D2. Property, plant and equipment
AP ACCOUNTING PRINCIPLES
Property, plant and equipment
Property, plant and equipment is recognized at cost less accumulated depreciation and any impairment. In cases where an investment in foreign currency has been recognized using hedge accounting, the gain/loss from the hedge is recognized as part of the acquisition cost. The cost of properties and production facilities included in major projects includes costs for running-in and start-up. Borrowing costs are included in the cost of investments exceeding SEK 250m that take more than 12 months to complete. Expenses for repairs and maintenance are expensed directly in profit or loss.
Depreciation and impairment
Land is not subject to depreciation. Buildings, machinery and equipment are depreciated on a straight-line basis over the useful lives of the assets. If, at accounting year-end, there is an indication that property, plant and equipment has declined in value, impairment testing is carried out.
|
Buildings |
|
Land |
|
Machinery and equipment |
|
Construction in progress |
||||||||
SEKm |
2015 |
2014 |
2013 |
|
2015 |
2014 |
2013 |
|
2015 |
2014 |
2013 |
|
2015 |
2014 |
2013 |
Accumulated costs |
22 802 |
22 007 |
18 558 |
|
7 437 |
7 422 |
7 000 |
|
86 804 |
84 367 |
71 633 |
|
4 023 |
4 368 |
3 414 |
Accumulated depreciation |
–9 653 |
–9 023 |
–7 751 |
|
–1 826 |
–1 679 |
–1 530 |
|
–52 403 |
–50 009 |
–41 667 |
|
– |
– |
– |
Accumulated impairment |
–407 |
–222 |
–216 |
|
–70 |
–32 |
–50 |
|
–2 173 |
–847 |
–865 |
|
–2 |
–7 |
–8 |
Property, plant and equipment Vinda |
– |
– |
867 |
|
– |
– |
– |
|
– |
– |
3 392 |
|
– |
– |
– |
Total |
12 742 |
12 762 |
11 458 |
|
5 541 |
5 711 |
5 420 |
|
32 228 |
33 511 |
32 493 |
|
4 021 |
4 361 |
3 406 |
Value, January 1 |
12 762 |
11 458 |
9 912 |
|
5 711 |
5 420 |
5 252 |
|
33 511 |
32 493 |
28 533 |
|
4 361 |
3 406 |
4 073 |
Investments |
505 |
389 |
646 |
|
154 |
163 |
214 |
|
2 337 |
2 342 |
1 894 |
|
4 337 |
2 713 |
2 642 |
Sales and disposals |
–2 |
–13 |
–14 |
|
–7 |
–35 |
–3 |
|
–134 |
–56 |
–68 |
|
–23 |
–8 |
–34 |
Company acquisitions |
– |
1 |
861 |
|
– |
1 |
– |
|
– |
52 |
3 330 |
|
– |
2 |
– |
Company divestments |
– |
– |
–4 |
|
– |
– |
–24 |
|
–48 |
– |
–29 |
|
– |
– |
– |
Reclassifications |
926 |
796 |
620 |
|
28 |
77 |
114 |
|
3 361 |
1 143 |
2 739 |
|
–4 516 |
–1 711 |
–3 223 |
Depreciation |
–873 |
–723 |
–650 |
|
–143 |
–136 |
–131 |
|
–4 652 |
–4 369 |
–3 935 |
|
– |
– |
– |
Impairment |
–197 |
–9 |
–5 |
|
–48 |
–3 |
–43 |
|
–1 394 |
–50 |
–131 |
|
– |
– |
– |
Translation differences |
–379 |
863 |
92 |
|
–154 |
224 |
41 |
|
–753 |
1 956 |
160 |
|
–138 |
–41 |
–52 |
Value, December 31 |
12 742 |
12 762 |
11 458 |
|
5 541 |
5 711 |
5 420 |
|
32 228 |
33 511 |
32 493 |
|
4 021 |
4 361 |
3 406 |
SEKm |
2015 |
2014 |
2013 |
Accumulated costs |
121 066 |
118 164 |
100 605 |
Accumulated depreciation |
–63 882 |
–60 711 |
–50 948 |
Accumulated impairment |
–2 652 |
–1 108 |
–1 139 |
Property, plant and equipment Vinda |
– |
– |
4 259 |
Total |
54 532 |
56 345 |
52 777 |
Value, January 1 |
56 345 |
52 777 |
47 770 |
Investments |
7 333 |
5 607 |
5 396 |
Sales and disposals |
–166 |
–112 |
–119 |
Company acquisitions |
– |
56 |
4 191 |
Company divestments |
–48 |
– |
–57 |
Reclassifications |
–201 |
305 |
250 |
Depreciation |
–5 668 |
–5 228 |
–4 716 |
Impairment |
–1 639 |
–62 |
–179 |
Translation differences |
–1 424 |
3 002 |
241 |
BS Value, December 31 |
54 532 |
56 345 |
52 777 |
Impairment mainly pertains to the Ortviken paper mill. Due to a decline in global demand for newsprint and weak profitability, non-current assets at Ortviken paper mill were impaired by SEK –1,263m to their recoverable amount. The Ortviken paper mill is part of the Forest Products operating segment. The recoverable amount of the non-current assets was determined through a present value calculation, in which expected future cash flows were discounted using a WACC before tax of 6% to determine the value in use.
During the period, interest was capitalized in machinery and equipment in an amount of SEK 47m (29; 23) and in construction in progress in an amount of SEK 3m (6; 1). The average interest rate used was 7% (2; 3).