2.5 Property, plant and equipment Property, plant and equipment including land and buildings are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is de-recognised. All other repairs and maintenance are charged to the consolidated statement of profit or loss during the financial period in which they are incurred. Interest costs on borrowings to finance the construction of property, plant and equipment are capitalised during the period of time that is required to complete and prepare the asset for its intended use. Other borrowing costs are expensed. Land is not depreciated. Depreciation is provided on the straight-line basis at rates estimated to write-off the cost of each asset over its expected useful life. In the case of motor vehicles, depreciation is based on cost less an estimated residual value. The estimated useful lives of assets are reviewed periodically, taking account of commercial and technological obsolescence as well as normal wear and tear, and depreciation rates are adjusted if appropriate. Current rates of depreciation are: Freehold property Leasehold property and improvements Plant and equipment Rental assets Furniture and fixtures Motor vehicles 2% 2% to 20% 5% to 33.3% 25% 10% to 25% 10% to 25% The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each statement of financial position date. Leasehold property and improvements are depreciated over the shorter of the asset's useful economic life and the lease term. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are included in the consolidated statement of profit or loss. Consolidated Statement of Cash Flows. Year ended September 30. Expressed in Thousands of Trinidad and Tobago dollars Cash flows from operating activities Profit before income tax from continuing operations Profit before tax from discontinued operations Adjustments for: As at September 30 Notes 2022 $ 2021 $ (Restated) 1,029,319 925,089 1 37 138,946 165,518 Share of results of associates and joint ventures 10 (18,842) (52,344) Depreciation and impairment of property, plant and equipment 5 228,854 217,010 Depreciation of right-of-use assets 6 91,021 90,332 Depreciation and impairment of investment properties 7 2,577 2,892 Impairment of goodwill 8 10,263 Amortisation of other intangible assets 9 20,980 19,320 Unwinding of interest on restoration liability 214 145 Covid-19 lease concessions 6.2 (276) Gain on disposal of property, plant and equipment (67,472) (113,748) Gain on disposal of investment properties (6,791) (8,828) Gain on disposal of subsidiaries 37 (83,441) (90,784) Expected credit losses/impairment expense on financial instruments 22,278 6,942 Loss/(gain) on other financial instruments 16,810 (51,255) Employee retirement and other benefits 11,035 (16,541) 1,385,488 1,103,735 Profit before changes in working capital Changes in working capital: Increase in inventories Increase in trade and other receivables Decrease in other provisions and other charges Increase in instalment credit and other loans Increase in trade and other payables Increase in statutory deposits with regulators Increase in liabilities on insurance contracts Increase in customers' deposits (435,865) (94,454) (304,333) (530,721) (32,743) (28,234) (25,005) (14,786) 182,633 (21,011) 107,234 (45,586) - 157,758 4,545 253,101 Cash generated from operations Taxation paid 1,002,265 659,491 (321,154) (245,454) Net cash generated from operating activities 681,111 414,037
2.5 Property, plant and equipment Property, plant and equipment including land and buildings are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is de-recognised. All other repairs and maintenance are charged to the consolidated statement of profit or loss during the financial period in which they are incurred. Interest costs on borrowings to finance the construction of property, plant and equipment are capitalised during the period of time that is required to complete and prepare the asset for its intended use. Other borrowing costs are expensed. Land is not depreciated. Depreciation is provided on the straight-line basis at rates estimated to write-off the cost of each asset over its expected useful life. In the case of motor vehicles, depreciation is based on cost less an estimated residual value. The estimated useful lives of assets are reviewed periodically, taking account of commercial and technological obsolescence as well as normal wear and tear, and depreciation rates are adjusted if appropriate. Current rates of depreciation are: Freehold property Leasehold property and improvements Plant and equipment Rental assets Furniture and fixtures Motor vehicles 2% 2% to 20% 5% to 33.3% 25% 10% to 25% 10% to 25% The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each statement of financial position date. Leasehold property and improvements are depreciated over the shorter of the asset's useful economic life and the lease term. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are included in the consolidated statement of profit or loss. Consolidated Statement of Cash Flows. Year ended September 30. Expressed in Thousands of Trinidad and Tobago dollars Cash flows from operating activities Profit before income tax from continuing operations Profit before tax from discontinued operations Adjustments for: As at September 30 Notes 2022 $ 2021 $ (Restated) 1,029,319 925,089 1 37 138,946 165,518 Share of results of associates and joint ventures 10 (18,842) (52,344) Depreciation and impairment of property, plant and equipment 5 228,854 217,010 Depreciation of right-of-use assets 6 91,021 90,332 Depreciation and impairment of investment properties 7 2,577 2,892 Impairment of goodwill 8 10,263 Amortisation of other intangible assets 9 20,980 19,320 Unwinding of interest on restoration liability 214 145 Covid-19 lease concessions 6.2 (276) Gain on disposal of property, plant and equipment (67,472) (113,748) Gain on disposal of investment properties (6,791) (8,828) Gain on disposal of subsidiaries 37 (83,441) (90,784) Expected credit losses/impairment expense on financial instruments 22,278 6,942 Loss/(gain) on other financial instruments 16,810 (51,255) Employee retirement and other benefits 11,035 (16,541) 1,385,488 1,103,735 Profit before changes in working capital Changes in working capital: Increase in inventories Increase in trade and other receivables Decrease in other provisions and other charges Increase in instalment credit and other loans Increase in trade and other payables Increase in statutory deposits with regulators Increase in liabilities on insurance contracts Increase in customers' deposits (435,865) (94,454) (304,333) (530,721) (32,743) (28,234) (25,005) (14,786) 182,633 (21,011) 107,234 (45,586) - 157,758 4,545 253,101 Cash generated from operations Taxation paid 1,002,265 659,491 (321,154) (245,454) Net cash generated from operating activities 681,111 414,037
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter6: Statement Of Cash Flows
Section: Chapter Questions
Problem 20E
Related questions
Question
Analyze the accounting treatment of Property, Plant and Equipment, including
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