Depreciation principles require systematic allocation, annual review of useful life and residual value, and method reflecting consumption. Depreciation is the systematic allocation of an asset's depreciable amount over its useful life; significant parts must be depreciated separately. The depreciable amount is determined by cost or revalued amount, expected useful life and estimated residual value, each reviewed at least annually and any change treated as a change in accounting estimate. The depreciation method must reflect the pattern of consumption, be reviewed annually, and may be straight-line, diminishing balance or units of production; methods based on revenue are inappropriate.