000Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

14 TAXATION(a) Taxation in the consolidated statement of comprehensive income represents:

Current tax
Provision for enterprise income tax in the mainland of
China and other countries and regions on the estimatedassessable profits for the year
Provision for Hong Kong profits tax on the estimatedassessable profits for the year

Deferred tax
Origination and reversal of temporary differences, net(note 23)

Note

2023
Million2022
Million(i)

41,22137,066

(ii)

585

489

41,80637,555(3,210)(277)

38,59637,278Note:(i)

The provision for enterprise income tax in the mainland of China and other countries and regions has been calculated on theestimated assessable profits for the year at the rates of taxation prevailing in the regions in which the Group operates. The
Company’s subsidiaries operate mainly in the mainland of China. The provision for the PRC enterprise income tax is based on thestatutory tax rate of 25% (2022: 25%) on the estimated assessable profits determined in accordance with the relevant income
tax rules and regulations of the PRC for the year ended 31 December 2023. Certain subsidiaries of the Company entitle to thepreferential tax rate of 15% (2022: 15%). Also certain research and development costs of the Company’s PRC subsidiaries are
qualified for 100% additional deduction since 30 September 2022 (Before 30 September 2022: 75%) for tax purpose.

(ii)

The provision for Hong Kong profits tax is calculated at 16.5% (2022: 16.5%) of the estimated assessable profits for the year
ended 31 December 2023.

(iii)

Pursuant to the “Notice regarding Matters on Determination of Tax Residence Status of Chinese-controlled Offshore
Incorporated Enterprises under Rules of Effective Management” issued by SAT in 2009 (“2009 Notice”), the Company
is qualified as a PRC offshore-registered resident enterprise. Accordingly, the dividend income of the Company from its
subsidiaries in the PRC is exempted from PRC enterprise income tax.

123

124

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

14 TAXATION (CONTINUED)(b) Reconciliations between income tax expense and accounting profit at applicable tax
rates:

Profit before taxation

2023
Million2022
Million170,531

162,872

42,63340,718(2,087)(246)
1,392(2,646)(2,738)(51)
1,384(2,517)

1,332

1,462

(1,782)(980)

38,59637,278

Notional tax on profit before tax, calculated at the PRC’s statutory tax
rate of 25% (Note)
Tax effect of non-taxable items– Income from investments accounted for using the equity method– Other non-taxable income
Tax effect of non-deductible expenses
Tax rate differential (note 14(a)(i)(ii))
Tax effect of deductible temporary difference and deductible tax loss
for which no deferred tax asset was recognized (note 23)
Additional deduction for qualified research and development costs(note 14(a)(i))
Taxation

Note: The PRC’s statutory tax rate is adopted as the majority of the Group’s operations are subject to this rate.

(c) The tax charged relating to components of other comprehensive income is asfollows:

Changes in value of financial assets
measured at FVOCI
Remeasurement of defined benefit
liabilities
Currency translation differences
Share of other comprehensive
income/(loss) of investments
accounted for using the equity
methodOther comprehensive income
Current tax
Deferred tax

Before tax
Million2023
Tax charged
Million

After tax
Million

Before tax
Million2022
Tax charged
Million

After tax
Million

205

(4)

201

(222)

(4)

(226)

(184)
573

–
–

(184)
573

15
2,575

–
–

15
2,575

922

–

922

(1,105)–(1,105)

1,516

(4)

1,512

1,263

(4)

1,259

–
(4)

–
(4)

(4)

(4)

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

15 EARNINGS PER SHARE(a) Basic earnings per share
The calculation of basic earnings per share for the year ended 31 December 2023 is based on the profit
attributable to equity shareholders of the Company of RMB131,766 million (2022: RMB125,459 million)
and the weighted average number of 21,376,288,436 shares (2022: 21,346,920,449 shares) in issueduring the year.

(b) Diluted earnings per share
For the year ended 31 December 2023 and 2022, the Group has considered the impact from the following
factors when calculating diluted earnings per share:(i)Convertible bonds issued by an associate of the Group (“CB”) that were outstanding during theyears (note 24);

(ii)

Share options issued by the Company that were outstanding during the years (note 38);

(iii)

The RMB Shares publicly offered but had yet to be listed on the SHEX during the preceding year (note39); and(iv)

The over-allotment option that was outstanding during the preceding year (note 39).

Of the above, the first two factors had dilutive effects for the year ended 31 December 2023 but not
2022. In particular, (i) the assumed conversion of the CB would have decreased the profit attributable
to equity shareholders of the Company (for the year ended 31 December 2022: increased), and (ii) tothe extent that the performance conditions would have been satisfied if the end of the year were theend of the performance period, the exercise price of the relevant share options were below the average
market price of the Company’s ordinary shares on the HKEX during the period those share options were
outstanding (for the year ended 31 December 2022: above).
The third factor had no dilutive effect during the preceding year, as (iii) the offer price of the RMB Shares
was not lower than its fair value during the period from the beginning of the preceding year to thecompletion date of the listing on the SHEX.
The fourth factor had a dilutive effect during the preceding year, as (iv) the exercise price of the overallotment option was lower than the average market price of the RMB Shares during the exercisable
period.

125

126

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

15 EARNINGS PER SHARE (CONTINUED)(b) Diluted earnings per share (Continued)
For the year ended 31 December 2023, the calculation of diluted earnings per share is based on the profit
attributable to equity shareholders of the Company of RMB131,699 million and the weighted average
number of 21,408,818,755 shares in issue after adjusting for the effect of all dilutive potential ordinary
shares during the year.
(i)

Profit attributable to ordinary equity shareholders of the Company (diluted)
2023
MillionProfit attributable to equity shareholders of the Company used in calculating
basic earnings per share
Add: changes in share of profit of the associate
Less: fair value gain and interest income relating to the CB held by the Group,
net of tax
Profit attributable to equity shareholders of the Company used in calculating diluted
earnings per share(ii)

131,766254(321)
131,699

Weighted average number of ordinary shares (diluted)
2023
Numberof shares
Weighted average number of shares in issue during the year
Dilutive equivalent shares arising from share options

21,376,288,436
32,530,319

Weighted average number of shares (diluted) during the year

21,408,818,755

For the year ended 31 December 2022, the calculation of diluted earnings per share is based on the profit
attributable to equity shareholders of the Company of RMB125,459 million and the weighted average
number of 21,346,970,167 shares in issue after adjusting for the effect of all dilutive potential ordinary
shares during the year. As the dilutive effect on earnings per share resulting from the assumed exerciseof over-allotment option was negligible, therefore diluted earnings per share were the same as basic
earnings per share.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

16 PROPERTY, PLANT AND EQUIPMENT
Telecommunicationstransceivers,
switching centers,
transmission andother network
equipment
Buildings
MillionMillion(Re-presented)(Re-presented)

Office equipment,
furniture,
fixturesand others
Million(Re-presented)

Total
Million(Re-presented)

Cost:
166,220

1,780,394

17,038

1,963,652

5,480
365
(384)
357

165,735
159(36,282)
831

920
331
(1,339)14

172,135855(38,005)
1,202

172,038

1,910,837

16,9642,099,839

As at 1 January 2022

63,627

1,185,800

12,248

1,261,675

Charge for the year
Disposals and write-off
Exchange differences

6,201
(319)
83

149,478(34,935)
334

1,463(1,272)
10

157,142(36,526)427

As at 31 December 2022

69,5921,300,677

12,4491,382,718

102,446

610,160

4,515

717,121

As at 1 January 2022
Transferred from construction in progress
Other additions
Disposals and write-off
Exchange differences
As at 31 December 2022
Accumulated depreciation and impairment:

Net book value:
As at 31 December 2022

127

128

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

16 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Telecommunicationstransceivers,
switching centers,
transmission andother network
equipment
Buildings
MillionMillion

Office equipment,
furniture,
fixturesand others
Million

Total
MillionCost:
As at 1 January 2023

172,038

1,910,837

16,9642,099,839

Transferred from construction in progress
Other additions
Disposals and write-off
Exchange differences

5,215
65
(1,020)111

154,243
328(51,155)
257

1,170
498
(1,348)3

160,628891(53,523)371

As at 31 December 2023

176,4092,014,510

17,2872,208,206

As at 1 January 2023

69,5921,300,677

12,4491,382,718

Charge for the year
Disposals and write-off
Exchange differences

6,225
(379)
21

154,827(50,223)
104

1,525(1,277)
2

162,577(51,879)
127

As at 31 December 2023

75,4591,405,385

12,6991,493,543

100,950

609,125

4,588

714,663

Accumulated depreciation and impairment:

Net book value:
As at 31 December 2023

As disclosed in note 22(c), in accordance with the collaboration agreements with China Broadcasting Network
Corporation Ltd. (“CBN”), without consent from the other party, any party may not dispose of (includingtransfer, mortgage or pledge) its ownership in all or any 700MHz wireless network assets (including but notlimited to base stations, antennas and essential wireless ancillary equipment) within the scope of collaboration.
As at 31 December 2023, the aforesaid assets amounted to RMB53,237 million and RMB3,202 million were
included in property, plant and equipment and construction in progress, respectively (As at 31 December 2022:
RMB43,949 million and RMB4,276 million).

17 CONSTRUCTION IN PROGRESSAs at 1 January
Additions
Transferred to property, plant and equipment and other intangible assets
As at 31 December

2023
Million2022
Million73,087
173,476(172,067)

71,742
181,143(179,798)

74,49673,087

Construction in progress primarily comprises expenditure incurred on the network expansion projects but not
yet completed.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

18 LEASES
This note provides lease information about the Group as a lessee.

(a) Right-of-use assets
Telecommunications
Towers andrelated assets
Million

Buildings andpremisesMillion

OthersMillion

Total
MillionAs at 1 January 2022

89,01849,242

5,395

143,655

Additions
Decreases
Exchange differences

67,776(6,441)–

11,889(11,579)
130

8,675(2,778)–88,340(20,798)130

As at 31 December 2022

150,353

49,682

11,292

211,327

As at 1 January 2022

59,55526,0772,673

88,305Additions
Decreases
Exchange differences

17,242(4,504)–

8,986(8,711)75

3,309(2,124)–29,537(15,339)75

As at 31 December 2022

72,293

26,427

3,858

102,578

78,06023,255

7,434

108,749

Cost:

Accumulated amortization andimpairment:

Net book value:
As at 31 December 2022

129

130

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

18 LEASES (CONTINUED)(a) Right-of-use assets (Continued)
Telecommunications
Towers andrelated assets
Million

Buildings andpremisesMillion

OthersMillion

Total
MillionAs at 1 January 2023

150,353

49,682

11,292

211,327

Additions
Decreases
Exchange differences

8,526(7,833)–9,684(8,563)36

3,500(2,089)–21,710(18,485)36

As at 31 December 2023

151,046

50,83912,703

214,588

As at 1 January 2023

72,293

26,427

3,858

102,578

Additions
Decreases
Exchange differences

16,657(3,378)–9,056(7,704)12

3,951(1,337)–

29,664(12,419)
12

As at 31 December 2023

85,572

27,791

6,472

119,835

65,47423,0486,231

94,753

Cost:

Accumulated amortization andimpairment:

Net book value:
As at 31 December 2023

On 13 December 2022, the board of the Company approved the entering into by China Mobile
Communication Co., Ltd. (“CMC”) with China Tower Corporation Limited (“China Tower”) of theCommercial Pricing Agreement and the Service Agreement, each for a term of five years from 1 January2023 to 31 December 2027, which was accounted for as lease modification. As at 31 December 2022,
the Group has recognized the related lease liabilities and the corresponding additions of right-of-use
assets amounting to RMB59,112 million based on the new lease terms. Subsequently, CMC entered into
those agreements with China Tower after the resolution were approved during the extraordinary general
meeting of the Company on 11 January 2023.
Pursuant to the Commercial Pricing Agreement and the Service Agreement, China Tower will continue
to lease telecommunications towers and provide other related services to CMC’s subsidiaries. Based onthese agreements, negotiation was done at the provincial level about the specific assets to be leased andrelated services to be provided, and provincial service agreements have been entered into.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

18 LEASES (CONTINUED)(b) Land use rights
For the year ended 31 December 2023, the amortization of land use rights expensed in the profit or loss
amounted to RMB483 million (2022: RMB472 million).

