Page 119 - S P Setia Annual Report 2016

 

 

 

 

 

Page 119 - S P Setia Annual Report 2016
P. 119

S P Setia Berhad Group                                                                                 117
          Annual Report 2016




                                                                               Notes To The Financial Statements

                                                                                  For The Financial Year Ended 31 December 2016

          1.   SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)
              (g)   Property, plant and equipment

                   (i)   Measurement basis

                       Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses, if any.

                       The cost of property, plant and equipment includes expenditure that is directly attributable to the acquisition of an asset.

                       Subsequent costs are included in the asset’s carrying amount when it is probable that future economic benefits associated
                       with the asset will flow to the Group and to the Company 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 profit or loss during the
                       financial year in which they are incurred.

                       Property, plant and equipment are derecognised upon disposal or when no future economic benefits are expected from
                       their use or disposal. On disposal, the difference between the net disposal proceeds and the carrying amount is recognised
                       in profit or loss.

                   (ii)  Depreciation

                       Freehold land and capital work-in-progress are not depreciated.

                       Depreciation is calculated to write off the depreciable amount of other property, plant and equipment on a straight-line
                       basis over their estimated useful lives. The depreciable amount is determined after deducting residual value from cost.

                       The principal annual rates used for this purpose are:

                        Freehold buildings                                                       2%
                        Leasehold land                                            Lease term of 99 years
                        Plant, machinery, cranes and trucks                                     20%
                        Renovations, computer equipment,
                          office equipment, furniture and fittings                          10% - 33%
                        Motor vehicles                                                          20%

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

              (h)   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 benefits associated
                       with the asset will flow 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 profit or loss during the financial year in
                       which they are incurred.

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