Page 92 - China Mobile Limited - Annual Report 2012

China Mobile Limited
Annual Report 2012
86
Notes to the Financial Statements
(Expressed in Renminbi unless otherwise indicated)
1 Significant Accounting Policies (Continued)
(i) Leased assets (Continued)
(ii) Assets acquired under finance leases
Where the Group acquires the use of assets under finance leases, the amounts representing the fair value
of the leased asset, or, if lower, the present value of the minimum lease payments of such assets is
included in property, plant and equipment and the corresponding liabilities, net of finance charges, are
recorded as obligations under finance leases. Depreciation is provided for at rates, which write off the cost
of the assets over the term of the relevant lease or, where it is likely the Group will obtain ownership of the
asset, the life of the asset, as set out in note 1(h). Impairment losses are accounted for in accordance with
the accounting policy as set out in note 1(j). Finance charges implicit in the lease payments are charged to
profit or loss over the period of the leases so as to produce an approximately constant periodic rate of
charge on the remaining balance of the obligations for each accounting period. Contingent rentals are
charged to profit or loss in the accounting period in which they are incurred. There were no contingent
rentals recognized by the Group during the years presented.
(iii) Operating lease charges
Where the Group has the use of assets held under operating leases, payments made under the leases are
charged to profit or loss in equal instalments over the accounting periods covered by the lease term,
except where an alternative basis is more representative of the pattern of benefits to be derived from the
leased asset. Lease incentives received are recognized in profit or loss as an integral part of the aggregate
net lease payments made. Contingent rentals are charged to profit or loss in the accounting period in
which they are incurred. There were no contingent rentals recognized by the Group during the years
presented.
The cost of acquiring land held under an operating lease is amortized on a straight-line basis over the
period of the lease term.