notes to the Consolidated Financial Statements (cont’d) property, plant and equipment (i) Recognition and measurement (ii) Subsequent costs (iii) Depreciation  leaSeS Company as a lessee 61 AnnuAl RepoRt 2011 that the hedge is ineffective, such differences are recognized in profit or loss. When the hedged part of a net investment is disposed  of, the relevant amount in the cumulative amount of foreign currency translation differences is transferred to profit or loss as part of  the profit or loss on disposal. Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses.  Cost includes expenditures that are directly attributable to the acquisition of the asset, including the present value of the expected  cost for the decommissioning of the asset after its use, if the recognition criteria for a provision are met. The cost of self-constructed  assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to a working  condition for their intended use, the costs of dismantling and removing the items and restoring the site on which they are located,  and capitalized borrowing costs. Cost also may include capitalized borrowing costs and transfers from other comprehensive income  of any gain or loss on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment.  When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major  components) of property, plant and equipment. An item of property, plant and equipment is derecognized upon disposal or when no  future economic benefits are expected from its use or disposal. Any gain or loss on the derecognition of the asset is determined by  comparing the proceeds from disposal with the carrying amount of property, plant and equipment, and is recognized net within other  income in profit or loss. The cost of replacing a part of an item of property, plant and equipment is recognized in the carrying amount of the item if it is  probable that the future economic benefits embodied within the part will flow to the Company, and its cost can be measured reliably.  The carrying amount of the replaced part is derecognized. The costs of the day-to-day servicing of property, plant and equipment are  recognized in income as incurred. Depreciation is calculated over the depreciable amount, which is the cost of an asset, or other amount substituted for cost, less its  residual value. Depreciation is recognized in income on a straight-line basis over the estimated useful lives of each component part of  an item of property, plant and equipment, since this most closely reflects the expected pattern of consumption of the future  economic benefits embodied in the asset. Leased assets are depreciated over the shorter of the lease term and their useful lives  unless it is reasonably certain that the Company will obtain ownership by the end of the lease term. Land is not depreciated. The estimated useful lives for the current and comparative periods are as follows: Depreciation methods, useful lives and residual values are reviewed at least at each financial year end and adjusted if appropriate.  The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at inception date: whether fulfilment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right  to use the asset. Finance leases, which transfer to the Company substantially all the risks and benefits incidental to ownership of the leased item, are capitalized at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the  minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to  achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized in the income statement. Leased assets are depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will  obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and  the lease term. Operating lease payments are recognized as an expense in the income statement on a straight line basis over the lease term. Building structure 60 years  Major building components 15–30 years Production equipment 10–25 years  Furniture and fixtures 10–25 years Computer hardware and peripherals  4–5 years Software components  4–11 years