Summary of Significant Accounting Policies
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(d) Associated Companies
- Associated companies are those in which the Group has a long-term substantial equity interest and in whose commercial
and financial policy decisions the Group actively participates. The Group’s share of profits less losses of associated
companies, as shown in their audited accounts for the year ended 31 December (except for certain associated
companies), is included in the Group’s results.
- The results of certain associated companies which do not prepare audited accounts at 31 December are based on their
latest audited accounts and unaudited management accounts for the ensuing months up to 31 December.
- Investments in associated companies are stated in the Company’s and Group’s accounts at the attributable share of their
combined net asset value as shown in their accounts. Any revaluation surplus or deficit arising each year is taken direct to
capital reserves.
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(e) Other Investments
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Investments held on a long-term basis are stated at average cost. Provision is made for any diminution in value which is
considered to be permanent.
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(f) Fixed Assets
- Fixed assets are stated at cost except for those which have been revalued. Surpluses arising on revaluation are credited
direct to capital reserves. Revaluation deficits are taken to the profit and loss account in the absence of or to the extent
that they exceed any surpluses held in reserves relating to previous revaluations.
- The carrying amounts in respect of both revalued assets and those measured at cost are reviewed at each balance sheet
date to assess whether they are recorded in excess of their recoverable amounts. If carrying values exceed the recoverable
amounts, the assets are written down accordingly.
- All fixed assets, except for freehold and long leasehold (i.e. with unexpired tenures of over 20 years) land, are depreciated
evenly over their expected useful lives and residual values have also been taken into account where appropriate. The
estimated useful lives of the Group’s fixed assets have been taken as follows:
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| Buildings |
30 to 50 years |
| Short leasehold land and buildings |
Over period of lease (ranging from 2 to 20 years) |
| Machinery and equipment |
3 to 7 years |
| Motor vehicles |
4 to 5 years |
- Profits or losses on disposal of all fixed assets are included in the profit and loss account. Any surpluses held in capital
reserves in respect of previous revaluations of fixed assets disposed of during the year are regarded as having become
realised and are transferred to the revenue reserves.
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