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Note 3. Departmental financial position 2017–18

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 3.1a: Trade and other receivables

 

2018
$’000

2017
$’000

Trade and other receivables

   

Goods and services

1,576

1,149

Appropriation receivable

15,359

20,372

GST receivable from the Australian Taxation Office

525

455

Total trade and other receivables (gross)

17,460

21,976

Less impairment allowance - Goods and services

-

(1)

Total trade and other receivables (net)

17,460

21,975

Credit terms for goods and services are within 30 days (2017: 30 days).

Accounting policy

Trade receivables are classified as ‘loans and receivables’. Loans and receivables are measured at face value less impairment.

Reconciliation of impairment allowance

   

Opening balance

(1)

(1)

Amounts written off

-

1

Amounts recovered and reversed

1

-

(Increase)/decrease recognised in net cost of services

-

(1)

Closing balance

-

(1)

Accounting policy

Trade receivables are assessed for impairment at the end of each reporting period.

Note 3.2: Non-financial assests

Note 3.2a: Reconciliation of the opening and closing balances of property, plant and equipment and intangibles

Reconciliation of the opening and closing balances of property, plant and equipment and intangibles for 2018

 

Buildings
- Leasehold improvements

Plant and equipment

Computer software

Other Intangibles
- Intellectual property

Total

2018

$’000

$’000

$’000

$’000

$’000

As at 1 July 2017

         

Gross book value

2,442

1,622

3,850

707

8,621

Accumulated depreciation, amortisation and impairment

(1,619)

(1,157)

(2,632)

(707)

(6,115)

Total as at 1 July 2017

823

465

1,218

-

2,506

Additions – by purchase

5,747

1,414

1,034

-

8,195

Depreciation and amortisation

(812)

(334)

(544)

-

(1,690)

Disposals

-

(19)

(12)

-

(31)

Total as at 30 June 2018

5,758

1,526

1,696

-

8,980

           

Total as at 30 June 2018 represented by

         

Gross book value

6,340

2,063

4,678

97

13,178

Accumulated depreciation, amortisation and impairment

(582)

(537)

(2,982)

(97)

(4,198)

Total as at 30 June 2018

5,758

1,526

1,696

-

8,980

Property, plant and equipment and intangibles were assessed for impairment as at 30 June 2018. No indicators of impairment were identified (2017: a loss of $1,390,000). No property, plant and equipment and intangibles are expected to be disposed of within the next 12 months (2017: $274,000).

Revaluation of non-financial assets

Revaluations are conducted in accordance with the revaluation policy contained in this note. No revaluation was performed during 2018 (2017: nil). There was no revaluation increment (2017: nil). All increments and decrements, to the extent that they reverse a previous increment, are transferred to the asset revaluation reserve by asset class and included in the equity section of the statement of financial position. No decrements due to revaluation were expensed in 2018 (2017: nil).

Contractual commitments for the acquisition of property, plant, equipment and intangible assets

There are no significant contractual commitments for the acquisition of property, plant and equipment (2017: two commitments with a value of $5,002,000).

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. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor’s accounts immediately prior to the restructuring.

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 are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations are 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 are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve 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                              2018                                    2017                      

Leasehold improvements          Expected lease term            Expected lease term

Property, plant and equipment  1 to 13 years                        1 to 13 years

Impairment

All assets were assessed for impairment at 30 June 2018. 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 (2017: 2 to 10 years).

All intangible assets were assessed for impairment as at 30 June 2018.

Note 3.2b: Prepayments paid

 

2018
$’000

2017
$’000

Prepayments paid

   

Suppliers

561

560

Total prepayments paid

561

560

No indicators of impairment were found for prepayments paid.

Note 3.3: Payables

 

2018
$’000

2017
$’000

Note 3.3a: Suppliers

   

Trade creditors and accruals

3,101

2,441

Operating lease rentals

275

190

Total suppliers

3,376

2,631

     

Note 3.3b: Prepayments received

   

Rendering of services

5,795

4,586

Total prepayments received

5,795

4,586

     

Note 3.3c: Other payables

   

Wages and salaries

152

153

Superannuation

26

26

Separations and redundancies

536

109

Operating lease incentives

-

28

Other

73

80

Total other payables

787

396

Accounting policy

Suppliers 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 rentals are expensed on a straight-line basis, which is representative of the pattern of benefits derived from the leased assets.

Prepayments received are recognised for payments received for services that are not yet fully performed. This is measured in accordance with the accounting policy in note 1.2a for own-source revenue.

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

The APSC recognises a payable for separation and redundancy benefit payments when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.

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.

Note 3.4: Other provisions

Note 3.4a: Provision for restoration obligations

 

2018
$’000

2017
$’000

     

As at 1 July

285

280

Additional provisions made

95

-

Amounts used

(139)

-

Unwinding of discount or change in discount rate

4

5

Total as at 30 June

245

285

     

The APSC currently has two (2017: 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.

There was no revaluation of the restoration obligations (2017: no revaluation).

Last reviewed: 
18 October 2018