Financial Statements 2019/2020


MIDDLESEX UNIVERSITY NOTES TO THE ACCOUNTS (continued)


Year Ended 31 July 2020


Exchange differences arising from a monetary item receivable from or payable to a foreign operation, the settlement of which is neither planned nor likely in the foreseeable future, are considered to form part of a net investment in a foreign operation and are recognised directly in equity.


K. Tangible Fixed Assets Valuation


Fixed assets are stated at cost/deemed cost less accumulated depreciation and accumulated impairment losses. Certain items of land and buildings fixed assets that have been revalued on the date of transition to the FRS 102 are measured on the basis of deemed cost, being the revalued amount at the date of the revaluation 31 July 2014.


Where parts of a fixed asset have different useful lives, they are accounted for as separate items of fixed assets.


Land and buildings


Capitalisation Costs incurred in relation to land and buildings after initial purchase or construction are capitalised to the extent that they increase the expected future benefits to the University.


Depreciation


Freehold land is not depreciated as it is considered to have an indefinite useful life. Freehold buildings are depreciated on a straight line basis over their expected useful lives as follows:


Freehold Buildings Freehold Buildings Major Improvements Minor Refurbishments


50 years 50 years


10 – 20 years


Buildings include long leasehold premises and property depreciated over the life of the lease up to a maximum of 50 years. Capitalised costs of leasehold building improvements are depreciated over the shorter of their useful life or the remaining term of the lease.


Equipment Capitalisation


Fixtures, fittings and equipment, including computers and software, costing less than de minimis £30,000 per individual item or group of related items is recognised as expenditure through write off in the year of acquisition. All other equipment is capitalised.


Depreciation


Capitalised equipment is stated at cost and depreciated on a straight line basis over its expected useful life as follows:


Freehold Buildings Fixtures, fittings and equipment


Computer equipment (hardware and software)


Motor vehicles: van and minibus fleet Motor cars fleet


5 – 10 years 4 years


5 – 10 years 3 years


Equipment assets held under finance leases are depreciated over the life of the lease if this is a shorter period.


Assets under construction


Assets in the course of construction are accounted for at cost, based on the value of architects’ certificates and other direct costs incurred to the end of the year. They are not depreciated until they are brought into use.


Borrowing costs


Borrowing costs which are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised.


Impairment


A review for impairment of fixed assets is carried out if events or changes in circumstances indicate that the carrying amount may not be recoverable, whether through the economic benefits of use or through disposal. Where there is evidence of impairment, fixed assets are written down to the recoverable amount.


Repairs and maintenance


Expenditure to ensure that a tangible fixed asset maintains its previously recognised standard of performance is recognised in the Consolidated Statement of Comprehensive Income and Expenditure in the period it is incurred. The University has a planned maintenance programme, which is reviewed on an annual basis.


Fixed assets identified for disposal


Fixed assets identified for disposal are stated at the lower of cost or net realisable value.


Middlesex University


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