Page 109 - S P Setia Annual Report 2013
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Annual Report 2013 S P SETIA BERHAD GROUP Financial Statements | 107





NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 OCTOBER 2013 (CONT’D)






1. SiGniFicant accOUntinG POlicieS (cOnt’D)

(i) Property, plant and equipment (cont’d)
(ii) Depreciation (cont’d)

The principal annual rates used for this purpose are:

Freehold buildings 1% - 2%
Plant, machinery, cranes and trucks 20%
Offce equipment, renovations, furniture and fttings 10% - 40%
Motor vehicles 16%

The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.

(j) Investment properties
Investment properties are properties held to earn rental income or for capital appreciation or both rather than for use in the production
or supply of goods and services or for administrative purposes, or sale in the ordinary course of business. Investment properties include
properties that are being constructed or developed for future use as investment properties.

(i) Measurement basis
Investment properties are stated at cost less accumulated depreciation and impairment losses, if any.

The cost of investment properties includes expenditure that is directly attributable to the acquisition of the asset.

Subsequent costs are included in the asset’s carrying amount when it is probable that future economic benefts associated with
the asset will fow to the Group and the cost of the asset can be measured reliably. The carrying amount of the replaced part is
derecognised. All other repairs and maintenance are charged to proft or loss during the fnancial year in which they are incurred.

Investment properties are derecognised upon disposal or when they are permanently withdrawn from use and no future economic
benefts are expected from their disposal. On disposal, the difference between the net disposal proceeds and the carrying amount
is recognised in proft or loss.

(ii) Depreciation

Freehold land and investment properties under construction are not depreciated.
Depreciation is calculated to write off the depreciable amount of other investment properties on a straight-line basis over their
estimated useful lives. Depreciable amount is determined after deducting the residual value from the cost of the investment
property.

The principal annual rates used for this purpose are:

Freehold buildings 2%
Leasehold buildings Over the remaining period of the lease
Leasehold land Over the remaining period of the lease
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting
date.
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