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100 Annual Report 2007
Notes to the Financial Statements
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
2.5 Property and equipment
Property and equipment is stated at historical cost less accumulated depreciation. Historical cost
includes expenditure that is directly attributable to the acquisition of the item.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as
appropriate, only when it is probable that future economic benefi ts associated with the item will fl ow to
the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part
is derecognized. All other repairs and maintenance are charged to the income statement during the
year in which they are incurred.
Depreciation is calculated using the straight-line method to allocate their costs to their residual
amounts over their estimated useful lives, as follows:
Years
Computer equipment 3
Furniture and offi ce equipment 3
Leasehold improvements 2–3 (shorter of remaining lease
period or estimated useful life)
Buildings 20
An asset’s residual value and useful life are reviewed, and adjusted if appropriate, at each balance
sheet date.
Construction-in-progress represents buildings under construction, which is stated at actual construction
cost less any impairment loss. Construction-in-progress is transferred to property and equipment when
completed and ready for use.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s
carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount
and are recognized within other operating income/(losses) in the income statement.