Page 112 - Annual Report 2019

109 ANNUAL REPORT 2019 QFC REGULATORY AUTHORITY FINANCIAL STATEMENTS

Leases
Furniture and equipment (cont.)
An item of furniture and equipment is de-recognised Intangible assets are carried at cost less accumulated
upon disposal or when no future economic benefits are amortisation and impairment losses, if any. Those are Accounting policies applied from 1 January 2019
expected from its use or disposal. Any gain or loss arising amortised on a straight-line basis over a period of three The QFC Regulatory Authority assesses at contract inception
on de-recognition of the asset (calculated as the difference years except for the eXtensible Business Reporting whether a contract is, or contains, a lease. That is, if the
between the net disposal proceeds and the carrying amount Language (XBRL) software and Microsoft Dynamics AX, contract conveys the right to control the use of an identified
of the asset) is included in the statement of comprehensive which is amortised over a period of five years, commencing asset for a period of time in exchange for consideration.
income in the year the asset is de-recognised. when the asset is available for its intended use. This
expense is reported as general and administration
The residual values, useful lives and methods of depreciation expense in the statement of comprehensive income. QFC Regulatory Authority as a lessee
of furniture and equipment are reviewed at each financial The QFC Regulatory Authority applies a single recognition
year end and adjusted prospectively, if appropriate. Subsequent expenditure is only capitalised when it and measurement approach for all leases, except for
increases the future economic benefits embodied in the short-term leases and leases of low-value assets. The
Intangible assets specific asset to which it relates. Where no intangible asset QFC Regulatory Authority recognises lease liabilities
can be recognised, development expenditure is charged to to make lease payments and right-of-use assets
Intangible assets include the cost of purchased computer the statement of comprehensive income when incurred. representing the right to use the underlying assets.
software and software developed in-house. Intangible assets
acquired separately are measured on initial recognition at Expenditure on research or on the research phase of i) Right-of-use assets
cost. Costs associated with the development of software for an internal project is recognised as an expense in the
internal use are capitalised only if the design of the software period in which it is incurred. The QFC Regulatory Authority recognises right-of-use
is technically feasible, and the QFC Regulatory Authority has assets at the commencement date of the lease (i.e., the
both the resources and intent to complete its development date the underlying asset is available for use). Right-of-
and ability to use it upon completion. In addition, costs are use assets are measured at cost, less any accumulated
only capitalised if the asset can be separately identified, it is depreciation and impairment losses, and adjusted for any
probable that the asset will generate future economic remeasurement of lease liabilities. The cost of right-of-use
benefits, and that the development cost of the asset can be assets includes the amount of lease liabilities recognised,
measured reliably. initial direct costs incurred, and lease payments made
at or before the commencement date less any lease
Only costs that are directly attributable to bringing the asset incentives received. Right-of-use assets are depreciated
to working condition for its intended use are included in its on a straight-line basis over the shorter of the lease term
measurement. These costs include all directly attributable and the estimated useful lives of the assets, as follows:
costs necessary to create, produce and prepare the asset to be
capable of operating in a manner intended by management. Office equipment – 3 years
Vehicles – 3 years