compressed_Annual Report 2016-ilovepdf-compressed

on the present value of expected claims and
benefits arising net of expected premiums payable
under the related reinsurance contracts. Amounts
recoverable from or due to reinsurers are measured
consistently with the amounts associated
with the reinsured contracts and in accordance
with the terms of each reinsurance contract.
Reinsurance assets include balances due from reinsurance
companies for ceded insurance liabilities.
Amounts recoverable from reinsurers’ are estimated
in a manner consistent with the outstanding
claims provision or settled claims associated with
the reinsured policy. The cost of reinsurance related
to long term contracts is accounted for over
the life of the underlying insurance policies using
assumptions consistent with those used to account
for the underlying policies. Premiums ceded and
benefits reimbursed are presented in the statement
of comprehensive income and statement of
financial position on a gross basis.
Reinsurance assets are assessed for impairment
at each balance sheet date. If there is reliable
objective evidence, as a result of an event that
occurred after its initial recognition, that amounts
due may not be recoverable, the Fund reduces
the carrying amount of the reinsurance asset
to its recoverable amount and recognises that
impairment loss in the statement of comprehensive
income.
2.4 PROPERTY PLANT AND EQUIPMENT
All property, plant and equipment are stated at
historical cost less depreciation. Historical cost
includes expenditure that is directly attributable to
the acquisition of the items. Cost may also include
transfers from equity of any gains/losses on
qualifying cash flow hedges of foreign currency
purchases of property, plant and equipment.
Subsequent costs are included in the asset’s carrying
amount or recognised as a separate asset, as
appropriate, only when it is probable that future
economic benefits associated with the item will
flow to the group and the cost of the item can
be measured reliably. The carrying amount of the
replaced part is derecognised. All other repairs
and maintenance are charged to the income
statement during the financial period in which
they are incurred.
Land is not depreciated. Depreciation on other
assets is calculated using the straight-line method
to allocate their cost or revalued amounts to their
residual values over their estimated useful lives, as
follows:
4% 20% 20% 33.3%
Building
Office
furniture
and equipment
Motor
Vehicle
Computer
equipment
and Sofware
The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at the end
of each reporting period.
An asset’s carrying amount is written down immediately
to its recoverable amount if the asset’s
carrying amount is greater than its estimated recoverable
amount.
Gains and losses on disposals are determined by
comparing the proceeds with the carrying amount
and are recognised within ‘Other (losses)/gains –
net’ in the income statement. When revalued assets
are sold, the amounts included in other reserves are
transferred to retained earnings.
SINCEPHETELO MVA FUND 35