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Straco Corporation Limited • Annual Report 2014
NOTES TO THE FINANCIAL STATEMENTS
3
Significant accounting policies (cont’d)
3.3 Property, plant and equipment (cont’d)
Subsequent costs
The cost of replacing a component of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that
the future economic benefits embodied within the component will flow to the Group and its cost can be measured reliably. The carrying amount of the
replaced component is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.
Depreciation
Depreciation is based on the cost of an asset less its residual value.
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and
equipment. Construction in progress is not depreciated.
Depreciation is recognised from the date that the property, plant and equipment are installed and are ready for use, or in respect of internally
constructed assets, from the date that the asset is completed and ready for use.
The estimated useful lives for the current and comparative years, if applicable, are as follows:
Leasehold land and buildings
20 to 50 years
Leasehold improvements
10 years
Cable car equipment
10 to 20 years
Giant observation wheel
35 years 7 months
Office equipment, furniture and fittings
3 to 5 years
Motor vehicles
5 to 8 years
Machinery
10 to 20 years
Fishes and marine livestock
5 years
Show equipment
3 years
Depreciation methods, useful lives and residual values are reviewed at the end of each reporting period and adjusted if appropriate.
3.4 Investment property
Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course
of business, use in the production or supply of goods or services or for administrative purposes. Investment property is measured at fair value on
initial recognition from the acquisition through business combination. Subsequent to initial recognition, investment property is measured at cost less
accumulated amortisation and accumulated impairment losses.
Investment property is depreciated using the straight line method over 35 years 7 months, the remaining lease term.
