91
COSCO Corporation (Singapore) Limited
Annual Report 2015
NOTES TO THE
FINANCIAL STATEMENTS
For the financial year ended 31 December 2015
Financial Statements
2.
Significant accounting policies
(continued)
2.4 Property, plant and equipment
(continued)
(b)
Depreciation
(continued)
No depreciation is provided for construction-in-progress.
The motor vessels are subject to overhauls at regular intervals. The inherent components of
the initial overhaul are determined based on the estimated costs of the next overhaul and are
separately depreciated over a period of two and a half years in order to reflect the estimated
intervals between two overhauls. The costs of the overhauls subsequently incurred are capitalised
as additions and the carrying amounts of the replaced components are written off to profit or loss.
The residual values, estimated useful lives and depreciation 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 profit or loss when the changes arise.
(c)
Subsequent expenditure
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 Group and the cost of the item can be
measured reliably. All other repair and maintenance expenses are recognised in profit or loss when
incurred.
(d)
Disposal
On disposal of an item of property, plant and equipment, the difference between the disposal
proceeds and its carrying amount is recognised in profit or loss within “other gains and losses”.
2.5 Intangible assets
Goodwill on acquisitions
Goodwill on acquisitions of subsidiaries and businesses on or after 1 January 2010 represents the
excess of (i) the sum of the consideration transferred, the amount of any non-controlling interest in the
acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over (ii) the fair
value of the identifiable net assets acquired.
Goodwill on acquisition of subsidiaries and businesses prior to 1 January 2010 and on acquisition of
joint ventures and associated companies represents the excess of the cost of the acquisition over the
fair value of the Group’s share of the identifiable net assets acquired.
Goodwill on subsidiaries is recognised separately as intangible assets and carried at cost less
accumulated impairment losses.
Goodwill on associated companies is included in the carrying amount of the investments.
Gains and losses on the disposal of subsidiaries and associated companies include the carrying
amount of goodwill relating to the entity sold, except for goodwill arising from acquisitions prior to 1
January 2001. Such goodwill was adjusted against retained profits in the year of acquisition and is not
recognised in profit or loss on disposal.
