In looking at non-current assets. It's really useful to understand how to forecast PP&E property plant and equipment in order to do this. We are going to use base analysis BASE.

The b stands for beginning and we're going to take the beginning PP&E at the start of the year.

I'm then going to ask what would I add and subtract from that figure the A and ASE of Base? Well, what makes PP&E go up.

That's the add and it's going to be capital expenditure, buying more property buying more planting equipment.

I then ask what can I subtract to make that go down the kind of thing I can forecast is going to be depreciation.

I know how much PP&E I've got at the start of the year.

I've got an accounting policy for depreciation so I can forecast how it's going to go down. So if I take that beginning PP&E figure maybe 100 I add on capex capital expenditure of 10.

I've now got 110 of PP&E.

I subtract off depreciation of say 2 and that gets me to my e or ending PP&E of 108. Now. It's very important to realize that when forecasting PP&E you can use base analysis, but we can't use base analysis going back into the past. There may be other things that we did not expect to happen that will have impacted these numbers.

So for instance an impairment, an impairment would be a subtraction line here. So in principle, you could add a subtraction line for impairment in here, but not when your forecasting that's the most important thing just not when forecasting an impairment is an extraordinary loss of value an unexpected loss of value while you can see it when looking historically you can't predict it.

You can't forecast an unexpected loss of value so we wouldn't expect to include impairments when forecasting PP&E.