Page 155 - IC26 LIFE INSURANCE FINANCE

Review of Amortisation Period and Amortisation Method

During the life of an intangible asset, it may become apparent that the estimate of its

useful life is inappropriate. Therefore, the amortisation period and the amortisation

method should be reviewed at least at each financial year end.

If the expected useful life of the asset is significantly different from previous estimates,

the amortisation period should be changed accordingly. Such changes should be accounted

for in accordance with AS 5.

Retirements and Disposals

An intangible asset should be derecognised (eliminated from the balance sheet) on disposal

or when no future economic benefits are expected from its use and subsequent disposal.

Gains or losses arising from the retirement or disposal of an intangible asset should be

determined as the difference between the net disposal proceeds and the carrying amount

of the asset and should be recognised as income or expense in the statement of profit and

loss.

Transitional Provisions

Where, on the date of this Statement coming into effect, an enterprise is following an

accounting policy of not amortising an intangible item or amortising an intangible item over

a period longer than the period determined under this Statement and the period

determined has expired on the date of this Statement coming into effect, the carrying

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