89
A N N U A L R E P O R T 2 0 1 6
For the Financial Year Ended 31 March 2016
NOTES TO THE
FINANCIAL STATEMENTS
3.
Significant accounting estimates and judgements (cont¡¯d)
3.2
Key sources of estimation uncertainty
(cont¡¯d)
(a)
Useful lives of property, plant and equipment
The cost of property, plant and equipment is depreciated on a straight line basis over the property, plant and equipment¡¯s estimated
economic useful lives. Management estimates the useful lives of these property, plant and equipment to be within 3 to 50 years.
Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual
values of these assets, therefore, future depreciation charges could be revised. The carrying amount of the property, plant and
equipment at the end of each reporting period is disclosed in Note 11 to the financial statements.
(b)
Impairment of loans and receivables
The Group assesses at the end of each reporting period whether there is any objective evidence that a financial asset is impaired.
Factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay
in payments are objective evidence of impairment. In determining whether there is objective evidence of impairment, the Group
considers whether there is observable data indicating that there have been significant changes in the debtor¡¯s payment ability or
whether there have been significant changes with adverse effect in the technological, market, economic or legal environment in which
the debtor operates in.
Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss
experience for assets with similar credit risk characteristics. The carrying amount of the Group¡¯s loans and receivables at the end of the
reporting period is disclosed in Note 19 to the financial statements. If the present value of estimated future cash flows decrease by
10% from management¡¯s estimates, the Group¡¯s allowance for impairment will increase by $2,247,000 (2015: increase by $2,351,000).
