Vtech 2014 Annual Report Download - page 56

54 VTech Holdings Limited Annual Report 2014
Notes to the Financial Statements
7 Tangible Assets (Continued)
Land and buildings comprise:
Freehold
land and
buildings and
medium-term
leasehold land
and buildings
US$ million
Short-term
leasehold
buildings
US$ million
Total
US$ million
Cost or valuation
At 1 April 2012 28.1 42.5 70.6
Disposals – (0.4) (0.4)
Revaluation (note (a)) (2.5) – (2.5)
Effect of changes in exchange rates (0.4) 0.2 (0.2)
At 31 March 2013 and 1 April 2013 25.2 42.3 67.5
Revaluation (note (a)) (2.0) – (2.0)
Effect of changes in exchange rates 0.8 – 0.8
At 31 March 2014 24.0 42.3 66.3
Accumulated depreciation
At 1 April 2012 – 26.8 26.8
Charge for the year 0.7 1.3 2.0
Written back on disposals – (0.4) (0.4)
Revaluation (note (a)) (0.2) – (0.2)
Effect of changes in exchange rates – 0.1 0.1
At 31 March 2013 and 1 April 2013 0.5 27.8 28.3
Charge for the year 1.0 1.2 2.2
Revaluation (note (a)) (0.3) – (0.3)
Effect of changes in exchange rates – 0.1 0.1
At 31 March 2014 1.2 29.1 30.3
Net book value at 31 March 2014 22.8 13.2 36.0
Net book value at 31 March 2013 24.7 14.5 39.2
Cost or valuation of tangible assets is analysed as follows:
At cost – 42.3 42.3
At professional valuation (note (a)) 24.0 – 24.0
24.0 42.3 66.3
Net book value of land and buildings comprises:
Hong Kong
Medium-term leasehold land and buildings (less than 50 years
but not less than 10 years) 14.4 – 14.4
Overseas
Freehold land and buildings 8.4 – 8.4
Short-term leasehold buildings – 13.2 13.2
8.4 13.2 21.6
Net book value of revalued land and buildings had the assets been
carried at cost less accumulated depreciation 5.5 – 5.5
Fair value measurement of properties
(i) Fair value hierarchy
The following table presents the fair value of the Group’s properties
measured at the balance sheet date on a non-recurring basis,
categorised into the three-level fair value hierarchy as defined in
IFRS 13, Fair value measurement. The level into which a fair value
measurement is classified is determined with reference to the
observability and significance of the inputs used in the valuation
technique as follows:
• Level 1 valuations: Fair values measured using only Level 1
inputs i.e. unadjusted quoted prices in active markets for
identical assets or liabilities at the measurement date
• Level 2 valuations: Fair values measured using Level 2 inputs
i.e. observable inputs which fail to meet Level 1, and not using
significant unobservable inputs. Unobservable inputs are
inputs for which market data are not available
• Level 3 valuations: Fair values measured using significant
unobservable inputs
The fair value of the freehold land and buildings and the medium-
term leasehold land and buildings of the Group held for own use
as at 31 March 2014 are classified as Level 2 valuations.
During the year ended 31 March 2014, there were no transfers
between Level 1 and Level 2, or transfers into or out of Level 3. The
Group’s policy is to recognise transfers between levels of fair value
hierarchy as at the balance sheet date in which they occur.
(ii) Valuation techniques and inputs used in Level 2 fair value
measurements
The fair value of properties held for own use is determined using
market comparison approach by reference to recent sales price
and rental of comparable properties on a price per square foot
basis using market data which is publicly available.