Keele University
Statement of Accounting Policies ( continued ) For the year ended 31 July 2021
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Fixed assets ( continued )
Impairment
A review for impairment of a tangible fixed asset is carried out if events or changes in circumstances indicate that the carrying amount of the tangible fixed asset may not be recoverable . If there is an indication of impairment , the recoverable amount of any affected asset is estimated and compared with its ’ carrying amount . If the estimated recoverable amount is lower , the carrying amount is reduced to its estimated recoverable amount , and an impairment loss is recognised when it arises . If an impairment loss subsequently reverses , the carry amount of the asset is increased to the revised estimate of its recoverable amount , but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in prior years . A reversal of an impairment loss is recognised when it arises .
Borrowing costs
Borrowing costs are recognised as expenditure in the period in which they are incurred . 14 . Heritage assets
Heritage assets are individual objects , collections , specimens or structures of historic , scientific or artistic value that are held and maintained principally for their contribution to knowledge and culture .
Heritage assets costing in excess of the capitalisation threshold of £ 20,000 will be capitalised and recognised at their cost or value where reasonably obtainable . The University uses the valuation for insurance purposes as the basis for the value reflected in the financial statements . The University ’ s significant donated assets are works of art , porcelain and antiques . These are accounted for as heritage assets .
Heritage assets are revalued in line with insurance valuations , with any movements taken to the Statement of Comprehensive Income and Expenditure . The valuations are usually carried out every five years , and on an interim basis for specific items .
Heritage assets are not depreciated as their long economic life and high residual value mean that any depreciation would not be material . However , they are subject to an annual impairment review in accordance with applicable accounting standards .
15 . Investment Properties
Investment property is land or a building , or part of a building , held for rental income or capital appreciation rather than for use in delivering services . Mixed use property is separated between investment property and property , plant and equipment where the separate portions can be sold separately or leased out under a finance lease . Where the fair value of the investment property portion cannot be reliably measured , the entire property has been included within property , plant and equipment . Where investment property , or a component of that property , is rented to another group entity the property has been accounted for within property , plant and equipment .
Investment properties are initially measured at cost and then subsequently at fair value at the end of each reporting date , with changes in fair value recognised in the Statement of Comprehensive Income and Expenditure . Investment properties are not depreciated but are revalued or reviewed annually according to market conditions as at the reporting date .
16 . Investments
Investments in jointly controlled entities , associates and subsidiaries are carried at cost ( less impairment ) in the University ' s separate financial statements . Investments are held in the Balance Sheet as basic financial assets and are measured in accordance with Note 25 .
17 . Accounting for Joint Operations , Jointly Controlled Assets and Joint Ventures
A joint venture is an entity where the University has joint control and is entitled to a share of the net assets and liabilities . The University accounts for its share of joint ventures using the equity method , which involves recognition in the Statement of Comprehensive Income and Expenditure of the University ’ s share of the joint venture ' s net surplus or deficit for the year .
The interest in a joint venture is carried in the Balance Sheet as the University ’ s share in the net assets of the joint venture together with any goodwill less any impairment loss . When the University ’ s share in a loss exceeds the carrying amount of the joint venture , the carrying amount is reduced to zero . No further losses are recognised , unless the University has responsibility for obligations relating to the joint venture .
The University accounts for its share of transactions from joint operations and jointly controlled assets through the Statement of Comprehensive Income and Expenditure .
18 . Stock
Stock is held at the lower of cost and net realisable value . Stock held under Maintenance and Building stores is held using an average cost . Food and beverage stock is held at latest cost .
The development land for sale is valued on a “ per acre ” basis for the remaining unsold plots on the development site by an external valuer , unless a separate plot specific valuation has been performed .