2007 - Pinguely Haulotte

Consolidated financial statements of December 31st, 2007
3.2 Intangible assets
a) Development expenditures
Research expenditures are expensed as
incurred. Development expenditures in
connection with projects (for the design
of new products or improvement of
existing products) are recognized as
intangible assets when they meet the
following criteria:
- The technical feasibility of completing
the intangible asset;
- The intention of management to
complete the intangible asset;
- The ability to use or sell the intangible
asset;
- That it is probable that the future
economic benefits attributable to the
development expenditure will flow to
the entity;
- The availability of adequate technical,
financial and other resources to
complete the project;
- That the cost of the asset can be
measued reliably.
Other development expenditures that
do not meet these criteria are recognized
as expenses for the period in which there
are incurred. Development expenditures
previously expensed are not recorded
as assets in subsequent periods.
Development expenditures are amortized
from the date the asset is commissioned
on a straight-line basis over the useful life
of the asset i.e. between 2 and 5 years.
In compliance with IAS 36, development
expenditures recognized under assets
not yet fully amortized are subject to
annual impairment tests whenever
events or changes in circumstances
indicate that it might be impaired
(when the inflow of economic benefits
is less than initially anticipated). A
comparaison of the value of capitalized
development expenditures and
expected cash flows projected over a
period between 2 and 5 years is carried
out to determine the impairment to be
recorded.
b) Other intangible assets
Other intangible assets (software, patents,
etc.) are recognized at their purchase
cost excluding incidental expenses and
financial charges.
Software is amortized on a straight-line
basis over 3 to 5 years.
3.3 Property, plant and equipment
Property, plant and equipment are
recognized in the balance sheet at
purchase cost (less discounts and all costs
necessary to bring the asset to working
condition for its intended use) or
production cost. Finance costs are not
included in the cost of fixed assets.
Fixed assets are depreciated according
to their depreciable amount (cost less
the residual value), starting from the date
the asset is ready to be commissioned.
Depreciation is recorded over the useful
life that reflects the consumption of future
economic benefits associated with the
asset that will flow to the enterprise.
When the carrying value of an asset is
greater than the expected recoverable
amount, an impairment is recorded for
the difference.
Component parts are treated as separate
items and subject to different
depreciation rates if the related assets
have different useful lives. The costs of
the renewal or replacement of
components are recognized as distinct
assets and the replaced asset is eliminated.
In compliance with IAS 17, acquisitions
financed leases are recognized as assets
at the lower of fair value of the leased
item and the present value of the
minimum lease payments at the
inception of the lease according to the
procedures defined below when the
lease agreements transfer substantially
all of the risks and rewards of ownership
to the lessee. The corresponding liability
is recognized under borrowings.
Land is not depreciated. Other tangible
fixed assets are depreciated on a straightline
basis over their expected useful lives
as follows :
- Land improvements : 10 years
- Structural work : 30 to 40 years
- Interior office improvements :
5 to 10 years
- Paint line : 8 to 15 years
- Telehandlers, aerial work platforms
and cranes : 7 to 10 years
- Machine tools : 20 years
- Other equipment : 10 years
- Industrial processes : 3 to 5 years
- Computer equipment : 5 years
- Furniture : 10 years
- General services : 20 years
The residual value and useful lives of the
assets are reviewed and when necessary
adjusted at the end of each period.
3.4 Treasury shares
Shares of Haulotte Group S.A. acquired
in connection with the Group share buyback
programs (liquidity contract assuring
an orderly market in the company’s shares
and buyback program) are recorded as
a deduction from equity at acquisition
cost. No gain or loss is recognized in the
income statement from purchases, sales
or impairment of treasury shares.
3.5 Financial assets
Financial assets includes loans, advances
to non-consolidated subsidiaries and
other financial assets recognized at fair
value on the acquisition date and
measured at amortized cost at the end
of each period. Any impairment in the
value of these assets is immediately
recorded in the income statement.
The classification and designation of
financial assets is determinated at initial
recognition, when the Group becomes
a party to the contractual clauses
of the assets and are subject to reevaluation
at the end of each period in
accordance with IAS 39.
ENGLISH