BANKSETA ANNUAL REPORT 2023

ANNUAL FINANCIAL STATEMENTS ACCOUNTING POLICIES TO THE ANNUAL FINANCIAL STATEMENTS for the year ended 31 March 2023 7. PROPERTY AND EQUIPMENT Property and equipment comprise tangible non-current assets that are held for use for administrative purposes and are expected to be used during more than one financial year. - it is probable that future economic benefits or service potential associated with the item will flow to the SETA; and - the cost or fair value of the item can be measured reliably. The cost of an item of property and equipment is the purchase price and other costs attributable to bring the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Trade discounts and rebates are deducted in arriving at the cost. Where an asset is acquired through a non-exchange transaction, its cost is its fair value as at the date of acquisition. Property and equipment is initially recognised at cost and subsequently at cost less any subsequent accumulated depreciation and adjusted for any impairments. Depreciation is charged so as to write off the cost of assets over their estimated useful lives, using the straight line method. The useful life indicators are used to review estimated useful lives, residual values and depreciation method each year, with the effect of any changes in estimate accounted for on a prospective basis. The useful life, residual value and depreciation method is assessed at each reporting date for appropriateness. The cost of an item of property and equipment is recognised as an asset when:

The following useful lives are used in the calculation of depreciation.

- - - - -

Computer equipment

3 to 15 years 10 to 25 years 5 to 22 years 5 to 10 years

Office furniture and fittings

Office equipment

Other movable assets Leasehold improvements

over the lease term

Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount (i.e. impairment losses are recognised.) BANKSETA derecognises property and equipment assets when it disposes of the assets or alternatively does not consume economic benefits or service potential from those assets. The gain or loss on disposal of property and equipment is determined as the difference between the sale proceeds and the carrying amount and is taken into account in determining the net surplus or deficit for the year. Remaining useful lives are reviewed annually each year in accordance with the indicator based approach and adjusted as needed. The estimated remaining useful lives take into account the state of the asset and the current usage of the assets. Assets are assessed for impairment indicators on an annual basis.

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PART F: FINANCIAL INFORMATION | BANKSETA ANNUAL REPORT 2022/23