Annual Report & Accounts 2007-2008 - Historic Scotland

useful lives. The depreciation periods for the principal categories of assets are: -
Land
Buildings and dwellings
Plant and motor vehicles
Office equipment
Computer equipment
Development costs
Antiques and works of art
(non-heritage)
Not depreciated
On an individual basis not exceeding 60 years
5 years
5 years
3 years
On an individual basis not exceeding 7 years
Up to 60 years
Assets in the course of construction are not depreciated until the asset is brought into use.
Archives, which comprise maps, plans, photographs and books, are not depreciated, as the
annual costs incurred in their maintenance and updating are sufficient to maintain their
value.
Additions to historic collections are not depreciated as the length of their anticipated
useful economic life is such that depreciation is not considered to be material.
(f) Donated assets
Donated tangible fixed assets are capitalised at their current value on receipt, and this
value is credited to the donated asset reserve. Subsequent revaluations are also taken
to this reserve. Each year an amount equal to the depreciation charge on the asset is
released from the donated asset reserve to the income and expenditure account.
(g) Intangible fixed assets
Purchased computer software licences are capitalised as intangible fixed assets where
expenditure of £1,000 or more is incurred. Software licences are amortised over the
shorter of the term of the licence and the useful economic life. Intangible assets are stated
at cost.
(h) Realised element on depreciation of revaluation reserve
Depreciation is charged to the income and expenditure account on the revalued amount
of the relevant assets. An element of the depreciation arises from the increase in valuation
and is in excess of the depreciation that would be charged on the historic cost of the
relevant assets. The amount relating to this excess is the realised gain on revaluation and is
transferred from the revaluation reserve to the general fund.
(i) Stocks
All stocks held are stated at the lower of cost and net realisable value.
(j) Capital charge
A charge, reflecting the cost of capital utilised by the agency, is included in the operating
costs. The charge is calculated at the government’s standard rate of 3.5 per cent (2006/07:
3.5 per cent) on the average carrying amount of all assets less liabilities, except for donated
assets, where the charge is nil.
(k) Pension costs
Past and present employees of Historic Scotland are covered by the provisions of the
Principal Civil Service Pension Scheme which are described in the remuneration report.
Full superannuation costs are an expense of Historic Scotland at rates determined by HM
Treasury.
REPORT & ACCOUNTS 58