Page 101 - PEA_AnnualReport_2016

3. .2 Special purpose deposits at fnancial institutions, which are presented as non-current assets
in the statements of fnancial position, are deposits to be used longer than one accounting period and cannot be
used for operating activities are PEA Employee Gratuity Fund.

3.5 Investments in associates
Investments in associates are presented in the consolidated fnancial statements under the equity method.

3.6 Investments in subsidiary
Investments in subsidiary are presented in the separate fnancial statements under the cost method.
In case an impairment of investment has occurred, the impairment loss of investment will be recognized
in the statements of comprehensive income.

3.7 Investment property
Investment property comprises of property and plant acquired for used in the operation but has not been utilized
and/or property and plant owned to earn rentals. Provincial Electricity Authority has adopted to measured using the cost
method. Subsequently investment property is presented at cost after deducting accumulated depreciation (if any).

3.8 Property, plant and e uipment
Provincial Electricity Authority’s policies for property, plant and equipment, and depreciation are
summarized as follows :
Property, plant and equipment are initially recognized at cost which is calculated from purchase prices
plus any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable
of operation in the manner intended. Self-constructed assets are recorded as construction costs, consisting of
material costs, direct labor and construction-related expenses.

Property is stated at cost. Plant and equipment are stated at cost less accumulated depreciation and
accumulated impairment losses of assets (if any).
Property comprises of land used in the operation and land acquired for operating objective with certain
plan of usage within one year.
Depreciation of plant and equipment is calculated using the straight-line method over the estimated
useful lives of the assets as follows :

Percentage per annum

Buildings and constructions 3 and 6.25
Electricity generating systems 3 - 20
Electricity distributing systems 4 - 20
Furniture, tools, equipment and vehicles 4 - 20

When property, plant and equipment are impaired, the impairment losses will be recognized in the statements
of comprehensive income.
In case of disposal, Provincial Electricity Authority writes off cost of assets and its accumulated depreciation
from the accounts, and recognizes gain or loss on disposal of assets as other income or other expenses in the
statements of comprehensive income.

SMART PEA 101
Annual Report 2016 Provincial Electricity Authority