NOTE 01
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
Revaluation
The Group’s infrastructure assets were
revalued as at 30 June 2015. Infrastructure
assets are shown at fair value (inclusive
of revaluations and impairments) less
accumulated depreciation, based on periodic,
but at least triennial revaluations. Any
accumulated depreciation at the date of
revaluation is eliminated against the gross
carrying amount of the asset and the net
amount is restated to the revalued amount of
the asset.
Any revaluation increment is credited to the
asset revaluation reserve included in the
equity section of the consolidated balance
sheet, except to the extent that it reverses
a revaluation decrement of the same asset
previously recognised in the consolidated
income statement, in which case the
increase is recognised in the consolidated
income statement (net of tax). Revaluation
increments and decrements recognised are
allocated to the infrastructure asset carrying
amounts within the asset grouping on a pro-
rata basis.
The Group has elected that the deemed cost of
assets on hand at 30 June 2005 is the revalued
amount of those assets. Any accumulated
depreciation as at the revaluation date is
eliminated against the gross carrying amount of
the asset and the net amount is restated to the
revalued amount of the asset. Items of property,
plant and equipment are either derecognised
on disposal or when no further future economic
benefits are expected from its use. Gains and
losses on disposals are determined by comparing
proceeds with the carrying amount and are
included in the consolidated income statement.
Upon disposal or derecognition, any revaluation
reserve relating to the asset is transferred to
retained earnings.
Cost
Subsequent costs are included in the asset’s
carrying amount or recognised as a separate
asset, as appropriate, only when it is probable
that future economic benefits associated with
the item will flow to the Group and the cost
of the item can be measured reliably. All other
repairs and maintenance are charged to the
consolidated income statement during the
financial period in which they are incurred.
Depreciation
Land is not depreciated. The cost of
improvements to or on leasehold properties is
amortised over the expected lease term or the
estimated useful life of the improvement to the
Group, whichever is the shorter. Depreciation
on other assets is calculated using the straight
line method to allocate their cost or revalued
amounts, net of their residual values, over their
estimated useful lives, as follows:
Maximum Economic Useful Life*
Infrastructure assets
Ballast. . . . . . . . . . . . . . 60 years
Bridges. . . . . . . . . . . . . 40 years
Culverts . . . . . . . . . . . . 100 years
Rail . . . . . . . . . . . . . . . 110 years
Sleepers. . . . . . . . . . . . . 70 years
Signals & Communications. . . . . 30 years
Turnouts. . . . . . . . . . . . . 15 years
Tunnels. . . . . . . . . . . . . 50 years
Non-Infrastructure assets
Buildings. . . . . . . . . . . . . 50 years
IT & Other equipment. . . . . . . . 4 years
Motor vehicles. . . . . . . . . . . 5 years
Other equipment. . . . . . . . . 40 years
* Depending on the age and location of
particular assets, the economic life may
vary. The maximum economic useful life has
remained unchanged from the prior year.
Impairment
The carrying amounts of the Group’s non-
financial assets, other than inventories and
deferred tax assets, are reviewed at each
reporting date to determine whether there is
any indication of impairment. If any indication
exists, then the asset’s recoverable amount
is estimated. An impairment expense is
recognised if the carrying amount of an asset
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