13.

Property and equipment


	Land		Flight equipment			Purchase deposits for flight equipment			Ramp and miscellaneous			Furniture, fixtures, equipment a and other			Leasehold improvements			Construction in progress			Total
Cost -
Balance at January 1, 2015	$	6,301	$	2,707,019		$	321,175		$	39,740		$	25,308		$	28,580		$	7,716		$	3,135,839
Transfer of pre-delivery payments		—		161,169			(161,169	)		—			—			—			—			—
Additions		—		178,582			83,064			2,827			2,269			3,190			9,751			279,683
Disposals		—		(16,773	)		—			(25	)		(864	)		(881	)		(2,343	)		(20,886	)
Reclassifications		—		364			—			495			(766	)		4,977			(5,070	)		—

Balance at December 31, 2015	$	6,301	$	3,030,361		$	243,070		$	43,037		$	25,947		$	35,866		$	10,054		$	3,394,636
Transfer of pre-delivery payments		—		27,585			(27,585	)		—			—			—			—			—
Additions		—		94,348			34,680			3,026			1,878			73			7,435			141,440
Disposals		—		(36,812	)		—			(604	)		(1,226	)		(98	)		—			(38,740	)
Adjustments		—		100			—			—			2,363			—			—			2,463
Reclassifications		—		(340	)		—			(289	)		645			9,140			(10,896	)		(1,740	)

Balance at December 31, 2016	$	6,301	$	3,115,242		$	250,165		$	45,170		$	29,607		$	44,981		$	6,593		$	3,498,059
Transfer of pre-delivery payments		—		28,674			(28,674	)		—			—			—			—			—
Additions		—		158,557			192,196			1,461			3,392			1,614			5,246			362,466
Disposals		—		(54,114	)		(54	)		(228	)		(711	)		—			—			(55,107	)
Reclassifications		—		3,870			—			1,950			(4,764	)		3448			(6,061	)		(1,557	)

Balance at December 31, 2017	$	6,301	$	3,252,229		$	413,633		$	48,353		$	27,524		$	50,043		$	5,778		$	3,803,861
Accumulated depreciation -
Balance at January 1, 2015 (reported)	$	—	$	(567,341	)	$	—		$	(26,560	)	$	(18,197	)	$	(18,405	)	$	—		$	(630,503	)
Adjustment on correction of error		—		(181,242	)		—			—			—			—			—			(181,242	)

Balance at January 1, 2015 (restated)	$	—	$	(748,583	)	$	—		$	(26,560	)	$	(18,197	)	$	(18,405	)	$	—		$	(811,745	)
Depreciation for the year		—		(133,045	)		—			(3,214	)		(2,774	)		(4,229	)		—			(143,262	)
Disposals		—		13,341			—			23			581			177			—			14,122
Reclassifications		—		(39	)		—			1,202			(1,501	)		338			—			—

Balance at December 31, 2015 (restated)	$	—	$	(868,326	)	$	—		$	(28,549	)	$	(21,891	)	$	(22,119	)	$	—		$	(940,885	)
Depreciation for the year		—		(141,418	)		—			(3,724	)		(2,284	)		(4,246	)		—			(151,672	)
Disposals		—		13,587			—			524			1,220			12			—			15,343
Adjustments		—		(14	)		—			—			(2,667	)		—			—			(2,681	)
Reclassifications		—		(99	)		—			(116	)		41			174			—			—

Balance at December 31, 2016 (restated)	$	—	$	(996,270	)	$	—		$	(31,865	)	$	(25,581	)	$	(26,179	)	$	—		$	(1,079,895	)
Depreciation for the year		—		(148,188	)		—			(3,811	)		(2,192	)		(4,505	)		—			(158,696	)
Disposals		—		51,233			—			200			704			—			—			52,137
Reclassifications		—		(1,335	)		—			(1,540	)		4,110			(1,235	)		—			—

Balance at December 31, 2017 (restated)	$	—	$	(1,094,560	)	$	—		$	(37,016	)	$	(22,959	)	$	(31,919	)	$	—		$	(1,186,454	)
Carrying amounts -
At December 31, 2015 (restated)	$	6,301	$	2,162,035		$	243,070		$	14,488		$	4,056		$	13,747		$	10,054		$	2,453,751

At December 31, 2016 (restated)	$	6,301	$	2,118,972		$	250,165		$	13,305		$	4,026		$	18,802		$	6,593		$	2,418,164

At December 31, 2017 (restated)	$	6,301	$	2,157,669		$	413,633		$	11,337		$	4,565		$	18,124		$	5,778		$	2,617,407

Flight equipment comprises aircraft, engines, aircraft components and, major maintenance.

The amount of $192.2 million corresponds to the advance payments on aircraft purchase contracts during 2017 (2016: $34.7 million), which include $1.8 million of borrowing costs capitalized during the year ended December 31, 2017 (2016 and 2015: Nil). The rate used to determine the amount of borrowing costs eligible for capitalization was 2.14%, which is the interest rate of the specific borrowing (see note 18). As of December 31, 2017, the carrying amount of the asset acquired under finance leases is $535.5 million (2016: $463.4 million).

Aircraft and related maintenance components with a carrying value of $1.7 billion are pledged as collateral for the obligation of the special purpose entities as of December 31, 2017 and 2016.

As of December 31, 2017 and 2016, construction in progress mainly comprises remodeling projects for airport facilities and offices, and the construction of the new hangar.

During 2016, as a result of the annual review of the useful life, the Company concluded that airframe and engines are now expected to remain in operation for 27 years from the purchase date. As consequence the expected useful life of the fleet decreased by 3 years. The effects of these changes on actual and expected depreciation expense of the current fleet, included in the operational expenses in the consolidated statement of profit or loss, amounts to $11.8 million per year.