IBERSOL | 2019 Annual Report

Consolidated Financial Statements 2.6 TANGIBLE FIXED ASSETS Buildings and other structures include own properties assigned to the restaurant ac- tivities and expenses on works at third-party properties, in particular those required for setting up restaurant shops. Tangible fixed assets are shown at the acquisition cost, net of the respective amorti- sation and accumulated impairment losses. The historic cost includes all expenses attributable directly to the acquisition of goo- ds. Costs with loans incurred and with loans obtained for the construction of fixed tan- gible assets are recognized as part of the construction cost of the asset. Subsequent costs are added to the amounts for which the good is recorded or re- cognised as separate assets, as appropriate, only when it is probable that the com- pany will obtain the underlying economic benefits and the cost may be reliably mea- sured. Other expenses on repairs and maintenance are recognised as an expense in the period in which they are incurred. Depreciation of assets is calculated by the equal annual amounts method in order to allocate its cost at its residual value, according to its estimated lifetime, as follows: Buildings and other constructions 10-35 years* Equipment: 10 years Tools and utensils: 4 years Vehicles: 5 years Office equipment: 10 years Other tangible assets: 5 years (*) Buildings and other constructions owned by the Group have an estimated life cycle of up to 50 years. The amounts which assets may be depreciated, their lifetime and the depreciation method are reviewed and adjusted if necessary on the consolidated statement of financial position date. Changes in lifetime are treated as a change in accounting estimate and are applied prospectively. If the accounted amount is higher than the asset’s recoverable amount, it is imme- diately readjusted to the estimated recoverable amount (Note 2.8). Gains and losses consequent to a reduction or sale are determined by the difference between receipts from the sale and the asset’s accounted value, and are recognised as other operating income or other operating costs in the profit and loss account. When revaluated goods are sold, the amount included in other reserves is transfer- red to retained profit. 220