Page 135 - SC Annual Report 2018 (ENG)

Securities
Commission
Malaysia
ANNUAL
REPORT
2018

(b) Property, plant and equipment

(i) Recognition and measurement

Items of property, plant and equipment are measured at cost less any accumulated
depreciation and any accumulated impairment losses.

Cost includes expenditures that are directly attributable to the acquisition of the asset
and any other costs directly attributable to bringing the asset to working condition for its
intended use, and the costs of dismantling and removing the items and restoring the site
on which they are located. Purchased software that is integral to the functionality of the
related equipment is capitalised as part of that equipment.

When significant parts, if any, of an item of property, plant and equipment have different
useful lives, they are accounted for as separate items (major components) of property,
plant and equipment.

The gain or loss on disposal of an item of property, plant and equipment is determined by
comparing the proceeds from disposal with the carrying amount of property, plant and
equipment and is recognised net within “other income” or “other expenses” respectively
in profit or loss.
(ii) subsequent costs

The cost of replacing a component of an item of property, plant and equipment is recognised
in the carrying amount of the item if it is probable that the future economic benefits
embodied within the component will flow to the SC and its cost can be measured reliably.
The carrying amount of the replaced component is derecognised to profit or loss. The
costs of the day-to-day servicing of property, plant and equipment are recognised in profit
or loss as incurred.

(iii) depreciation

Depreciation is based on the cost of an asset less its residual value. Significant
components of individual assets are assessed, and if a component has a useful life that is
different from the remainder of that asset, then that component is depreciated separately.

Depreciation is recognised in profit or loss on a straight-line basis over the estimated
useful lives of each component of an item of property, plant and equipment from the
date that they are available for use. Leased assets are depreciated over the shorter
of the lease term and their useful lives unless it is reasonably certain that the SC will
obtain ownership by the end of the lease term. Property, plant and equipment under
construction are not depreciated until the assets are ready for their intended use.

The estimated useful lives for the current and comparative year are as follows:

Leasehold land Over the lease period of 99
years expiring in 2094
Buildings 50 years
Office equipment, furniture and fittings 5 – 10 years
Computer and application systems 3 years
Motor vehicles 5 years

Depreciation methods, useful lives and residual values are reviewed at end of the
reporting period and adjusted as appropriate.

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