Vodafone 1998 Annual Report Download - page 79

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Statement Of Accounting Policies
Turnover represents the invoiced value, excluding value added tax, of services and goods supplied by the Group.
Pensions
Costs relating to defined benefit plans, which are periodically calculated by professionally qualified actuaries, are charged
against profits so that the expected costs of providing pensions are recognised during the period in which benefit is derived
from the employees' services.
The costs of the various pension schemes may vary from the funding, dependent upon actuarial advice, with any difference
between pension cost and funding being treated as a provision or prepayment.
Defined contribution pension costs charged to the profit and loss account represent contributions payable in respect of the
period.
Research and development
Expenditure on research and development is written-off in the year in which it is incurred.
Scrip dividends
Dividends satisfied by the issue of ordinary shares have been credited to reserves. The nominal value of the shares issued
has been offset against the share premium account.
Intangible fixed assets
Purchased intangible fixed assets, including licence fees, are capitalised at cost, except for customer contracts which are
written-off to reserves in the year in which they are acquired.
Network licence costs are amortised over the periods of the licences. Amortisation is charged from commencement of service
of the network. The annual charge is calculated in proportion to the expected usage of the network during the start up period
and on a straight line basis thereafter.
Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated depreciation.
Depreciation is not provided on freehold land. The cost of other tangible fixed assets is written-off, from the time they are
brought into use, by equal instalments over their expected useful lives as follows:
Freehold buildings 25 - 50 years
Leasehold premises the term of the lease
Plant and machinery 10 years
Motor vehicles 4 years
Computers and software 3 - 5 years
Furniture and fittings 10 years
Tangible fixed assets include overheads incurred in the acquisition, establishment and installation of base stations.
Investments
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