11. Property, plant and equipment

Measurement basis

Property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. The cost of self-manufactured assets includes the cost of materials, direct labour costs, a reasonable proportion of indirect production costs and capitalised financing costs. Where relevant, the estimated costs of dismantling and removing the asset and restoring the site on which the asset is located are added to the cost.

Computer software that is an integral part of the computer equipment is capitalised as part of the related equipment. Only assets for which the Group holds the beneficial ownership are recognised on the balance sheet.

Gains and losses on the sale of an item of property, plant and equipment are determined by comparing the sales proceeds with the carrying amount of the item of property, plant and equipment and are recognised net under income in the income statement.

Components

If property, plant and equipment consist of components with different useful lives, these components are accounted for as separate items under property, plant and equipment.

The carrying amount of an item of property, plant and equipment includes the cost of renewing (part of) the item when that cost is incurred and when it is probable that the renewal will lead to future economic benefits. All other costs of maintaining the assets are recognised as an expense in the income statement as incurred.

Depreciation

Depreciation of property, plant and equipment is applied on a straight-line basis, less residual value and on the basis of the estimated useful life of each individual item of property, plant and equipment. Depreciation is charged to the income statement.

Land is not depreciated except for paving. The estimated useful life of property, plant and equipment is as follows:

The useful life indicated is an average of the assets included therein and of the components of the assets, if any. The depreciation method, remaining useful life and residual value are assessed annually.

If an item of property, plant and equipment is designated as a real estate asset due to a change in use, or if an item of property, plant and equipment is designated for own use, transfers are made to real estate assets or property, plant and equipment respectively. Since the measurement of both categories of non-current assets is the same, the transfer is made at the carrying amount.