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72 LIPPO MALLS INDONESIA RETAIL TRUST ANNUAL REPORT 2013
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONT’D
Borrowing Costs
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qualifying asset that necessarily take a substantial period of time to get ready for their intended use or sale are capitalised as
part of the cost of that asset until substantially all the activities necessary to prepare the qualifying asset for its intended use
or sale are complete.
Unit Based Payments
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the transaction.
Plant and Equipment
Depreciation is provided on a straight-line basis to allocate the gross carrying amounts less their residual values over their
estimated useful lives of each part of an item of these assets. The annual rates of depreciation are as follows:
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An asset is depreciated when it is available for use until it is derecognised even if during that period the item is idle. Fully
depreciated assets still in use are retained in the fnancial statements.
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depreciation and any accumulated impairment losses. The gain or loss arising from the derecognition of an item of plant and
equipment is determined as the diference between the net disposal proceeds, if any, and the carrying amount of the item
and is recognised in the proft or loss. The residual value and the useful life of an asset is reviewed at least at each end of the
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accounting estimate, and the depreciation charge for the current and future periods are adjusted.
Cost also includes acquisition cost, any cost directly attributable to bringing the asset to the location and condition necessary
for it to be capable of operating in the manner intended by management. Subsequent cost is recognised as an asset only
when it is probable that future economic benefts associated with the item will fow to the entity and the cost of the item can
be measured reliably. All other repairs and maintenance are charged to the proft or loss when they are incurred.
Investment Property
Investment property is property owned or held under a fnance lease to earn rentals or for capital appreciation or both, rather
than for use in the production or supply of goods or services or for administrative purposes or sale in the ordinary course of
business. It includes an investment property in the course of construction. After initial recognition at cost including transaction
costs the fair value model is used to measure the investment property at fair value as of the end of the reporting year. A gain
or loss arising from a change in the fair value of investment property is included in proft or loss for the reporting year in which
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being valued.
NOTES TO THE FINANCIAL STATEMENTS (CONT’D)
31 December 2013