Rolls-Royce Annual Report 2000

Financial statements

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Note 10

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10 Tangible fixed assets

	Land and buildings £m	Plant and equipment £m	Aircraft and engines £m	In course of construction £m	Total £m

Group
Cost or valuation:
At January 1, 2000	489	1,547	209	170	2,415
Exchange adjustments	4	27	12	3	46
Additions at cost	12	133	26	82	253
On disposals of businesses	(13)	(33)	—	(1)	(47)
Reclassifications	8	101	—	(109)	—
Disposals/write-offs	(8)	(74)	(45)	(2)	(129)

At December 31, 2000	492	1,701	202	143	2,538

Accumulated depreciation:
At January 1, 2000	41	570	51	—	662
Exchange adjustments	1	8	2	—	11
Provided during year	22	145	11	—	178
On disposals of businesses	—	(8)	—	—	(8)
Disposals/write-offs	(3)	(60)	(14)	—	(77)

At December 31, 2000	61	655	50	—	766

Net book value at December 31, 2000	431	1,046	152	143	1,772

Net book value at December 31, 1999	448	977	158	170	1,753


Company
Cost or valuation:
At January 1, 2000	265	883	—	133	1,281
Additions at cost	4	76	—	20	100
Reclassifications	8	82	—	(90)	—
Disposals/write-offs	(2)	(31)	—	—	(33)

At December 31, 2000	275	1,010	—	63	1,348

Accumulated depreciation:
At January 1, 2000	26	398	—	—	424
Provided during year	10	68	—	—	78
Disposals/write-offs	—	(29)	—	—	(29)

At December 31, 2000	36	437	—	—	473

Net book value at December 31, 2000	239	573	—	63	875

Net book value at December 31, 1999	239	485	—	133	857

		Group		Company

Tangible fixed assets include:	2000 £m	1999 £m	2000 £m		1999 £m

Net book value of finance leased assets	104	109	27		32

Assets held for use in operating leases:
Cost	178	194	—		—
Depreciation	(37)	(44)	—		—

Net book value	141	150	—		—

Non-depreciable land	85	90	59		59

Land and buildings at cost or valuation comprise:
Cost	235	222	72		62
Valuation at December 31, 1985	1	1	—		—
Valuation at December 31, 1996¹	256	266	203		203

	492	489	275		265

Land and buildings at net book value comprise:
Freehold	400	415	231		232
Long leasehold	19	19	9		8
Short leasehold	12	14	(1)		(1)

	431	448	239		239

On an historical cost basis the net book value of land and buildings would have been as follows:
Cost	475	471	256		246
Depreciation	(152)	(135)	(118)		(111)

	323	336	138		135

Capitalised interest included in net book value of assets in course of construction	4	2	—		—

Capital expenditure commitments – contracted but not provided for	91	177	27		33

The Group has adopted FRS 15 ‘Tangible fixed assets', and has followed the transitional provisions to retain the book value of land and buildings,
certain of which were revalued in 1996 (see ¹below).

¹Group properties were revalued at December 31, 1996 as follows:

i) Specialised properties, including certain of the Group's major manufacturing sites, were revalued on a depreciated replacement cost basis.

ii) Non-specialised properties were revalued by reference to their existing use value.

iii) Properties surplus to the Group's requirements were revalued on an open market value basis.

In the United Kingdom the revaluation was carried out by Gerald Eve, Chartered Surveyors, Fuller Peiser, Chartered Surveyors and Storey Sons & Parker, Chartered Surveyors, in accordance with the appraisal and valuation manual of the Royal Institution of Chartered Surveyors. Overseas properties were valued principally by independent local valuers.