element of the lease rental is deducted from the obligation to the lessor as paid. The interest element of lease rentals and the depreciation of the  relevant assets are charged to the consolidated statement of income. Operating lease rental payments are charged to the consolidated statement of income on a straight-line basis as incurred over the term of the lease. Where an item of capital assets, that must be used to connect customers to the network, is received from a customer, or where cash is received from a customer for the acquisition or construction of such an item, that asset is recorded and measured on initial recognition at its fair value in accordance with IFRIC 18. The period over which the credit is recognized depends upon the nature of the service provided by the Corporation as  determined by the agreement with the customer. If the agreement does not specify a period, the revenue is treated as deferred income and recognized over a period no longer than the useful life of the transferred asset used to provide the ongoing service. Capitalized costs related to an asset under development include all eligible expenditures incurred in connection with the development and construction of the power generating asset until it is available for its intended use. The Corporation capitalizes all direct project costs related to the development of the Corporation's electricity generation projects. Capitalization commences when the project is: Upon a project becoming commercially operational, the capitalized costs, including capitalized borrowing costs, if any, are transferred to capital assets and are amortized on a straight-line basis over the estimated useful lives of the various components. The recovery of project development costs is dependent upon continued access to the development sites, regulatory approval, sufficient project financing, and the successful commercialization of project sites for the profitable sale of electricity. The Corporation separately identifies acquired intangible assets, including computer software and system developments, electricity supply contracts, gas purchase contracts, water rights and licences, and records each at their fair value at the date of acquisition. The initial fair value is amortized over  their estimated useful lives using the straight-line method as follows: Transfers of Assets from Customers Projects Under Development Intangible Assets Identifiable intangible assets Goodwill Impairment of Non-financial Assets Goodwill represents the excess of the cost of an acquisition over the fair value of the Corporation's share of the identifiable net assets of the  acquired subsidiary at the date of acquisition. Goodwill is carried at cost less accumulated impairment losses. Impairment losses are recognized in “other gains and (losses), net”. Goodwill is allocated to each cash-generating unit (“CGU”) or group of CGUs that are expected to benefit from the  related business combination. Gains and losses on disposal of an entity include the carrying amount of goodwill relating to the entity sold. The expected useful lives of intangible assets are reviewed on an annual basis and adjusted prospectively. The capital assets and intangible assets with finite lives are tested for impairment when events or changes in circumstances indicate that the carrying  value may not be recoverable. For the purpose of measuring recoverable amounts, assets are grouped at the lowest levels for which there are  separately identifiable cash inflows. The recoverable amount is the higher of an asset's fair value less costs to sell the assets and the value in use  (being the present value of the expected future cash flows of the relevant assets or CGU). An impairment loss is recognized for the amount by which  the asset's carrying value exceeds its recoverable amount. The Corporation evaluates impairment losses, other than goodwill impairment, for potential reversals when events or circumstances warrant such consideration. Goodwill and intangible assets with indefinite lives are reviewed for impairment annually or at any time when an indicator of impairment exists. Management monitors goodwill and intangible assets with indefinite lives for internal purposes based on its CGUs. For 2013 and 2012, all goodwill  and indefinite life assets pertained to the utilities – water segment. 2013 ANNUAL REPORT  61 Power Utilities – water Computer software 3 to 7 years 3 to 7 years Electricity supply, gas purchase and other contracts 8 to 20 years n/a Water rights 10 to 35 years n/a Licences n/a Indefinite life • Clearly identified;  • The technical feasibility has been established; • Management has indicated its intention to construct, operate and maintain the project; • A future market is identified or a Power Purchase Agreement ("PPA") awarded; and • Adequate resources exist or are expected to be available to complete the project.