(c) Lease liabilities
For the year ended 31 December 2023, lease liabilities of RMB15,375 million (2022: RMB82,503 million)
was incurred relating to additions of right-of-use assets.
As at 31 December 2023 and 2022, the maturity analysis of lease liabilities was set out in note 42(b).

19 GOODWILL
2023
Million2022
MillionAs at 1 January
Impairment

35,301–35,344(43)

As at 31 December

35,30135,301

Impairment tests for goodwill
As at 31 December 2023, the goodwill is mainly attributable to the cash-generating units in relation to theoperation in the mainland of China which management currently monitors. The recoverable amount of the cashgenerating unit is determined based on the VIU calculations by using the discounted cash flow method. Thismethod considers the pre-tax cash flows of the subsidiaries (cash-generating unit) for the five years ending
31 December 2028 and the projected perpetual cash flows after the fifth year. For the five years ending 31
December 2028, the average growth rate is assumed to be 1.5%, while for the years beyond 31 December
2028, the assumed continual growth rate to perpetuity is 1%. The present value of cash flows is calculatedby discounting the cash flow using pre-tax discount rate of approximately 11%. The management performed
impairment test for the goodwill in relation to the operation in the mainland of China and determined such
goodwill was not impaired. Reasonably possible changes in key assumptions would not lead to the goodwill
impairment losses.
In addition, an impairment provision has been made by a subsidiary of the Group against goodwill arising fromacquisition in previous years amounted to RMB43 million in 2022.

131

132

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

20 OTHER INTANGIBLE ASSETS
SoftwareMillion(Re-presented)

OthersMillion(Re-presented)

Total
Million(Re-presented)

As at 1 January 2022

85,691

16,542102,233

Additions
Disposals
Exchange differences

10,985(1,919)25

5,717(4,381)476

16,702(6,300)501

As at 31 December 2022

94,782

18,354

113,136

As at 1 January 2022

64,3639,290

73,653Charge for the year
Written back on disposals
Exchange differences

8,318(1,817)10

4,857(3,315)165

13,175(5,132)175

As at 31 December 2022

70,874

10,997

81,871

23,9087,357

31,265

SoftwareMillion

OthersMillion

Total
MillionAs at 1 January 2023

94,782

18,354

113,136

Additions
Disposals
Exchange differences

12,081(7,817)
6

4,273(3,091)
85

16,354(10,908)91

As at 31 December 2023

99,052

19,621

118,673

As at 1 January 2023

70,874

10,997

81,871

Charge for the year
Written back on disposals
Exchange differences

9,539(7,679)3

5,202(3,014)31

14,741(10,693)34

As at 31 December 2023

72,737

13,21685,953

26,315

6,405

32,720

Cost:

Accumulated amortization and impairment:

Net book value:
As at 31 December 2022

Cost:

Accumulated amortization and impairment:

Net book value:
As at 31 December 2023

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

21 SUBSIDIARIESThe following list contains only the particulars of subsidiaries which principally affected the results, assets or
liabilities of the Group. The class of shares held is ordinary unless otherwise stated.
Proportion ofownership interest
Held by theHeld by aCompany
subsidiary

No.

Name of company*

Place ofincorporation/
establishment
and operation

1

China Mobile Communication(BVI) Limited

the British Virgin
Islands (“BVI”)

HK$1

100%

–

2

China Mobile Communication
Co., Ltd. **the mainland of
China

RMB53,218,848,326

–

100%

Network and businesscoordination center

3

China Mobile Group
Guangdong Co., Ltd.
(“Guangdong Mobile”)

the mainland of
China

RMB5,594,840,700

–

100%

Telecommunications operator

4

China Mobile Group
Zhejiang Co., Ltd.

the mainland of
China

RMB2,117,790,000

–

100%

Telecommunications operator

5

China Mobile Group
Jiangsu Co., Ltd.

the mainland of
China

RMB2,800,000,000

–

100%

Telecommunications operator

6

China Mobile GroupFujian Co., Ltd.

the mainland of
China

RMB5,247,480,000

–

100%

Telecommunications operator

7

China Mobile Group
Henan Co., Ltd.

the mainland of
China

RMB4,367,733,641

–

100%

Telecommunications operator

8

China Mobile Group
Hainan Co., Ltd.

the mainland of
China

RMB643,000,000

–

100%

Telecommunications operator

9

China Mobile Group
Beijing Co., Ltd.

the mainland of
China

RMB6,124,696,053

–

100%

Telecommunications operator

10

China Mobile Group
Shanghai Co., Ltd.

the mainland of
China

RMB6,038,667,706

–

100%

Telecommunications operator

11

China Mobile Group
Tianjin Co., Ltd.

the mainland of
China

RMB2,151,035,483

–

100%

Telecommunications operator

12

China Mobile Group
Hebei Co., Ltd.

the mainland of
China

RMB4,314,668,531

–

100%

Telecommunications operator

13

China Mobile Group
Liaoning Co., Ltd.

the mainland of
China

RMB5,140,126,680

–

100%

Telecommunications operator

14

China Mobile Group
Shandong Co., Ltd.

the mainland of
China

RMB6,341,851,146

–

100%

Telecommunications operator

15

China Mobile Group
Guangxi Co., Ltd.

the mainland of
China

RMB2,340,750,100

–

100%

Telecommunications operator

Particulars of issued
and paid-up capital

Principal
activity
Investment holding company

133

134

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

21 SUBSIDIARIES (CONTINUED)
Proportion ofownership interest
Held by theHeld by aCompany
subsidiary

No.

Name of company*

Place ofincorporation/
establishment
and operation

16

China Mobile Group
Anhui Co., Ltd.

the mainland of
China

RMB4,099,495,494

–

100%

Telecommunications operator

17

China Mobile Group
Jiangxi Co., Ltd.

the mainland of
China

RMB2,932,824,234

–

100%

Telecommunications operator

18

China Mobile Group
Chongqing Co., Ltd.

the mainland of
China

RMB3,029,645,401

–

100%

Telecommunications operator

19

China Mobile Group
Sichuan Co., Ltd.

the mainland of
China

RMB7,483,625,572

–

100%

Telecommunications operator

20

China Mobile Group
Hubei Co., Ltd.

the mainland of
China

RMB3,961,279,556

–

100%

Telecommunications operator

21

China Mobile Group
Hunan Co., Ltd.

the mainland of
China

RMB4,015,668,593

–

100%

Telecommunications operator

22

China Mobile Group
Shaanxi Co., Ltd.

the mainland of
China

RMB3,171,267,431

–

100%

Telecommunications operator

23

China Mobile Group
Shanxi Co., Ltd.

the mainland of
China

RMB2,773,448,313

–

100%

Telecommunications operator

24

China Mobile Group
Neimenggu Co., Ltd.

the mainland of
China

RMB2,862,621,870

–

100%

Telecommunications operator

25

China Mobile Group
Jilin Co., Ltd.

the mainland of
China

RMB3,277,579,314

–

100%

Telecommunications operator

26

China Mobile Group
Heilongjiang Co., Ltd.

the mainland of
China

RMB4,500,508,035

–

100%

Telecommunications operator

27

China Mobile Group
Guizhou Co., Ltd.

the mainland of
China

RMB2,541,981,749

–

100%

Telecommunications operator

28

China Mobile Group
Yunnan Co., Ltd.

the mainland of
China

RMB4,137,130,733

–

100%

Telecommunications operator

29

China Mobile Group
Xizang Co., Ltd.

the mainland of
China

RMB5,698,643,686

–

100%

Telecommunications operator

30

China Mobile GroupGansu Co., Ltd.

the mainland of
China

RMB1,702,599,589

–

100%

Telecommunications operator

31

China Mobile Group
Qinghai Co., Ltd.

the mainland of
China

RMB3,422,564,911

–

100%

Telecommunications operator

Particulars of issued
and paid-up capital

Principal
activityAnnual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

21 SUBSIDIARIES (CONTINUED)
Proportion ofownership interest
Held by theHeld by aCompany
subsidiary

No.

Name of company*

Place ofincorporation/
establishment
and operation

32

China Mobile Group
Ningxia Co., Ltd.

the mainland of
China

RMB740,447,232

–

100%

Telecommunications operator

33

China Mobile Group
Xinjiang Co., Ltd.

the mainland of
China

RMB9,381,599,639

–

100%

Telecommunications operator

34

China Mobile Group
Design Institute Co., Ltd.

the mainland of
China

RMB160,232,547

–

100%

Provision of telecommunications
network planning design andconsulting services

35

China Mobile Holding
Company Limited**

the mainland of
China

US$30,000,000

100%

–

Investment holding company

36

China Mobile Information
Technology Co., Ltd.**

the mainland of
China

US$7,633,000

–

100%

Provision of roaming clearance,
IT system operation
technology support services

37

Aspire Holdings Limited

Cayman Islands

HK$93,964,583

66.41%–

Investment holding company

38

Aspire (BVI) Limited#

BVI

US$1,000–

100%

Investment holding company

39

Aspire Technologies(Shenzhen) Limited**#the mainland of
China

US$10,000,000

–

100%

Development, services andmaintenance of industry
value-added platform

40

Aspire Information Network(Shenzhen) Limited**#the mainland of
China

US$5,000,000

–

100%

Provision of mobile datasolutions, system integrationand development

41

Aspire Information Technologies the mainland of(Beijing) Limited**#
China

US$5,000,000

–

100%

Operation support and capability
service of digital content

42

Fujian FUNO Mobile
Communication Technology
Company Limited***the mainland of
China

RMB60,000,000–

51%

Network construction andmaintenance, network
planning and optimizing
training and information
services

43

Advanced Roaming & Clearing
House Limited

BVI

US$2

100%

–

Provision of roaming clearance
services

44

Fit Best Limited

BVI

US$1

100%

–

Investment holding company

45

China Mobile Hong Kong
Company Limited

Hong Kong

HK$951,046,930

–

100%

46

China Mobile International
Holdings Limited

Hong Kong

HK$20,719,810,000

100%

–

Particulars of issued
and paid-up capital

Principal
activity

Provision of telecommunications
and related services
Investment holding company

135

136

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

21 SUBSIDIARIES (CONTINUED)
Place ofincorporation/
establishment
and operation

Particulars of issued
and paid-up capital

Proportion ofownership interest
Held by theHeld by aCompany
subsidiary

Principal
activityNo.

Name of company*

47

China Mobile International
LimitedHong Kong

HK$6,376,425,499

–

100%

Provision of voice and roaming
clearance services, internet
services and value-added
services48

China Mobile Group
Device Co., Ltd.

the mainland of
China

RMB6,200,000,000–

99.97%

Provision of electronic
communication products
design services and sale ofrelated products

49

China Mobile Group
Finance Co., Ltd.
(“China Mobile Finance”)

the mainland of
China

RMB11,627,783,669–

92%

Provision of non-banking
financial services

50

China Mobile IoT Company
Limitedthe mainland of
China

RMB3,500,000,000

–

100%

Provision of network services

51

China Mobile (Suzhou)
Software Technology
Co., Ltd.

the mainland of
China

RMB3,172,000,000

–

100%

Provision of Mobile Cloud
research and development
and operation support
services

52

China Mobile E-CommerceCo., Ltd. (“China Mobile
E-Commerce”)

the mainland of
China

RMB700,000,000

–

100%

Provision of e-payment,
e-commerce and internet
finance services

53

China Mobile (Hangzhou)
Information Technology
Co., Ltd.

the mainland of
China

RMB1,750,000,000

–

100%

Provision of family information
products, technology researchand development services

54

China Mobile Online
Services Co., Ltd.

the mainland of
China

RMB3,500,000,000

–

100%

Provision of call center andinternet information services

55

MIGU Company Limited

the mainland of
China

RMB10,400,000,000

–

100%

Provision of mobile internet
digital content services

56

China Mobile TieTong
Company Limited

the mainland of
China

RMB31,880,000,000

–

100%

Provision of engineering,
maintenance, sales andtelecommunications services

57

China Mobile Internet
Company Limited

the mainland of
China

RMB3,000,000,000

–

100%

Provision of internet related
services

58

China Mobile Investment
Holdings Company Limited

the mainland of
China

RMB3,532,920,000

–

100%

Investment holding company

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

21 SUBSIDIARIES (CONTINUED)
Proportion ofownership interest
Held by theHeld by aCompany
subsidiary

No.

