Mandarin Oriental International Limited - Mandarin Oriental Hotel ...

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NOTES TO THE FINANCIAL STATEMENTS CONTINUED
9 Tangible assets continued
Freehold land & buildings include a property of US$114.2 million (2004: US$115.6 million), which is stated net of
tax incremental financing of US$31.5 million (2004: US$32.4 million) (refer note 17). No interest was capitalized
during the year (2004: interest of US$1.3 million was capitalized based on rates ranging from 4.3% to 6.0%).
If the freehold properties and the building component of leasehold properties had been included in the financial
statements at cost, the carrying value would have been US$503.3 million (2004: US$595.6 million).
Certain of the hotel properties are pledged as security for bank loans as shown in note 16.
The transfer-in during the year represents development costs of US$1.9 million in respect of Mandarin Oriental,
Tokyo.
Leasehold land and buildings include a hotel property held under a finance lease as follows:
MANDARIN ORIENTAL INTERNATIONAL LIMITED
2005 2004
US$m US$m
Cost or valuation – 70.2
Accumulated depreciation – (1.6)
Net book value – 68.6
Analysis of additions (including transfer in) by geographical area
– Hong Kong and Macau 17.8 6.1
– Other Asia 20.6 0.9
– Europe 7.4 5.0
– The Americas 4.7 20.0
50.5 32.0
Analysis of additions (including transfer in) by activity
– Hotel ownership 49.7 31.4
– Hotel management 0.8 0.6
50.5 32.0
Analysis of depreciation by geographical area
– Hong Kong and Macau 10.3 9.1
– Other Asia 3.6 3.1
– Europe 8.4 9.7
– The Americas 7.7 8.8
30.0 30.7
Analysis of depreciation by activity
– Hotel ownership 29.2 29.8
– Hotel management 0.8 0.9
30.0 30.7