2013 AnnuAl RepoRt - Australian Grand Prix

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