Name of company*

Place ofincorporation/
establishment
and operation

59

China Mobile System
Integration Co., Ltd.

the mainland of
China

RMB1,500,000,000

–

100%

Provision of computer system
integration, construction,
maintenance and related
technology development
services

60

China Mobile (Chengdu)
ICT Co., Ltd.

the mainland of
China

RMB1,650,000,000

–

100%

Provision of information
technology products andtechnology research anddevelopment services

61

China Mobile (Shanghai)
ICT Co., Ltd.

the mainland of
China

RMB1,830,000,000

–

100%

Provision of information
technology products andtechnology research anddevelopment services

62

China Mobile Financial
Technology Co., Ltd.

the mainland of
China

RMB655,410,800

–

100%

Provision of e-payment,
e-commerce and internet
finance services

63

China Mobile Xiong’an
ICT Co., Ltd.

the mainland of
China

RMB670,000,000

–

100%

Provision of information
technology products andtechnology research anddevelopment services

64

Zhongyidong Information
Technology Co., Ltd.

the mainland of
China

RMB1,000,000,000

–

100%

Provision of IT solution including
digital technology

65

China Mobile Information
System Integration Co., Ltd.

the mainland of
China

RMB250,000,000

–

100%

Provision of computer system
integration, construction,
maintenance and related
technology development
services

66

China Mobile Park Construction
and Development Co., Ltd.

the mainland of
China

RMB300,000,000

–

100%

Provision of infrastructure agent
construction, centralized park
operations, IDC operation andmaintenance services*

The nature of all the legal entities established in the mainland of China is limited liability company.

**

Companies registered as wholly owned foreign enterprises in the mainland of China.

***

Company registered as a sino-foreign equity joint venture in the mainland of China.

#

Effective interest held by the Group is 66.41%.

Particulars of issued
and paid-up capital

Principal
activity

No subsidiaries in which the Group have non-controlling interests are material to the Group.

137

138

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

22 INVESTMENTS IN ASSOCIATES AND JOINT ARRANGEMENTS
The amounts of investments accounted for using the equity method recognized in the consolidated balance
sheet are as follows:
As at
31 December
2023
Million

As at
31 December
2022
Million

181,080635

174,955694

181,715

175,649

Associates
Joint ventures(a) Major associates
Details of major associates, all of which are listed on exchanges, are as follows:

Place ofincorporation/
establishment
and operation

Proportion ofownership
interest heldby the Company
or its subsidiary

Principal activity

Shanghai Pudong Development Bank
Co., Ltd. (“SPD Bank”)

The PRC

18%

Provision of banking services

China Tower

The PRC

28%

Provision of construction,
maintenance and operation of
telecommunications towers

Name of associateManagement has assessed and determined that the Group has significant influence over these associates,
including those investments where the ownership interest held by the Group is less than 20%, taking
into factors including but not limited to the Group’s representation on the boards of the directors of these
entities. The consistency of the accounting policies between the Group and its associates has been
considered when the Group recognized its interests in these associates.
The Group’s effective interest holding in True Corporation Public Company Limited (“True Corporation”)
has reduced from 18% to 8% following the investee’s corporate amalgamation and disposal of certain
shares by the Group during the year ended 31 December 2023. Since then, True Corporation is no longer
considered as a major associate of the Group.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

22 INVESTMENTS IN ASSOCIATES AND JOINT ARRANGEMENTS (CONTINUED)(a) Major associates (Continued)(i)

The fair values of the interests in listed associates are based on quoted market prices (level 1:
unadjusted quoted price in active markets) at the balance sheet date without any deduction fortransaction costs and disclosed as follows:
As at 31 December 2023
Carrying
Fair
amountvalue
MillionMillionSPD Bank
China Tower(ii)

117,936
54,36535,31736,524As at 31 December 2022
Carrying
Fair
amountvalue
MillionMillion
113,01752,762

38,83836,880

The Group assesses whether there is objective evidence that interests in associates are impaired ateach balance sheet date.
As at 31 December 2023, the fair value of investment in SPD Bank was RMB35,317 million (asat 31 December 2022: RMB38,838 million) based on its quoted market price, which was below
its carrying amount by 70.1% (as at 31 December 2022: 65.6%). The management of the Group
performed an impairment assessment with the assistance of an independent external valuer
and determined the recoverable amount of the investment based on its VIU. The calculation has
considered pre-tax cash flow projections of SPD Bank for the five years ending 31 December 2028
with an extrapolation made to perpetuity. The discount rate used to discount the cash flows to theirrespective net present values was 11% in 2023, and was based on cost of capital used to evaluate
investments of similar nature in the mainland of China. Management judgement is required inestimating the future cash flows of SPD Bank. The key assumptions are determined with reference
to external sources of information. Based on the management’s assessment result, there was no
impairment of the investment as at 31 December 2023.
As at 31 December 2023, the fair value of investment in China Tower was RMB36,524 million (asat 31 December 2022: RMB36,880 million) based on its quoted market price, which was below
its carrying amount by 32.8% (as at 31 December 2022: 30.1%). The management of the Group
performed an impairment assessment and determined the recoverable amount of the investment
based on its VIU. Based on the management’s assessment result, there was no impairment of theinvestment as at 31 December 2023.
As at 31 December 2023, there was no impairment indicator of the Group’s interests in otherassociates or joint ventures.

139

140

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

22 INVESTMENTS IN ASSOCIATES AND JOINT ARRANGEMENTS (CONTINUED)(a) Major associates (Continued)(iii)

Summarised financial information on major associates:
SPD Bank
As at 31 December
2023
2022
MillionMillionTotal assets
Total liabilities
Total equity

9,007,247
8,274,363
732,884

8,704,651
7,997,876
706,775

Total equity attributable to ordinary equity shareholders
Percentage of ownership of the Group

614,840
18%

587,963
18%

Total equity attributable to the GroupThe impact of fair value adjustments at the time of acquisition,
goodwill and others

111,852

106,933

6,084

6,084

Interest in associates

117,936

113,017

China Tower
As at 31 December
2023
2022
MillionMillionTotal current assets
Total non-current assets
Total current liabilities
Total non-current liabilities
Total equity

78,083247,924
63,93464,379197,694

49,706
255,854
65,15846,811
193,591

Total equity attributable to equity shareholders
Percentage of ownership of the Group

197,69428%

193,59128%

Total equity attributable to the GroupElimination of unrealized profits resulting from the transfer
of Tower Assets

55,21654,070(851)(1,308)Interest in associates

54,36552,762

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

22 INVESTMENTS IN ASSOCIATES AND JOINT ARRANGEMENTS (CONTINUED)(a) Major associates (Continued)(iii)

Summarised financial information on major associates (Continued):

Revenue
Profit before taxation
Profit attributable to the equity shareholders of the company
Other comprehensive loss attributable to the equity shareholdersof the company
Total comprehensive income attributable to the equity
shareholders of the company
Dividends received from associates

Revenue
Profit before taxation
Profit attributable to equity shareholders of the company
Other comprehensive income attributable to equity
shareholders of the company
Total comprehensive income attributable to equity
shareholders of the company
Dividends received from associates

SPD Bank
2023
Million2022
Million173,434
40,69236,702

188,62256,14951,171

––

––

––
1,707

––
2,187

China Tower
2023
Million2022
Million94,00912,832
9,750

92,17011,528
8,787

6

–

9,756
1,589

8,787
1,290

Note: Up to the approval date of these financial statements, SPD Bank has not yet disclosed their annual financial statements
for the year ended 31 December 2023. The numbers presented in the table above are extracted from financial information
which was released and publicly disclosed by SPD Bank, with some information such as other comprehensive income
attributable to the equity shareholders of the company and total comprehensive income attributable to the equity
shareholders of the company not being disclosed.

141

142

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

22 INVESTMENTS IN ASSOCIATES AND JOINT ARRANGEMENTS (CONTINUED)(b) Immaterial associates and joint ventures
The aggregate carrying amount of investments in other associates and joint ventures and related financial
information are not material to the Group.

(c) Investments in a joint operation
To efficiently enhance its 5G network coverage, the Group entered into a series of collaborationagreements with CBN to co-construct and share 700MHz 5G wireless network (the “Co-constructionand Sharing Agreement”). In accordance with the Co-construction and Sharing Agreement, the parties
shall co-construct and share 700MHz wireless network (including but not limited to base stations andantennas) based on all 700MHz frequency bands of the radio spectrum in respect of which CBN had
been permitted to use by relevant national departments. The parties shall jointly determine network
construction plans. Without consent from the other party, any party may not dispose of (includingtransfer, mortgage or pledge, etc) all or any of the 700MHz wireless network assets within the scope ofcollaboration. The Group initially bear the construction costs of the 700MHz 5G wireless network within
the agreed scope under the Co-construction and Sharing Agreement and shall initially own the assets
underlying the said wireless network. CBN shall pay the Group network usage fees based on fair andreasonable negotiations. Therefore, both parties have the right to use the 700MHz wireless network.
Subject to compliance with applicable laws, regulations and regulatory requirements, CBN may purchase
50% of the 700MHz 5G wireless network assets from the Group by stages, at the then assessed fairvalue.

23 DEFERRED TAX ASSETS AND LIABILITIESThe components of deferred tax assets and liabilities recognized and the movements during the year ended 31
December 2023 are as follows:

As at
1 January
2023
MillionDeferred tax assets before offsetting:Write-down of obsolete inventories
Depreciation, amortization, write-off and impairment of property,
plant and equipment and other intangible assets
Accrued expenses
Unredeemed Reward Program
Expected credit impairment losses
Lease liabilities
OthersDeferred tax liabilities before offsetting:
Change in value of financial assets measured at FVPL
Accelerated depreciation of property, plant and equipment
Right-of-use assets
Others
Total

Chargedto otherCredited/(charged) to comprehensive
incomeprofit or loss
MillionMillionExchangedifferences
Million

As at
31 December
2023
Million

74

–

–

–

74

9,185
22,056
7,499
2,781
25,211
6,187

153
2,593
(988)
1,467
(2,982)
3,192

–
–
–
–
–
–

–
–
–
–
–
2

9,338
24,6496,511
4,248
22,2299,381

72,993

3,435

–

2

76,430(1,474)(4,747)(24,745)(960)(2,951)
(663)
3,156
233

–
–
–
(4)

–
(10)
–
(5)

(4,425)(5,420)(21,589)(736)(31,926)

(225)

(4)

(15)

(32,170)

41,067

3,210

(4)

(13)

44,260Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

23 DEFERRED TAX ASSETS AND LIABILITIES (CONTINUED)
The components of deferred tax assets and liabilities recognized and the movements during the year ended 31
December 2022 are as follows:

Deferred tax assets before offsetting:Write-down of obsolete inventories
Depreciation, amortization, write-off and impairment of property,
plant and equipment and other intangible assets
Accrued expenses
Unredeemed Reward Program
Expected credit impairment losses
Lease liabilities
OthersDeferred tax liabilities before offsetting:
Change in value of financial assets measured at FVPL
Accelerated depreciation of property, plant and equipment
Right-of-use assets
OthersTotal

As at
1 January
2022
Million(Charged)/credited to
profit or loss
MillionChargedto othercomprehensive
incomeMillionExchangedifferences
Million

As at
31 December
2022
Million

85

(11)

–

–

74

8,226
20,6109,815
2,382
13,281
4,786

959
1,446
(2,316)399
11,930
1,394

–
–
–
–
–
–

–
–
–
–
–
7

9,185
22,056
7,499
2,781
25,211
6,187

59,18513,801–

7

72,993(1,164)(4,047)(12,628)
(499)

(310)
(641)
(12,117)
(456)

–
–
–
(4)

–
(59)
–
(1)

(1,474)(4,747)(24,745)(960)(18,338)(13,524)

(4)

(60)

(31,926)

40,847

277

(4)

(53)

41,067

The net amounts of deferred tax assets and deferred tax liabilities after offsetting are as follows:
As at 31 December 2023
Offsetting Amount after
amountoffsetting

As at 31 December 2022
Offsetting
Amount after
amountoffsetting

Deferred tax assets(29,093)

47,337(29,355)

43,638Deferred tax liabilities

29,093(3,077)29,355(2,571)

Deferred tax assets are recognized for deductible temporary differences and tax losses carry-forwards only
to the extent that the realization of the related tax benefit through future taxable profits is probable. Certain
subsidiaries of the Group did not recognize deferred tax assets of RMB15,062 million (2022: RMB14,383
million) in respect of deductible temporary differences and tax losses amounting to RMB79,044 million (2022:
RMB75,221 million) that can be carried forward against future taxable income as at 31 December 2023. The
deductible tax losses of entities in mainland of China are allowed to be carried forward within next five years
against future taxable profits, while those of high-tech enterprises are allowed to be within next ten years, andentities operating in Hong Kong can carry forward tax losses for unlimited period.

