/ 1 2 5
NOTES TO THE FINANCIAL STATEMENTS
C A M B R I D G E I N D U S T R I A L T R U S T
A N N U A L R E P O R T 2 0 1 5
3.
Significant accounting policies (Cont’d)
3.5 Impairment – non-financial assets
The carrying amounts of the Group’s non-financial assets, other than investment properties, are reviewed
at each reporting date to determine whether there is any indication of impairment. If any such indication
exists, the asset’s recoverable amount is estimated.
For the purpose of impairment testing, assets that cannot be tested individually are grouped together into
the smallest group of assets that generates cash inflows from continuing use that are largely independent
of the cash inflows of other assets or groups of assets (the “cash-generating unit”, or “CGU”).
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to
sell. In assessing value in use, the estimated future cash flows are discounted to their present value using
a pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset.
An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated
recoverable amount. Impairment losses are recognised in the Statement of Total Return.
Impairment losses recognised in prior years are assessed at each reporting date for any indications that
the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the
estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent
that the asset’s carrying amount does not exceed the carrying amount that would have been determined,
net of depreciation or amortisation, if no impairment loss had been recognised.
3.6 Revenue recognition
(i)
Rental income from operating leases
Rental income from investment properties is recognised in the Statement of Total Return on a
straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral
part of the total rental income over the term of the lease.
(ii)
Interest income
Interest income is accrued using the effective interest method.
3.7 Expenses
(i)
Property expenses
Property expenses are recognised on an accrual basis. Included in property expenses are the
Property Manager’s fee which is based on the applicable rate stipulated in Note 1.
(ii)
Management fees
Management fees are recognised on an accrual basis based on the applicable rates stipulated in
Note 1.
