WCT-Page 30 to ProxyForm (2.4MB).pdf - Announcements - Bursa ...

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d
2.7 Property, plant and equipment cont’d
WCT Berhad (66538-K)
annual report 2011
Any revaluation surplus is recognised in other comprehensive income and accumulated in equity under the asset
revaluation reserve, except to the extent that it reverses a revaluation decrease of the same asset previously
recognised in profit or loss, in which case the increase is recognised in profit or loss. A revaluation deficit is
recognised in profit or loss, except to the extent that it offsets an existing surplus on the same asset carried in the
asset revaluation reserve.
Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the
asset and the net amount is restated to the revalued amount of the asset. The revaluation surplus included in
the asset revaluation reserve in respect of an asset is transferred directly to retained earnings on retirement or
disposal of the asset.
Freehold land has an unlimited useful life and therefore is not depreciated. Depreciation is computed on a
straight-line basis over the estimated useful lives of the assets as follows:
- Buildings : 50 years - Furniture and fittings : 5 to 10 years
- Plant and machinery : 2 to 11 years - Marine plant, tug and barges : 5 years
- Motor vehicles : 3 to 7 years - Renovations : 6 to 7 years
- Office equipment : 2 to 10 years
Assets under construction included in plant and equipment are not depreciated as these assets are not yet
available for use.
The carrying values of property, plant and equipment are reviewed for impairment when events or changes in
circumstances indicate that the carrying value may not be recoverable.
The residual value, useful life and depreciation method are reviewed at each financial year-end, and adjusted
prospectively, if appropriate.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits
are expected from its use or disposal. Any gain or loss on derecognition of the asset is included in the profit or
loss in the year the asset is derecognised.
2.8 Investment properties
Investment properties are initially measured at cost, including transaction costs. Subsequent to initial recognition,
investment properties are measured at fair value which reflects market conditions at the reporting date. Fair
value is arrived at by reference to market evidence of transaction prices for similar properties and is performed by
registered independent valuer having an appropriate recognised professional qualification and recent experience
in the location and category of the properties being valued. Gains or losses arising from changes in the fair values
of investment properties are included in profit or loss in the year in which they arise.
A property interest under an operating lease is classified and accounted for as an investment property on a
property-by-property basis when the Group holds it to earn rentals or for capital appreciation or both. Any such
property interest under an operating lease classified as an investment property is carried at fair value.
91
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
cont’d