How do I determine the useful life of a freehold building ?

Question

My company had purchased a freehold land and building for the purpose of earning rental income.

This building had a age of 40 years old.

The cost of the building is $2 million.  

No depreciation was provided in the past 40 years.

1) How can I determined its useful life ?

2) Most companies determined freehold building as 50 years, can I depreciate the building for the next 50 years or 10 years ?

Answer 1

1. Refer IAS 16.56; you can also employ a professional valuer.

2.Yes, provided the 50 years are justified which is often true for general buildings