AASB 116 Property, Plant and Equipment 43-49: Component depreciation: depreciate separately each part whose cost is significant relative to the whole item, grouping parts with the same life and method, depreciate the remainder, and recognise the charge in profit or loss unless it forms part of another asset's cost

What does 43-49 require?

The amount recognised for an item is allocated to its significant parts and each part is depreciated on its own, for example an airframe apart from its engines, or the favourable or unfavourable lease terms embedded in the cost of an asset leased out under an operating lease. Parts sharing the same useful life and method may be grouped. Where some parts are depreciated separately, the rest of the item (the individually insignificant parts) is also depreciated separately, using approximation techniques if expectations for those parts vary; the entity may also choose to depreciate insignificant parts separately. Each period's depreciation is recognised in profit or loss unless the asset's benefits are consumed in producing another asset, in which case it enters that asset's carrying amount, for example manufacturing plant depreciation within inventory conversion costs under AASB 102 or development equipment depreciation within an intangible asset under AASB 138.