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Buildings Plant and machinery

2% - 10% 10%

Furniture, fittings and office equipment

10% – 33.33%

Motor vehicles Mould

20% 10%

Annual Report 2009

Gain and loss on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment.

(d)

Depreciation methods, useful lives and residual values are reassessed at the balance sheet date.

Leases

A lease is recognised as a finance lease if it transfers substantially to the Group all the risks and rewards incidental to ownership. Leases of land and buildings are classified as operating or finance leases in the same way as leases of other assets. The land and buildings elements of a lease of land and buildings are considered separately for the purposes of lease classification. All leases that do not transfer substantially all the risks and rewards are classified as operating leases, with the following exceptions:

  • -

    Property held under operating leases that would otherwise meet the definition of an investment property is classified as an investment property on a property-by-property basis and, if classified as investment property, it is accounted for as if it is held under a finance lease; and

  • -

    Land held for own use under an operating lease, the fair value of which cannot be measured separately from the fair value of a building situated thereon at the inception of the lease, is accounted for as being held under a finance lease, unless the building is also clearly held under an operating lease.

The cost of replacing part 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 the income statement as incurred.

The principal annual rates used for this purpose are:

When significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

(ii)

Subsequent costs

Depreciation is recognised in the income statement on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. Freehold land is not depreciated. Property, plant and equipment under construction are not depreciated until the assets are ready for their intended use.

YIKON

CORPORATION BHD

(527272-V)

Notes to the Financial Statements (cont’d)

  • 2.

    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)

    • 2.3

      Significant Accounting Policies (cont’d)

(c)

Property, Plant and Equipment (cont’d)

(i)

Recognition and measurement (cont’d)

(iii)

Depreciation

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