2013 AnnuAl RepoRt - Australian Grand Prix

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Notes to and Forming Part of the Financial Statementsfor the Financial Year Ended 30 June 2013or loss upon recognition may be reclassified out of the fair value through profit or losscategory, if they are no longer held for the purpose of selling or repurchasing in the nearfuture.Financial instrument assets that meet the definition of loans and receivables may bereclassified out of the fair value through profit and loss category into the loans andreceivables category, where they would have met the definition of loans and receivableshad they not been required to be classified as fair value through profit and loss. In thesecases, the financial instrument assets may be reclassified out of the fair value through profitcategory, if there is the intention and ability to hold them for the foreseeable future or untilmaturity.(l)Financial AssetsCash and depositsCash is held at call with Treasury Corporation of Victoria and other financial institutions.For the purpose of the Cash Flow Statement, cash and cash equivalents includes notes andcoins held, cash at bank and deposits with a maturity of 3 months or less, which are readilyconvertible to cash on hand and are subject to insignificant risk of changes in value.ReceivablesReceivables consist predominantly of debtors in relation to goods and services and accruedinvestment income that are not quoted on the active market.Receivables that are contractual are classified as financial instruments. Statutory receivablesare not classified as financial instruments.Receivables are initially recognised at fair value plus any attributable transaction cost andsubsequently measured at amortised cost using the effective interest method less anallowance for impairment.A provision for doubtful receivables is made when there is objective evidence that the debtsmay not be collected and bad debts are written off when identified.Impairment of financial assetsAt the end of each reporting period, the Corporation assesses whether there is objectiveevidence that a financial asset or group of financial assets is impaired. All financial instrumentassets, except those measured at fair value through profit and loss, are subject to annualreview for impairment.Receivables are assessed for bad and doubtful debts on a regular basis. Those bad debtsconsidered as written off by mutual consent are classified as a transaction expense. Baddebts not written off by mutual consent and the allowance for doubtful receivables areclassified as ‘other economic flows’ in the net result.The amount of the allowance is the difference between the financial asset’s carrying amountand the present value of the estimated future cash flows, discounted at the effective interestrate.In assessing impairment of statutory (non-contractual) financial assets, which are not financialinstruments, professional judgement is applied in assessing materiality usingAustralian Grand Prix Corporation Annual Report 2013 3939
Notes to and Forming Part of the Financial Statementsfor the Financial Year Ended 30 June 2013estimates, averages and other computational methods in accordance with AASB 136Impairment of Assets.(m) Non-financial AssetsInfrastructure, Plant and EquipmentItems of non-financial physical assets are measured initially at cost and subsequently revaluedat fair value less accumulated depreciation and impairment. Where an asset is received forno or nominal consideration, the cost is the asset’s fair value at the date of acquisition.The fair value of infrastructure, plant and equipment is normally determined by reference tothe asset’s depreciated replacement cost. For plant and equipment, existing depreciatedhistorical cost is generally a reasonable proxy for depreciated replacement cost because ofthe short lives of the assets concerned.For the accounting policy on impairment of non-financial physical assets, refer to impairmentof non-financial assets under Note 1(j) Impairment of non-financial assets.Non-financial physical assets constructed by the CorporationThe cost of constructed non-financial physical assets includes the cost of all materials used inconstruction, direct labour on the project, and an appropriate proportion of variable andfixed overheads.Leasehold improvementsThe cost of leasehold improvements is capitalised as an asset and depreciated over theshorter of the remaining term of the lease or the estimated useful life of the improvements.Revaluation of non-financial physical assetsNon-financial physical assets are measured at fair value on a cyclical basis in accordancewith Financial Reporting Directions (FRD’s) issued by the Minister of Finance. A full revaluationof assets normally occurs every 5 years and is based on the asset’s Government PurposeClassifications. Independent valuers are used to conduct scheduled revaluations.Revaluation increases and decreases arise from differences between an asset’s carryingvalue and fair value.Net revaluation increases (where the carrying amount of a class of assets is increased as aresult of a revaluation) are recognised in ‘Other economic flows – other movements in equity’and accumulated in equity under the asset revaluation surplus. However the net revaluationincrease is recognised in the net result to the extent that it reverses a net revaluation decreasein respect of the same class of infrastructure, plant and equipment previously recognised asan expense (other economic flows) in the net result.Net revaluation decreases are recognised immediately as expenses (other economic flows) inthe net result, except that the net revaluation decrease shall be recognised in othercomprehensive income to the extent that a credit balance exists in the revaluation surplus inrespect of the same class of infrastructure, plant and equipment.The net revaluation decrease recognised in other comprehensive income reduces theamount accumulated in equity under revaluation surplus.4040Australian Grand Prix Corporation Annual Report 2013
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Page 3 and 4: 1. Report of the ChairmanThe Austra
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Page 8 and 9: 2. General Informationa. Introducti
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2013 AnnuAl RepoRt - Australian Grand Prix

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