2005 - Asianbanks.net

3.11 Premises and equipment
Buildings and equipment are stated at cost or appraised value less accumulated depreciation.
The Bank and its subsidiaries initially record land, buildings and equipment at their costs on the acquisition dates. The Bank,
thereafter, arranges to have their independent appraisers valued land and buildings and records those assets at their appraised values. The
Bank has policy to revalue such assets every 3 to 5 years in order that the book value of those assets on the balance sheet dates does not
differ materially from their fair value.
The Bank recognizes surplus/deficit arising as a result of revaluation of its assets as follows: -
(a)
(b)
When an asset’s carrying amount is increased as a result of the revaluation, the increase is credited directly to the equity under the
heading of “Surplus on revaluation of assets”. However, a revaluation increase will be recognized as income in the statements of
earnings to the extent that it reverses a revaluation decrease of the same asset previously recognized as an expense in the
statement of earnings.
When an asset’s carrying amount is decreased as a result of the revaluation, the decrease is recognized as an expense. However, a
revaluation decrease will be charged directly against the related “Surplus on revaluation of assets” to the extent that the decrease
does not exceed the amount held in the surplus on revaluation in respect of the same asset and the exceeded amount is recognized
as an expense in the statements of earnings.
3.12 Depreciation
Depreciation of buildings and equipment is calculated by reference to their costs on a straight line basis over the following
estimated periods of useful lives.
Buildings - 20 - 30 years
Office equipment - 3 - 10 years
Motor vehicles - 5 years
No depreciation is determined for land and assets in process.
Depreciation is included in determining earnings.
Depreciation of the revalued portion of buildings, which is determined by the straight-line method over the remaining useful lives,
is recognized in the statement of earnings. Surplus on revaluation of assets is charged to the retained earnings by the then-determined
amount.
3.13 Intangible assets and amortization
(a)
(b)
(c)
Leasehold rights are amortized as expenses on a straight-line method over the lease periods of 1 to 30 years.
Computer software is amortized as expenses on a straight-line method over the periods of estimated useful lines of 3 to 10 years.
No amortization for computer software under development.
Goodwills incurred as a result of investments in subsidiaries are amortized as expenses on a straight-line method over their
estimated economic lives of 10 years.
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