Property and Equipment

  • Property and equipment are initially measured at cost which is comprised of its purchase price and any directly attributable costs of bringing the asset to the location and condition for its intended use. At the end of each reporting period, these items of property and equipment are measured at cost less any subsequent accumulated depreciation, amortization and impairment losses, if any. 
  • Subsequent expenditures relating to an item of property and equipment that have already been recognized are added to the carrying amount of the asset when it is probable that future economic benefits, in excess of the originally assessed standard of performance of the existing asset, will flow to the entity. The carrying amount of the replaced part is derecognized.  
  • All other subsequent expenditures are recognized as expenses in the period in which those are incurred. 
  • Depreciation and amortization are recognized in profit or loss on a straight-line basis over the estimated useful lives of the assets (or any on the basis of the depreciation method used by the entity). Building and land improvements are amortized over the estimated useful life of the improvements. 
  • The useful lives and depreciation and amortization methods are reviewed at each reporting date to ensure that the amounts, periods and methods of depreciation and amortization are consistent with the expected pattern of economic benefits from those assets. 
  • Fully depreciated assets are retained in the accounts until they are no longer in use and no further charge for depreciation is made in respect of those assets.  
  • An item of property and equipment is derecognized upon disposal or when no future economic benefits are expected from its use or disposal, the cost and the related accumulated depreciation and amortization, and impairment losses, if any, are removed from the accounts. Any resulting gain or loss arising from the retirement or disposal, which is the difference between the sales proceeds and the carrying amount of the asset, is recognized in profit or loss.

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