SCI Annual Report 2015

SCI ELECTRIC PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES
(FORMERLY KNOW AS “SCI ELECTRIC MANUFACTURER COMPANY LIMITED”)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE TEAR ENDED 31 DECEMBER 2015
When assets are sold or retired, the Group will write-off both the assets and related accumulated
depreciation from the accounts and will recognize any gain or loss from retirement of the asset in profit or loss.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each
reporting period.
Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down
immediately to its recoverable amount. Estimated recoverable amount is the higher of the anticipated discounted
cash flows from the continuing use of the asset and the amount obtainable from the sale of the asset less any
costs of disposal.
Repairs and maintenance are charged to the income statement during the financial period in which they are
incurred. The cost of major renovations is included in the carrying amount of the asset when it is probable that
future economic benefits in excess of the originally assessed standard of performance of the existing asset will flow
to the Company. Major renovations are depreciated over the remaining useful life of the related asset.
Gains and losses on disposals of property, plant and equipment are determined by comparing proceeds
with the carrying amount and are included in operating profit.
Work-in-progress is stated at cost. These assets are not depreciated until such time as the relevant assets
are completed and ready for their intended operational use.
Annual Report 2015
3.12 Right in service concession arrangement
Right in service concession arrangement is measured initially at its cost. Costs comprise construction costs of dam
and other related equipment and related transaction costs and borrowing costs. Borrowing costs are incurred for
the purpose of acquiring, constructing or producing a qualifying asset are capitalised as part of its cost. Borrowing
costs are capitalised while acquisition or construction is actively underway and cease once the asset is substantially
complete. The right in service concession arrangement is amortized on a straight-line basis over the period of the
concession of 30 years.
Expenditure on the Environmental and Social expenses and other assets under the conditions required in
the Concession Agreements are capitalised and amortised on a straight-line basis over the period of the
Concession of 30 years.
3.13 Intangible assets
Computer software is stated at historical cost less accumulated amortization. Software costs are amortized as an
expense by the straight - line method over a period of 5 years.
3.14 Impairment of assets
Assets that have an indefinite useful life, for example goodwill, are not subject to amortisation and are tested
annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised
for the amount by which the carrying amount of the assets exceeds its recoverable amount. The recoverable amount
is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets
are grouped at the lowest level for which there is separately identifiable cash flows. Non-financial assets other than
goodwill that suffered impairment is reviewed for possible reversal of the impairment at each reporting date.
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