LensCrafters 2013 Annual Report Download - page 103

Buildings and building improvements From 19 to 40 years
Machinery and equipment From 3 to 12 years
Aircraft 25 years
Other equipment From 5 to 8 years
Leasehold Improvements The lower of useful life and the residual
duration of the lease contract
Depreciation stops when is classified as held for sales, in compliance with IFRS 5 “Non-Current Assets Held
for Sale and Discontinued Operations”.
Subsequent costs are included in the asset’s carrying amount or recognized 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 derecognized. Repairs and maintenance
costs are charged to the consolidated statement of income during the financial period in which they are incurred.
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying item
of Property, Plant and Equipment are capitalized as part of the cost of that asset.
The net carrying amount of the qualifying items of Property, Plant and Equipment as well as their useful lives
are assessed and, if necessary, at each balance sheet date. Their net carrying amount written down if it is lower than
their recoverable amount.
Upon disposal or when no future economic benefits are expected from the use of an item of property, plant and
equipment, its carrying amount is derecognized. The gain or loss arising from derecognition is included in profit and
loss.
Assets held for sale
Assets held for sale include non-current assets (or disposal groups) whose carrying amount will be primarily
recovered through a sale transaction rather than through continuing use and whose sale is highly probable in the short
term. Assets held for sale are measured at the lower of their carrying amount and their fair value, less costs to sell.
Finance and operating leases
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are
classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are
charged to the consolidated statement of income on a straight-line basis over the lease term.
Leases where lessees bear substantially all the risks and rewards of ownership are classified as finance leases.
Finance leases are capitalized at the lease’s commencement at the lower of the fair value of the leased property and the
present value of the minimum lease payments.
Each finance lease payment is allocated between the liability and finance charges. The corresponding rental
obligations, net of finance charges, are included in “long-term debt” in the statement of financial position. The interest
element of the finance cost is charged to the consolidated statement of income over the lease period. The assets acquired
under finance leases are depreciated over the shorter of the useful life of the asset and the lease term.
Intangible assets
(a) Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net
identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill is tested at least annually for
impairment and carried at cost less accumulated impairment losses. Impairment losses on goodwill are not reversed.
Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
(b) Trademarks and other intangible assets