Notes to the Accounts
10. Tangible fixed assets
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| All figures in £ millions | Freehold and leashold property | Plant and equipment | Assets in course of construction | Total |
| Cost or as valued | ||||
| At 31 December 1996 | 312.3 | 459.0 | 18.1 | 789.4 |
| Exchange difference | (1.2) | (6.5) | (0.2) | (7.9) |
| Reclassifications | 18.8 | 8.3 | (28.5) | (1.4) |
| Permanent diminution in value | (1.6) | - | - | (1.6) |
| Owned by subsidiary undertakings acquired | 0.5 | 4.0 | - | 4.5 |
| Capital expenditure | 7.0 | 59.9 | 47.1 | 114.0 |
| Disposals | (15.0) | (33.7) | - | (48.7) |
| Owned by subsidiary undertakings disposed | (1.3) | (6.2) | - | (7.5) |
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| At 31 December 1997 | 319.5 | 484.8 | 36.5 | 840.8 |
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| Depreciation | ||||
| At 31 December 1996 | 63.4 | 242.0 | - | 305.4 |
| Exchange difference | - | (3.9) | - | (3.9) |
| Reclassifications | (1.4) | - | - | (1.4) |
| Provided in the year | 11.4 | 53.8 | - | 65.2 |
| Subsidiary undertakings acquired | 0.1 | 2.1 | - | 2.2 |
| Disposals | (2.1) | (26.9) | - | (29.0) |
| Owned by subsidiary undertakings disposed | (0.1) | (3.6) | - | (3.7) |
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| At 31 December 1997 | 71.3 | 263.5 | - | 334.8 |
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| Net book value | ||||
| At 31 December 1996 | 248.9 | 217.0 | 18.1 | 484.0 |
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| At 31 December 1997 | 248.2 | 221.3 | 36.5 | 506.0 |
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Freehold and leasehold property
Net book value includes: freehold of £205.7m (1996: £221.0m), short
leases of £39.6m (1996: £23.1m) and long leases of £2.9m (1996: £4.8m).
On an original cost basis, cost would have been included at £324.5m,
and accumulated depreciation at £65.4m. The net book value included
at valuation is £5.0m (1996: £8.0m).
Permanent diminution in value
Freehold and leasehold property includes £1.5m of assets held for resale.
At 31 December 1997 the provision for permanent diminution in value amounted
to £43.5m in cost and £2.9m in depreciation.
Depreciation
Fixed assets are depreciated over their estimated economic lives in equal
annual amounts. Generally, freeholds are depreciated at 1% to 5% per annum,
leaseholds at 2% per annum, or over the period of the lease if shorter,
and plant and equipment at various rates between 5% and 33% per annum.
Land, amounting to £65.9m, is not depreciated.
Capital commitments
The Group had capital commitments for fixed assets, including finance
leases, amounting to £132.9m at 31 December 1997 (1996: £126.7m). This
represented £31.4m already under contract and £101.5m authorised but not
yet contracted.
Other notes
The net book value of Group tangible fixed assets includes £1.0m in respect
of assets held under finance leases. Depreciation on these assets charged
in 1997 was £0.9m. The net book value of Group tangible fixed assets includes
£3.2m (1996: £4.2m) in respect of capitalised interest. Assets in the
course of construction includes £25.6m (1996: £nil) in respect of the
Shared Services initiative which will become operational during 1998.
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