Page 54 - CPM Sri Lanka Annual Report 2020-2021

54 ACCELERATION THROUGH
ADAPTATION
CPM Sri Lanka | Annual Report 2020-2021

3. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies listed below have been applied consistently to all periods presented in these financial
statements.

(a) Equipment

(i) Recognition and measurement
Cost includes expenditure that is directly attributable to the acquisition of the asset.

Gains/losses on disposal of equipment are determined by comparing the proceeds from disposal with the
carrying amount of the equipment and are recognized net within “Other Income” in the statement or income
and expenditure.

(ii) Depreciation
Depreciation is recognised in the statement of income and expenditure on a straight-line basis over the
estimated useful lives of the asset as follows;

Years
Furniture 5
Computers 5
Telephone 5
Office equipment 5

Useful lives of assets are reviewed at each reporting date. The Institute provides depreciation for the assets
purchased and disposed of during the period on a straight-line basis.

(b) Receivables

Receivables are carried at anticipated realizable value.

(c) Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, demand deposit and short-term highly liquid investments which
are readily convertible to known amounts of cash and are subjected to insignificant risks of change in value. For the
purpose of the statement of cash flows, cash and cash equivalents comprise cash in hand, deposits held at call
with banks.

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