HSBC 2010 Annual Report Download - page 339

337
Overview Operating & Financial Review Governance Financial Statements Shareholder Information
Leasehold land and buildings
2010 2009
Cost
Accumulated
depreciation Cost
Accumulated
depreciation
US$m US$m US$m US$m
At 1 January .................................................................................. 1,824 (831) 1,621 (675)
Additions ...................................................................................... 181 – 175 –
Disposals ....................................................................................... (81) 54 (89) 71
Depreciation charge for the year .................................................. – (133) – (133)
Impairment loss recognised .......................................................... – – – (24)
Exchange differences .................................................................... (16) – 86 (40)
Other changes ............................................................................... 36 (23) 31 (30)
At 31 December ............................................................................ 1,944 (933) 1,824 (831)
Net carrying amount at 31 December ........................................... 1,011 993
Investment properties
Movement on the fair value of investment properties
Freehold
land and
buildings
Long
leasehold
land and
buildings
Short
leasehold
land and
buildings Total
US$m US$m US$m US$m
Fair value
At 1 January 2010 ......................................................................... 640 184 237 1,061
Additions at cost ........................................................................... 240 – – 240
Fair value adjustments .................................................................. 31 24 38 93
Disposals ....................................................................................... (216) (2) – (218)
Transfers ....................................................................................... – (42) 42 –
Exchange differences .................................................................... (34) (1) (1) (36)
Other changes ............................................................................... 6 (7) (6) (7)
At 31 December 2010 ................................................................... 667 156 310 1,133
Fair value
At 1 January 2009 ......................................................................... 566 188 217 971
Additions at cost ........................................................................... 36 – – 36
Fair value adjustments .................................................................. (58) 16 18 (24)
Disposals ....................................................................................... – (25) – (25)
Exchange differences .................................................................... 57 5 – 62
Other changes ............................................................................... 39 – 2 41
At 31 December 2009 ................................................................... 640 184 237 1,061
Investment properties are valued on an open market value basis as at 31 December each year by independent
professional valuers who have recent experience in the location and type of properties. Investment properties in Hong
Kong, the Macau Special Administrative Region and mainland China, which represent more than 35% by value of
HSBC’s investment properties subject to revaluation, were valued by an independent valuer who is a member of the
Hong Kong Institute of Surveyors and who has recent experience in the locations and categories of the investment
properties.
Included within ‘Other operating income’ was rental income of US$26m (2009: US$81m; 2008: US$23m) earned by
HSBC on its investment properties. Direct operating expenses of US$3m (2009: US$2m; 2008: US$2m) incurred in
respect of the investment properties during the year were recognised in ‘General and administrative expenses’. Direct
operating expenses arising in respect of investment properties that did not generate rental income during 2010
amounted to nil (2009 and 2008: nil).
At 31 December 2010, HSBC had no contractual obligations to purchase, construct, develop, maintain or enhance
investment properties (2009: nil).
HSBC Holdings had no investment properties at 31 December 2010 or 2009.