143

144

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

24 FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS(a) Methods of determining fair value of financial instruments
The following table presents the fair value and fair value hierarchy of the Group’s financial instruments
measured at the end of the reporting period on a recurring basis. The level into which a fair value
measurement is classified is determined with reference to the lowest level input that is significant to theentire measurement. The different levels have been defined as follows:•

Level 1 valuations: unadjusted quoted prices in active markets for identical assets or liabilities at themeasurement date.

•

Level 2 valuations: observable inputs which fail to meet Level 1, and not using significant
unobservable inputs.

•

Level 3 valuations: fair value measured using significant unobservable inputs.

(b) Assets measured at fair value on a recurring basis
The following table presents the Group’s assets that are measured at fair value at 31 December 2023:
Level 1MillionLevel 2MillionLevel 3
Million

Total
Million––52,725
9,780
517

–
–
–
–
–

226,963
50,573––
1,081

226,963
50,57352,7259,780
1,598

63,022–

278,617341,639

Financial assets measured at FVOCI

3,345

–

173

3,518

Total

66,367–

278,790345,157

Financial assets measured at FVPL
Wealth management products(“WMPs”)
Asset management plans
Bond funds and monetary funds
CB
Equity investments and others

The following table presents the Group’s assets that are measured at fair value at 31 December 2022:

Financial assets measured at FVPL
WMPs
Asset management plans
Bond funds and monetary funds
CB
Equity investments and others

Financial assets measured at FVOCI
Total

Level 1MillionLevel 2MillionLevel 3
Million

Total
Million––48,816
9,532
931

–
–
–
–
–

184,91250,011––
1,231

184,91250,011
48,816
9,532
2,162

59,279–236,154

295,433

364

–

126

490

59,643–

236,280

295,923

Note: The Group’s asset management plans are issued by domestic public offering fund, securities companies and other financial
institutions investing in low or medium risk underlying assets, which mainly consist of money market instruments, PRC treasury
bond, central bank bill, local government debt, corporate bond or debt with high credit ratings, debt assets and some stock
investments.

For the year ended 31 December 2023, the Group didn’t convert any CB into SPD Bank’s common stock(2022: Nil).

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

24 FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (CONTINUED)(c) Valuation techniques used and the qualitative information of key parameters for fairvalue measurements categorized as Level 3
The financial assets categorized into Level 3 mainly represented wealth management products, asset
management plans and unlisted equity investments. The fair value of wealth management products andasset management plans is determined based on their net asset value provided by the counterparty
ﬁnancial institutions as at the end of the reporting period, where the significant unobservable inputs are
the net assets. The relationship of unobservable inputs to fair value is positive correlation. The fair value of
unlisted equity investments is measured using the market approach, where the significant unobservable
inputs are the liquidity discount of similar financial instruments. The relationship of unobservable inputs tofair value is negative correlation.
The movements during the year in the balance of these Level 3 fair value measurements are as follows:

Financial assets measured at FVOCIFinancial assets measured at FVPL

Recognizedin other
Recognized in comprehensive
incomeprofit or loss
MillionMillion

As at
31 December
2023
Million

As at
31 December
2022
MillionPurchase
Million

Disposal/transfer
Million126
236,15431
37,000–(4,737)–
10,20016–

173
278,617236,280

37,031(4,737)

10,20016

278,790(d) Transfers between Levels
For the year ended 31 December 2023, as an equity investment held by the Group is listed on the Main
Board of the SHEX in 2023 and its fair value is determined based on unadjusted quoted prices in an
active markets, the Group upgraded certain financial instruments from Level 3 to Level 1 of the fair value
hierarchy.
There were no transfers between the levels of fair value hierarchy for the year ended 31 December 2022.

25 OTHER FINANCIAL ASSETS MEASURED AT AMORTIZED COST
As at 31 December 2023
Non-current
Current
assetsassetsMillionMillion
Other financial assets measured at amortized cost
– PRC treasury bonds– Other debt instrument investments

Total
MillionAs at 31 December 2022
Non-current
Current
assetsassetsMillionMillion

Total
Million

5,243
385

–
32,0205,243
32,405

9,331
385

–
16,3009,331
16,685

5,628

32,02037,6489,716

16,30026,016

PRC treasury bonds will mature in 2052 and bear a fixed coupon rate of 3.32% and effective interest rates of
3.08% to 3.11% per annum, with the aggregated principal amounted to RMB5,000 million as at 31 December
2023 (31 December 2022: RMB9,000 million).
Other debt instrument investments mainly include various debt instrument investments to banks, otherfinancial institutions and third parties.

145

146

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

26 BANK DEPOSITS

NoteTerm deposits and certificates ofdeposits
Restricted bank deposits

(i)
(ii)

As at 31 December 2023
Non-current
Current
assetsassetsMillionMillion

Total
MillionAs at 31 December 2022
Non-current
Current
assetsassetsMillionMillion

Total
Million47,6807,707

34,3262,887

82,006
10,59439,331
6,556

53,902
2,475

93,2339,031

55,387

37,21392,60045,88756,377102,264

Note:(i)

The item represents deposits with banks with original maturity exceeding three months. The applicable interest rate is determinedin accordance with the benchmark interest rate published by the People’s Bank of China (“PBOC”) or with reference to the market
interest rate. As at 31 December 2023, interest receivable amounting to RMB2,410 million (as at 31 December 2022: RMB2,935 million)
was included in the item.

(ii)

As at 31 December 2023 and 2022, restricted bank deposits included in non-current assets were mainly about the statutory deposit
reserves by China Mobile Finance in accordance with relevant requirements of PBOC, which are not available for use in the Group’s
daily operations.
As at 31 December 2023 and 2022, restricted bank deposits included in current assets were mainly about the deposited customer
reserves, performance bonds and others.

27 OTHER NON-CURRENT ASSETS

Contract assets (note 29)
Contract costs (Note)
Long-term prepaid expenses
Others

As at
31 December
2023
Million

As at
31 December
2022
Million

4,227
25,047
5,107
11,877

3,756
21,2504,667
4,883

46,25834,556

Note: Contract costs capitalized mainly related to the relevant costs incurred for the customers accessing to the Group’s telecommunications
network (such as wireline broadband access). As at 31 December 2023, capitalized contract costs that are expected to be amortizedexceeding one year amounted to RMB9,385 million (as at 31 December 2022: RMB5,526 million). For the year ended 31 December
2023, the amortization of capitalized contract costs amounted to RMB23,405 million (2022: RMB25,968 million).

28 INVENTORIES

Handsets and other terminals
Others

As at
31 December
2023
Million

As at
31 December
2022
Million

8,845
3,181

8,345
3,351

12,026

11,696

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

29 CONTRACT ASSETS

Contract assets
Loss allowance

Less: non-current portion included in other non-current assets

As at
31 December
2023
Million

As at
31 December
2022
Million24,456(822)

18,019(606)

23,634

17,413(4,227)(3,756)

19,407

13,657As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

16,3506,283
5,209
20,342
6,697

16,348
4,248
3,699
15,282
3,180

54,88142,75730 ACCOUNTS RECEIVABLE(a) Aging analysis
Aging analysis of accounts receivable, net of loss allowance is as follows:

Base on invoice date:Within 30 days
31–60 days
61–90 days
91 days–1 year
Over 1 year

The accounts receivable of the Group are primarily comprised of receivables due from customers andother telecommunications operators.

(b) Expected credit impairment loss allowance of accounts receivable
The following table summarizes the changes in expected credit impairment loss allowance of accounts
receivable:
2023
Million2022
Million(Re-presented)

As at 1 January
Recognized
Written-off

15,587
9,254(1,202)

13,117
4,582(2,112)As at 31 December

23,63915,587147

148

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

31 OTHER NON-FINANCIAL ASSETS

Prepaid VAT and input VAT to be deducted, etc.
Others

As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

17,012
6,096

16,817
1,623

23,10818,440As at
31 December
2023
Million

As at
31 December
2022
Million

2,908
138,651

11,954
155,152

141,559

167,106As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

173,309124,147

161,520
109,786

297,456

271,306

32 CASH AND CASH EQUIVALENTS

Bank deposits with original maturity within three months
Cash at banks and on hand

33 ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable
Accrued expenses

This item primarily includes payables and accrued items for purchases of network expansion, maintenance andsupport expenses and interconnection expenses, etc.
The aging analysis of accounts payable is as follows:

Base on invoice date:Within 180 days
181 days – 1 year
Over 1 year

As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

105,895
28,732
38,682

97,042
26,73037,748173,309

161,520

All the accounts payable are expected to be settled within one year or are repayable on demand.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

34 CONTRACT LIABILITIES

Non-refundable prepaid service fees
Unredeemed Reward Program
Unused data traffic carried over
OthersLess: non-current portion

As at
31 December
2023
Million

As at
31 December
2022
Million

18,892
29,945
14,276
3,955

21,67235,557
15,9093,030

67,06876,168

(875)

(913)

66,19375,255  Contract liabilities would be recognized as operating revenue upon the rendering of services. Almost all of thecontract liability balance as at 31 December 2022 was recognized as operating revenue in the consolidated
statement of comprehensive income within one year.

35 RECEIPTS IN ADVANCE
This item mainly includes refundable prepaid service fees received from customers in advance of providing theservices or products promised in the contract.

36 OTHER PAYABLES

Short-term deposits in China Mobile FinanceDeposits and retentions
Accrued salaries, wages and other benefits
Others

As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

3,408
13,348
5,922
15,523

12,521
14,182
5,893
13,90038,20146,496

Short-term deposits in China Mobile Finance primarily comprises the short-term deposits placed by CMCC andits subsidiaries excluding the Group (“CMCC Group”) in China Mobile Finance and the corresponding interest
payable. The deposits are unsecured and carry interest at prevailing market rate.

