Page 179 - CJ 2019 INTEGRATED REPORT

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1 NOTES TO THE FINANCIAL
STATEMENTS 31 DECEMBER 2019 (CONTINUED)
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Property plant and equipment
(Continued)
The assets’ residual values and and useful lives are reviewed and and adjusted if appropriate at at the end of each reporting period An asset’s asset’s carrying carrying amount amount amount amount is is written down immediately to its its recoverable recoverable amount amount amount amount if the asset’s asset’s carrying carrying amount amount amount amount is is greater than its estimated recoverable amount amount Gains and and losses on on disposals are are determined by comparing the the the the proceeds with with the the the the carrying amount and and are are recognised within ‘Other operating income/(expenses)-net’ in in in in in in in in in in in in in profit or or loss loss On disposal disposal o of revalued assets assets the the the the the surplus on on on on revaluation revaluation remaining in in in in in in in in in revaluation revaluation reserve for these assets assets is is transferred to retained earnings Property plant and and equipment
which have been funded through finance leases are depreciated over the the the the shorter of of the the the the useful life of the the asset and and the the lease term Borrowing costs costs incurred for for the the the the construction of of any qualifying asset asset are are are capitalised during the the the the period of of time that is is required to complete and prepare the the the the asset asset for for its intended use Other borrowing costs costs are are are expensed Investment property Properties that that are are are held for for long-term rental yields or or or or or for for capital appreciation or or or or or both and and that that are are are not occupied by the the Group or or or or or the the Company are are are classified as as as as investment properties properties Investment properties properties comprise office buildings and and retail outlets leased out out under operating lease lease agreements Some properties may be be be partially occupied occupied by by the the the the the the Group Group Group with the the the the the the remainder being held for for rental income or or or capital appreciation If that that that part part of the the the the the the the property occupied occupied occupied by by the the the the the the the Group Group Group can be be be sold separately separately the the the the the the the Group Group Group accounts for for for the the the the the the the portions portions separately separately The portion portion portion portion that that that is is is is owner-occupied is is is is accounted for for for under under IAS IAS 16 and the the the the the the portion portion portion portion that that that is is is is held for for rental income or or or or or or or or or capital appreciation or or or or or or or or or both is is is is is is treated treated as as investment investment property property property under under IAS IAS 40 When the the the portions portions cannot be sold separately the the the the whole property property property property is is is is treated treated as as as investment investment property property property property only if i i an an an an an insignificant insignificant portion portion portion is is is is owner-occupied owner-occupied The Group Group considers the the the the the the owner-occupied owner-occupied portion portion portion as as insignificant insignificant when the the the the the the property property property is is is more than 95% held to to earn rental income or or or or or capital appreciation In order to to determine the the the the the the the percentage of of the the the the the the the portions the the the the the the the Group Group uses the the size of the the property measured in in square metre Recognition of investment investment properties takes place only when it it fit it it is is is probable that that the the the the future economic benefits that that are associated with the the the the investment investment property will flow to the the the the entity and the the the the cost can be be measured reliably This is is is is usually when all risks are transferred Investment properties are measured initially at at cost cost cost cost including transaction costs The carrying amount includes the the the the cost cost cost cost cost of of of of replacing parts of of of of an an an an existing investment investment property property at at the the the the the time the the the the the cost cost cost cost cost has incurred if the the the the the recognition recognition criteria are are met and excludes the the the the the costs of of of of day-to-day servicing of of of of an an an investment investment investment property property Subsequent to to initial recognition recognition investment investment investment properties properties are are are stated at at at at fair fair value value which which reflects market conditions at at at at the the the the the reporting date Gains or or or losses arising from changes in in in in in in in in in in in in in the the the the the fair fair value value of o investment investment properties properties are are included included in in in in in in in in in in in in in profit or or or loss loss in in in in in in in in in in in in in the the the the the year in in in in in in in in in in in in in which which they arise Subsequent expenditure is is is is included included in in in in in in in in in in the the the the the the the the the asset’s carrying amount only when fit it it fit it it it is is is is probable that future economic benefits associated with the the the the the the the the item item will flow to to the the the the the the the the Group and and the the the the the the the the cost cost of o the the the the the the the the item item can be be measured reliably All other repairs and and maintenance costs are are charged to to profit or loss during the the the the the the financial period in in fin in in which they are are incurred The The fair fair value value of of of investment properties properties is is is based on on on on on on the the the nature location and condition of of of the the the specific asset The The fair fair value value value is is is calculated on on on on on on on on on the the the the the basis of of of of of recent transactions in in in in similar properties properties adjusted i if i i necessary for any difference in in in the the the the the nature location or or or condition of of of the the the the the specific asset The fair value value of of of investment property property does does not not reflect reflect future future capital expenditure expenditure that will improve or or or enhance the the the the property property and does does not not reflect reflect the the the the related future future future benefits from this future expenditure expenditure These valuations are performed annually by external appraisers INTEGRATED REPORT 2019