Page 85 - SAR141018_Forterra AR 2013

FORTERRA
ANNUAL REPORT 2013
NOTES TO THE
FINANCIAL STATEMENTS
83
3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Property, plant and equipment (Continued)
Subsequent costs
The cost of replacing a component of an item of property, plant and equipment is
recognised in the carrying amount of the item if it is probable that the future economic
benefits embodied within the part will flow to the Group, and its cost can be measured
reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-
day servicing of property, plant and equipment are recognised in profit or loss as incurred.
Depreciation
Depreciation is based on the cost of an asset less its residual value. Significant components
of individual assets are assessed and if a component has a useful life that is different from
the remainder of that asset, that component is depreciated separately.
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful
lives of each component of an item of property, plant and equipment. Leased assets are
depreciated over the shorter of the lease term and their useful lives unless it is reasonably
certain that the Group will obtain ownership by the end of the lease term.
Depreciation is recognised from the date that the properties, plant and equipment are
installed and are ready for use. Depreciation methods, useful lives and residual values are
reviewed at each reporting period and adjusted if appropriate.
The estimated useful lives for the current and comparative years are as follows:
Self-use office units 20 years
Furniture, fittings and equipment 5-10 years
Depreciation of an asset ceases at the date the asset is classified as held for sale in
accordance with FRS105 – Non-current Assets Held for Sale and Discontinued Operations.