ANNUAL REPORT 2014
61
NOTES TO THE FINANCIAL STATEMENTS
(CONTINUED)
For the financial year ended 31 December 2014
2.
SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
(c)
Group accounting
(continued)
(2)
Associated companies (continued)
(iii) Disposals
Gains and losses arising from partial disposals or dilutions in investments in associated companies
in which significant influence is retained are recognised in profit or loss.
Investments in associated companies are derecognised when the Group loses significant influence.
If the retained equity interest in the former associated company is a financial asset, the retained
equity interest is measured at fair value. The difference between the carrying amount of the
retained interest at the date when significant influence is lost and its fair value is recognised
in profit or loss.
Please refer to Note 2(g) for the Company’s accounting policy on investments in subsidiaries
and associated companies.
(d)
Property, plant and equipment
(1)
Leasehold land and buildings
Leasehold land and buildings are stated at cost less accumulated depreciation and accumulated
impairment losses (Note 2(h)(2)).
(2)
Plant and equipment
Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment
losses (Note 2(h)(2)).
(3)
Components of costs
The cost of an item of property, plant and equipment includes its purchase price and any cost that is
directly attributable to bringing the asset to the location and condition necessary for it to be capable
of operating in the manner intended by management. The projected cost of dismantlement, removal
or restoration is also included as part of the cost of property, plant and equipment if the obligation for
dismantlement, removal or restoration is incurred as a consequence of acquiring or using the asset.
(4)
Depreciation
Depreciation is calculated using a straight-line method to allocate the depreciable amounts of property,
plant and equipment over their estimated useful lives as follows:
Leasehold land and buildings
-
50 years or over the term of the lease, whichever is shorter
Plant and equipment
-
4 to 10 years
Construction-in-progress assets are not depreciated until they are brought to use. Fully depreciated
assets are retained in the financial statements until they are no longer in use.
The residual values, estimated useful lives and depreciation method of property, plant and equipment
are reviewed, and adjusted as appropriate, at each financial year-end to ensure that the method and
period of depreciation are consistent with the expected pattern of economic benefits from items of
property, plant and equipment. The effects of any revision are recognised in the profit or loss for the
financial year in which the changes arise.
