Page 61 - 2021 ANNUAL REPORT draft

difference between the net disposal proceeds and the carrying amount of the asset) is included in the
income statement in the year the asset is derecognized.

3.9. Intangible assets

Software

Software acquired by the Bank is stated at cost less accumulated amortization and accumulated impairment
losses.
Expenditure on internally developed software is recognized as an asset when the Bank is able to
demonstrate its intention and ability to complete the development and use the software in a manner that
will generate future economic benefits, and can reliably measure the costs to complete the development.
Development costs previously expensed cannot be capitalized. The capitalized costs of internally
developed software include all costs directly attributable to developing the software and capitalized
borrowing costs, and are amortized over its useful life. Internally developed software is stated at capitalized
cost less accumulated amortization and impairment. There was no such expenditure during the year.
Subsequent expenditure on software assets is capitalized only when it increases the future economic
benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.
Amortization is recognized in profit or loss on a straight-line basis over the estimated useful life of the
software, from the date that it is available for use since this most closely reflects the expected pattern of
consumption of the future economic benefits embodied in the asset. The maximum useful life of software
is five years.
Amortization methods, useful lives and residual values are reviewed at each financial year-end and adjusted
if appropriate.

3.10. Impairment of non-financial assets

The carrying amounts of the Bank’s non-financial assets are reviewed at each reporting date to determine
whether there is any indication of impairment. If any such indication exists then the asset’s recoverable
amount is estimated. For goodwill and intangible assets that have indefinite useful lives or that are available
for use, the recoverable amount is estimated each year. However, the Bank chooses the cost model
measurement to reassess investment property after initial recognition i.e. depreciated cost less any
accumulated impairment losses.
An impairment loss is recognized if the carrying amount of an asset or its cash-generating unit exceeds its
recoverable amount. A cash-generating unit is the smallest identifiable asset Bank that generates cash
flows that largely are independent from other assets and Banks. Impairment losses are recognized in the
income statement. Impairment losses recognized in respect of cash-generating units are allocated first to
reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount
of the other assets in the unit (group of units) on a pro rata basis.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair
value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset.
An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses
recognized in prior years are assessed at each reporting date for any indications that the loss has
decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates
used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s
carrying amount does not exceed the carrying amount that would have been determined, net of depreciation
or amortization, if no impairment loss had been recognized.

3.11. Deposits

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Guaranty Trust Bank (Gambia) Limited Financial Statements December 2021