Page 91 - CA Sri Lanka Integrated Annual Report 2023

previous period for all amounts reported Estimates and underlying assumptions are 2. SUMMARY OF SIGNIFICANT
in the financial statements, in order to reviewed on an ongoing basis. Revisions to ACCOUNTING POLICIES
enhance the understanding of the financial accounting estimates are recognised in the 2.1 Assets and the Bases of Their
statements of the current period and to period in which the estimate is revised, if Valuation
improve comparability. the revision affects only that period or in the 2.1.1 Property, Plant and Equipment
period of the revision and future periods if
Where necessary, comparative figures have the revision affects both current and future (a) Basis of Recognition and
been rearranged to conform to the current periods. Measurement
year’s presentation . Property, plant and equipment are
Information about significant areas of recognised if it is probable that
1.6.4 Responsibility and Approval of estimates, uncertainty and critical judgments future economic benefits associated
Financial Statements in applying accounting policies that have with the asset will flow to the
The Council of The Institute of Chartered the most significant effects on the amounts Institute and the cost of the asset
Accountants of Sri Lanka acknowledges their recognised in the financial statements is as can be measured reliably.
responsibility for the financial statements follows.
and financial statements were approved and All property, plant and equipment
authorised for issue by the Council at the a) Defined Benefit Plans are stated initially at cost and
meeting held on 25 March 2024. The cost of the retirement benefit subsequently measured at cost
plan of employees is determined less accumulated depreciation
1.6.5 Materiality and Aggregation using Projected Unit Credit (PUC) and any impairment losses.
method. Such method involves use Repair and maintenance costs are
Each material class of similar items is of assumptions concerning the rate recognised in the statement of
presented separately in the financial of interest, rate of salary increases comprehensive income as incurred.
statements. Items of a dissimilar nature or and retirement age. Due to the The carrying values of property,
function are presented separately, unless long-term nature of the plan, such plant and equipment are reviewed
they are immaterial.
estimates are subject to significant for impairment when events or
uncertainty. changes in circumstances indicate
1.6.6 Functional and Presentation
Currency that carrying value may not be
b) Estimating the Incremental recoverable.
The financial statements are presented in Borrowing Rate
Sri Lankan Rupees, which is the Institute’s As the Institute cannot readily (b) Depreciation
functional and presentation currency, in the determine the interest rate implicit Depreciation is calculated by using
primary economic environment in which the in the lease, it uses its incremental a straight-line method on the cost
Institute operates. borrowing rate (IBR) to measure the of all property, plant and equipment,
lease liabilities. IBR is rate of interest in order to write-off such amounts
All financial information presented in Sri that a lessee would have to pay to over the estimated useful life of such
Lankan Rupees have been rounded to the borrow similar facility from a financial assets.
nearest thousand, unless stated otherwise. institution.
The estimated useful lives of assets
1.7 Significant Accounting c) Changes in Accounting Estimates are as follows:
Estimates and Judgments
and Judgments
Accounting estimates are monetary amounts Any changes in accounting estimates Asset category Useful life
in financial statements that are subject to and critical judgements are disclosed (years)
measurement uncertainty. The preparation in the relevant notes to the financial Buildings 50
and presentation of financial statements, statements. Furniture 5- 10
in conformity with Sri Lanka Accounting
Plant and Machinery 5-10
Standards, requires Management to make
judgments, estimates and assumptions that Motor vehicles 10
affect the application of accounting policies Computers 5
and reported amounts of assets, liabilities,
income and expenses. Actual results may Depreciation of an asset begins
differ from these estimates and judgments when it is available for use and
used. ceases at the earlier date that
the asset is classified as held for
sale and the date that the asset is
derecognised.

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