annual report 2011–12 - Parliament of New South Wales - NSW ...

Transport for NSW
Notes to the financial statements
For the period from 1 November 2011 to 30 June 2012
1. Summary of significant accounting policies (cont’d)
m) Income recognition
Income is recognised and measured at the fair value of the consideration or contribution
received or receivable to the extent that it is probable that the economic benefit will flow to
Transport for NSW and the income can be reliably measured. The following specific criteria
must also be met before income is recognised:
(i)
Parliamentary appropriations and contributions
Parliamentary appropriations and contributions from other bodies (including grants and
contributions) are generally recognised as income when Transport for NSW obtains control
over the assets comprising the appropriations/ contributions. Control over appropriations/
contributions are normally obtained upon the receipt of cash. At 30 June unspent
appropriations are recognised as liabilities rather than income, as the authority to spend the
money lapses and the unspent amount must be repaid to the Consolidated Fund. The liability
is disclosed in note 15 as part of “Current liabilities – Other”. The amount will be repaid and the
liability will be extinguished next financial year. Any liability in respect of transfer payments is
disclosed in Note 20 “Administered assets and liabilities”.
(ii)
Sale of goods and services
Revenue from the sale of goods is recognised as revenue when Transport for NSW transfers
the significant risks and rewards of ownership of the assets.
Revenue from the provision of services (including passenger transport services) is recognised
as revenue when the service is provided or by reference to the stage of completion.
(iii)
Retained taxes, fines and fees
Financial statements
Retained taxes, fines and fees are recognised when cash is received.
(iv)
Investment revenue
Interest revenue on cash and cash equivalents is recognised using the effective interest
method as set out AASB 139 Financial Instruments: Recognition and Measurement. Rental
revenue is recognised in accordance with AASB 117 Leases on a straight line basis over the
lease term. Royalty revenue is recognised in accordance with AASB 118 Revenue on an
accrual basis in accordance with the substance of the relevant agreement.
(v)
Shared services revenue
Shared services revenue represents revenue for the provision of shared services to various
transport operating entities.
(vi)
Other revenue
Other revenue comprises the value of the emerging rights to receive private sector provided
infrastructure. The non-cash revenue is also recognised as an asset (Note 12).
Financial statements
145