149

150

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

37 DEFERRED REVENUE
2023
Million2022
MillionAs at 1 January
Additions during the year
Recognized in the consolidated statement of comprehensive income

8,810
3,099
(2,628)

8,487
2,750
(2,427)As at 31 December

9,281

8,810

38 SHARE-BASED PAYMENTAt the Company’s Annual General Meeting (“AGM”) held on 20 May 2020, the shareholders of the Company
approved the adoption of the Share Option Scheme (the “Scheme”), for the grant of share options (“Share
Options”) to qualified participants.
The maximum number of shares to be issued upon the exercise of the Share Options granted under the
Scheme shall not in aggregate exceed 10% of the total share capital of the Company as at the date of approvalof the Scheme at a general meeting of shareholders.
The exercise price of options shall be determined in accordance with the fair market price principle, with thebase day for pricing being the Grant Date. The exercise price shall not be lower than the higher of the following
prices: (i) the closing price of the Shares on the Grant Date; and (ii) the average closing price of the Shareson the HKEX for the five trading days prior to the Grant Date. Subject to the satisfaction of the conditions forvesting as provided under the Scheme, the Share Options granted shall be vested in three batches as follows: (i)the first batch (being 40% of the Share Options granted) will be vested on the first trading day after 24 months
from the Grant Date; (ii) the second batch (being 30% of the Share Options granted) will be vested on thefirst trading day after 36 months from the Grant Date; and (iii) the third batch (being 30% of the Share Options
granted) will be vested on the first trading day after 48 months from the Grant Date. Vesting period ends ten
years from the Grant Date.
Participants are backbone management, technical and business personnel who have a direct impact on the
Company’s operating performance and sustainable development. No Share Options had been granted to thedirectors, chief executive or substantial shareholders of the Company or any of their related parties.
On 12 June 2020 (the “First Grant”), the Board of Directors of the Company approved the grant of Share
Options representing an aggregate of 305,601,702 shares to 9,914 participants of the Scheme pursuant to theaforementioned authorization, which represented 1.5% of the Company’s issued share capital at then. The
exercise price was HK$55.00 per share.
On 19 September 2022 (the “Second Grant”), the Board of Directors of the Company approved the grant of
Share Options representing an aggregate of 607,649,999 shares to 10,988 participants of the Scheme pursuant
to the aforementioned authorization, which represented 2.8% of the Company’s issued share capital at then.
The exercise price was HK$51.60 per share.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

38 SHARE-BASED PAYMENT (CONTINUED)
For the year ended 31 December 2023, share options compensation expenses recorded in profit or loss
amounted to RMB717 million (2022: RMB411 million).

(a) Movements in share options
Movements in the numbers of share options outstanding and their related weighted average exercise
prices are as follows:
Share option scheme
Average
Numbers of
exercise prices
options
As at 1 January 2022
GrantedForfeited

HK$55.00
HK$51.60
HK$54.98

302,096,876
607,649,999(22,147,157)

As at 31 December 2022

HK$52.67

887,599,718

Vested and exercisable as at 31 December 2022

HK$55.00

101,069,905

As at 1 January 2023
Exercised
Forfeited

HK$52.67
HK$55.00
HK$54.57

887,599,718(28,053,548)(19,487,837)

As at 31 December 2023

HK$52.55

840,058,333

Vested and exercisable as at 31 December 2023

HK$55.00

150,089,484

75,569,164 options were vested and exercisable after the satisfaction of the conditions for vesting during
the year (2022: 104,167,642).
The weighted average share price at the date of exercise for share options exercised during the year was
HK$65.36 (2022: not applicable).

151

152

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

38 SHARE-BASED PAYMENT (CONTINUED)(b) Share options outstanding
Details of the expiry dates, exercise prices and the respective numbers of share options which remained
outstanding as at 31 December 2023 and 2022 are as follows:
No. of shares
involved in
the options
outstanding as at
Exercise price 31 December 2023

No. of shares
involved in theoptions
outstanding as at
31 December 2022

Grant Date

Normal exercise period

12 June 2020

12 June 2022-12 June 2030

HK$55.00

81,867,774

101,069,905

12 June 2020

12 June 2023-12 June 2030

HK$55.00

68,221,710

89,515,817

12 June 2020

12 June 2024-12 June 2030

HK$55.00

84,929,063

89,515,817

19 September 2022

19 September 202419 September 2032

HK$51.60

242,015,914

242,999,271

19 September 202519 September 2032

HK$51.60

181,511,936

182,249,454

19 September 202619 September 2032

HK$51.60

181,511,936

182,249,454

19 September 2022

19 September 2022

The options outstanding as at 31 December 2023 had a weighted average remaining contractual life of 8.0
years (as at 31 December 2022: 9.0 years).

(c) Fair value of share options
The Company used the Binomial Model to determine the fair value of the Share Options as at the Grant
Date, which is to be recorded in profit or loss over the vesting period.
The weighted average fair value of the Share Options granted by the Company was HK$4.00 per share (theFirst Grant) and HK$3.28 per share (the Second Grant). The model inputs to determine the fair value of
Share Options granted included:Granted on
Granted on
12 June 2020 19 September 2022
the Second Grant
the First Grant
Exercise prices
The closing price at the Grant Date
Risk-free interest rate
Expected dividend yield
Expected volatility (Note)

HK$55.00
HK$54.25
0.65%
5.90%
21.34%

HK$51.60
HK$51.45
3.34%
9.04%
22.23%

Note: The expected volatility is determined based on the historical average daily trading price volatility of the shares of the Company.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

39 CAPITAL, RESERVES AND DIVIDENDS(a) Share capital
Numberof shares

RMB
Million20,475,482,897

402,130

902,767,867(15,424,000)

51,374––

21,362,826,764

453,504

21,362,826,764
28,053,548

453,504
1,497

As at 31 December 2023

21,390,880,312

455,001

Of which: Shares listed on the HKEX
Shares listed on the SHEX

20,488,112,445
902,767,867

Note
Ordinary shares, issued and fully paid:
As at 1 January 2022
Issuance of RMB Shares and exercise of over-allotment,
net of related issuance and professional expenses
Purchase of own shares

(i)
(ii)

As at 31 December 2022
As at 1 January 2023
Exercise of share options

(iii)

Note:
(i)

In January 2022, the Company made an initial public offering of 845,700,000 RMB Shares (before the exercise of the overallotment option) on the SHEX, and subsequently made an over-allotment of 57,067,867 shares in February 2022. The total
number of shares issued was 902,767,867 shares at the issue price of RMB57.58 per share. The amounts received, after
deducting related issuance and professional costs, are recorded as share capital.

(ii)

In February 2022, the Company repurchased and cancelled its own 15,424,000 shares listed on the HKEX, with the price paid
between HK$54.15 and HK$58.15 per share. The aggregate amount paid was HK$866 million (equivalent to RMB707 million).
Such buy-backs were financed out of the Company’s distributable profits, as a result, the aforesaid buy-backs were reduced
from the Company’s retained profits, in accordance with the requirements of HKCO.

(iii)

In 2023, share options were exercised to subscribe for 28,053,548 shares listed on the HKEX at a consideration of HK$1,543
million (equivalent to RMB1,395 million) which was credited to share capital. RMB102 million has been transferred from thecapital reserve to the share capital account in accordance with policy set out in note 2(w)(iii).

(iv)

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote pershare at meetings of the Company. All ordinary shares rank equally with regard to the Company’s residual assets.

153

154

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

39 CAPITAL, RESERVES AND DIVIDENDS (CONTINUED)(b) Dividends(i)Dividends attributable to the year:

Ordinary interim dividend declared and paid of HK$2.430(equivalent to approximately RMB2.240) (2022: HK$2.200(equivalent to approximately RMB1.881)) per share
Ordinary final dividend proposed after the balance sheet dateof HK$2.400 (equivalent to approximately RMB2.175) (2022:
HK$2.210 (equivalent to approximately RMB1.974)) per share

2023
Million2022
Million47,67442,243

46,52442,182

94,19884,425The proposed/approved ordinary final dividend/ordinary interim dividend per share, which isdeclared in Hong Kong dollar, is translated into RMB with reference to the exchange rate, being
the respective rate announced by the State Administration of Foreign Exchange in the PRC on 29
December 2023 and 30 June 2023 (2022: 30 December 2022 and 30 June 2022).
As the ordinary final dividend was declared after the balance sheet date, such dividend is notrecognized as liability as at 31 December 2023. In case of any change in the total number of issued
shares of the Company between the date of approval for these financial statements and the record
date for the implementation of the 2023 final dividend, the Company intends to keep the amount ofdividend per share unchanged and adjust the total amount of profit distribution accordingly.
In accordance with the 2009 Notice and the PRC enterprise income tax law, the Company isrequired to withhold enterprise income tax equal to 10% of any dividend, when it is distributed
to non-resident enterprise shareholders whose names appeared on the Company’s register ofmembers for shares listed on the HKEX, as at the record date for such dividend, and who were notindividuals.

(ii)

Dividends attributable to the previous financial year, approved and paid during the year:

Ordinary final dividend in respect of the previous financial year,
approved and paid during the year, of HK$2.210 (equivalent
to approximately RMB1.974) (2022: HK$2.430 (equivalent toapproximately RMB1.987)) per share

2023
Million2022
Million43,414

44,594

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

39 CAPITAL, RESERVES AND DIVIDENDS (CONTINUED)(c) Movements in components of equity
The reconciliation between the opening and closing balances of each component of the Group’s
consolidated equity is set out in the consolidated statement of changes in equity. Details of the changes
in the Company’s individual components of equity between the beginning and the end of the year are set
out below:
SharecapitalMillionCapitalreserve
MillionRetained
profits
MillionTotal
equityMillion402,130717

94,789497,636

Changes in equity for 2022:
Profit for the year––

83,894

83,894

Total comprehensive income
for the year––

83,894

83,894

51,374––

51,374––(44,594)(44,594)––(42,243)(42,243)

–

–

(707)

(707)

–

411

–

411

As at 31 December 2022

453,504

1,128

91,139545,771

As at 1 January 2023

453,504

1,128

91,139545,771

Changes in equity for 2023:
Profit for the year––

90,30490,304

Total comprehensive income
for the year––

90,30490,304––(43,414)(43,414)––(47,674)(47,674)

1,497

(102)

–

1,395

–

717

–

717

455,001

1,743

90,355547,099

As at 1 January 2022

Issuance of RMB Shares andexercise of over-allotment(note 39(a)(i))
Dividends approved in respect ofprevious year (note 39(b)(ii))
Dividends declared in respect of
current year (note 39(b)(i))
Purchase of own shares(note 39(a)(ii))
Share option scheme– Value of share options(note 38)

Dividends approved in respect ofprevious year (note 39(b)(ii))
Dividends declared in respect of
current year (note 39(b)(i))
Exercise of share options(note 39(a)(iii))
Share option scheme– Value of share options(note 38)
As at 31 December 2023

155

156

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

39 CAPITAL, RESERVES AND DIVIDENDS (CONTINUED)(d) Nature and purpose of different reserves(i)Capital reserve
The capital reserve mainly comprises the following:

(ii)

–

RMB295,665 million debit balance brought forward as a result of the elimination of goodwill
arising on the acquisition of subsidiaries before 1 January 2001 against the capital reserve;–

The difference between the consideration and the carrying amounts of net assets of acquired
business under business combinations under common control; and–The fair value of share options granted to employees of the Group that are recognized inaccordance with the accounting policy in note 2 (w)(iii).

PRC statutory reserves
PRC statutory reserves mainly include statutory surplus reserve and discretionary surplus reserve.
In accordance with the Company Law of the PRC, domestic enterprises in the mainland of China
are required to transfer 10% of their profit after taxation, as determined under accounting principles
generally accepted in the PRC (“PRC GAAP”), to the statutory surplus reserve until such reservebalance reaches 50% of the registered capital of relevant mainland subsidiaries. Moreover, upona resolution made by the shareholders, a certain percentage of domestic enterprises’ profit after
taxation, as determined under PRC GAAP, is transferred to the discretionary surplus reserve. During
the year, appropriations were made by such subsidiaries to the statutory surplus reserves anddiscretionary surplus reserves accordingly.
The statutory and discretionary surplus reserves can be used to reduce previous years’ losses,
if any, and may be converted into paid-up capital, provided that the statutory reserve after such
conversion is not less than 25% of the registered capital of relevant subsidiaries.

