12
Computer software
The Company recognises under “Computer Software” the costs incurred in the acquisition and
development of computer programs, including website development costs. Computer software
maintenance costs are recognised with a charge to the income statement for the year in which
they are incurred. Computer software is amortised on a straight-line basis over three to five years.
4.2Property, plant and equipment
Property, plant and equipment are initially recognised at acquisition or production cost and are
subsequently reduced by the related accumulated depreciation and by any impairment losses
recognised, as indicated in this note.
Property, plant and equipment upkeep and maintenance expenses are recognised in the income
statement for the year in which they are incurred. However, the costs of improvements leading to
increased capacity or efficiency or to a lengthening of the useful lives of the assets are capitalised.
The Company depreciates its property, plant and equipment by the straight-linemethod at annual
rates based on the years of estimated useful life of the assets, the detail being as follows:
Years of
estimated
useful life
Buildings
33
Plant
5 to 8
Computer hardware
3 to 5
Other fixtures
6 to 10
Other items of property, plant and equipment
6 to 10
Impairment of intangible assets and property, plant and equipment
At the end of each reporting period (for intangible assets with indefinite useful lives) or whenever
there are indications of impairment (for other tangible and intangible assets), the Company tests
these assets for impairment to determine whether the recoverable amount of the assets has been
reduced to below their carrying amount.
Recoverable amount is the higher of fair value less costs to sell and value in use.
In the case of property, plant and equipment, the impairment tests are performed individually for
each asset.
Where an impairment loss subsequently reverses (not permitted in the specific case of goodwill),
the carrying amount of the asset is increased to the revised estimate of its recoverable amount,
but so that the increased carrying amount does not exceed the carrying amount that would have
been determined had no impairment loss been recognised in prior years. A reversal of an
impairment loss is recognised as income.
4.3Operating leases
Lease income and expenses from operating leases are recognised in income on an accrual basis.
A payment made on entering into or acquiring a leasehold that is accounted for as an operating
lease represents prepaid lease payments that are amortised over the lease term in accordance
with the pattern of benefits provided.
The leases in which the Company is a lessor consist basically of facilities which the Company has
leased to companies in its Group.
