Brambles 2006 Annual Report - Alle jaarverslagen

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Brambles
2006 Annual Report
recognised as a special item of expense in the income statement
in the reporting period in which the write-down occurs.
The expected net cash flows included in determining recoverable
amounts of non-current assets are discounted to their present
values using a market risk adjusted discount rate.
Property, plant and equipment
Property, plant and equipment (PPE) is stated at cost, net of
depreciation and any impairment, except land which is shown
at cost less impairment. Cost includes expenditure that is directly
attributable to the acquisition of assets, and, where applicable,
an initial estimate of the cost of dismantling and removing the
item and restoring the site on which it is located.
Subsequent expenditure is capitalised only when it is probable
that future economic benefits associated with the expenditure will
flow to Brambles. Repairs and maintenance are expensed in the
income statement in the period they are incurred.
Depreciation is charged in the financial statements so as to writeoff
the cost of all PPE, including landfill sites, but excluding other
freehold land, to their residual value on a straight-line or reducing
balance basis over their expected useful lives to Brambles.
Residual values and useful lives are reviewed, and adjusted
if appropriate, at each balance sheet date.
Predominantly, the straight-line basis has been used except for
landfill sites where depreciation is based on the capacity used
as a proportion of the total capacity available.
The expected useful lives of PPE are generally:
• Buildings 50 years
• Pooling equipment 5–10 years
• Other plant and equipment
(owned and leased)
3–20 years
The cost of improvements to leasehold properties is amortised
over the unexpired portion of the lease, or the estimated useful
life of the improvement to Brambles, whichever is the shorter.
Provision is made for irrecoverable pooling equipment based
on experience in each market. The provision is presented within
accumulated depreciation.
The carrying values of PPE are reviewed for impairment
when circumstances indicate their carrying values may not be
recoverable. Assets are assessed within the cash generating unit
to which they belong. Any impairment losses are recognised in
the income statement.
The recoverable amount of PPE is the greater of its fair value
less costs to sell and its value in use. Value in use is determined
as estimated future cash flows discounted to their present
value using a pre-tax discount rate reflecting current market
assessments of the time value of money and the risk specific
to the asset.
PPE is derecognised upon disposal or when no future economic
benefits are expected to arise from continued use of the asset.
Any net gain or loss arising on derecognition of the asset is
included in the income statement and presented as other income
in the period in which the asset is derecognised.
Goodwill
Goodwill is carried at cost less accumulated impairment losses.
Goodwill is not amortised.
Goodwill represents the excess of the cost of an acquisition over
the fair value of Brambles’ share of the net identifiable assets of
the acquired subsidiary, joint venture or associate at the date of
acquisition. Goodwill on acquisitions of subsidiaries is included
in intangible assets. Goodwill on acquisitions of joint ventures
and associates is included in investments in joint ventures
and associates.
Upon acquisition, any goodwill arising is allocated to each cash
generating unit expected to benefit from the acquisition. Goodwill
is tested annually for impairment, or more frequently if events or
changes in circumstances indicate that it might be impaired. An
impairment loss is recognised when the recoverable amount of
the cash generating unit is less than its carrying amount.
On disposal of an operation, goodwill associated with the
disposed operation is included in the carrying amount of the
operation when determining the gain or loss on disposal.
In its transition to IFRS, Brambles has elected to make use of
the exemption set out in IFRS 1/AASB 1 in relation to business
combinations and has not applied IFRS 3/AASB 3: Business
Combinations to combinations that occurred before 1 July 2004.
The carrying amount of goodwill under AGAAP at 1 July 2004 has
been deemed to be the carrying amount of goodwill under IFRS
at that date, as further described in Note 38.
Intangible assets
Intangible assets acquired are capitalised at cost, unless
acquired as part of a business combination in which case they
are capitalised at fair value as at the date of acquisition. Following
initial recognition, intangible assets are carried at cost less
provisions for amortisation and impairment.
The costs of acquiring and developing computer software
for internal use are capitalised as intangible non-current assets
where it is used to support a significant business system and
the expenditure leads to the creation of a durable asset.
Useful lives have been established for all non-goodwill intangible
assets. Amortisation charges are expensed in the income
statement on a straight-line basis over those useful lives.
Estimated useful lives are reviewed annually.
The expected useful lives of intangible assets are generally:
• Customer lists and relationships 3–20 years
• Computer software 3–7 years
There are no non-goodwill intangible assets with indefinite lives.
Intangible assets are tested for impairment where an indicator
of impairment exists, either individually or at the cash generating
unit level.
Gains or losses arising from derecognition of an intangible
asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognised
in the income statement when the asset is derecognised.
LIABILITIES
Payables
Trade and other creditors represent liabilities for goods and
services provided to Brambles prior to the end of the financial year
which remain unpaid at the reporting date. The amounts
are unsecured and are paid within normal credit terms.
Provisions
Provisions for liabilities are made on the basis that, due to a
past event, the business has a constructive or legal obligation to
transfer economic benefits that are of uncertain timing or amount.
Provisions are measured at the present value of management’s
best estimate at the balance sheet date of the expenditure
required to settle the obligation. The discount rate used is a
pre-tax rate that reflects current market assessments of the time
value of money and the risks appropriate to the liability.
Provisions for environmental and landfill costs include provisions
associated with the closure and post closure costs of landfill sites.