4.78 MB - Perth Airport

NOTES
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2005
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This general purpose financial report has been prepared in accordance with Accounting Standards, other authoritative pronouncements of the
Australian Accounting Standards Board, Urgent Issues Group Consensus Views and the Corporations Act 2001. It is prepared in accordance
with the historical cost convention, except for certain assets which, as noted, are at valuation.
Unless otherwise stated, the accounting policies adopted are consistent with those of the previous period. Comparative information is
reclassified where appropriate to enhance comparability.
(a) Principles of Consolidation
The consolidated accounts comprise the accounts of WAC and all of its controlled entities. A controlled entity is any entity controlled by
WAC. Control exists where WAC has the capacity to dominate the decision making in relation to the financial and operating policies of
another entity so that the other entity operates with WAC to achieve common objectives. Details of the controlled entity are contained in
note 9 to the accounts.
All inter-company balances and transactions between the entities in the consolidated entity, including any unrealised profit or losses, have
been eliminated on consolidation.
(b) Changes in accounting policies
The accounting policies adopted are consistent with those of the previous year.
(c) Taxes
(i) Income taxes
Tax effect accounting procedures using the liability method are followed whereby the income tax expense is matched with the
accounting profit after allowing for permanent differences. The future income tax benefit relating to tax losses is not carried forward
as an asset unless the benefit is virtually certain of realisation. Income tax on cumulative timing differences is set aside to the deferred
income tax or the future income tax benefit accounts at the rates which are expected to apply when those timing differences reverse.
(ii) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
• where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST
is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
• receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the
Statement of Financial Position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash flows arising from investing
and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
(iii) Tax consolidation legislation
WAC’s parent, Airstralia Development Group Pty Ltd elected to form a tax consolidation group for income tax purposes with effect
from 1 July 2003. The Australian Taxation Office has been formally notified of this decision.
As a consequence, Airstralia Development Group, as the head entity in the tax consolidated group, recognises current and deferred
tax amounts relating to transactions, events and balances of the wholly- owned controlled entities in the group as if those transactions,
events and balances were its own, in addition to the current and deferred amounts arising in relation to its own transactions, events
and balances. Amounts receivable or payable under an accounting tax sharing agreement with the tax consolidated entities are
recognised separately as tax-related amounts receivable from or payable to other entities in the group. Expenses and revenues arising
under the tax sharing agreement are recognised as a component of income tax expense or income tax revenue.
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