Building Lifelong Relationships - NUSS

Notes to the financial statements
2 Summary of significant accounting policies (cont’d)
PG
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NUSS
ANNUAl RepoRt 2006
Significant accounting estimates and judgements
The preparation of the financial statements in conformity with FRS requires the use of estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the financial year. Although these estimates are
based on management’s best knowledge of current events and actions, actual results may differ from those estimates.
Functional and presentation currency
Items included in the financial statements of the Society are measured using the currency that best reflects the economic
substance of the underlying events and circumstances relevant to the Society (“the functional currency”). The financial
statements of the Society are presented in Singapore dollars, which is also the functional currency of the Society.
Property and equipment and depreciation
Properties and equipment are stated at cost less accumulated depreciation and any impairment losses, with the exception
of assets under construction-in-progress which are stated at cost plus other directly related expenses including interest
expense. The cost of an asset comprises its purchase price and any directly attributable costs of bringing the asset to working
condition for its intended use. Expenditure for additions, improvements and renewals is capitalised and expenditure for
maintenance and repairs is charged to the income and expenditure account. When assets are sold or retired, their cost and
accumulated depreciation are removed from the financial statements and any gains or loss resulting from their disposal is
included in the income and expenditure account.
Dismantlement, removal or restoration costs are included as part of the cost of property, plant and equipment if the
obligation for dismantlement, removal or restoration is incurred as a consequence of acquiring or using the asset. Cost
may also include transfers from equity of any gains/losses on qualifying cash flow hedges of foreign currency purchases
of property, plant and equipment.
Depreciation is calculated on the straight-line method to write off the cost of assets over their estimated useful lives.
The annual rates of depreciation are as follows:
Kent Ridge - old building 3 1 /3% (over original lease period)
Kent Ridge - new building 5% (over remaining lease period)
Suntec City premises 16 2 /3% (over total lease period)
Furniture, fittings and equipment 33 1 /3%
Fruit machines 25%
Kitchen equipment 20%
Office equipment 10%
Computers 33 1 /3%
Motor vehicles 20%
Tools and equipment 20%
Fitness equipment 33 1 /3%
The carrying amounts of property and equipment are reviewed yearly in order to assess whether their carrying amounts need
to be written down to recoverable amounts. Recoverable amount is defined as the higher of value in use and net selling price.