DIPPED PRODUCTS PLC / ANNUAL REPORT 2008—2009

Accounting Policies
commercially feasible, future economic benefits are probable, and the Group intends to and has sufficient resources
to complete development and to use or sell the asset. The expenditure capitalised includes the cost of materials,
direct labour and overhead costs that are directly attributable to preparing the asset for its intended use. Other
development expenditure is recognised in profit & loss when incurred.
Capitalised development expenditure is measured at cost less accumulated amortisation and accumulated
impairment losses.
4.5.3. Other intangible assets
Other intangible assets that are acquired by the Group which have finite useful lives, are stated at cost less
accumulated amortisation and accumulated impairment losses.
4.5.4. Subsequent expenditure
Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic
benefits embodied in the specific asset to which it relates. All other expenditure including expenditure on internally
generated brands is recognised in profit & loss when incurred.
4.5.5. Amortisation
Amortisation is recognised in profit & loss on a straight-line basis over the estimated useful lives of intangible
assets, other than goodwill, from the date that they are available for use. The estimated useful life for capitalised
development cost is five years.
4.6 Investments
4.6.1. Short term investments
Short term investments are measured at the lower of cost and market value on an aggregate portfolio basis,
with any resultant gain or loss recognised in profit & loss.
4.6.2. Long term investments
Quoted and unquoted investments in shares held on long term basis are measured at cost.
In the parent Company’s Financial Statements, investments in subsidiaries and associates are carried at cost
under the parent Company accounting policy for long term investments.
Provision for fall in value is made when in the opinion of the Directors there has been a decline other than
temporary in the carrying amount of the investment.
4.6.3. Investment property
Investment property, comprise freehold land and buildings, is property held either to earn rental income
or for capital appreciation or for both and is not occupied substantially for the supply of goods or services
or in administration, and is not intended for sale in the ordinary course of business. Investment property
is initially measured at its cost including related transaction costs and thereafter carried at its cost less any
accumulated depreciation and any accumulated impairment losses.
4.7. Inventories
Inventories are measured at the lower of cost and net realisable value. Net realisable value is the estimated selling
price in the ordinary course of business less the estimated cost of completion and selling expenses. The general
basis on which cost is determined is:
All inventory items, except manufactured inventories and work-in-progress are measured at weighted average
directly attributable cost.
Manufactured inventories and work-in-progress are measured at weighted average factory cost which includes all
direct expenditure and appropriate shares of production overhead based on normal operating capacity.
4.8 Trade and other receivables
Trade and other receivables are stated at their estimated realisable value.
4.9 Cash & cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand
and form an integral part of the Group’s cash management are included as a component of cash and cash
equivalents for the purpose of the Statement of Cash Flows.
4.10 Impairment
The carrying amounts of the Group’s non-financial assets other than investment property, inventories and deferred
tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any
such indication exists then the asset’s recoverable amount is estimated. For goodwill and intangible assets that have
indefinite lives or that are not yet available for use, recoverable amount is estimated at each reporting date or more
frequently, if events or changes in circumstances indicate that it might be impaired.
48
D I P P E D P R O D U C T S P L C A N N U A L R E P O R T 2 0 0 8 – 2 0 0 9