Westgold Resources Limited Annual Report 2021

72 Westgold Resources Limited Annual Report 2021 for the year ended 30 June 2021 FINANCIAL REPORT NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 7. EXPENSES 2021 2020 (a) Cost of sales Gold production Salaries, wages expense and other employee benefits 158,441,833 133,259,379 Other production costs 129,580,548 167,889,923 Write down in value of inventories to estimated net realisable value 6,175,664 1,005,487 Royalty expense 21,922,481 20,901,094 Contract mining services Salaries, wages expense and other employee benefits 54,126 632,015 Mining and contracting service costs 3,155 308,958 Depreciation and amortisation expense Depreciation of non-current assets: Property, plant and equipment 52,350,718 43,275,574 Buildings 1,883,586 1,827,771 Right-of-use assets 7,482,892 7,531,333 Amortisation of non-current assets: Mine properties and development costs 77,561,033 86,121,198 Total cost of sales 455,456,036 462,752,732 (b) Finance costs Interest expense 1,587,326 2,694,183 Capitalised borrowing costs to qualifying asset (1,587,326) (2,694,183) Unwinding of rehabilitation provision discount 347,475 918,881 Total finance costs 347,475 918,881 The development of the Big Bell Underground Mine is deemed to be a qualifying asset and interest expenses of $1,587,326 (2020: $2,694,183) have therefore been capitalised to the underlying qualifying asset. The rate used to determine the amount of borrowing costs eligible for capitalisation was 4.16% (2020: 4.60%).