The company owns freehold property which is held for rental purposes.
The directors have reviewed the carrying value, expected useful economic life and estimated residual value of the property. Having considered the nature of the asset and the directors’ expectation that the residual value is not materially lower than the carrying value, no depreciation charge has been provided in the year.
The directors consider this treatment to result in no material misstatement of the financial statements. The property is reviewed annually for indicators of impairment.