Notestothefinancialstatements
For the financial year ended31December 2015
2.
Summaryof significant accountingpolicies (cont’d)
2.6
Property, plant andequipment
All itemsof property, plant andequipment are initially recordedat cost. Subsequent to recognition, property, plant andequipment other than freehold landand
buildingaremeasuredat cost lessaccumulateddepreciationandany accumulated impairment losses.
Thecost includes thecostof replacingpartof theproperty, plantandequipmentandborrowingcosts thataredirectlyattributable to theacquisition, construction
or production of a qualifying property, plant and equipment. The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is
probable that futureeconomicbenefitsassociatedwith the itemwill flow to theGroupand the cost of the item canbemeasured reliably.
When significant parts of property, plant and equipment are required to be replaced in intervals, the Group recognises such parts as individual assets with
specificuseful livesanddepreciation, respectively. Likewise,whenamajor inspection isperformed, itscost is recognised in thecarryingamount of theplant and
equipment asa replacement if the recognition criteriaare satisfied. All other repair andmaintenance costsare recognised inprofit or lossas incurred.
Depreciationof anasset beginswhen it isavailable for useand is computedona straight-linebasisover theestimateduseful lifeof theasset as follows:
Leasehold landandbuildings
– over remaining termsof lease
Leasehold improvements
– 5 to7 years
Furnitureand fittings
– 5 years
Officeequipment
– 3 to5 years
Motor vehicles
– 4 to5 years
Plant andequipment
– 3 to10 years
Assetsunder constructionarenot depreciatedas theseassetsarenot yet available for use.
Fully depreciated assets still in use are retained in the financial statements until they are no longer in use and no further charge for depreciation ismade in
respect of theseassets.
Thecarrying valueof property, plant andequipment are reviewed for impairmentwheneventsor changes incircumstances indicate that thecarrying valuemay
not be recoverable.
The residual value, useful lifeanddepreciationmethodare reviewedat each financial year-endandadjustedprospectively, if appropriate.
An item of property, plant and equipment is derecognisedupondisposal orwhenno future economics benefits are expected from its use or disposal. Any gain
or lossarisingonderecognitionof theasset is included in theprofit or loss in the year theasset isderecognised.
2.
Summaryof significant accountingpolicies (cont’d)
2.7
Intangibleasset
Vessel design
Vessel design is treated as intangible asset and initially capitalised at cost. Vessel design is subsequently carried at cost less accumulated amortisation and
accumulated impairment losses. These costsareamortised toprofit or lossusing the straight-linemethodover theuseful lifeof 10 years.
2.8
Impairment of non-financial assets
TheGroupassessesat each reportingdatewhether there isan indication that anassetmaybe impaired. If any indicationexists, orwhenanannual impairment
testing for anasset is required, theGroupmakesanestimateof theasset’s recoverableamount.
Anasset’s recoverableamount is thehigher of anasset’sor cash-generatingunit’s fair value lesscostsof disposal and its value inuseand isdetermined for an
individual asset, unless theasset doesnot generatecash inflows that are largely independent of those fromotherassetsorgroupsof assets.Where thecarrying
amount of anasset or cash-generatingunit exceeds its recoverableamount, theasset is considered impairedand iswrittendown to its recoverableamount.
Impairment losses of continuing operations are recognised in profit or loss, except for assets that are previously revaluedwhere the revaluationwas taken to
other comprehensive income. In this case, the impairment isalso recognised inother comprehensive incomeup to theamount of any previous revaluation.
Apreviously recognised impairment loss is reversedonly if therehasbeenachange in theestimatesused todetermine theasset’s recoverableamount since the
last impairment losswas recognised. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increase cannot exceed
the carrying amount that wouldhave beendetermined, net of depreciation, hadno impairment loss been recognisedpreviously. Such reversal is recognised in
profit or lossunless theasset ismeasuredat revaluedamount, inwhich case the reversal is treatedasa revaluation increase.
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BAKERTECHNOLOGYlimited
ANNUAL REPORT 2015
