2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) 2.7 Property, plant and equipment (cont’d.) S ubsequent to initial recognition, property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses, if any. When significant parts of property, plant and equipment are required to be replaced at intervals, the Group and the Company recognise such parts as individual assets with specific useful lives and depreciates them accordingly. The carrying amount of parts that are replaced is derecognised. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred. Freehold land has unlimited useful life, and therefore is not depreciated. Construction in-progress are not depreciated as these assets are not yet available for use. A bearer plant is a living plant that is used in the production or supply of agricultural produce, is expected to bear produce for more than one period and has a remote likelihood of being sold as agricultural produce, except for incidental scrap sales. The bearer plants of the Group are fish, fruits, vegetables and poultry. Immature bearer plants are measured at accumulated costs of planting of bearer plants, similar to accounting for a self-constructed item of property, plant and equipment. Bearer plants are classified as immature until it is available for harvest. At that point, bearer plants are measured at amortised cost and depreciated over their useful life. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows: - Freehold buildings: 20 to 50 years - Leasehold buildings: 20 to 50 years - Golf course: 99 years - Plant and machineries: 5 to 20 years - Office furniture, fittings and equipment: 4 to 10 years - Motor vehicles: 5 years - Bearer plants: 25 years T he residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate. A n item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the profit or loss when the asset is derecognised. 2.8 Inventories (a) Land held for property development L and held for property development consists of land where no development activities have been carried out or where development activities are not expected to be completed within the normal operating cycle. Such land is classified within noncurrent assets and is carried at lower of cost and net realisable value. L and held for property development is reclassified as property development costs at the point when development activities have commenced and where it can be demonstrated that the development activities can be completed within the normal operating cycle. NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022 176 ANNUAL REPORT 2022
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