Infrastructure assets in the course of construction are
classified as capital work in progress. Capital works in
progress are recorded at cost, and are not depreciated
until they have been completed and the assets are
ready for economic use.
(q) Intangible assets
Computer software has a finite useful life and is
carried at cost less accumulated amortisation.
Amortisation is calculated using the straight line
method to allocate the cost of computer software
over its estimated useful life of four years.
Under lease arrangements, ARTC may provide
funds to other bodies to acquire additional
land holdings to enable the infrastructure to be
expanded. ARTC is not entitled to be reimbursed for
this expenditure but has the right to use the land.
The land rights have a finite useful life expiring
in conjunction with the relevant lease and are
carried at cost less accumulated amortisation.
Amortisation is calculated using the straight line
method to allocate the cost of land rights over its
estimated useful life.
Other intangible assets relate to contractual
rights in relation to a wholesale access agreement
which provides a pricing cap over the third party
infrastructure asset between Kalgoorlie and Perth
which completes track access between the East and
West coast of Australia.
(r) Trade and other payables
These amounts represent liabilities for goods and
services provided to the Group prior to the end of
financial year which are unpaid and are measured at
amortised cost. The amounts are unsecured and are
usually paid within 30 days of recognition.
Due to their short term nature they are not discounted.
(s) Provisions
Provisions for legal claims, service warranties and
make good obligations are recognised when the Group
has a present legal or constructive obligation as a
result of past events, it is probable that an outflow of
resources will be required to settle the obligation and
the amount has been reliably estimated. Provisions are
not recognised for future operating losses.
Where there are a number of similar obligations,
the likelihood that an outflow will be required in
settlement is determined by considering the class of
obligations as a whole. A provision is recognised even
if the likelihood of an outflow with respect to any one
item included in the same class of obligations may
be small.
Provisions are measured at the present value of
management’s best estimate of the expenditure
required to settle the obligation at the reporting date.
(t) Employee benefits
(i) Short-term obligations
Liabilities for wages and salaries, including non
monetary benefits and annual leave expected to be
settled within 12 months of the reporting date are
recognised in respect of employees’ services up to
the reporting date and are measured at the amounts
expected to be paid when the liabilities are settled.
(ii) Other long-term employee benefit obligations
The liability for long service leave and associated on
costs is accumulated from the date of commencement.
They are measured at the amounts expected to be
paid when the liabilities are settled and discounted to
determine their present value. Consideration is given
to expected future wage and salary levels with an
allowance for expected future increases.
(u) Financial instruments
The Group’s principal financial instruments comprise
receivable, payables, borrowings, bonds, cash, short
term deposits and derivatives. The carrying amount
equates to the fair value of the financial instruments.
Non-derivative financial assets
Receivables are financial assets with fixed or
determinable payments that are not quoted in an
active market. Such assets are recognised initially at
fair value plus any directly attributable transaction
NOTE 01
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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