Hartpury Annual Report July 2025

Hartpury University Annual Report and Financial Statements > 2024/2025

Notes to the Financial Statements (continued) Year Ended 31 July 2025

Property, plant and equipment

Assets under construction

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses.

Assets under construction are stated at cost, based on the value of architects’ certificates and other direct costs incurred up to the reporting date.

Certain items of fixed assets that were revalued to fair value on or prior to the date of transition to the FEHE SORP are measured on the basis of deemed cost, being the revalued amount at the date of that revaluation. Land and buildings Land and buildings inherited from the Local Education Authority are stated in the Balance Sheet at valuation based on depreciated replacement cost, as the open market value for existing use is not readily obtainable. The associated credit is included within the revaluation reserve. The difference between depreciation charged on the historic cost of assets and the depreciation charge for the year calculated on the revalued amount is released to the income and expenditure reserve on an annual basis. Land and buildings acquired, and building improvements made since incorporation, are included in the Balance Sheet at cost. Freehold land is not depreciated. Freehold buildings are depreciated over their expected useful economic life to the University of between five and fifty years. Where land and buildings are acquired with the aid of specific grants, they are capitalised and depreciated as set out above. The related grants are credited to a deferred income account within creditors and are released to the income and expenditure account over the expected useful economic life of the related asset on a systematic basis consistent with the depreciation policy. The deferred income is allocated between creditors due within one year and those due after more than one year. Finance costs that are directly attributable to the construction of land and buildings are capitalised as part of the cost of those assets. A review for impairment of a fixed asset is carried out where events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. On adoption of FRS 102, the University followed the transitional provision to retain the book value of land and buildings, which were revalued in 1996, as deemed cost and has not adopted a policy of revaluing these properties subsequently.

Assets under construction are not depreciated until they are brought into use.

Subsequent expenditure on existing fixed assets

Expenditure on tangible fixed assets incurred after initial purchase is charged to expenditure in the period in which it is incurred, unless it increases the future economic benefits expected to be derived from the asset by the University. In such cases, the expenditure is capitalised and depreciated on the relevant basis.

Equipment

Library books inherited from the Local Education Authority are stated at valuation and are not depreciated. The cost of library books purchased is expensed directly to the income and expenditure account in the period of acquisition. Equipment costing less than £500 per individual item is recognised as expenditure in the period of acquisition. All other equipment is capitalised at cost. Equipment inherited from the Local Education Authority is included in the Balance Sheet at valuation. Inherited equipment has been depreciated on a straight-line basis over its remaining useful economic life to the University of between three and ten years from incorporation and is now fully depreciated. All other equipment is depreciated on a straight-line basis over its expected useful economic life as follows:

Computer equipment – 3 years Motor vehicles – 4 years Plant – 8 years Furniture, fixtures and fittings – 10 years

Where equipment is acquired with the aid of specific grants, it is capitalised and depreciated in accordance with the above policy. The related grant is credited to a deferred capital grant account and released to the Consolidated Statement of Comprehensive Income over the expected useful economic life of the related equipment.

Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction, or production of a qualifying asset are capitalised as part of the cost of that asset.

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