(iii) Other reserves
Other reserves mainly comprises the following:–in accordance with relevant regulations issued by the Ministry of Finance of the PRC, asubsidiary of the Company, China Mobile Finance, is required to set aside a reserve throughappropriations of profit after tax according to a certain ratio of the ending balance of its grossrisk-bearing assets to cover potential losses against such assets;–share of other comprehensive income/(loss) of investments accounted for using the equity
method; and–the changes in fair value of financial assets measured at FVOCI, net of tax, until the financial
assets are derecognized;(iv) Exchange reserve
The exchange reserve comprises all foreign currency translation differences arising from thetranslation of foreign currency denominated financial statements of overseas enterprises. The
reserve is dealt with in accordance with the accounting policies set out in note 2(y).

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

39 CAPITAL, RESERVES AND DIVIDENDS (CONTINUED)(e) Capital management
The Group’s primary objectives of capital management are to maintain a reasonable capital structure
and to safeguard the Group’s ability to continue as a going concern in order to provide returns forshareholders. The Group actively and regularly reviews and manages its capital structure to stabilize thecapital position and prevent operation risk. Meanwhile, the Group will maximize the shareholders’ return
and will make adjustment on the capital structure in accordance with the changes in economic conditions.
The Group monitors capital on the basis of liabilities-to-assets ratio. This ratio is calculated as total
liabilities divided by total assets. At the end of reporting period, the Group’s liabilities-to-assets ratio is asfollows:

Total assets
Total liabilities
Liabilities-to-assets ratio

As at
31 December
2023
Million

As at
31 December
2022
Million1,992,657
646,672

1,935,538
634,115

32.5%

32.8%

Except for China Mobile Finance that is subject to certain capital requirements imposed by China Banking
and Insurance Regulatory Commission, the Company and its other subsidiaries are not subject toexternally imposed capital requirements.

157

158

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

40 BALANCE SHEET OF THE COMPANY
As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

1547,3501
546,634

547,351546,635

1,426
2
36
3,376
3,363

1,364
1
–
549
4,889

8,203

6,803

555,554

553,438

8,455
–

7,562
105

8,455

7,667

8,455

7,667

455,001
92,098453,504
92,267

Total equity

547,099545,771

Total equity and liabilities

555,554

553,438

Note
AssetsNon-current assets
Property, plant and equipment
Investments in subsidiaries
Current assets
Other receivables
Prepayments
Prepaid income tax
Bank deposits
Cash and cash equivalents
Total assets
Equity and liabilities
Liabilities
Current liabilities
Other payables
Income tax payable
Total liabilities
EquityShare capital
Reserves

39(a)
39(c)

The balance sheet of the Company was approved by the Board of Directors on 21 March 2024 and was signed
on its behalf.
Yang Jie
Name of Director
Li Ronghua
Name of Director

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

41 RELATED PARTY TRANSACTIONS(a) Transactions with CMCC GroupThe following is a summary of principal related party transactions entered into by the Group with CMCC
and its subsidiaries excluding the Group (“CMCC Group”) for the years ended 31 December 2023 and2022. The majority of these transactions also constitute continuing connected transactions as defined
under Chapter 14A of Listing Rules. Further details of these continuing connected transactions aredisclosed under the paragraph “Continuing Connected Transactions” in the Report of Directors.

Revenue from telecommunications facilities
construction services
Revenue from comprehensive support services
Technical support services charges
Additions of right-of-use assets
Related costs for lease of network assets and property
Interest expenses
Net repayment of short-term deposits

Note

2023
Million2022
Million

(i)
(ii)
(iii)
(iv)
(iv)
(v)
(v)

1,530
773
335
3,600
12,58440(9,111)

1,859
505
439
9,139
9,067
65
(6,648)The outstanding balances related to transactions with CMCC Group are included in the following accounts
captions summarized as follows:

Accounts receivable
Other receivables
Prepayments
Right-of-use assets
Lease liabilities
Accounts payable and accrued expenses
Receipts in advance
Other payables

As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

2,341
89
9
5,701
7,351
14,363
4
3,810

2,801
27
1
6,818
7,467
11,273
61
12,692

These amounts arise in the ordinary course of business and with terms determined through mutual
negotiation which are fair and reasonable.

159

160

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

41 RELATED PARTY TRANSACTIONS (CONTINUED)(a) Transactions with CMCC Group (Continued)
Note:
(i)

The Group provides telecommunications facilities construction services to CMCC Group for the telecommunications projectplanning, design, construction, maintenance and other services.

(ii)

The Group provides comprehensive management, support and other services to CMCC Group.

(iii)

The Group purchases technical support and other services from CMCC Group.

(iv)

The amounts primarily represent the additions of right-of-use assets/the charges to CMCC Group for the lease of machinery
rooms and transmission pipelines, power support and other network assets and resources, offices and retail outlets.
For the year ended 31 December 2023, the Group recognized the right-of-use assets for the lease of machinery rooms andtransmission pipelines amounting to RMB2,500 million, and recognized the right-of-use assets for the lease of offices and retail
outlets amounting to RMB1,094 million. Related costs for lease of machinery rooms and transmission pipelines include thedepreciation of right-of-use assets, finance costs associated with the lease liabilities and other charges amounting to RMB2,932
million. Related costs for lease of power support and other network assets and resources amounting to RMB8,243 million.
Related costs for lease of offices and retail outlets include the depreciation of right-of-use assets, finance costs associated withthe lease liabilities and other charges amounting to RMB1,409 million.

(v)

The amounts represent the bank deposits received from or repaid to CMCC Group and related interest expenses. The interest
rate of short-term bank deposits is negotiated based on the benchmark interest rate published by the PBOC.

(b) Principal transactions with associates and joint ventures of the GroupThe following is a summary of principal related party transactions entered into by the Group with theassociates and joint ventures of the Group for the year ended 31 December 2023 and 2022, the terms ofwhich are fair and reasonable.
2023
Million2022
Million

(iv)
(iv)

1,526
135
5,040
39
3,572
41,020
3,277

1,197
97
5,101
110
3,726
41,54462,907(v)

16,027(18,512)

(vi)
(vii)
(vii)
(viii)

–
3,000
3,248
2,681

(5,650)10,000
8,838
2,174

Note
Revenue from telecommunications services
Telecommunications services charges
Technical support services charges
Property leasing and management services revenue
Dividend received
Related costs for use of tower assets
Additions of right-of-use assets
Increase/(decrease) in cash, cash equivalents andbank deposits
Decrease in other financial assets measured atamortized cost
Purchase of financial assets measured at FVPL
Disposal of financial assets measured at FVPL
Interest and other income

(i)
(i)
(ii)
(iii)

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

41 RELATED PARTY TRANSACTIONS (CONTINUED)(b) Principal transactions with associates and joint ventures of the Group (continued)
The outstanding balances related to transactions with the associates and joint ventures of the Group areincluded in the following accounts captions summarized as follows:

Accounts receivable
Right-of-use assets
Other receivables
Cash, cash equivalents and bank deposits
Other financial assets measured at amortized cost
Financial assets measured at FVPL
Prepayments
Lease liabilities
Accounts payable and accrued expenses
Bills payable
Receipts in advance
Other payables

As at
31 December
2023
Million

As at
31 December
2022
Million(Re-presented)

345
54,441
111
71,197
201
33,08631
60,17816,365
13,3261232

278
67,776
252
56,052201
32,185
3
70,59915,362
5,026
17
11

Note:
(i)

The Group provides/purchases telecommunications services to/from Group’s associates and joint ventures for thetelecommunications project planning, design and construction services and telecommunications services.

(ii)

The Group purchases technical support and other services from the Group’s associates and joint ventures.

(iii)

The Group provides property leasing and management service to China Tower and other associates and joint ventures.

(iv)

The amounts primarily represent the related costs for tower assets leasing and other service charges/the additions of right-ofuse assets. For the year ended 31 December 2023, related costs for use of tower assets include the depreciation of right-of-use
assets amounting to RMB13,796 million (2022: RMB14,545 million), charges for use of tower assets and finance costs associatedwith the lease liabilities amounting to RMB26,629 million (2022: RMB26,580 million), other service charges amounting to
RMB595 million (2022: RMB419 million).

(v)

The amounts represent the deposits placed with SPD Bank, the interest rate of which is negotiated based on the benchmark
interest rate published by PBOC.

(vi)

The amounts represent debt instrument investments placed with SPD Bank. The related interest rates are mutually agreed
among both parties with reference to the market interest rates.

(vii)

The amounts represent the WMPs purchased from SPD Bank. The return rates of WMPs are determined with reference tomarket conditions.

(viii)

The amounts primarily represent interest income from the deposits placed with SPD Bank and debt instrument investments
placed with SPD Bank, and the income derived from WMPs purchased from SPD Bank and the CB publicly issued by SPD Bank.

161

162

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

41 RELATED PARTY TRANSACTIONS (CONTINUED)(c) Transactions with a major associate of CMCC GroupThe following is a summary of principal related party transactions entered into by the Group with the
major associate of the CMCC Group for year ended 31 December 2023 and 2022, the terms of which are
fair and reasonable.

Increase in cash, cash equivalents and bank deposits
Interest and other income

Note

2023
Million2022
Million

(i)
(ii)

938
1,845

––
––

The outstanding balances related to transactions with the major associates of the CMCC Group areincluded in the following accounts captions summarized as follows:
As at
31 December
2023
Million

As at
31 December
2022
Million

3,645
38,691––––

Cash, cash equivalents and bank deposits
Financial assets measured at FVPL
Notes:(i)

The amounts represent the deposits placed with Postal Savings Bank of China (“PSBC”), the interest rate of which is negotiatedbased on the benchmark interest rate published by PBOC.

(ii)

The amounts primarily represent income from the deposits placed with PSBC, and the income derived from WMPs purchasedfrom PSBC.

(d) Transactions with other government-related entities in the PRC
The Group is a government-related enterprise and operates in an economic regime currently dominatedby entities directly or indirectly controlled by the PRC government through government authorities,
agencies, affiliations and other organization (collectively referred to as “government-related entities”).
Apart from transactions with CMCC Group (note 41(a)), associates and joint ventures (note 41(b)) andan associate of CMCC Group (note 41(c)) with other government-related entities which include but notlimited to the following:–

rendering and receiving telecommunications services, including interconnection revenue/charges–

sharing certain telecommunications network infrastructures and frequency bands of the radio
spectrum–purchasing of goods, including use of public utilities–

placing of bank deposits and purchasing of investment products

These transactions are conducted during the ordinary course of the Group’s business based on terms
comparable to the terms of transactions enacted with other entities that are not government-related.
The Group prices all its telecommunications services and products based on commercial negotiations
with reference to rules and regulations stipulated by related authorities of the PRC Government, whereapplicable. The Group has also established its procurement policies and approval processes for purchasesof products and services, which do not depend on whether the counterparties are government-related
entities or not.

(e) For key management personnel remuneration please refer to note 12.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

42 FINANCIAL RISK MANAGEMENT AND FAIR VALUES
Exposure to credit, liquidity, interest rate and foreign currency risks arises in the normal course of the Group’sbusiness. The Group’s exposure to these risks and the financial risk management policies and practices usedby the Group to manage these risks are described below:(a) Credit risk and concentration risk
The Group’s credit risk is primarily attributable to the financial assets in the balance sheet, which mainly
include deposits with banks, WMPs, asset management plans, CB, bills receivable, accounts receivable,
other receivables and other financial assets measured at amortized cost. The maximum exposure tocredit risk is represented by the carrying amount of the financial assets.

