Asus 2009 Annual Report Download - page 160

156
ASUSTeK COMPUTER INC. AND SUBSIDIARIES
Notes to Financial Statements
(Continued)
(12) Property, plant and equipment, leased assets, idle assets, and depreciation
Property, plant and equipment are stated at cost. Cost associated with significant additions,
improvements, and replacements to property, plant and equipment are capitalized. Expenditures
for regular repairs and maintenance are charged against operating income.
Depreciation of property, plant and equipment is provided over the estimated useful lives of the
assets by using the straight-line method. If the property, plant and equipment have reached the
end of their estimated useful lives but are still in use, the Company will estimate their remaining
useful lives and residual value, and depreciate the residual value using the same method.
Property, plant and equipment leased to other parties under operating leases are classified as leased
assets. The related depreciation is accounted for as a reduction of rental income. The useful
lives of fixed assets, leased assets and idle assets are as follows:
A. Buildings and buildings improvements: 3 to 60 years.
B. Machinery and equipment: 2 to 10 years.
C. Instruments and equipment: 1 to 8 years.
D. Other equipment: 1 to 20 years.
Property, plant and equipment not currently used in operations are transferred to idle assets. The
cost, accumulated depreciation, and accumulated impairment of the original assets not currently
used in operations are all transferred to idle assets or other assets, and depreciated.
(13) Intangible assets and deferred expense
Intangible assets represent trademarks, technological know-how, computer software and land use
rights, which are amortized using the straight-line method over their estimated economic lives.
Also, intangible assets are evaluated periodically for impairment in accordance with the R.O.C.
SFAS No. 35. Deferred expense represents office decoration tooling, which is amortized using
the straight-line method over 9 months to 10 years.
(14) Accrued product warranty liability
When the sales of the products attached with a warranty clause are recognized, warranty liabilities
are accrued and current expenses are recorded according to historical return rates and repair costs,
failure rates and warranty periods.