ANNUAL REPORT 2017/18 33
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
2.8 Property, plant and equipment
Property, plant and equipment are recognised at cost less
accumulated depreciation and accumulated impairment
losses. Donated assets are recognised at the valuation
determined by valuers at the time of receipt of the assets.
The cost of an item of property, plant and equipment is
recognised as an asset if, and only if, it is probable that
future economic benefits associated with the item will
flow to the University and the cost of the item can be
measured reliably.
The cost of an item of property, plant and equipment
includes its purchase price and any cost that is directly
attributable to bringing the asset to the location and
condition necessary for it to be capable of operating in
the manner intended by management.
The construction-in-progress consists of construction
costs and related expenses incurred during the period
of construction.
Subsequent expenditure relating to property, plant and
equipment that has already been recognised is added to
the carrying amount of the asset only when it is probable
that future economic benefits associated with the item
will flow to the University and the cost of the item can
be measured reliably. All other repair and maintenance
expenses are recognised in income and expenditure
when incurred.
Except for construction-in-progress which is not
depreciated, depreciation on other property, plant and
equipment is calculated using the straight-line method to
allocate their depreciable amounts over their estimated
useful lives as follows:
Estimated useful lives
Leasehold land
99 years
Buildings
30 years
Plant and machinery
10 years
Computer systems, communications
5 to 6 years
and laboratory equipment
Personal computers and equipment
3 years
Furniture and fittings
7 years
Audio visual and office equipment
5 to 8 years
Motor vehicle
10 years
NOTES TO THE FINANCIAL STATEMENTS
31 March 2018
Property, plant and equipment costing less than $2,000
(2017: $2,000) each are taken to income and expenditure
when purchased.
The residualvalues, estimateduseful lives anddepreciation
method of property, plant and equipment are reviewed,
and adjusted as appropriate, at each balance sheet date.
The effects of any revision are recognised in income and
expenditure when the changes arise.
On disposal of an item of property, plant and equipment,
the difference between the disposal proceeds and its
carrying amount is included in income and expenditure.
2.9 Intangible assets
Computer software licences costs
Acquired computer software licences are initially
capitalised at cost which includes the purchase price
(net of any discounts and rebates) and any other directly
attributed cost of preparing the asset for its intended
use. Direct expenditure, which enhances or extends
the performance of computer software beyond its
specifications and which can be reliably measured, is
recognised as a capital improvement and added to
the original cost of the software. Costs associated with
maintaining the computer software are expensed off.
Capitalised computer software licences are subsequently
carried at cost less accumulated amortisation and
accumulated impairment losses. These costs are
amortised to income and expenditure using the straight-
line method over their estimated useful lives of three to
five years.
The amortisation period and amortisation method are
reviewed at least at each balance sheet date. The effects
of any revision are recognised in income and expenditure
when the changes arise.
2.10 Impairment of non-financial assets
Property, plant and equipment and intangible assets are
tested for impairment whenever there is any objective
evidence or indication that these assets may be impaired.
If the recoverable amount of the asset is estimated to
be less than its carrying amount, the carrying amount
of the asset is reduced to its recoverable amount. The
difference between the carrying amount and recoverable
amount is recognised as an impairment loss in income
and expenditure.