(i)

Risk management
Substantially all the Group’s cash at banks, and bank deposits are deposited in financial institutionsin the mainland of China and Hong Kong. The credit risk on liquid funds is limited as the majority ofcounterparties are financial institutions with high credit ratings assigned by international credit-rating
agencies and large state-controlled financial institutions. The Group’s WMPs and asset management
plans are issued by major domestic banks and other financial institutions investing in low or medium
risk underlying assets, which mainly consist of money market instruments, PRC treasury bond,central bank bill, local government debt, corporate bond or debt with high credit ratings, and somestock investments. CB are bonds with AAA credit rating bonds issued by SPD Bank. Other financial
assets measured at amortized cost primarily include PRC treasury bonds, various debt instrument
investments to banks and other financial institutions and third parties with high credit, as such, therelated credit risk is considered as immaterial.
The accounts receivable of the Group are primarily comprised of receivables due from customers
and other telecommunications operators. Accounts receivable from individual customers are
spread among an extensive number of customers and the majority of the receivables fromindividual customers are due for payment within one month from the date of billing. For corporate
customers, the credit period granted by the Group is based on the service contract terms, normallynot exceeding 1 year. Other receivables primarily comprise receivables due from deposits andretentions. Management has a credit policy in place and the exposures to these credit risks aremonitored on an ongoing basis, taking into account the counter parties’ financial position, theGroup’s past experience and other factors. Meanwhile, concentrations of credit risk with respect
to accounts receivables are limited due to the Group’s customer base being large and unrelated.
As such, management considers the aggregate risks arising from the possibility of credit losses islimited and acceptable.

163

164

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

42 FINANCIAL RISK MANAGEMENT AND FAIR VALUES (CONTINUED)(a) Credit risk and concentration risk (Continued)(ii)

Impairment of financial assets
The Group has the following types of assets that are subject to expected credit loss model:–

Accounts receivable and contract assets–

Other financial assets measured at amortized costAccounts receivable and contract assets
The Group applies the simplified approach to measuring expected credit losses which uses a
lifetime expected loss allowance for all accounts receivable and contract assets.
To measure the expected credit losses, accounts receivable have been grouped by amounts duefrom individual customers, corporate customers, and other miscellaneous customer groups basedon similar credit risk characteristics and ages.
The expected loss rates are based on the payment profiles of sales over a period before 31
December 2023 or 31 December 2022 respectively and the corresponding historical credit losses
experienced within this period. The Group’s expected loss rates are mainly determined based on
the corresponding historical credit losses. The Group also has considered the expected changes inmacroeconomic factors, such as Consumer Price Index (“CPI”), Producer Price Index (“PPI”) and
Gross Domestic Product (“GDP”), and adjusted the historical loss rates based on expected changes
in these factors accordingly to reflect current and forward-looking information affecting the ability of
the customers to settle the receivables.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

42 FINANCIAL RISK MANAGEMENT AND FAIR VALUES (CONTINUED)(a) Credit risk and concentration risk (Continued)(ii)

Impairment of financial assets (Continued)
Accounts receivable and contract assets (Continued)
The expected credit loss as at 31 December 2023 and 2022 was determined as follows for eachcustomers group of accounts receivables due from individual customers and corporate customers,
respectively:

As at 31 December 2023
Individual customers
Expected loss rate
Gross carrying amount
Loss allowance

As at 31 December 2023
Corporate customers
Expected loss rate
Gross carrying amount
Loss allowance

As at 31 December 2022
Individual customers
Expected loss rate
Gross carrying amount
Loss allowance

As at 31 December 2022
Corporate customers
Expected loss rate
Gross carrying amount
Loss allowance

Within30 daysMillion31 days to
90 daysMillion91 days to
1 yearMillionOver
1 yearMillion

2%
2,748
(55)

20%
846
(169)

80%
1,893
(1,514)100%
1,845(1,845)

Within180 days
Million181 daysto 1 year
Million1 yearto 2 years
Million2 years
to 3 years
MillionOver 3years
Million3%
23,075(692)

25%
11,662(2,916)65%
10,143(6,593)85%
3,604(3,063)100%
4,586(4,586)

Within30 daysMillion31 days to
90 daysMillion91 days to
1 yearMillionOver
1 yearMillion

2%
2,890
(58)

20%
742
(148)

80%
1,520
(1,216)100%
1,380(1,380)Within180 days
Million181 daysto 1 year
Million1 yearto 2 years
Million2 years
to 3 years
MillionOver 3years
Million3%
15,812
(474)

25%
8,782
(2,196)65%
4,556(2,961)85%
2,401(2,041)

100%
3,002(3,002)As at 31 December 2023 and 2022, the expected loss rates for contract assets are from 3% to 5%.
The expected credit loss of the receivables from other customers is insignificant.
Expected credit impairment losses on accounts receivable are presented within other operating
expenses. Subsequent recoveries of amounts previously written off are credited against the sameline item. Individual receivables which were known to be uncollectible were written off by reducing
the carrying amount directly.

165

166

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

42 FINANCIAL RISK MANAGEMENT AND FAIR VALUES (CONTINUED)(a) Credit risk and concentration risk (Continued)(ii)

Impairment of financial assets (Continued)
Other financial assets measured at amortized cost
Other financial assets measured at amortized cost include cash and cash equivalents, bank deposits,
bills receivables, other receivables, PRC treasury bonds and other debt instrument investments, etc.
They are considered to be of low credit risk and the relevant expected credit loss is insignificant.

(b) Liquidity risk
Liquidity risk refers to the risk that funds will not be available to meet liabilities as they fall due, andresults from timing and amount mismatches of cash inflow and outflow. The Group maintains sufficient
cash balances and bank deposits (which are readily convertible to known amounts of cash) to meet its
funding needs, including working capital, capital expenditures, dividend payments, and payments for
short-term deposits of CMCC Group received by China Mobile Finance, etc.
The following table sets out the remaining contractual maturities at the balance sheet date of theGroup’s financial liabilities, which are based on the undiscounted cash flows (including interest payments
computed using contractual rates or, if floating, based on prevailing rates at the balance sheet date) andthe earliest date the Group would be required to repay:

As at 31 December 2023
Accounts payable and accrued expenses
Bills payable
Receipts in advance
Other payables
Lease liabilities
Other non-current liabilities

Carrying
amountMillion

Total
contractual
undiscounted
cash flow
MillionWithin1 yearor on
demandMillionMore than
1 year but
less than
3 years
MillionMore than
3 years but
less than
5 years
MillionMore than
5 years
Million297,456
26,52079,035
26,673102,934
359

297,456
26,52079,035
26,673110,821405

297,456
26,52079,035
26,67336,099–––––45,34977––––
22,168
81

–
–
–
–
7,205
247

532,977

540,910465,783

45,42622,249

7,452

Carrying
amountMillion(Re-presented)
As at 31 December 2022
Accounts payable and accrued expenses
Bills payable
Receipts in advance
Other payables
Lease liabilities
Other non-current liabilities

More thanMore thanWithinTotal
3 years but
1 year but
1 yearcontractual
less thanMore thanless thanor onundiscounted
5 years
5 years
3 years
demandcash flow
MillionMillionMillionMillionMillion(Re-presented) (Re-presented) (Re-presented) (Re-presented) (Re-presented)

271,306
14,75984,44635,286112,660
383

271,306
14,75984,44635,286122,029423

271,306
14,75984,44635,28632,970–––––41,922
84––––
32,63681––––
14,501
258

518,840

528,249

438,767

42,00632,717

14,759Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

42 FINANCIAL RISK MANAGEMENT AND FAIR VALUES (CONTINUED)(c) Interest rate and fair value risk
The Group consistently monitors the current and potential fluctuation of interest rates in managing theinterest rate risk on a reasonable level. As at 31 December 2023, the Group did not have any interestbearing borrowings at variable rates, but had RMB3,408 million (as at 31 December 2022: RMB12,521
million) of short-term bank deposits placed by CMCC, which were at fixed rate and expose the Group to
fair value interest rate risk. The Group determines the amount of its fixed rate borrowings depending on
the prevailing market condition. Management does not expect fair value interest rate risk to be high as
the interest involved will not be significant.
As at 31 December 2023, total cash and bank deposits balances of the Group amounted to RMB234,159
million (as at 31 December 2022: RMB269,370 million), interest-bearing other financial assets measured
at amortized cost and other debt investments amounted to RMB40,643 million (as at 31 December
2022: RMB26,145 million), and WMPs, monetary funds and other investment products amounted to
RMB330,258 million (as at 31 December 2022: RMB283,767 million). The interest and other income
generated by the assets mentioned above for 2023 was RMB19,970 million (2022: RMB16,109 million)
and the average interest rate was 3.37% (2022: 2.76%). Assuming the total cash and bank balances,interest-bearing receivables and WMPs are stable in the coming year and interest rate increases/
decreases by 100 basis points, the profit for the year and total equity would approximately increase/decrease by RMB4,538 million (2022: RMB4,345 million).
The carrying amount of the financial instruments carried at amortized cost are not materially different
from their respective fair values at the balance sheet dates as they are readily convertible into cash or
repayable on demand.

(d) Foreign currency risk
The Group has foreign currency risk as certain cash and deposits with banks are denominated in foreign
currencies, principally Hong Kong dollars and US dollars that is different from the functional currency of
the respective group entities. As the amount of the Group’s foreign currency cash and deposits withbanks represented 5.20% (2022: 3.4%) of the total cash and deposits with banks, the Group considered
the related foreign currency risk was immaterial.

167

168

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

43 CAPITAL COMMITMENTS
The Group’s capital expenditure contracted for as at 31 December but not provided for in the consolidated
financial statements are as follows:

Land and buildings
Telecommunications equipment and others

2023
Million2022
Million

2,829
20,0662,205
27,552

22,89529,75744 EVENTS AFTER THE REPORTING PERIOD
Proposed dividend
After the balance sheet date, the Board of Directors proposed a final dividend for the year ended 31 December
2023. Further details are disclosed in note 39(b)(i).

Change of the depreciable life of 5G wireless assets and related transmission equipment
On 21 March 2024, the Board of Directors of the Company approved to change the depreciable life of 5G
wireless assets and related transmission equipment. At the end of 2023, the IMT-2030 (6G) Promotion Group
formally proposed that the 6G standard shall be established in 2025 with commercialization expected in 2030.
It was also clearly stated that 5G network investments shall be reused in 6G network infrastructure to the
maximum extent, and therefore it is expected that 5G and 6G networks will co-exist after commercializationof 6G and 5G equipment will have a relatively long life cycle. After full consideration of technology, businessand other factors and detailed assessment of the state of use of relevant assets, and also with reference tothe practices of other telecommunications operators, the Board of Directors of the Company resolved andapproved an adjustment of the depreciable life of the 5G wireless assets and related transmission equipmentfrom 7 years to 10 years with effect from 1 January 2024, which the Company considers to be a moreobjective and fair reflection of the expected useful life of such type of assets and their actual state of use.
The aforesaid change in accounting estimate will be made using the prospective application method with noneed for any retrospective adjustment, and hence the Group’s financial reports for 2023 and earlier years will
not be affected. The aforesaid changes are estimated to affect the Group’s depreciation by a decrease of
approximately RMB18.0 billion for the year ending 31 December 2024.

45 COMPARATIVE FIGURES
Certain comparative figures on the consolidated financial statements have been re-presented to conform to thepresentation for the year.

Annual Report 2023

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

46 ACCOUNTING ESTIMATES AND JUDGEMENTS
Critical estimations and judgements are as follows:

Impairment losses of accounts receivable
The impairment loss allowance of accounts receivable is based on assumptions about risk of default andexpected loss rates. The Group assesses these assumptions and selects the inputs to the impairment
calculation, based on the Group’s historical credit losses, macroeconomic factors as well as expected changes
in these factors at each balance sheet date.

Depreciation
Depreciation is calculated to write off the cost of property, plant and equipment, less their estimated residual
value, if any, using the straight-line method over their estimated useful lives. The Group reviews the estimateduseful lives and residual values of the assets annually in order to determine the amount of depreciation expense
to be recorded during any reporting period. The useful lives and residual values are determined based on theGroup’s historical experience with similar assets and take into account anticipated technological changes. The
depreciation expense for future periods is adjusted if there are significant changes from previous estimates.

