Australia Post Annual Report 2008–09

15 Investment properties
Opening balance as at 1 July
Additions
Net transfer to investment property
Disposals
Net (loss)/gain from fair value adjustments
2009
$m
Consolidated Corporation
Closing balance as at 30 June 219.5 238.4 219.5 241.3
Investment properties are stated at fair value, which has been determined based on valuations performed by Savills Pty Ltd for all property as at
30 June 2009 and 30 June 2008. Savills is an industry specialist in valuing these types of investment property. The fair value considers the capitalised
rental streams where the property is leased to a third party and the amount at which the assets could be exchanged between a knowledgeable willing
buyer and a knowledgeable willing seller in an arm’s-length transaction at the date of valuation, in accordance with Australian Valuation Standards.
In determining fair value, the expected net cashflows applicable to each property have been discounted to their present value using a
market-determined, risk-adjusted, discount rate applicable to the respective asset.
16 Impairment testing of goodwill
Goodwill acquired through business combinations has been
allocated to individual cash-generating units as follows:
Post Logistics Group
Messenger Post
The Printsoft eLetter Group
Other
238.4
0.5
2.9
(3.5)
(18.8)
2009
$m
0.0
19.9
9.1
1.4
2008
$m
127.1
0.3
47.8
(1.2)
64.4
2009
$m
241.3
0.5
0.0
(3.5)
(18.8)
2008
$m
130.0
0.3
47.8
(1.2)
64.4
Consolidated Corporation
2008
$m
24.4
19.9
9.1
1.4
2009
$m
0.0
19.9
0.0
1.4
2008
$m
0.0
12.0
0.0
1.4
30.4 54.8 21.3 13.4
The recoverable amount of all goodwill has been determined based on a value-in-use calculation using cashflow forecasts extracted from three-year
corporate plans approved by senior management and the board. The forecasts are extrapolated for a further two years and a terminal value is applied.
These forecasts use management estimates to determine income, expenses, capital expenditure and cashflows for each CGU. Revenue growth
rates applied by all cash-generating units to the two-year period outside the corporate plan are 4.0% (2008: 2.5% to 4.0%). After this period a
1.5% to 2.5% (2008: 1.5% to 2.5%) revenue growth rate is applied. A pre-tax discount rate applicable to the specific cash-generating unit has
been applied. These rates are between 13.1% and 13.2% (2008: 11.4% and 12.0%).
At 30 June 2009, the carrying value of Goodwill for the Post Logistics Group CGU was tested for impairment based on value in use. This test resulted
in an impairment charge of $24.4 million (2008: $12 million) being recognised in the consolidated accounts against goodwill and $33.1 million
(2008: $12 million) in the corporation’s accounts against the investment balance (see note 10).
Management believes that any reasonably possible change in the key assumptions would not cause the carrying amount of any cash-generating units
containing goodwill to exceed their recoverable amount.
Australia Post Annual Report 2008–09 | Financial and statutory reports 85