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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2016
Annual Report 2016 83
Notes to the consolidated financial statements
30 June 2016
(continued)
13 Property, plant and equipment (continued)
(b) Non-current assets pledged as security
Refer to note 16 for information on non-current assets pledged as security by the Group.
(c) Recognition and measurement
Property, plant and equipment are stated at historical cost less accumulated depreciation and any accumulated
impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of the items. It also
includes the direct cost of bringing the asset to the location and condition necessary for first use and the estimated
future cost of rehabilitation, where applicable. The assets are subsequently measured at cost less accumulated
depreciation and any accumulated impairment losses.
Subsequent costs are included in the asset's carrying amount or recognised 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 any component accounted for as a separate asset is derecognised
when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they
are incurred.
Depreciation
Land is not depreciated. Depreciation on other assets is calculated using either units-of-production or straight-line
depreciation as follows:
Depreciation periods are primarily:
Buildings
5 - 10 years
Mining plant and equipment
2 - 10 years
Motor vehicles
3 - 8 years
Furniture and fittings
3 - 10 years
Leased assets
3 - 4 years
Depreciation is expensed as incurred, unless it relates to an asset or operation in the construction phase, in which case
it is capitalised.
Derecognition
An item of property, plant and equipment is derecognised when it is sold or otherwise disposed of, or when its use is
expected to bring no future economic benefits. Any gain or loss from derecognising the asset (being the difference
between the proceeds of disposal and the carrying amount of the asset) is included in the profit or loss in the period the
item is derecognised.
The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
period.
(d) Key estimates and judgements
The estimations of useful lives, residual values and depreciation methods require significant management judgements
and are regularly reviewed. If they need to be modified, the depreciation and amortisation expense is accounted for
prospectively from the date of the assessment until the end of the revised useful life (for both the current and future
years).
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