Taxation
The Group is subject to income taxes mainly in the mainland of China and Hong Kong. Significant judgment
is required in determining the provision for income taxes. There are many transactions and calculations forwhich the ultimate tax determination is uncertain during the ordinary course of business. The Group recognizes
liabilities for anticipated tax issues based on estimates of whether additional taxes will be due. Where the final
tax outcome of these matters is different from the amounts that were initially recorded, such differences will
impact the income tax and deferred tax provisions in the period in which such determination is made.
For temporary differences which give rise to deferred tax assets, the Group assesses the likelihood that thedeferred tax assets could be recovered. Deferred tax assets are recognized based on the Group’s estimatesand assumptions that they will be recovered from taxable income arising from continuing operations in theforeseeable future.

Impairment of property, plant and equipment, goodwill, right-of-use assets, otherintangible assets and investments accounted for using the equity method
The Group’s property, plant and equipment, goodwill, right-of-use assets, other intangible assets andinvestments accounted for using the equity method comprise a significant portion of the Group’s total assets.
Changes in technology or industry conditions may cause the value of these assets to change. Property, plantand equipment, right-of-use assets, other intangible assets subject to amortization and investments accounted
for using the equity method, are reviewed at least annually to determine whether there is any indicationof impairment. The recoverable amount is estimated whenever events or changes in circumstances haveindicated that their carrying amounts may not be recoverable. In addition, for goodwill, the recoverable amount isestimated annually whether or not there is any indication of impairment.
The recoverable amount of an asset is the greater of its fair value less costs of disposal and VIU. In assessing VIU,
the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset. The calculationof the estimated future cash flow requires significant judgement relating to level of revenue and amount ofoperating costs. The Group uses all readily available information in determining an amount that is a reasonableestimation of the recoverable amount, including estimates based on reasonable and supportable assumptions
and projections of revenue and operating costs. Changes in these estimates could have a significant impact
on the carrying value of the assets and could result in further impairment charge or reversal of impairment in
future periods. Additional information for the impairment assessment of goodwill and investments accounted
for using the equity method is disclosed in notes 19 and 22, respectively.

169

170

China Mobile Limited

Notes to the Consolidated Financial Statements(Expressed in RMB unless otherwise indicated)

47 POSSIBLE IMPACT OF AMENDMENTS, NEW STANDARDS,
INTERPRETATIONS AND DISCLOSURES ISSUED BUT NOT YET EFFECTIVE
OR MANDATORY FOR THE YEAR ENDED 31 DECEMBER 2023
Up to the date of issue of these financial statements, the IASB/HKICPA has issued a number of amendments
and new standards which are not yet effective or mandatory for the year ended 31 December 2023 and whichhave not been adopted in these financial statements. Of these developments, the following relate to mattersthat may be relevant to the Group’s operations and financial statements:
Effective foraccounting
periods
beginning on
or after
Amendments to IAS/HKAS 1, “Presentation of financial statements” – Classification of
liabilities as current or non-current (“2020 amendments”)

1 January 2024

Amendments to IAS/HKAS 1, Presentation of financial statements: Non – current liabilities
with covenants (“2022 amendments”)

1 January 2024

Amendments to IFRS/HKFRS 16, Leases: Lease liability in a sale and leaseback

1 January 2024

Amendments to IAS/HKAS 7, Statement of cash flows and IFRS/HKFRS 7, Financial
Instruments: Disclosures: Supplier finance arrangements

1 January 2024

Amendments to IAS/HKAS 21, The effects of changes in foreign exchange rates: Lack of
exchangeability

1 January 2025

Amendments to IFRS/HKFRS 10, “Consolidated Financial Statements” andIAS/HKAS 28, “Investments in associates and joint ventures” – Sale or contributionof assets between an investor and its associate or joint venture

To be determinedManagement is assessing the impact of such new standards and amendments to standards and will adopt therelevant standards and amendments to standards in the subsequent periods as required.

Annual Report 2023

Financial Summary(Expressed in RMB)RESULTS
2023
Million2022
Million2021
Million2020
Million2019
Million863,514145,795

812,058
125,201

751,409
96,849695,692
72,378674,392
71,525

1,009,309

937,259

848,258

768,070

745,917

268,895
207,132
144,333
52,477
142,80759,319254,182
200,077
130,157
49,592
122,743
51,409225,010
193,045
118,680
48,24396,08349,234

206,424
172,401
106,429
49,943
73,10047,039

175,810
182,818
102,518
52,81372,56546,244874,963

808,160

730,295

655,336

632,768

Profit from operations

134,346

129,099

117,963

112,734

113,149

Other gains
Interest and other income
Finance costs
Income from investments accounted for using
the equity method

9,823
21,134(3,730)9,388
15,729(2,330)8,257
16,729(2,679)5,602
14,341(2,996)

4,029
15,560(3,246)

8,958

10,986

11,914

12,67812,641

Profit before taxation

170,531

162,872

152,184

142,359

142,133

Operating revenue
Revenue from telecommunications services
Revenue from sales of products and others
Operating expenses
Network operation and support expenses
Depreciation and amortization
Employee benefit and related expenses
Selling expenses
Cost of products sold
Other operating expenses

Taxation(38,596)(37,278)(35,878)(34,219)(35,342)PROFIT FOR THE YEAR

131,935

125,594

116,306

108,140

106,791

171

172

China Mobile Limited

Financial Summary(Expressed in RMB)

2023
Million2022
Million2021
Million2020
Million2019
Million

176

(226)

(406)

957

(75)

(184)

15

(143)

–

–

(146)

(12)

7

32

14

25
573

–
2,575

–
(882)

–
(1,915)

–
683

1,068

(1,093)

(219)

(585)

428

TOTAL COMPREHENSIVE INCOME FOR
THE YEAR

133,447

126,853

114,663

106,565

107,841

Profit attributable to:Equity shareholders of the Company
Non-controlling interests

131,766
169

125,459
135

116,148
158

107,843297

106,641150

PROFIT FOR THE YEAR

131,935

125,594

116,306

108,140

106,791

Total comprehensive income attributable to:Equity shareholders of the Company
Non-controlling interests

133,275
172

126,718
135

114,505
158

106,268297

107,691
150

TOTAL COMPREHENSIVE INCOME FOR
THE YEAR

133,447

126,853

114,663

106,565

107,841

Other comprehensive income for the year,
net of tax:
Items that will not be subsequently
reclassified to profit or loss
Changes in the fair value of financial assets
measured at fair value through othercomprehensive income
Remeasurement of defined benefit
liabilities
Share of other comprehensive (loss)/income of investments accounted forusing the equity method
Items that may be subsequently
reclassified to profit or loss
Changes in the fair value of financial assets
measured at fair value through othercomprehensive income
Currency translation differences
Share of other comprehensive income/(loss) of investments accounted forusing the equity method

Annual Report 2023

Financial Summary(Expressed in RMB)ASSETS AND LIABILITIES
As at
31 December
2023
Million

As at
31 December
2022
Million

As at
31 December
2021
Million

As at
31 December
2020
MillionAs at 31
December
2019
Million714,663
74,496
94,753
14,87735,301
2,279
32,720717,12173,087
108,749
15,24435,301
1,334
31,265

701,977
71,74255,35015,73935,344919
28,580686,60971,65165,091
16,19235,344574
25,577660,707
67,97874,30816,48935,343528
17,072

181,715
47,337

175,649
43,638

169,556
43,216

161,811
38,998155,228
32,628

3,518

490

689

1,111

513

185,621

187,130

78,600––5,628
55,387
46,2589,716
45,88734,556283
17,056
26,905–23,836
21,345–
10,06328,517

Current assets

498,104

456,371595,371579,743

529,866

Total assets

1,992,657

1,935,538

1,841,327

1,727,882

1,629,240

Current liabilities

558,565

533,337

582,148517,274

462,067

Lease liabilities
Deferred revenue
Defined benefit plan and other employee
benefit liabilities
Deferred tax liabilities
Other non-current liabilities

67,7599,281

81,7418,810

30,922
8,487

42,4608,601

51,635
6,861

6,408
3,077
1,582

5,951
2,571
1,705

5,522
2,369
1,587

4,355
1,668
752

–
1,388
–

Property, plant and equipment
Construction in progress
Right-of-use assets
Land use rights
Goodwill
Development expenditure
Other intangible assets
Investments accounted for using theequity method
Deferred tax assets
Financial assets measured at fair value
through other comprehensive income
Financial assets measured at fair value
through profit or loss
Other financial assets measured atamortized cost
Bank deposits
Other non-current assets

Total liabilities

646,672

634,115

631,035

575,110

521,951

Total equity

1,345,985

1,301,423

1,210,292

1,152,772

1,107,289

Certain comparative figures in this financial summary have been re-presented to conform to the presentation for the
year.

173

174

China Mobile Limited

Corporate Information

BOARD OF DIRECTORSCOMPANY SECRETARYRMB SHARE REGISTRAR

Executive Directors

Ms. WONG Wai Lan, Grace

China Securities Depository andClearing Corporation Limited(CSDC)
Head Office Address:
No. 17 Tai Ping Qiao Street,
Xicheng District,
Beijing, P.R. China
Postal Code: 100033
www.chinaclear.cn

Mr. YANG Jie(Executive Director & Chairman)
Mr. LI Pizheng(Executive Director)
Mr. LI Ronghua(Executive Director &Chief Financial Officer)

Independent Non-Executive
Directors
Mr. Stephen YIU Kin Wah
Dr. YANG Qiang
Mr. Carmelo LEE Ka Sze
Mrs. Margaret LEUNG KO May Yee

PRINCIPAL BOARD
COMMITTEES
Audit Committee
Mr. Stephen YIU Kin Wah (Chairman)
Dr. YANG Qiang
Mr. Carmelo LEE Ka Sze
Mrs. Margaret LEUNG KO May Yee

Remuneration Committee
Mr. Stephen YIU Kin Wah (Chairman)
Dr. YANG Qiang
Mr. Carmelo LEE Ka Sze
Mrs. Margaret LEUNG KO May Yee

Nomination Committee
Dr. YANG Qiang (Chairman)
Mr. Stephen YIU Kin Wah
Mr. Carmelo LEE Ka Sze
Mrs. Margaret LEUNG KO May Yee

Sustainability Committee
Mrs. Margaret LEUNG KO May Yee(Chairman)
Mr. LI Ronghua
Mr. Carmelo LEE Ka Sze

AUDITORS
KPMG
Public Interest Entity Auditor
registered in accordance with
the Accounting and Financial
Reporting Council Ordinance
KPMG Huazhen LLP
Public Interest Entity Auditor
recognised in accordance with
the Accounting and Financial
Reporting Council Ordinance

LEGAL ADVISER
Sullivan & Cromwell (Hong Kong)
LLP

REGISTERED OFFICE
60/F, The Center
99 Queen’s Road Central
Hong Kong

PUBLIC AND INVESTORRELATIONS
Tel: 852 3121 8888
Fax: 852 2511 9092
Website: www.chinamobileltd.com
Stock code:(HKEX)
941 (HKD Counter) and
80941 (RMB Counter)(SSE) 600941

HK SHARE REGISTRAR
Hong Kong Registrars Limited
Shops 1712–1716,
17/F Hopewell Centre
183 Queen’s Road East
Wanchai, Hong Kong

PUBLICATIONSAs required by the laws andregulations of People’s Republicof China and Hong Kong SAR, theCompany shall file an annual reportwith Shanghai Stock Exchange andHong Kong Stock Exchange by theend of April each year. Copies of
the annual reports of the Company,
once filed, will be available at:Hong Kong and themainland of China:
China Mobile Limited
60/F, The Center,
99 Queen’s Road Central
Hong Kong
29 Jing Rong Avenue,
Xi Cheng District, Beijing, China
www.chinamobileltd.com
SSE: www.sse.com.cn
HKEX: www.hkexnews.hk

China Mobile Limited
60/F., The Center, 99 Queen’s Road Central, Hong Kong
Tel : (852) 3121 8888
Fax : (852) 3121 8809

Website: www.chinamobileltd.com
Welcome to China Mobile Limited’s website

This annual report is printed on environmentally friendly paper