Annual Report 2007-08 - Plumbing Industry Commission

NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2008
1.5 Depreciation and amortisation
Depreciation is calculated on a straight-line basis to write off the net cost of property (excluding land) over its expected useful life to the
Commission. Estimates of the remaining useful lives for all assets are reviewed annually. The expected useful lives for the financial years
ended 30 June 2008 and 30 June 2007 are as follows:
Rate
Useful life
Motor vehicles 20% 5 years
Furniture and fittings 10% 10 years
IT 33.33% 3 years
Office machines, equipment and intangibles 33.33% 3 years
Buildings 2.50% 40 years
1.6 Employee benefits (excluding superannuation)
Employee benefits expense include all costs related to employment including wages and salaries, leave entitlements, staff contract bonuses,
payroll tax, work cover and redundancy payments. These are recognised when incurred.
1.7 Superannuation
The Commission contributes to the Government Superannuation Schemes – revised and new, Vic Super Pty Ltd, Vic Super Top Up, C+ Bus
Superannuation Fund, and CPSL Master Fund. All contributions up to the 30 June 2008 were paid prior to the reporting date.
Total contributions of $364,548 (2007: $191,773) were made by the Commission to these funds during the reporting period.
The basis for calculating superannuation contributions payable by the Commission is determined by the various schemes.
The superannuation contributions for the reporting period are included as part of salaries and associated costs in the operating statement
of the Commission.
Defined contribution plans
Contributions to defined contribution superannuation plans are expensed when incurred.
Defined benefit plans
The amount charged to the operating statement in respect of defined benefit plans superannuation represents the contribution made by
the Commission to the superannuation plan in respect to the current services of current Commission staff. Superannuation contributions
are made to the plans based on the relevant rules of each plan.
The Commission does not recognise any defined benefit liability in respect of the superannuation plan because the Commission has no
legal or constructive obligation to pay future benefits relating to its employees; its only obligation is to pay superannuation contributions as
they fall due. The Department of Treasury and Finance administers and discloses the State’s defined benefit liabilities in its financial report.
No loans have been made from any of these funds to the Commission.
1.8 Impairment of assets
All assets are assessed annually for indicators except for:
• inventories
• financial assets
If there is an indication of impairment, the assets concerned are tested as to whether their carrying value exceeds their recoverable amount.
Where an asset’s carrying value exceeds its recoverable amount, the difference is written off by a charge to the operating statement except
to the extent that the write-down can be debited to an asset revaluation reserve amount applicable to that class of asset.
The recoverable amount for most assets is measured at the higher of depreciated replacement cost and fair value less costs to sell.
Recoverable amount for assets held primarily to generate net cash inflows is measured at the higher of the present value of future cash
flows expected to be obtained from the asset and fair value less costs to sell. It is deemed that, in the event of the loss of an asset, the
future economic benefits arising from the use of the asset will be replaced unless a specific decision to the contrary has been made.
PLUMBING INDUSTRY COMMISSION 2007–08 Financial REPORT 61