Complete annual report 2010-11 - Land - NSW Government

State Property Authority
Notes to and Forming Part of the Financial Statements
For the Year Ended 30 June 2011
(k) Investment Properties
Investment properties are measured initially at cost, including transaction costs. Where an investment property is acquired
at no cost or for nominal cost, the investment property is measured initially at its fair value. 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 reflects market conditions at the reporting date. Gains or losses arising from
changes in the fair values of investment properties are recognised in the Net Surplus/Deficit in the year in which they arise
as per AASB 140 "Investment Property".
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permanently withdrawn from use and no future economic benefit is expected from its disposal.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 the Net Surplus/Deficit in the year of retirement or
disposal.
Transfers are made to investment property when, and only when, there is a change in use evidenced by the ending of
owner-occupation, commencement of an operating lease to another party, the ending of construction or development or
when property previously classified as Property, Plant and Equipment is no longer held for strategic purposes and meets
the definition of investment property under AASB 140 "Investment Property".
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 owner-occupied property to investment property, the Authority accounts for such property in accordance
with the policy stated under Property, Plant and Equipment up to the date of change in use.
(l) Assets Held For Sale
Non-current assets are classified as Assets Held for Sale where the assets are available for immediate sale, the sale is
highly probable and where the carrying value will be principally recovered through a sale transaction rather than through
continuing use.
Assets held for sale are measured at the lower of their carrying amount at the time of such classification and their fair value
less costs to sell. These assets are not depreciated while they are classified as held for sale.
(m) Depreciation and Amortisation of Property, Plant and Equipment
(i) Depreciation
Depreciation is provided for on a straight-line basis for all depreciable non-current assets so as to write off the
depreciable amount of each asset as it is consumed over its useful life to the Authority. Estimates of remaining useful
lives are made on a regular basis for all assets, with annual reassessments for major items.
The Authority's buildings are separately componentised into the structure, air conditioning units and lifts where it can
be determined that these components:
(a) physically exist; and
(b) are material enough to justify separate tracking; and
(c) are capable of having a reliable value attributed to them; and
(d) have differing estimated useful lives to the extent that failure to depreciate them separately would result in a
material difference in the annual depreciation expense for the entity.
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State Property Authority