Accounting Policies  |  continued Property, plant and equipment – Note 14 Taxation – current and deferred – Notes 11 and 27  Impairment of long-lived assets and goodwill – Notes 14 and 15  78 CRH The carrying values of items of property, plant and equipment are reviewed for  indicators of impairment at each reporting date and are subject to impairment  testing when events or changes in circumstances indicate that the carrying  values may not be recoverable. Goodwill is subject to impairment testing on an  annual basis and at any time during the year if an indicator of impairment is  considered to exist. In the year in which a business combination is effected and  Impairment of property, plant and equipment and goodwill Assumptions Deferred tax assets are recognised in respect of all deductible temporary  differences, carry-forward of unused tax credits and unused tax losses to the  extent that it is probable that taxable profits will be available against which the  temporary differences can be utilised. The carrying amounts of deferred tax  assets are subject to review at each balance sheet date and are reduced to the  extent that future taxable profits are considered to be inadequate to allow all or  part of any deferred tax asset to be utilised.  The defined benefit pension asset or liability in the Consolidated Balance Sheet  comprises the total for each plan of the present value of the defined benefit  obligation less the fair value of plan assets out of which the obligations are to be  settled directly. Plan assets are assets that are held by a long-term employee  benefit fund or qualifying insurance policies. Fair value is based on market price  information and, in the case of published securities, it is the published bid price.  The value of any defined benefit asset is limited to the present value of any  economic benefits available in the form of refunds from the plan and reductions  in the future contributions to the plan. The Group’s income tax charge is based on reported profit and expected  statutory tax rates, which reflect various allowances and reliefs and tax planning  opportunities available to the Group in the multiple tax jurisdictions in which it  operates. The determination of the Group’s provision for income tax requires  certain judgements and estimates in relation to matters where the ultimate tax  outcome may not be certain. The recognition or non-recognition of deferred tax  assets as appropriate also requires judgement as it involves an assessment of  the future recoverability of those assets. In addition, the Group is subject to tax  audits which can involve complex issues that could require extended periods for  resolution. Although management believes that the estimates included in the  Consolidated Financial Statements and its tax return positions are reasonable, no  assurance can be given that the final outcome of these matters will not be  different than that which is reflected in the Group’s historical income tax provisions  and accruals. Any such differences could have a material impact on the income  tax provision and profit for the period in which such a determination is made.  The Group’s obligation in respect of post-employment healthcare and life  assurance benefits represents the amount of future benefit that employees have  earned in return for service in the current and prior periods. The obligation is  computed on the basis of the projected unit credit method and is discounted to  present value using a discount rate equating to the market yield at the balance  sheet date on high-quality corporate bonds of a currency and term consistent  with the currency and estimated term of the post-employment obligations. The assumptions underlying the actuarial valuations from which the amounts  recognised in the Consolidated Financial Statements are determined (including  discount rates, expected return on plan assets, rate of increase in future  compensation levels, mortality rates and healthcare cost trend rates) are updated  annually based on current economic conditions and for any relevant changes to  the terms and conditions of the pension and post-retirement plans. These  assumptions can be affected by (i) for the discount rate, changes in the rates of  return on high-quality corporate bonds; (ii) for the expected return on plan assets,  changes in the pension plans’ strategic asset allocations to various investment  types or to long-term return trend rates in the capital markets in which the  pension fund assets are invested; (iii) for future compensation levels, future labour  market conditions and (iv) for healthcare cost trend rates, the rate of medical cost  inflation in the relevant regions. The weighted average actuarial assumptions  used and sensitivity analysis in relation to the discount rates employed in the  determination of pension and other post-retirement liabilities are contained in  Note 28 to the Consolidated Financial Statements.  The Group’s accounting policy for property, plant and equipment is considered  critical because the carrying value of €8,448 million at 31 December 2012  represents a significant portion (40%) of total assets at that date. Property, plant  and equipment are stated at cost less any accumulated depreciation and any  accumulated impairments except for certain items that had been revalued to fair  value prior to the date of transition to IFRS (1 January 2004). Repair and maintenance expenditure is included in an asset’s carrying amount or  recognised as a separate asset, as appropriate, only when it is probable that  future economic benefits associated with the item will flow to the Group and the  cost of the item can be measured reliably. All other repair and maintenance  expenditure is charged to the Consolidated Income Statement during the  financial period in which it is incurred. Borrowing costs incurred in the construction of major assets which take a  substantial period of time to complete are capitalised in the financial period in  which they are incurred.  While management believes that the assumptions used are appropriate,  differences in actual experience or changes in assumptions may affect the  obligations and expenses recognised in future accounting periods. The assets  and liabilities of defined benefit pension schemes may exhibit significant period- on-period volatility attributable primarily to asset valuations, changes in bond  yields and longevity. In addition to future service contributions, significant cash  contributions may be required to remediate past service deficits. In the application of the Group’s accounting policy, judgement is exercised by  management in the determination of residual values and useful lives. Depreciation  and depletion is calculated to write off the book value of each item of property,  plant and equipment over its useful economic life on a straight-line basis at the  following rates: Land and buildings:  The book value of mineral-bearing land, less an estimate of  its residual value, is depleted over the period of the mineral extraction in the  proportion which production for the year bears to the latest estimates of mineral  reserves. Land other than mineral-bearing land is not depreciated. In general,  buildings are depreciated at 2.5% per annum (“p.a.”). Plant and machinery:  These are depreciated at rates ranging from 3.3% p.a. to  20% p.a. depending on the type of asset. Plant and machinery includes transport  which is, on average, depreciated at 20% p.a. Depreciation methods, useful lives and residual values are reviewed at each  financial year-end. Changes in the expected useful life or the expected pattern of  consumption of future economic benefits embodied in the asset are accounted  for by changing the depreciation period or method as appropriate on a  prospective basis. Current tax represents the expected tax payable (or recoverable) on the taxable  profit for the year using tax rates enacted for the period. Any interest or penalties  arising are included within current tax. Where items are accounted for outside of  profit or loss, the related income tax is recognised either in other comprehensive  income or directly in equity as appropriate. Deferred tax is recognised using the liability method on temporary differences  arising at the balance sheet date between the tax bases of assets and liabilities  and their carrying amounts in the Consolidated Financial Statements. However,  deferred tax liabilities are not recognised if they arise from the initial recognition of  goodwill; in addition, deferred income tax is not accounted for if it arises from  initial recognition of an asset or liability in a transaction other than a business  combination that at the time of the transaction affects neither accounting nor  taxable profit or loss. No provision has been made for temporary differences  applicable to investments in subsidiaries and interests in joint ventures as the  Group is in a position to control the timing of reversal of the temporary differences  and it is probable that the temporary differences will not reverse in the foreseeable  future. Due to the absence of control in the context of associates (significant  influence only), deferred tax liabilities are recognised where appropriate in respect  of CRH’s investments in these entities on the basis that the exercise of significant  influence would not necessarily prevent earnings being remitted by other  shareholders in the undertaking. Deferred tax is determined using tax rates (and laws) that have been enacted or  substantially enacted by the balance sheet date and are expected to apply when  the related deferred income tax asset is realised or the deferred income tax  liability is settled. Deferred tax assets and liabilities are not subject to discounting. 