Entire Document - Chris Hani District Municipality

4. INTANGIBLE ASSETS (continued)4.2 Subsequent Measurement, Amortisation and Impairment (continued)Amortisation only commences when the asset is available for use, unless stated otherwise.The amortisation rates are based on the following estimated useful lives:Asset Class Years Asset Class YearsComputer Software 2 - 5 Licences 2 - 5Intangible Assets are annually tested for impairment, including Intangible Assets notyet available for use. Where items of Intangible Assets have been impaired, thecarrying value is adjusted by the impairment loss, which is recognised as an expensein the period that the impairment is identified. The impairment loss is the differencebetween the carrying amount and the recoverable service amount.Chapter 4The estimated useful life, residual values and amortisation method are reviewedannually at the end of the financial year. Any adjustments arising from the annualreview are applied prospectively as a Change in Accounting Estimate in the Statementof Financial Performance.1.3DerecognitionIntangible Assets are derecognised when the asset is disposed of or when thereare no further economic benefits or service potential expected from the use of theasset. The gain or loss arising on the disposal or retirement of an Intangible Assetis determined as the difference between the proceeds of disposal and the carryingvalue and is recognised in the Statement of Financial Performance.251