Annual Report 2011 Australian Grand Prix Corporation

Notes to and Forming Part of the Financial Statementsfor the Financial Year Ended 30 June 2011Revaluation of non-current assetsNon-financial physical assets are measured at fair value in accordance with FRD 103D issued by theMinister of Finance. A full revaluation of assets normally occurs every 5 years and is based on theasset’s Government Purpose Classifications. Independent valuers are used to conduct scheduledrevaluations.Revaluation increases and decreases arise from differences between an asset’s carrying value andfair value.Net revaluation increases (where the carrying amount of a class of assets is increased as a resultof a revaluation) are recognised in ‘Other economic flows – other movements in equity’ andaccumulated in equity under the revaluation surplus. However the net revaluation increase isrecognised in the net result to the extent that it reverses a net revaluation decrease in respect ofthe same class of infrastructure, plant and equipment previously recognised as an expense (othereconomic flows) in the net result.Net revaluation decreases are recognised immediately as expenses (other economic flows) in thenet result, except that the net revaluation decrease shall be recognised in other comprehensiveincome to the extent that a credit balance exists in the revaluation surplus in respect of the sameclass of infrastructure, plant and equipment. The net revaluation decrease recognised in othercomprehensive income reduces the amount accumulated in equity under revaluation surplus.Revaluation increases and decreases relating to individual assets within a class of infrastructure,plant and equipment, are offset against one another within that class but are not offset in respect ofassets in different classes. Any revaluation surplus is not normally transferred to accumulated fundson de-recognition of the relevant asset.Capital WorksAll fixed capital works constructed within Albert Park have been transferred to a third party, ParksVictoria free of charge, in accordance with the licence agreements.Intangible assetsPurchased intangible assets are initially recorded at cost. Subsequently, intangible assets with finiteuseful lives are carried at cost less accumulated amortisation and accumulated impairment losses.Costs incurred subsequent to initial acquisition are capitalised when it is expected that additionalfuture economic benefits will flow to the State.When recognition criteria in AASB 138 Intangible Assets are met, internally generated intangibleassets are recognised at cost less accumulated amortisation and impairment.Refer to Note 1(i) Depreciation and Amortisation and Note 1(j) Impairment of non-financial assets.Australian Grand Prix Corporation Annual Report 2011 39