Page 57 - ar2011

Notes to the Financial Statement
For the year ended 31st December 2011
NATURAL COOL HOLDINGS LIMITED
Annual Report 2011 55
3 Signifcant accounting policies (Continued)
3.4 Property, plant and equipment (Continued)
(iii) Depreciation
Depreciation is based on the cost of an asset less its residual value. Signifcant 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 proft or loss on a straight-line basis over their 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. Freehold land is not
depreciated.
The estimated useful lives for the current and comparative period are as follows:
Freehold properties 50 years
Computers 3 years
Furniture, fttings and offce equipment 5 years
Motor vehicles 5-10 years
Machineries 5-10 years
Tools 5 years
Renovation 5 years
Depreciation methods, useful lives and residual values are reviewed at the end of each
reporting period and adjusted if appropriate.
3.5 Intangible assets
(i) Goodwill
Goodwill that arises upon the acquisition of subsidiaries is included in intangible assets and
represents the excess of:
 the fair value of the consideration transferred; plus
 the recognised amount of any non-controlling interests in the acquiree; plus
 if the business combination is achieved in stages, the fair value of the existing equity
interest in the acquiree,
over the net recognised amount (generally fair value) of the identifable assets acquired and
liabilities assumed.
When the excess is negative, a bargain purchase gain is recognised immediately in proft or
loss.
Subsequent measurement
Goodwill is measured at cost less accumulated impairment losses.