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Note 3. Departmental financial position

This section analyses the APSC's assets used to conduct its operations and the operating liabilities incurred as a result. Employee related information is disclosed in the People and Relationships section, Note 5.

Note 3.1: Financial assets

Note 3.1a: Trade and other receivables
  2016
$'000
2015
$'000
Trade and other receivables
Goods and services 1,447 1,851
Appropriation receivable 22,980 25,025
GST receivable from the Australian Taxation Office 405 539
Total trade and other receivables (gross) 24,832 27,415
Less impairment allowance - Goods and services (1) (6)
Total trade and other receivables (net) 24,831 27,409

All trade and other receivables are expected to be recovered in no more than 12 months.

Trade and other receivables (gross) aged as follows
  2016
$'000
2015
$'000

Credit terms for goods and services are within 30 days (2015: 30 days).

1. The reduction in overdue receivables is predominantly due to a pricing review for APSJobs, which occurred during 2014-15. This resulted in invoices being issued to customers-later in that financial year and also required additional time to communicate the new pricing structure to customers.

Not overdue 24,265 26,986
Overdue by
- 0 to 30 days 233 92
- 31 to 60 days 276 93
- 61 to 90 days 32 120
- More than 90 days 1 26 124
Total trade and other receivables (gross) 24,832 27,415

Accounting policy

Trade receivables are classified as 'loans and receivables'. Loans and receivables are measured at face value less impairment. Trade receivables are recognised and derecognised upon trade date. Trade receivables are assessed for impairment at the end of each reporting period.

Note 3.1a: Trade and other receivables (continued)
  2016
$'000
2015
$'000
Impairment allowance aged as follows
Overdue by
- more than 90 days (1) (6)
Total impairment allowance (1) (6)

These items are assessed as impaired as it will be uneconomic to pursue them.

Reconciliation of impairment allowance
  2016
$'000
2015
$'000
Opening balance (6) (1)
Amounts written-off - -
Amounts recovered and reversed 6 -
(Increase)/decrease recognised net cost of services (1) (5)
Closing balance (1) (6)

Note 3.2: Non-Financial assets

Reconciliation of the opening and closing balances of property, plant and equipment and intangibles for 2016

Note 3.2a: Reconciliation of the opening and closing balances of property, plant, equipment and intangibles
  Buildings
–Leasehold improvements
Property, plant & equipment Intangibles
– Computer software
Intangibles
– Intellectual property
Total

Property, plant, equipment and intangibles were assessed for impairment as at 30 June 2016, no impairment loss was identified (2015:nil).

No property, plant, equipment and intangibles are expected to be disposed of within the next 12 months (2015: nil).

2016 $'000 $'000 $'000 $'000 $'000
As at 1 July 2015  
Gross book value 2,145 1,411 2,984 814 7,354
Accumulated depreciation and impairment (381) (372) (2,012) (810) (3,575)
Total as at 1 July 2015 1,764 1,039 972 4 3,779
Additions–by purchase - 231 439 - 670
Revaluations and impairments recognised in other comprehensive income 570 - - - 570
Depreciation (385) (334) (340) (1) (1,060)
Disposals - (2) (2) (3) (7)
Total as at 30 June 2016 1,949 934 1,069 - 3,952
Total as at 30 June 2016 represented by
Gross book value 1,949 1,584 3,239 801 7,573
Accumulated depreciation and impairment - (650) (2,170) (801) (3,621)
Total as at30 June 2016 1,949 934 1,069 - 3,952

Revaluation of non-financial assets

In the 2015-16 financial year Australian Valuation Solutions conducted a revaluation of leasehold improvements (No revaluation was performed during the 2014-15 financial year). The revaluation was conducted in accordance with the revaluation policy contained in this note. Revaluation increment for leasehold improvements was $570,000 (2015: nil). All increments and decrements were transferred to the asset revaluation surplus by asset class and included in the equity section of the statement of financial position. No decrements were expensed (2015: nil).

Reconciliation of the opening and closing balances of property, plant and equipment and intangibles for 2015
  Buildings– Leasehold improvements Property, plant & equipment Intangibles– Computer software Intangibles– Intellectual property Total
2015 $'000 $'000 $'000 $'000 $'000
As at 1 July 2014
Gross book value 2,056 1,279 2,753 814 6,902
Accumulated depreciation and impairment - - (1,729) (799) (2,528)
Total as at 1 July 2014 2,056 1,279 1,024 15 4,374
Additions– by purchase 89 173 248 - 510
Depreciation (381) (396) (300) (11) (1,088)
Disposals - (17) - - (17)
Total as at 30 June 2015 1,764 1,039 972 4 3,779
Total as at 30 June 2015 represented by
Gross book value 2,145 1,411 2,984 814 7,354
Accumulated depreciation and impairment (381) (372) (2,012) (810) (3,575)
Total as at 30 June 2015 1,764 1,039 972 4 3,779

Accounting policy

Acquisition of assets

Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value.

Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and income at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements.

Asset recognition threshold

Purchases of property, plant and equipment are recognised initially at cost in the statement of financial position, except for purchases of property plant and equipment costing less than $2,000, or leasehold improvements costing less than $60,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to the provision for restoration obligations in property leases taken up by the APSC where there exists an obligation to restore the property to its original condition. These costs are included in the value of the APSC's leasehold improvements with a corresponding provision for restoration obligations recognised.

Revaluations

Following initial recognition at cost, property plant and equipment were carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations were conducted with sufficient frequency to ensure that the carrying amounts of assets do not materially differ from the assets' fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.

Revaluation adjustments were made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation surplus except to the extent that it reverses a previous revaluation decrement of the same asset class that was previously recognised in the surplus or deficit. Revaluation decrements for a class of assets are recognised directly in the surplus or deficit except to the extent that they reverse a previous revaluation increment for that class.

Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.

Depreciation

Depreciable property, plant and equipment assets are written off to their estimated residual values over their estimated useful lives to the APSC using, in all cases, the straight-line method of depreciation.

Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

Asset class 2016 2015
Leasehold improvements Lease term Lease term
Property, plant and equipment 1 to 13 years 1 to 13 years

Impairment

All assets were assessed for impairment at 30 June 2016. Where indications of impairment exist, the asset's recoverable amount is estimated and an impairment adjustment made if the asset's recoverable amount is less than its carrying amount.

Derecognition

An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

Intangibles

The APSC's intangibles comprise intellectual property, purchased software and internally developed software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses where the value of the asset exceeds $2,000 for purchased software and $60,000 for internally developed software and intellectual property.

Intangibles are amortised on a straight-line basis over their anticipated useful life. The useful lives of the APSC's intangibles are between 2 to 10 years (2015: 2 to 10 years).

All intangible assets were assessed for impairment as at 30 June 2016.

Note 3.2b: Prepayments paid
  2016
$'000
2015
$'000
No indicators of impairment were found for prepayments paid.
Prepayments paid expected to be recovered
No more than 12 months 565 454
More than 12 months - 9
Total prepayments paid 565 463

Note 3.3: Payables

  2016
$'000
2015
$'000
All other payables are expected to be settled in no more than 12months.
Note 3.3a: Suppliers
Trade creditors and accruals 3,808 4,166
Operating lease rentals 1,696 1,781
Total suppliers 5,504 5,947
Suppliers expected to be settled
No more than 12 months 3,946 4,299
More than 12 months 1,558 1,648
Total suppliers 5,504 5,947
Note 3.3b: Prepayments received
Prepayments received expected to be settled
No more than 12 months 4,924 7,312
More than 12 months - 65
Total prepayments received 4,924 7,377
Note 3.3c: Lease incentives
Lease incentives expected to be settled
No more than 12 months 163 163
More than 12 months 437 600
Total lease incentives 600 763
Note 3.3d: Other payables
Wages and salaries 79 737
Superannuation 14 130
Separations and redundancies 575 -
Other 90 59
Total other payables 758 926

Accounting policy

Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced). Supplier and other payables are recognised and derecognised upon trade date.

Operating lease incentives taking the form of lessor contributions and rent holidays are recognised as liabilities. These liabilities are reduced by allocating lease payments between rental expense and reduction of the liability.

The wages and salaries payable and superannuation payable represent outstanding contributions for the final fortnight of the financial year.

Note 3.4: Other provisions

Note 3.4a: Provision for restoration obligations
  2016
$'000
2015
$'000
The APSC currently has two (2015: two) leasing agreements which have provisions requiring the APSC to restore the premises to their original condition at the conclusion of the lease. The APSC has made provisions to reflect the present value of these obligations.
As at 1 July 401 391
Amounts reversed (131) -
Unwinding of discount or change in discount rate 10 10
Total as at 30 June 280 401
Provision for restoration obligations expected to be settled
No more than 12 months - 189
More than 12 months 280 212
Total provision for restoration obligations 280 401