Australia Post Annual Report 2008–09

Notes to and forming part of the Financial Report for the year ended 30 June 2009
Cashflows are included in the cashflow
statement on a gross basis and the GST
component of cashflows arising from investing
and financing activities – which is recoverable
from, or payable to, the taxation authority –
is classified as part of operating cashflows.
Commitments and contingencies are disclosed
inclusive of GST recoverable from, or payable
to, the taxation authority.
(r) 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
plus transaction costs where appropriate.
Assets acquired at no cost, or for nominal
consideration, are initially recognised as
assets and revenues 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 authority’s accounts immediately
before the restructuring.
(s) Property, plant and equipment
Property, plant and equipment are stated at
historical cost less accumulated depreciation
and any accumulated impairment losses. Such
cost includes the cost of replacing parts that
are eligible for capitalisation when the cost of
replacing the parts is incurred. Similarly, when
each major inspection is performed, its cost is
recognised in the carrying amount of the plant
and equipment as a replacement only if it is
eligible for capitalisation. All other repairs and
maintenance are recognised in the profit or
loss as incurred.
An item of property, plant or equipment is
derecognised upon disposal or when no further
future economic benefits are expected from
its use or disposal. Any gain or loss arising on
derecognition of the asset (calculated as the
difference between the net disposal proceeds
and the carrying amount of the asset) is
included in profit or loss in the year in which
the asset is derecognised.
Depreciable property, plant and equipment
assets are written off to their estimated
residual values over their estimated useful lives
using the straight-line method of depreciation.
Depreciation rates (useful lives) and methods are
reviewed annually and necessary adjustments
are recognised in the current, or current and
future reporting periods, as appropriate.
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Australia Post Annual Report 2008–09 | Financial and statutory reports
Depreciation rates applying to items in each
class of depreciable asset are based on the
following useful lives.
Buildings –
GPOs
Buildings –
other facilities
Leasehold
improvements
2009 2008
70
years
40–50
years
Lower
of lease
term and
10 years
Motor vehicles 3–10
years
Specialised plant
and equipment
Other plant and
equipment
10–20
years
3–10
years
70
years
40–50
years
Lower
of lease
term and
10 years
3–10
years
10–20
years
3–10
years
The aggregate amount of depreciation
allocated for each class of asset during
the reporting period is disclosed in note 3.
(t) Investment properties
Investment properties are measured initially at
cost, including transaction costs. The carrying
amount includes the cost of replacing part of
an existing investment property at the time
that cost is incurred if the recognition criteria
are met, and excludes the costs of day-to-day
servicing of an investment property.
Subsequent to initial recognition, investment
properties are stated at fair value, which is
based on active market prices, adjusted if
necessary, for any difference in the nature,
location or condition of the specific asset at
the balance sheet date. Gains or losses arising
from changes in the fair values of investment
properties are recognised in profit or loss in
the year in which they arise.
Investment properties are derecognised either
when they have been disposed of or when the
investment property is permanently withdrawn
from use and no future economic benefit is
expected from its disposal. Any gains or losses
on the retirement or disposal of an investment
property are recognised in profit or loss in the
year of retirement or disposal.
Transfers are made to investment property
when there is a change in use, evidenced by
ending of owner-occupation, commencement
of an operating lease to another party or
ending of construction or development.
Transfers are made from investment property
when, and only when, there is a change in
use, evidenced by commencement of
owner-occupation or commencement of
development with a view to sale.
For a transfer from investment property
to owner-occupied property or inventories,
the deemed cost of property for subsequent
accounting is its fair value at the date of
change in use. If the property occupied by
the group as an owner-occupied property
becomes an investment property, the group
accounts for such property in accordance with
the policy stated under Property, plant and
equipment up to the date of change in use.
When the group completes the construction or
development of a self-constructed investment
property, any difference between the fair value
of the property at that date and its previous
carrying amount is recognised in profit or loss.
(u) Investments and other
financial assets
Investments and financial assets in the
scope of AASB 139 Financial Instruments:
Recognition and Measurement are categorised
as either financial assets at fair value through
profit or loss, loans and receivables, held-tomaturity
investments, or available-for-sale
financial assets. The classification depends on
the purpose for which the investments were
acquired. Designation is re-evaluated at each
financial year end, but there are restrictions on
classifying to other categories. When financial
assets are recognised initially, they are
measured at fair value, plus, in the case of
assets not at fair value through profit or loss,
directly attributable transactions costs.
Recognition and derecognition
All regular-way purchases and sales of
financial assets are recognised on the trade
date, ie the date on which the group commits to
purchase the asset. Regular-way purchases or
sales are purchases or sales of financial assets
under contracts that require delivery of the
assets within the period established generally
by regulation or convention in the marketplace.
Financial assets are derecognised when the
right to receive cashflows from the financial
assets has expired or been transferred.
(i) Financial assets at fair value through
profit or loss
Financial assets classified as held for trading are
included in the category “financial assets at fair
value through profit or loss”. Financial assets
are classified as held for trading if they are
acquired for the purpose of selling in the near
term with the intention of making a profit.
Derivatives are also classified as held for trading
unless they are designated as effective hedging
instruments. Gains or losses on financial
assets held for trading are recognised in profit
or loss and the related assets are classified as
current assets in the balance sheet.