i'mpact Singapore Tourism Board Annual Report 2010/2011

NOTES TO THE FINANCIAL STATEMENTS
31 March 2011
STB as lessor
Amounts due from lessees under finance leases are recorded as receivables at the amount of STB’s net investment in the
leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on STB’s
net investment outstanding in respect of the leases.
Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease unless
another systematic basis is more representative of the time pattern in which use benefit derived from the leased asset is
diminished. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount
of the leased asset and recognised on a straight-line basis over the lease term.
STB as lessee
Rentals payable under operating leases are charged to income or expense on a straight-line basis over the term of the
relevant lease unless another systematic basis is more representative of the time pattern in which economic benefits from
the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the
period in which they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability.
The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where
another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are
consumed.
(d)
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
Depreciation of property, plant and equipment begins when the asset is available for use and is calculated using the
straight-line method to allocate their depreciable amounts over their expected useful lives as follows:
Leasehold land – Over the lease periods of 99 years
Buildings – 25 years
Building improvements – 5 years
Furniture, fittings and equipment – 3 to 5 years
Motor vehicles – 5 years
Electrical installation and air-conditioners – 7 years
Tourism assets – 3 to 10 years
Capital work-in-progress included in property, plant and equipment is not depreciated as these assets are not available for
use. Fully depreciated assets still in use are retained in the financial statements.
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