A summary of the policies applied to the group’s intangible assets is as follows:
Intellectual property
Useful life
Amortisation method used
Internally generated or acquired
Finite (10 years)
Amortised on a straightlinebasis
over the period of the
patent
Acquired
2.5 INVESTMENT PROPERTY
Investment property is land and buildings held to earn rentals or for capital appreciation or both. Investment property is
recognised as an asset when and only when it is probable that the future economic benefit associated with the investment
property will be the business and the investment property cost can be measured reliably.
Investment properties are initially recognised at cost, including transaction costs. Depreciation is calculated using the straightline
method to reduce their cost to their residual values over their estimated useful life. Land is not depreciated. Investment
properties depreciation methods, residual values and useful life are reviewed, and adjusted if appropriate, at the end of each
reporting period.
Investment properties are derecognised either when they have been disposed of or when the investment property is
permanently withdrawn from use and no future economic benefit is expected from its disposal. The difference between the
net disposal proceeds and the carrying amount of the asset is recognised in the Statements of Comprehensive Income in the
period of derecognition.
Transfers are made to/(from) investment property only when there is a change in use. If owner-occupied property becomes
an investment property, the company accounts for it in accordance with property, plant and equipment up to the date of
change.
Under certain circumstances, it is difficult to distinguish between investment property and property occupied by the owner.
In such circumstances, the criteria are to distinguish based on the existing occupation and purpose of the property.
2.6 LEASES
IFRS 16
The group assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to
control the use of an identified asset for a period of time in exchange for consideration.
Group as a lessee
The group applies a single recognition and measurement approach for all leases, except for short-term leases and leases of
low-value assets. The group recognises lease liabilities to make lease payments and right-of-use assets representing the right
to use the underlying assets.
i) Right-of-use assets
The group recognises right-of-use assets at the commencement date of the lease (i.e. the date the underlying asset is
available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and
adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease
incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the
estimated useful lives of the assets, as follows:
l Buildings and improvements
l Plant and machinery
3 to 15 years
3 to 15 years
If ownership of the leased asset transfers to the group at the end of the lease term or the cost reflects the exercise of a
purchase option, depreciation is calculated using the estimated useful life of the asset.
The right-of-use assets are also subject to impairment. Refer to accounting policy 3.8 for the impairment of non-financial
assets.
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SENWESBEL ANNUAL FINANCIAL STATEMENTS 2020 Senwesbel Limited Reg no: 1996/017629/06