axiata group berhad | annual report 2015
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3.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(c) Property, plant and equipment (“PPE”) (continued)
(ii) Depreciation and residual value
Freehold land is not depreciated as it has an infinite life. Other PPE are depreciated on a straight-line basis to write off the cost of the assets
to their residual values over their estimated useful lives in years, as summarised below:
Leasehold land
3 - 99 years
Buildings
2 - 50 years
Telecommunication network equipment
2 - 20 years
Movable plant and equipment
1 - 10 years
Computer support systems
2 - 10 years
Depreciation on assets under construction or capital work-in-progress commence when the assets are ready for their intended use.
Depreciation on PPE ceases at the earlier of derecognition or classification as held-for-sale.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of the reporting period.
(iii) Impairment
At the end of the reporting period, the Group and the Company assess whether there is any indication of impairment. If such indication
exists, an analysis is performed to assess whether the carrying value of the asset is fully recoverable. A write down is made if the carrying
value exceeds the recoverable amount. See significant accounting policies Note 3(e) to the financial statements on impairment of non-
financial assets.
(iv) Gains or losses on disposals
Gains or losses on disposals are determined by comparing the proceeds with the carrying amount of the related asset and are included in
the profit or loss.
(v) Asset exchange transaction
PPE may be acquired in exchange for a non-monetary asset or for a combination of monetary and non-monetary assets and is measured
at fair value unless;
•
the exchange transaction lacks commercial substance; or
•
the fair value of neither the assets received nor the assets given up can be measured reliably.
The acquired item is measured in this way even if the Group and the Company cannot immediately derecognise the assets given up. If the
acquired item cannot be reliably measured at fair value, its cost is measured at the carrying amount of the asset given up.
(vi) Repairs and maintenance
Repairs and maintenance are charged to the profit or loss during the period in which they are incurred. The cost of major renovations
is included in 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 Group and the Company. This cost is depreciated over the remaining useful
life of the related asset.
