Portland District Health Annual Report 2008 - South West Alliance of ...

Notes To and Forming Part of the Financial Statements for the Year Ended 30 June 2008
Entity as lessee
Finance leases are recognised as assets and liabilities at amounts equal to the fair value of the
lease property or, if lower, the present value of the minimum lease payment, each determined at
the inception of the lease. The lease asset is depreciated over the shorter of the estimated useful
life of the asset or the term of the lease. Minimum lease payments are allocated between the
principal component of the lease liability, and the interest expense calculated using the interest
rate implicit in the lease, and charged directly to the operating statement.
Contingent rentals associated with finance leases are recognised as an expense in the period in
which they are incurred.
Operating lease payments, including any contingent rentals, are recognised as an expense in the
operating statement on a straight line basis over the lease term, except where another
systematic basis is more representative of the time pattern of the benefits derived from the use
of the leased assets.
(z) Income Recognition
Income is recognised in accordance with AASB 118 Revenue and is recognised as to the extent it
is earned. Unearned income at reporting date is reported as income received in advance.
Amounts disclosed as revenue are, where applicable, net of returns, allowances and duties and
taxes.
Government Grants
Grants are recognised as income when the Health Service gains control of the underlying assets
in accordance with AASB 1004 Contributions. For reciprocal grants the Health Service is deemed
to have assumed control when the performance has occurred under the grant. For non-reciprocal
grants the Health Service is deemed to have assumed control when the grant is received or
receivable. Conditional grants may be reciprocal or non-reciprocal depending on the terms of the
grant.
Indirect Contributions
– Insurance is recognised as revenue following advice from the Department of Human
Services.
– Long Service Leave (LSL) – Revenue is recognised upon finalisation of movements in LSL
liability in line with the arrangements set out in the Acute Health Division Hospital
Circular 13/2008.
Patient Fees
Patient fees are recognised as revenue at the time the invoices are raised.
Private Practice Fees
Private Practice fees are recognised as revenue at the time the invoices are raised.
Donations and Other Bequests
Donations and bequests are recognised as revenue when received. If donations are for a special
purpose, they may be appropriated to a reserve, such as specific restricted purpose reserve.
Dividend Revenue
Dividend revenue is recognised on a receivable basis
Interest Revenue
Interest revenue is recognised on a time proportionate basis that takes into account the effective
yield of the financial asset.
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