TNAG-0638-FCO40-786-Supplies-of-electricity-for-Hong-Kong-1977 — Page 136

D.

2.

3.

Fixed assets representing major construction projects not completed will be separately shown in the balance sheet concerned as "plant under construction".

Equipment not included under 2. above but acquired for specific capital projects will, until installed, be classified as capital stores, as will general stock items of a capital nature. The aggregate of such capital stores will form part of the fixed assets, and will be shown as "equipment awaiting installation" in the balance sheet concerned.

Depreciation.

1.

Under the Scheme, there will be no depreciation on land, while depreciation on fixed assets will be charged on a straight line basis in accordance with the schedule set out in 2. below.

i.

ii.

Fixed assets acquired before commencement of the Scheme. In respect of each such asset or group of assets, the net book value at the commencement of the Scheme will be written off uniformly over the remainder of the useful life as set down in 2.iii) below.

Fixed assets acquired after commencement of the Scheme. In respect of each such asset, the cost will be written off uniformly over the useful life as set down in 2.iii) below, beginning on the first day of the month of commissioning.

iii. Type of Asset

Useful Life

Buildings, overhead lines and

cables :

25 years

༣.

Generating plant, switchgear

and transformers :

Public lighting, meters,

furniture, computers, tools communication and office equipment :

Motor vehicles :

20 years

10 years

4 years

For the determination of profits tax for the purposes of the Scheme, depreciation will be calculated in accordance with the Inland Revenue Ordinance.